USMCA clears House of Representatives hurdle

The US House of Representatives has given its approval to the new United States-Mexico-Canada Agreement (USMCA) that represents a renegotiation of the North American Free Trade Agreement (NAFTA).

It still needs to pass through the Senate but, according to the Executive Office of the President of the United States, “When finalized and implemented, the agreement will create more balanced, reciprocal trade that supports high-paying jobs for Americans and grows the North American economy.”

Major points of the agreement include new chapters covering Digital Trade, Anticorruption, and Good Regulatory Practices, as well as a chapter devoted to ensuring that small- and medium-sized enterprises (SMEs) benefit from the agreement, the Executive Office of the President said.

Clearing the House of Representatives represented a major step forward for the trade agreement, and lifted some of the uncertainty currently surrounding the future of trade across the region.

The US Senate is expected to add its approval in the new year.

Mexico’s Senate has approved the deal, but it still awaits the green light from Ottawa.

The CEO for DHL Express US, Greg Hewitt, was amongst those who offered their approval of the trade deal passing this stage of the process.

“The global e-commerce marketplace has fundamentally changed supply chains and trade flows around the world,” he said.

“DHL Express very much welcomes the effort by the US, Mexican and Canadian governments to modernize the North American free trade framework for this new environment.

“We are in no doubt that the advancements it proposes in areas such as trade facilitation and customs simplification, cross-border data flows and reduced tariffs and barriers, for example, will benefit the US small businesses and multinational corporations that ship internationally with DHL.”

Meanwhile, shipper organisations have also offered their approval. For example, the Washington DC-headquartered National Retail Federation, which claims to be the world’s largest retail association, welcomed the House of Representatives’ approval of the United States-Mexico-Canada Agreement and called on the Senate to immediately take similar action.

“This agreement provides significant updates to the North American Free Trade Agreement, which has benefited US retailers, workers and consumers for a quarter-century,” NRF senior vice president for government relations David French opined.

“These modernized provisions will help ensure that North American trade policy reflects today’s global economy and will continue to benefit the US economy.

“USMCA is a meaningful trade victory that will provide benefits for decades to come,” he enthused, pointing to provisions on digital trade, customs procedures and trade facilitation as areas of important improvements in the new agreement.