Tax

The NAM met with North American trade ministers last week in Cancun, Mexico, where it urged them to take up key trade priorities for manufacturers.

What happened: The NAM led a delegation from the American business community, which participated in a roundtable discussion ahead of the third United States–Mexico–Canada Agreement “Free Trade Commission” on July 7 in Cancun.

• Attendees at the roundtable event included NAM President and CEO Jay Timmons, U.S. Trade Representative Katherine Tai, Canadian Minister of Small Business, Export Promotion and International Trade Mary Ng, Mexican Secretary of the Economy Raquel Buenrostro and business executives from the three countries, including Rockwell Automation Chairman and CEO Blake Moret.

Shared values: The NAM underscored the importance of an investment climate underpinned by core democratic principles, such as transparency and the rule of law.

• “We believe in democracy,” Timmons said. “However imperfect, this system fosters free enterprise, competitiveness, individual liberty and equal opportunity. These values make manufacturing strong in our countries.”
• He added that each year North American manufacturers contribute $3 trillion to the U.S., Canadian and Mexican economies.

What must be done: Though the USMCA already creates advantages for North American manufacturers, the agreement’s full potential can only be realized if the three countries work together to address certain key challenges, Timmons told the attendees. Some of the main hurdles include:

• Mexico’s power-generation policies, which have long favored Mexican state-owned energy companies and led to higher bills for manufacturers that must use existing energy-supply contracts;
• Permitting delays for U.S. projects in Mexico that undercut American firms and reduce energy supply to North American manufacturers and consumers;
• Mexico’s expanded food-labeling requirements and bans on the sale of some U.S. foods and nonalcoholic beverages to minors, which unjustly restrict U.S. exports;
• High spectrum fees in Mexico that deter telecommunications competition, as well as the country’s weak patent enforcement, delayed approvals of pharmaceuticals and bans on certain chemicals and genetically modified corn; and
• Delays in the reform of Canada’s patent system, ongoing restrictions in Canada’s dairy market, a Canadian government proposal to brand “plastic manufactured items” as “toxic substances” and a change to Quebec packaging and labeling requirements that will upend decades of intellectual property law and could limit access to the Quebec market.

The last word: “Ensuring North American economic integration and regional competitiveness will require a multipronged effort that focuses on robust implementation of the USMCA, ensuring a competitive North American energy market and providing support for the manufacturing workforce across the region, among other key elements,” said NAM Vice President of International Economic Affairs Ken Monahan, who joined Timmons in Cancun.

• “The NAM has positioned itself as a leading U.S. business organization on North American trade and economic matters, and we look forward to continuing to engage with our member companies on these issues going forward.”