AVENTURA, Fla. – It will be critical to end Section 232 steel and aluminum tariffs on Mexico and Canada if the US-Mexico-Canada Agreement (USMCA) is to be approved, trade experts said at the International Sweetener Colloquium in Aventura on Feb. 26.
“I don’t think USMCA is going anywhere without elimination of steel and aluminum tariffs,” said Darci Vetter, vice chair for agriculture, food and trade at Edelman, a global communications marketing company and a former US Trade Representative chief agriculture negotiator. She said she expected the steel and aluminum issues would be resolved, and that it was “really important” that the USMCA is passed “to show we will be Canada’s and Mexico’s most reliable partner.”
Don Phillips, trade adviser for the American Sugar Alliance, agreed that the future of the USMCA depended on the Section 232 steel and aluminum tariffs.
Legislators in all three countries must approve the trilateral agreement that replaces the North American Free Trade Agreement. If the new agreement is not approved, NAFTA remains in place, although President Donald Trump has threatened to withdraw from NAFTA.
Both Colloquium speakers expressed hope but also uncertainty that a meaningful trade deal would be completed between the United States and China.
“If we don’t get reform, why did we put farmers through the past year?” Vetter said, referring to lost exports because of tariffs on many agricultural goods and expressing concern that an agreement may center on “big purchases” rather than real reform. She said US farmers have been supportive of the trade war with China, but their “patience is wearing thin.”
Vetter said that a challenge to China needed to happen, but the tactics of the Trump administration have “put agriculture in harm’s way” because of losing exports that it already had.
Phillips said a deal with China “can’t just be market access,” but added that China can’t be transformed in 60 days. He gave President Trump credit “for getting China’s attention” on trade and other issues.
Tomas Baert, counselor, delegation of the European Union to the United States, reiterated to Colloquium attendees that the EU has “been very clear” that agriculture is not part of trade negotiations with the United States, although he noted specific issues have been discussed, such as the EU buying more US soybeans.
Baert said the United States’ abandonment of the Trans-Pacific Partnership (TPP) was a “gift” to many countries, not just to China.
“US agriculture is missing out on great export opportunities,” he said.
Vetter said it was hard to see Japan going beyond what was agreed to in the TPP in a bilateral trade deal with the United States.
Overall, the United States is “kind of behind the eight ball” on trade agreements and was playing catch up with other countries, Phillips said.
“We have some catching up to do,” Vetter agreed. “US agriculture is rapidly falling behind its key competitors around the world.”