North American Business Leaders’ Perspectives on USMCA Opportunities and Challenges

By Business Roundtable Trade and International Committee Chair Lance Fritz, Chairman, President and CEO, Union Pacific Railroad; Juan Gallardo Thurlow, Chairman of the Board, CULTIBA and Head of the Business Roundtable of Mexico International Committee; and Victor Dodig, CEO, CIBC and Chair of the Business Council of Canada

Note: Below is a viewpoint from the Brookings Institution USMCA Forward 2022 report, which examines key priorities to build a more competitive, inclusive, and sustainable North American economy.

February 28, 2022

We are less than two years into a modernized North American trade agreement and already the United States-Mexico-Canada-Agreement (USMCA) boasts some early successes in facilitating North American economic competitiveness and resolving disputes. Despite the ongoing pandemic and border closures, merchandise, including food and consumer goods, has continued to flow to the benefit of all three countries. In addition, the digital economy has matured, with growing partnerships across North America. For the first time in 20 years, a North American State-to-State Dispute Settlement Mechanism has been used successfully. The updated consultation and enforcement mechanism in USMCA can help resolve differences. Moreover, the greater certainty and predictability provided by the agreement can incentivize further investments to enhance innovation, sustainability, and resilience across North America.

The business communities in all three countries welcome these early gains, but the hard work lies ahead: We must ensure USMCA generates an enduring positive impact on the economies of all our countries to benefit workers, businesses, and customers.

Our countries face many headwinds, including economic recovery, climate change, rapidly changing technologies, and the need for greater economic security and resiliency. Fully implementing and enforcing USMCA can help North American leaders tackle these opportunities and challenges together.

In support of a more coordinated North American economy, business leaders were pleased to see the release of bilateral frameworks in 2021: The Roadmap for a Renewed U.S.-Canada Partnership and the U.S.-Mexico High-Level Economic Dialogue. In addition, we welcomed early efforts to enhance cooperation and coordination through the first North American Leaders Summit in more than five years.

These engagements send the right signal that the future of the North American economy depends on working together at the highest levels to translate the promise of USMCA into results for citizens across the region.

Full implementation and enforcement of USMCA will sustain broad political and stakeholder support for the agreement. Our governments, business stakeholders, and civil society all invested considerable effort, supported the negotiations, and made compromises to reach this historic framework. Yet we are seeing some significant and worrying examples of our three countries developing policies that clearly undermine the objectives and commitments embodied in the agreement. We urge our governments to focus on the opportunity that North America presents to boost our mutual competitiveness and commit to resolving pressing policy challenges by demonstrating shared commitment to USMCA and its provisions.

Finally, we call on all three governments to fully harness the USMCA’s various committees, including the innovative USMCA Competitiveness Committee, to enhance supply chain resiliency and drive sustainability and innovation in the region.

Through USMCA, we have an unprecedented opportunity to strengthen North American supply chains and improve our competitiveness. The private sector stands ready to partner on the development and implementation of an ambitious USCMA and North American agenda to empower our businesses and workers to better compete in the world.