Mexico Ratifies USMCA, Canada Waits for U.S.

Canada has submitted the agreement to its parliament but is waiting for the U.S. to lead on ratification. Parliament will recess at the end of the week and will begin federal elections in October. The Prime Minister said he will reconvene parliament before the election to take a vote if the U.S. moves forward. The agreement is expected to pass easily in Canada.

“Our plan is to move forward in tandem with the U.S. We think of it as a kind of Goldilocks approach. Not too hot, not too cold. We’re not moving too fast, not moving too slow,” said Canadian Foreign Minister Chrystia Freeland last week.

Prime Minister Justin Trudeau will meet with President Trump this week to discuss the USMCA as well as the trade conflict with China.

U.S. lawmakers are still concerned about whether Mexico will follow through on enforcement of agreed labor reforms. The House Ways & Means trade subcommittee has scheduled a hearing on June 25 regarding the issue.

Congress is scheduled to leave for recess in August and U.S. Trade Representative Robert Lighthizer wants a vote before then.

“We want this dealt with as soon as possible,” said Lighthizer, adding that the agreement is “completely enforceable,” but pledged to work with Congress to address their concerns.

Senate Finance Committee Chairman Chuck Grassley said he “definitely” believes USMCA could be ratified before the August recess.

“If we don’t get it done by then, then of course I hope we can get it done in September or at least some time so it doesn’t get caught up in the 2020 election,” said Grassley.

House Speaker Nancy Pelosi told reporters on Wednesday that there are still several key impediments to congressional approval of the USMCA, citing enforcement rules, labor and environmental protections and provisions on pharmaceuticals. She has named a group of House Democrats to negotiate with the USTR on the issues.

The administration is waiting for a signal from Pelosi that there are enough votes to pass the USMCA before submitting the implementing bill to the House.