OTTAWA — After weeks of intense negotiations behind closed doors, a renegotiated North American Free Trade Agreement (NAFTA) has emerged. Like the original NAFTA, the new U.S.-Mexico-Canada Agreement, or USMCA, falls short when it comes to protecting workers’ rights, the environment, farmer livelihoods and the health and wellbeing of people across the continent.
Early analysis shows that the new agreement fails to address many of the long-term problems caused by NAFTA: wage stagnation and rising inequality, deterioration of farmer livelihoods, inadequate protection of public services and environmental degradation. In fact, USMCA may worsen the situation for many communities and industries.
USMCA will undermine access to affordable medicines in Canada. The deal extends the patent protection term for biologic medicines to 10 years (from 8 years), thereby delaying the entry of generic drugs into the market and contributing to rising drug costs. This change will impede access to affordable medicines and make it more difficult to develop a pharmacare program in Canada.
The new deal grants U.S. farmers greater access to Canada’s dairy market. In a move similar to liberalization under the CPTPP (Comprehensive and Progressive Trans-Pacific Partnership), the North American deal opens up 3.59% of Canada’s supply management system. This will jeopardize the viability of supply management, which ensures decent farmer livelihoods and high quality, affordable products for consumers.
USMCA fails to offer genuine environmental protection. The deal contains limited environmental provisions and lacks an effective enforcement system, which will allow corporations to continue to evade environmental policies by shifting toxic pollution to countries with weaker environmental regulations. This illustrates a step in the wrong direction when it comes to tackling climate change and meeting Canada’s commitments under the Paris Agreement.
It is worth noting that the new agreement removes the Investor State Dispute Settlement (ISDS) mechanism between Canada and the US. Though long overdue, this move represents a huge win for the labour, environmental and social justice movements that have long called for the elimination of ISDS. Unfortunately, Mexico will continue to be subject to ISDS provisions.
Despite the Trudeau government’s commitment to negotiate strong provisions on labour rights, gender equality, Indigenous rights and environmental protection, as part of its Progressive Trade Agenda, USMCA fails to provide these tools for building a more just and sustainable economy that benefits people across the continent.
The Canadian government seems to have succumbed to the thinking that without NAFTA we would have no trade, although this myth has been disproved by experts. As a result, Canada sold out its “progressive trade” principles and the best interest of its communities and industries.
Much work remains to be done to improve the trading relationships across North America. Any new deal must be environmentally sustainable and benefit people across the continent, not just multinational corporations. We, Common Frontiers, the Council of Canadians and the Trade Justice Network, urge the Canadian Parliament to undertake a robust public consultation before ratifying the agreement.