With the Trump administration having served notice of its intention to modernize the North American Free Trade Agreement (NAFTA), USCIB has been advocating for modernization of certain aspects of NAFTA through op-eds, testimonies and meetings. Most recently, USCIB Vice President for Trade and Finance Shaun Donnelly presented USCIB views at the “NAFTA Testimony” hearings held on June 27 at the International Trade Commission (ITC). While held at the ITC, USTR was running the three days of public hearings. Staff from Commerce, State, Treasury, Department of Homeland Security, and Agriculture also sat on the panel and joined in questioning presenters.

Donnelly’s testimony stemmed USCIB’s written submission, which had been developed with member input, focused on NAFTA’s importance to U.S. business and that it should be updated given that it is no longer a “cutting edge” trade agreement. “By all means, update, modernize,” said Donnelly. “But NAFTA does not need a fundamental “root and branch” renegotiation. Give NAFTA a facelift, not a lobotomy,” he emphasized.

Donnelly also highlighted five key messages from USCIB’s written submission:

1. Get strong digital economy provisions into NAFTA – e-commerce, cross border data flows, telecoms competition, prohibitions on data localization requirements.
2. Update other key areas – e.g. standards and Technical Barriers to Trade (TBTs), cover new forms of services, strengthen IPR provisions and enforcement to incentivize innovation, develop a meaningful chapter on State-Owned Enterprises (SOEs).
3. Update and strengthen customs and trade facilitation provisions; get higher de minimis levels.
4. Strong investment provisions are essential. Implementation/arbitration through Investor-State Dispute Settlement (ISDS) is essential. ISDS works and it is important for many U.S. investors even in North America; don’t be seduced by criticism from the EU and NGOs about ISDS or the EU’s investment court proposal.
5. Government Procurement chapter is important and its working. It’s balanced. Don’t rip it up. U.S. firms are selling a lot of goods and services to Canadian and Mexican government entities.

“Do the update quickly, seriously, trilaterally, in transparent manner, based on real issues of concern to the U.S. business community not with a political focus on bilateral trade balances or imposing unilateral trade barriers,” Donnelly concluded. “Work with U.S. business, we want to be partners in this important exercise.”