NAFTA SERIES: WHERE ARE WE NOW? OVERVIEW:
By Ben Stevens
On Thursday, September 13, 2018, the Washington International Trade Association hosted the tenth, and final event, in the Signature NAFTA Series, titled “Where Are We Now?”. The featured panel discussed the prognosis of the NAFTA renegotiations providing the current status and prospects for the new agreement. The distinguished panelists included Ambassador Arturo Sarukhan, Dr. Laura Dawson, Celeste Drake, and Professor Matt Gold. The panelists examined the challenges and uncertainties facing renegotiation efforts, while delving into the different political and economic factors influencing those with a seat at the negotiating table.
Starting the discussion was Matt Gold, current adjunct professor of law at Fordham University and former Deputy Assistant U.S. Trade Representative for North America. Gold introduced the panel topic with a comprehensive background on the U.S trade policy agenda and how deviations from the status quo by the current administration have affected NAFTA’s renegotiation. He noted the withdrawal from the Trans-Pacific Partnership (TPP) impacted renegotiation efforts by eliminating some automatic updates that would have addressed between the three trading partners in the TPP agreement. Some areas included updates to digital commerce and telecommunications rules. He also highlighted particularly contentious elements of renegotiation, such as the sunset clause and the rule of origin requirements for atuos.
The first speaker was Arturo Sarukhan, a nonresident senior fellow at The Brookings Institution and a distinguished visiting professor at the Annenberg School of Public Diplomacy at University of Southern California. Having served as the Mexican ambassador to the United States, Ambassador Sarukhan applied his knowledge and experience from the perspective of the Mexican government to the ongoing NAFTA renegotiations. He gave background on how the change in Mexican political leadership, through the July elections, had impacted negotiation process; highlighting a “strong desire of both the current and future leadership of Mexico to get a deal done”. Ambassador Sarukhan highlighted changes in the North American bilateral relations between the U.S and Canada as well as the U.S and Mexico. Attempting to illustrate the potential positive and negative implications of a new NAFTA, he noted that positive aspects IPR and e-commerce, while pointing out what he believed were negative aspects in the sunset clause and rules of origin requirements. Ambassador Sarukhan described a high level of uncertainty regarding the negotiations. He pointed out that “until congress submits a text to the president” there is a high level of speculation regarding potential changes to the trade agreement.
Second to speak was Dr. Lauren Dawson, Director of the Canada Institute at the Wilson Center, explained the Canadian perspective on the NAFTA renegotiation efforts by discussing how Canadian politicians must weigh the political pressure to stand opposed to President Trump against the economic incentives for cooperation with the U.S for a “more liberalized trade environment”. Dr. Dawson discussed the political impetus behind current negotiations. She highlighted how it could beneficial, stating it was analogous with “nitroglycerin in a mine”, as it could “clear the path”. However, she also pointed out that if it was too much, it would be as if there was too much nitroglycerin to cause too big of an explosion that would “collapse the whole mine”. Like Ambassador Sarukhan, Dr. Dawson made sure to highlight the uncertainty in the renegotiations.
Celeste Drake, trade and Globalization Specialist for the AFLCIO, was the final panelist to round out the discussion. She focused on the way labor unions view NAFTA and current renegotiation efforts. Her analysis provided a unique perspective that had not highlighted previously by the other panelists. She emphasized elements of NAFTA labor interprets as detrimental to workers ability to form unions, particularly in Mexico where unionization has been dramatically curtailed, or realize the gains of trade relative to the company owners. Like the other panelists Drake highlighted the uncertainty around the renegotiation. However, she described this uncertainty as a positive for labor as, they see potential for their concerns with NAFTA to be addressed. She argued that sunset clauses are not necessarily bad; because almost all legislation, like the Defense Authorization Act, require mandatory reexamination.
The panel provided a deep-dive into the NAFTA re-negotiations. A diverse set of viewpoints were examined, as the panelists provided unique perspectives of different stakeholders.