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United Fresh releases statement on NAFTA renegotiation

20 May 2017

Most farm leaders agree the 23-year-old NAFTA needs to be updated, but they continue to emphasize the importance of agricultural exports, particularly to NAFTA-partner Mexico, to USA farmers and ranchers who are enduring one of the most severe downturns in the farm economy in the last 20 years.

Gary Hufbauer, senior fellow at the Peterson Institute, says the United States could seek modest "technocratic" changes, including provisions to update NAFTA to reflect technologies that have emerged since the original agreement was negotiated. Canada and Mexico are the two largest destinations for U.S. goods and services, accounting for more than one-third of total U.S. exports, adding $80 billion to the U.S. economy and supporting more than 3 million American jobs, according to data from the Office of the U.S. Trade Representative. Talks with Canada and Mexico can begin after that. "Ending NAFTA won't solve those problems".

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NAFTA's impact on the economy was more modest than partisans on either side of the debate had expected. "Furthermore, Canada and Mexico are the United States' top trading partners and empirical evidence shows that all three countries reap significant economic benefits from the relationship". "We look forward to meeting with United States Trade Representative Robert Lighthizer in the coming months to discuss NAFTA renegotiation".

The statement was issued by Food and Agriculture Dialogue Co-Chairs Gary Martin, president and chief executive officer of the North American Export Grain Association, and William Westman, senior vice president for worldwide affairs with the North American Meat Institute.

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During the required 90-day period, the USTR will consult with "Congress and American stakeholders to create an agreement that advances the interests of America's workers, farmers, ranchers and businesses", he said. In part, that's because trade represents a surprisingly small portion of the USA economy " 28 per cent in 2015, according to the World Bank, one of the lowest shares in the world. The dairy groups have also continued to call for improving market access to Canada and tackling that country's expanding list of protectionist policies and other barriers to USA dairy exports. The impact on some vulnerable US industries was delayed.

American Farm Bureau President Zippy Duvall said trade is critical to the livelihood of the US agricultural sector because it spurs economic growth for farmers, ranchers and their rural communities. In fact, US manufacturing exports to Canada and Mexico have increased almost 260 percent over the past 23 years, and USA farm exports to the countries have grown by more than 150 percent. "Agriculture supports jobs in the food and agricultural industries and beyond", he said.

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Offering insight into how Mexico may seek to broker a deal, Moises Kalach, a linchpin of the country's private sector defense of NAFTA, said US business leaders and government officials were increasingly persuaded that existing supply chains should not be disrupted - but that future production lines could be tailored to provide more work for North America. "Obviously, dairy trade with Canada - where we continue to face 200%-300% tariffs and a slew of nontariff policies that distort dairy trade - is an entirely different story, and we need to address it as part of these talks".

United Fresh releases statement on NAFTA renegotiation