U.S., Canada, Mexico Meet to Push for Final Agreement on USMCA
Lighthizer, the U.S. Trade Representative, needs Mexico and Canada’s sign-off before Democrats will support USMCA.
(Bloomberg) --
The White House pushed Wednesday to wrap final negotiations with Democrats on President Donald Trump’s top legislative priority, the U.S.-Mexico-Canada Agreement, in meetings with top Mexican and Canadian officials.
The administration and House Democrats have been locked in tense negotiations for months to secure a potential vote before the end of the year on USMCA and this week managed to narrow their differences.
Wednesdays meeting broke up without a USMCA deal announcement but with Mexico and Canada citing progress.
Mexican deputy foreign minister Jesus Seade met first with Trump’s trade chief Robert Lighthizer to discuss the fixes that Lighthizer offered House Speaker Nancy Pelosi verbally earlier this week. Lighthizer, the U.S. Trade Representative, needs Mexico and Canada’s sign-off before Democrats will support USMCA.
“We are on the way to a resolution,” Seade told reporters Wednesday after the meeting in Washington. “I have to check some documents I’ve received, check them carefully and maybe discuss adjustments. So we still have some way to go but we are going well.”
Representatives of the U.S., Canada and Mexico then met later Wednesday evening at Lighthizer’s office. After, Canada’s deputy prime minister, Chrystia Freeland, told reporters they had a good discussion and that work is continuing.
“We very much believe that getting this agreement ratified by all three countries will be positive for all three countries,” she said, adding that they met to do their part to get USMCA “across the finish line.”
Freeland declined Wednesday to give a timeline for any final pact and signaled an openness to change some of the text of the USMCA, something she previously ruled out. Seade said he will visit Canada Friday for further talks.
The meetings are the latest sign that the three countries are nearing a deal that could win Pelosi’s support and pave the way for full ratification.
Pelosi signaled Monday that Democrats and the White House are on the cusp of a deal on the changes her caucus has been seeking to the agreement, most importantly on labor enforcement. She said in a statement Monday that a “substantially improved” USMCA was “within range.”
“Now, we need to see our progress in writing from the Trade Representative for final review,” Pelosi said.
Lighthizer is prepared to deliver “paper on the deal” quickly, White House trade adviser Peter Navarro told Fox News on Tuesday. “He’ll do whatever he needs to do to give them what they need to get confident about it,” Navarro said.
One Trump administration official, speaking on condition of anonymity, said a deal could be announced at any time, but probably no later than next week if positive talks continue.
Even if a deal is sealed, the House is not expected to vote on it immediately when it returns from recess next week. A House vote is more likely later in December, or even early next year, with the Senate acting in January.
Labor Enforcement
There are a number of procedural hurdles before the agreement can come to the floor for a vote, including committee hearings and review of the implementing bill in the House Ways and Means and Senate Finance committees. Those steps could be waived to save time, though.
Key to reaching a deal has been neutralizing any opposition from the largest U.S. union confederation, the AFL-CIO.
AFL-CIO President Richard Trumka held a phone call with union affiliates Tuesday to discuss the proposed changes to the deal and whether labor should voice public support for USMCA, people familiar with the call said. Trumka told Democrats earlier this month to hold out for more concessions from the administration. The AFL-CIO did not immediately respond to a request for comment.
Trump and his advisers tout USMCA as the best agreement ever negotiated for unions and Democrats, particularly the deal’s labor provisions and stricter auto-content rules that they say would boost U.S. manufacturing.
Enforcement of labor issues remains a final sticking point in the talks.
Labor Inspectors
Democrats have pushed for expanding the powers of U.S. customs agents to block the import of goods from Canada and Mexico from factories found to be in violation of USMCA labor standards. The approach resembles the existing Lacey Act whereby products from illegal logging or poaching are blocked at the border.
Mexico has said that it would oppose such an approach, as well as a Democratic proposal to put U.S. labor inspectors in its factories, calling it a violation of sovereignty.
Seade told reporters Wednesday that Mexico could be open instead to adjusting the USMCA arbitration panel process to facilitate decisions in labor rights disputes.
“Every single issue that has made me lose my sleep is off the table,” Seade said. “These are constructive things that are normal to have in an ambitious trade agreement.”
Trump has voiced frustration with the stalled deal and said it was unlikely the Congress would ever take it up for a vote.
“Nancy Pelosi, Adam Schiff, AOC and the rest of the Democrats are not getting important legislation done, hence, the Do Nothing Democrats,” Trump said in a tweet on Nov. 24. “USMCA, National Defense Authorization Act, Gun Safety, Prescription Drug Prices, & Infrastructure are dead in the water because of the Dems!”
The USMCA is forecast to have a marginal impact on the $20 trillion U.S. economy. The U.S. International Trade Commission, an independent government panel, said in an April analysis that USMCA would boost the U.S. economy by 0.35% and lead to 176,000 new jobs in the sixth year after implementation.
--With assistance from Eric Martin.
To contact the reporters on this story: Jenny Leonard in Washington at jleonard67@bloomberg.net;Erik Wasson in Washington at ewasson@bloomberg.net;Josh Wingrove in Washington at jwingrove4@bloomberg.net
To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Margaret Collins, Anna Edgerton
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