CA President Darren Praznik joined with his Mexican and U.S. colleagues for a discussion on the CUSMA/USMCA review and to update member companies on the status and industry strategies for these important negotiations. Praznik was joined on the panel by Carlos Berzunza, President of Mexico’s CANIPEC, and Heather Helm, Executive Vice-President of Global Strategies for the U.S. Personal Care Products Council (PCPC). The session was moderated by Alexandra Bratsafolis, Vice-President of the Americas at the Estee Lauder Companies.
All three of our North American industry associations have a history of working as a team on North American trade negotiations and were able to achieve some significant regulatory benefits from the negotiations in 2019-20. This coordinated effort has continued for the CUSMA/USMACA review which is scheduled for July of this year. The review is not a re-negotiation of the agreement but an opportunity to review its benefits and agree to continue for another period. If no agreement is reached, the agreement will continue with a review each year unless one or more party serve notice that they are withdrawing.
However, it is expected that the parties could reach side agreements to address various sector issues that could be added to the agreement. Although much of CUSMA remains in effect, various actions by the Trump administration on steel and aluminum, softwood lumber, and autos have undermined the agreement, as well as his threats to annex Canada as the 51st state, which has significantly changed the dynamic for this review.
As was discussed, a key objective of industry is to ensure tariff free trade in consumer goods as well as various regulatory improvements and efficiencies if this becomes possible. Tariff free access was not even an issue six years ago with the entire focus on reducing regulatory barriers to trade. Now, with the Trump administration talking about a general tariff on imports to the U.S., and the possible retaliatory tariffs which could result, keeping tariff free trade between our three jurisdictions is now the prime objective.
Another important issue raised in the discussion was changes the U.S. may be seeking to the “rules of origin” which could further disadvantage our industry.
CA’s Darren Praznik also gave an overview of the mood on Canada which has grown in resolve to not just accepting what the Trump administration demands. He also indicated that the strategy of the new Carney administration is to not rush into negotiations but rather allow time to weaken the position of the Trump administration in negotiations, provide more opportunity for U.S. business to make the case for CUSMA/USMCA, and make a reasonable agreement more likely. Praznik’s advice to our industry in the U.S. was to make every effort possible to make the case for CUSMA/USMAC to your politicians and the public. The tariff issue cannot be solved in Canada or Mexico, noted Praznik. The push for tariffs has come from the U.S., and it must be stopped by Americans.
PCPC used the opportunity to discuss its significant advocacy efforts in support of CUSMA/USMAC with U.S. political leaders as well as trade officials.
