Agreement Good Template For Large-scale Trade
An updated trade agreement binding the United States, Mexico and Canada is necessary because some of the principal issues at stake didn’t even exist when the North American Free Trade Agreement was struck 25 years ago. The internet was in its infancy, for example, when the NAFTA took effect on Jan. 1, 1994, and science-related business was far different than it is now. So the agreement struck Sunday, which will be known as the United States-Mexico-Canada trade agreement, appropriately includes much stronger protections for intellectual property such as software, biotechnology patents, pharmaceutical products and so on. Likewise, the agreement recognizes the evolution of other industries over the last quarter century. It takes into account the decline of the U.S. dairy industry, for example, and allows for greater export of powdered milk and other dairy products into the tightly regulated Canadian market. The agreement also addresses some of the unresolved problems of the original NAFTA. For example, it includes far better environmental and labor standards in Mexico, especially regarding auto and auto parts production. That could help shift some production from Mexico to U.S. factories, although it also likely will shift some production from Mexico to Asia. Meanwhile, the deal retains some of NAFTA’s best provisions, including a sound mechanism for dispute resolution. And, recognizing the rapidly changing nature of work, business and trade, the new pact calls for automatic six-year reviews. In all, the new agreement is a strong piece of work by the Trump administration, and a good template for continental-scale trade.