On April 18, 2019, the U.S. International Trade Commission (USITC) released its report on the potential impact of the U.S. – Mexico – Canada Agreement (USMCA). The report investigates the impact on the U.S. gross domestic product (GDP), imports and exports, employment, and production.
According to the USITC, their main findings are:
-
The USMCA could have a positive impact on U.S. real GDP and employment;
-
The emphasis is on the reduction of remaining nontariff measures on trade and the U.S. economy;
-
The elements of the agreement that could have the most significant effects on the U.S. economy are provisions that reduce policy uncertainty about digital trade and certain new rules of origin applicable to the automotive sector.
-
The USMCA may strengthen and add complexity to the rules of origin requirements in the automotive sector;
-
The USMCA’s requirements may increase U.S. production of automotive parts and employment, but increase prices and may decrease the consumption of vehicles in the United States;
-
The USMCA may reduce the scope of the investor-state dispute settlement (ISDS) mechanism;
-
The USMCA may strengthen labor standards and rights;
-
The USITC estimates the USMCA may raise U.S. real GDP by $68.2 billion (0.35 percent) and U.S. employment by 176,000 jobs (0.12 percent).
The USITC’s press release may be found here:
https://www.usitc.gov/press_room/news_release/2019/er0418ll1087.htm
The USITC’s report may be found here:
https://www.usitc.gov/publications/332/pub4889.pdf
