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The Canada-US-Mexico Agreement (CUSMA) is at substantial risk unless the three partners take responsibility for continuing to violate aspects of the deal, the head of the US Chamber of Commerce has said.
In the US, the trade pact is known as the United States-Mexico-Canada Agreement (USMCA). “Like any other agreement, the USMCA is not worth the paper it’s printed on without meaningful compliance and enforcement,” said Suzanne Clark, the chamber’s president and CEO, Monday at the North American Business Summit in Washington, DC.
It has been almost three years since the tri-lateral trade pact, which replaced the North American Free Trade Agreement, took effect. But Clark expressed concern that since the signing, all three countries have not complied with their part of the deal.
Canada, for example, is not honoring its obligations to increase market access given to the US and Mexico for milk, he said. The U.S. failed to implement CUSMA’s rules of origin for automotive components, Clark added.
Meanwhile, Mexico has failed to hold up its CUSMA energy obligations, she said.
“And this is just to name a few examples where compliance is lacking.”
Clark said government officials will say that the three countries will work through this problem, that they are just normal irritants in commercial relations, and that CUSMA does not provide the necessary mechanism to resolve the problem.
“That may be true, but it’s also as simple as keeping a promise,” he said.
Mexico and Canada have won a trade dispute with the United States over rules of origin for auto parts, which could help protect Canadian businesses and jobs.
North America is a “family” of countries that can come together with good intentions and honesty to see what works, and what needs to be improved, Clark said.
“That work begins with implementing and adhering to the letter and spirit of the USMCA.”
‘Push for accountability’
He said he understood the speculation about why there wasn’t more focus on enforcing the provision — it wasn’t a priority, if it was tied to other geopolitical considerations or caught up in the crisis on the U.S.-Mexico border.
“But regardless of the reason for the inaction, it’s important that people in this room push for accountability and compliance,” he said.
These issues must be resolved not only to prove the deal is feasible or to fulfill its potential, but most importantly, “to prove we can do it,” and there is a commitment to make the deal strong, Clark said.
“So that if the administration changes or when the USMCA undergoes a joint review scheduled in 2026, the economic case cannot be disputed. No one can say that this agreement does not optimize the competitiveness of North America,” said Clark.
CUSMA builds on the success of NAFTA and provides the transparency and certainty the business community needs, he said.
“Failure to do so reduces our potential to be the most competitive region in the world.”
“When these factors are absent, investment cannot grow, the economy cannot grow, jobs cannot be created and we do not enjoy prosperity,” Clark said.
“In its absence, corruption flourishes, ambiguity reigns, investment money flees and tax revenues decline.”
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