Trade Talk | NAFTA Criticism Affects This Week And Beyond
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Trade Talk | NAFTA Criticism Affects This Week And Beyond

The State Of Affairs For NAFTA Based Cross Border Trading.

The NAFTA criticism has us all seeing news stories and hearing broadcasts that salaciously present and debate today's state of affairs for people or products crossing U.S. Borders. NAFTA criticism combined with other Executive Orders affecting individuals crossing North American borders launched us into a noisy world. What as a business should you do, or do you focus on?

From our offices across the nation we can see carriers crossing the border without issues. In speaking with the Canadian Trucking Alliance this morning there are no reports of challenges with either carriers or cartage crossing the border between U.S. and Canada outside any norms expected. On all fronts that we have reached out to on the ground - all appears to be business as usual.

So what do you do? Carry on your business! Continue to press forward with what you do best and access your trade advisor when you come into anything that raises concerns about executing your business transactions across borders.

As for where to Focus - one place is on our weekly updates for you here, another is on opportunities perhaps not yet explored. For example, did you know that Canada has 12 Free Trade Agreements outside of NAFTA? Is it time to explore expansion opportunities or Alternative Trade Routes?

What We Know For Sure:

We shared this in last week's post however it may serve well to share again one more time to remind everyone that life and business are carrying on because these things we know for sure and hope that you, our readers, feel confident about also:

  1. Products will continue to go to the U.S. from Canada and products will continue to go to Canada from the U.S.
  2. Duties, taxes and fees will still need to be managed, filed and paid.
  3. Businesses will continue to do business across our borders.
  4. Where there is a need, there will be a trade.

What We Are Talking About:

Talk around here is pretty quiet this week, we spoke with Mike, one of our trade compliance experts upstairs and he shared that he hasn't had a single customer reach out to compliance with any concern about what is happening with NAFTA or in the US lately. From his vantage point it's business as usual. So this is good news.

Status Quo carries on and your business should too - as usual and beyond! For now, it is still unclear if this will all add up to something or sit quietly at the nothing it is in practice today.

Trade Talk | This Week In NAFTA

What We Think:

Might we suggest, carrying on with your business and perhaps viewing this time as an opportunity to proactively explore new markets within some of the 12 other Free Trade Agreements Canada has, or the 20 other Free Trade Agreements the U.S.A. have. New business after all is just beyond the horizon and well within reach of small and enterprise business in both countries.

Have a chat with one of our Trade Compliance Advisors and let's see where you can grow to: Trade Consulting

What We Advise:

Focus some time with your broker this week to be sure your company rulings are up to date with the new HS Tariff amendments that came into effect in January this year.

If you are a client of Pacific Customs Brokers we have already updated any rulings prior to the amendment taking effect however it's good to check in with your broker because ultimately as the vendor responsibility rests with you.

How To Accurately Complete A NAFTA Certificate Of Origin
speak to trade advisor

What We Are Reading:

What we are reading about NAFTA this week is that not too much is being impacted to any great degree.  At least not yet. Here are a couple of reads that were particularly interesting this week.

From Wall Street Journal (WSJ):

Nafta's Net U.S. Impact Is Modest

Nafta's Net U.S. Impact Is Modest. For all of the debate sparked by the North American Free Trade Agreement, most economists say its concrete impact on the U.S. economy has been modest - a small gain in growth and efficiency, and a small loss in jobs and lower wages for certain factory workers. But as with most free-trade agreements, the gains over 23 years have been diffuse and the pains more concentrated, helping stoke the intense political backlash that powered : Nafta’s Net U.S. Impact Is Modest

From LA Times:

NAFTA doesn't count for much economically, but it's still a huge political football. Here's why:

Kevin Drum at Mother Jones tried Sunday to mediate a debate over NAFTA between economists Brad DeLong of UC Berkeley and Dani Rodrik of the Harvard Kennedy School. He takes DeLong's point that the overall economic impact of NAFTA has been minuscule as a share of gross domestic product. NAFTA's impact on the U.S. whether good or bad ? is inevitably tiny,? Drum concludes, and he's right.

President Trump threw trade experts for another loop Thursday by endorsing - or seeming to endorse - a new tax system for imports and exports that he said would reduce our trade deficits (and) increase American exports. Not so incidentally, he also said it will generate revenue from Mexico that...

That's important, because Trump's approach to trade is all about those limited impacts. Those impacts are far beyond his ability to fix, even if he really wanted to, which is questionable. » Column: NAFTA doesn’t count for much economically, but it’s still a huge political football. Here’s why

From our Friends at Sandler, Travis & Rosenberg Trade Report

Renegotiated NAFTA Likely to Require Congressional Approval, CRS Says

President Trump would likely have to secure congressional approval for any substantive changes to U.S. law that would be required to implement a renegotiated NAFTA, according to a recent Congressional Research Service report.

CRS states that the negotiation of international agreements is generally considered to be the exclusive prerogative of the executive branch, which consequently does not appear to need approval from Congress to discuss changes to NAFTA with representatives of Canada and Mexico. There has been speculation that a future renegotiation of this agreement might cover issues such as tariff rates on goods trade, rules of origin, elimination of investor-state dispute settlement provisions, modifications to the general dispute settlement system, immigration and border security, and cooperation on migration from Central America, drug trafficking, and the illegal flow of arms and money.

Instead, attention will likely focus on whether any revised agreement resulting from such negotiations must be approved by Congress before it may take effect. » Renegotiated NAFTA Likely to Require Congressional Approval, CRS Says

Disclaimer: While reading, kindly note the date of this blog. At PCB we do our due diligence to write on the most relevant topic every week and naturally content may become dated as developments in a certain program/topic occur. For this reason, we greatly appreciate your readership and hope you continue reading with the posting date in mind. For the latest information on this topic please use our website's search function, or better yet, subscribe to our "Trading Post" newsletter to receive these updates directly to your inbox.
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About the Author
Gloria Terhaar
CCS (CA/US), CTCS, CBSA Prof. Designate

Gloria Terhaar began her career in Canadian customs brokerage 2007. She currently works in our Canadian division as a Trade Compliance Supervisor and Regulatory Compliance Specialist. Gloria has extensive experience in all aspects of documentation and regulatory requirements as they relate to importing products into Canada. Gloria is often called upon to train industry with some recent talks for MNP, the Surrey Board of Trade, TFO Canada and the BC Produce Marketing Association. In 2018, Gloria also participated in the Canadian Produce Marketing Association and the Canadian Horticultural Council advocacy event "Fall Harvest" in Ottawa where she participated in advocacy efforts for the Canadian produce industry.

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.