The North American Free Trade Agreement (NAFTA) came into effect on January 1, 1994. The agreement between Canada, the United States and Mexico aimed to increase economic activity and integration amongst the three countries. The Trump administration recently triggered the renegotiation of NAFTA, which began in August 2017 and continued into 2018.
The three countries reached an agreement on September 30, 2018, calling it the United States-Mexico-Canada Agreement (USMCA), and signed the new agreement on November 30. Each party now enters into the ratification process. The implementation legislation is expected to pass quite quickly through the Canadian Parliament, while greater resistance is anticipated in the United States Congress.
The “New NAFTA” / USMCA / CUSMA
Canada’s official legal text of the agreement, which will be called the Canada-United States-Mexico Agreement (CUSMA) as per standard naming practice with multilateral trade deals, can be found here.
Recent analysis of the new agreement has been conducted by the Canadian Centre for Policy Alternatives (CCPA), including implications for labour rights, climate action, and regulation. The compilation of analyses can be found here.
The new agreement falls short of the “progressive trade” priorities outlined by Minister Chrystia Freeland at the outset of the renegotiations. It is true that the CUSMA includes some notable wins, including the rollback of ISDS and elimination of energy proportionality; however, the agreement contains numerous concessions. Primarily, the new North American trade deal will hinder access to affordable medicines, create obstacles for public safety regulators, jeopardize Canada’s supply management system, threaten farmer livelihoods across the continent, and it fails to offer enforceable environment provisions to combat climate change. Furthermore, Canada signed onto the new agreement while U.S. tariffs on steel and aluminum remain in place. The Canadian government also abandoned its commitment to include new chapters on gender equality and Indigenous rights.
Read our joint statement with the Council of Canadians and Common Frontiers on the “New NAFTA.”
Background: What’s the Deal with NAFTA?
Since 1994, NAFTA has increased trade across borders and contributed to economic integration between Canada, the United States and Mexico. The efforts to lower trade barriers, however, have contributed to many negative impacts on people, democracy and the environment across the continent. Some of these impacts include:
- A rise in corporate profits and, in turn, economic inequality
- Stagnant (or falling) wages and rising unemployment across the continent
- The expansion of investor rights — specifically, investor-state dispute settlement (ISDS) allows foreign investors to challenge government regulations for alleged discrimination or loss of profits. This has enabled investors to challenge (and oftentimes overturn) public interest regulations that they deem unfavourable.
- Little to no contribution to improving working conditions, labour rights and standard of living — provisions in the NAFTA labour side agreement are non-binding
- Environmental degradation — provisions in the environmental side agreement are non-binding. This is worsened by the fact that ISDS threatens governments’ ability to develop and enforce environmental regulations.
- Deterioration of agricultural systems and farmer livelihoods in all three countries
- Regulatory cooperation efforts have contributed to a lowering of standards (e.g. public health and consumer protection)
For a more detailed analysis of NAFTA’s impact to date, see this Trade Justice Network brief or the resources below.
Trade Justice Network Actions
In May 2017, the Trade Justice Network (TJN) participated in the tri-national meeting of civil society organizations from Canada, the U.S. and Mexico to discuss the NAFTA renegotiations, which took place in Mexico City. Find a recap of the events here.
The TJN is a member of the pan-Canadian coalition that emerged from the tri-national meetings. The group aims to raise awareness about the implications of NAFTA, pressure the Canadian government to ensure that the negotiation process is transparent, democratic and participatory, and coordinate actions to call for a fairer North American trade relationship that benefits all people.
In September 2017, the TJN worked with other members of the pan-Canadian coalition’s coordinating team (Canadian Labour Congress, Canadian Union of Public Employees, Common Frontiers, Council of Canadians, Public Service Alliance of Canada, and Réseau québécois sur l’intégration continentale) to organize a NAFTA Civil Society Summit to coincide with the third round of NAFTA negotiations taking place in Ottawa. The coalition also developed a central website for organizations and activists to coordinate Days of Action to coincide with the NAFTA negotiations that took place in Montreal in January 2018.
The TJN submitted a written brief to the Canadian government consultations on NAFTA. The submission outlines our concerns with NAFTA, as well as an alternative model for trade and economic integration in North America.
The NAFTA renegotiations have prompted a great deal of anxiety amongst Canadians around the possibility that NAFTA could be eliminated altogether, despite analyses that show the end of NAFTA would not be disastrous for Canada. Rather than perceiving the demise of NAFTA (or other corporate trade deals) as a threat, the TJN believes this presents an opportunity to explore alternatives to the current global trade model. The TJN has long called for a more equitable, socially just and sustainable model for global trade; and so, in the context of NAFTA, the TJN is continuing to work to present alternatives to the current global trade regime. See our webpage on creating alternatives.
Following the announcement of the “New NAFTA,” named the USMCA, the TJN released a joint statement with the Council of Canadians and Common Frontiers. The statement outlines the ways in which the USMCA/CUSMA severely falls short of not only the Canadian government’s stated commitments to more “progressive trade,” but also the overhaul necessary to develop a more equitable and sustainable model of trade (and negotiation process). We also urge the Canadian Parliament to undertake a robust public consultation and analysis before the agreement goes to any vote.
What Can You Do?
Get involved! Find below the various campaigns and initiatives led by Canadian civil society organizations.
Urge your Member of Parliament to oppose the new CUSMA/USMCA, and to demand a robust public consultation and comprehensive analysis before the new agreement goes to any vote.
Resources and Campaigns
Check out these NAFTA campaigns, analyses, statements and other resources from TJN participating organizations: