Saskatchewan Capital Visit | May 14-15
His Honour the Honourable W. Thomas Molloy, Lieutenant Governor of Saskatchewan
Honourable Scott Moe, Premier of Saskatchewan
Honourable Lyle Stewart, Minister of Agriculture
Honourable Dustin Duncan, Minister of the Environment
Honourable Jeremy Harrison, Minister of Trade and Export Development
Honourable David Marit, Minister of Highways and Infrastructure
Honourable Bronwyn Eyre, Minister of Energy and Resources
Honourable Mark Docherty, Speaker of the Legislative Assembly
Ms. Carla Beck, Deputy Leader of the Official Opposition
Mr. Greg Brkich, Government House Leader
PNWER Officers and staff had a productive visit to Saskatchewan with individual meetings with six different ministers and the Premier and several other leaders in the legislature. NAFTA and trade were front and center in nearly all the meetings, with Agriculture, Transportation and Energy as key priorities for the province. PNWER Officers also discussed market access and cross border impacts to transportation and opportunities to partner with other states and provinces to increase throughput capacity. PNWER officers discussed several current projects involving our jurisdictions, such as the Legislative Energy Horizons Institute (LEHI) and recent efforts to address tariffs on Canadian steel and aluminum and newsprint. During a well attended luncheon with all the MLAs, Vice President Larry Doke invited everyone to be part of the host committee for the PNWER Summit in 2019, scheduled to be held in Saskatoon, SK on July 21-25, 2019.
PNWER Delegation with the Lieutenant Governor of Saskatchewan, Thomas Molloy (middle). (From left to right,) Brandon Hardenbrook (PNWER), Shawna Argue (APEGS), Sen. Arnie Roblan (PNWER President, Oregon State Legislator), Rep. Mike Cuffe (PNWER Vice President, Montana State Legislature), Mr. Larry Doke (PNWER Vice President, Saskatchewan MLA), Ret. Senator John Brenden (Montana), Matt Morrison (PNWER Executive Director)
PNWER Delegates with the Premier of Saskatchewan, the Honourable Scott Moe. From left to right, Mr. Larry Doke (MLA, Saskatchewan, PNWER Vice President), Senator John Brenden (Montana), Sen. Arnie Roblan (Oregon State, PNWER President), Premier Scott Moe (Saskatchewan), Rep. Mike Cuffe (Montana State, PNWER Vice President), Matt Morrison (PNWER Executive Director).
Senator Arnie Roblan speaks during the Pizza Lunch Meet & Greet, held in the Legislative Library, nearly all MLA’s attended.
Alberta Capital Visit
PNWER delegates had the chance to meet with a variety of different groups in Alberta. Wednesday morning, May 16, started off with a Roundtable discussion with members of the Alberta Government.
Later that afternoon, PNWER delegates visited the Food Processing Development Centre and toured the facilities.
House Speaker Paul Ryan's May 17th deadline has come and gone without a new deal on NAFTA. This was originally the deadline for the Trump administration to submit a trade deal in order to have it voted on by the current congress before the end of the session.. This makes a NAFTA deal in 2019 now more likely than ever.
However, Canada and Mexico are not deterred by Ryan's deadline and remain optimistic about reaching a deal soon. Mexican Economy Minister Ildefonso Guajardo has said a deal in late May or early June is still possible (Mexico elects a new president on July 1st).
In addition, on Thursday Ryan extended his deadline, saying that a deal produced in the next week or two could still be voted on by this congress. That would only be possible if the International Trade Commission can finish their review of the deal in less than the allotted 105 days after signing.
Issues that still need to be solved: Auto manufacturing rules of origin, steel and aluminum tariffs, the dispute resolution mechanism, the sunset clause, seasonality tariffs, textiles, dairy market access, de minimis and ecommerce rules.
If the parties cannot agree on a deal before these deadlines, an agreement in principle that would calm markets and lay a groundwork for next year is more likely.
In late April PNWER issued a revised statement calling for a continued exemption of steel and aluminum tariffs from Canada which was extended another month. PNWER also issued a statement opposing tariffs on newsprint from Canada.
In Other NAFTA News:
Saskatchewan Premier Moe says NAFTA needs an update not a rewrite following first U.S. summit - Global News
Christopher Sands on The Risks of Missing the May Deadline for NAFTA 2.0 - CSIS
A new NAFTA will probably not get done this year. Now what? - POLITICO
Trump’s Goal for Nafta Rewrite Looks Unattainable in 2018 - The Wall Street Journal
Time is running out on NAFTA, as U.S. grapples with China over trade - CBS News
Kudlow Says Nafta Deal Is Test of Trump Trade Cooperation - Bloomberg
Contributions by Zack Tarhouni, PNWER Intern
Christoper Sands, Senior Associate, Americas Program at the Center for Strategic and International Studies reviews the consequences of delaying NAFTA agreement at https://www.csis.org/analysis/risks-missing-may-deadline-nafta-20
An 'agreement in principle' could not be reached at the Summit of the Americas earlier this month, but Vice President Pence and Commerce Secretary Wilbur Ross, who attended in place of President Trump, are hopeful about reaching a preliminary deal by the third week of May.
All parties seem eager to meet this deadline as US Trade Representative Robert Lighthizer meets with his Canadian and Mexican counter parts on Tuesday (4/24) in Washington DC. High ranking officials met Friday (4/20) and will continue through the weekend in preparation for the trilateral meeting. The 7th of 30 eventual chapters in the NAFTA agreement has just been completed.
The origin rules for auto parts remains a major sticking point in negotiations. This rule governs the percentage of vehicle content that must be made in NAFTA countries. Originally, the Trump administration wanted to raise that requirement from 62.5% to 85% and increase the amount built in the US but has 'significantly softened' their position.
Former Commerce Secretary Carlos Gutierezz offered his predictions on an eventual NAFTA deal, saying that number will end up at 70%-75% for regional rules of origin (auto content coming from any of the three NAFTA nations rather than from US only). In addition, the proposed sunset provision requiring NAFTA renegotiation every five years will likely be changed to a recurring check-in.
Other negotiation speed bumps include government procurement, investor-state dispute settlement (ISDS), and dairy products.
Meanwhile, elections that could be consequential for NAFTA are quickly approaching; Mexico elects a new president on July 1, and US Midterm elections on November 6 could elect a Congress that makes NAFTA renegotiation difficult.
Under the Trade Promotion Authority the White House must give Congress 90 days notice of its decision to sign the new agreement. 60 days before signing, a legal text of the agreement must be released (if anti-dumping and countervailing duty measures are changed by the deal, 180 days notice would be required instead).
Other NAFTA and Trade news:
Contributions by Zack Tarhouni, PNWER Intern
The next round of NAFTA talks has been delayed to allow for a series of high level meetings in DC on Friday April 6th, (Next round of NAFTA talks on hold as ministers meet in Washington) between US Trade Representative Robert Lighthizer, Canadian Foreign Affairs Minister Chrystia Freeland, and Mexico's Secretary of Economy Ildefonso Guajardo Billarreal. The 8th Round is expected to begin next week, from April 8-18, although it has not been formalized yet. In addition, the leaders of Canada, Mexico, and the US will meet at the Summit of the America's April 13th-14th, where there is a possibility of signing an agreement in principle on NAFTA.
Since the last round of talks in March, the Trump administration has pulled back on some of its contentious auto-manufacturing requirements, but a number of serious questions remain, including carve-outs on steel and aluminum tariffs for Mexico and Canada, which expire on May 1st (U.S. sets May 1 tariff threat on Canada, Mexico amid rush to speed up NAFTA talks) and the proposed "sunset clause" requiring NAFTA renegotiation every 5 years. The US tariffs on steel and aluminum from Canada and Mexico received temporary exemptions after stakeholders expressed concern over impacts. PNWER issued a statement on the proposed tariffs on March 7th PNWER Letter to President Donald J. Trump - March 7, 2018 Also nearly 130 republican congressional leaders, led by Rep. Dave Reichert (WA) signed a letter opposing the tariffs
Nearly 100 Congressional Republicans sent a letter to the USTR to push to maintain the investor-state dispute settlement (ISDS) in NAFTA, in response Ambassador Lighthizer's statements on his preference to do away with the ISDS process before the House Ways and Means Committee.
In Idaho, bi-partisan state legislative leaders have expressed their concern over the potential impact of withdrawal from NAFTA on the state. Minority Leader Rep. Erpelding and Senate Commerce & Human Resources Committee chair Sen. Jim Patrick co-authored an editorial outlining their concerns: NAFTA has been a game-changer for Idaho. Don’t damage Idaho agriculture, tech companies
Finally, here's a new tool developed by the US Chamber showing economic data by state related to NAFTA trade with Canada and Mexico: https://www.naeconomicalliance.com/nafta-and-you-interactive-map/ According to the tool, across WA, OR, ID, and MT there are 585,000 jobs supported by NAFTA and $13,218,868,498 in NAFTA supported exports.
Other NAFTA and Trade news:
Senate Ag chairman says trade disputes “not a good situation”
As Trump Threatens NAFTA (Again), States With the Most on the Line Ahead of Trade Talks
These deadlines explain why Trump's hurrying to get a Nafta deal
Alberta signs letter to U.S. President Donald Trump opposing steel tariffs
Any NAFTA deal in principle would focus on auto rules
In Nafta Shift, U.S. Focuses on Labor Standards
Contributions by Zack Tarhouni, PNWER Intern
Senator Lisa Murkowski spoke about the need to have more administrative officials understand the importance of the arctic. It cannot be the sole responsibility of Alaska officials; U.S. officials need to be educated on and advocate for arctic policies, especially policies that will endure past the current Presidential Administration. Almost all U.S. agencies have a role to play in the arctic and they need to breakdown internal silos and be more collaborative with one another. It is challenging to work with each individual agency with various arctic initiatives. Additionally, the Arctic Circle will highlight Alaska at its annual meeting in Iceland, as well as the importance of shipping in the arctic and sharing icebreaker infrastructure in North America.
Rep. Don Young spoke to the challenges of working with the federal government and the need for more collaboration with the State of Alaska. He emphasized the importance of working with the International Maritime Organization (IMO) on a system for transiting the Arctic in North America.
Transportation infrastructure and arctic policy with regional leaders through roundtables and consultation
Transportation infrastructure and arctic policy with regional leaders through roundtables and consultation. Issues were raised during the panel discussions and roundtable of bilateral concern. Oil and gas development in Alaska could pose a threat to the porcupine caribou herd that migrates across the region. According to U.S. officials, there are vacancies on the International Porcupine Caribou Board, a body established by a bilateral agreement to address issues with the herd. Moreover, sufficient oil spill response equipment is another area in need of transboundary attention. Representatives from Canada emphasized the systemic nature of the Arctic, and any environmental disaster will not be confined to its source.
John Higginbotham, Centre for International Governance Innovation (CIGI) spoke about the need for the governments to work together especially on Arctic policy and the importance of the prime minister and president to work together on arctic issues. Adrianna Muir, Deputy Senior Arctic Official from the U.S. State Department spoke about the need for all levels of the federal government agencies to communicate across silos. This theme was mentioned during Senator Murkowski’s remarks on fixing communication barriers across the federal government. She also recognized Alaska’s role as a leader in the Arctic. Senator Stedman added that arctic communities want infrastructure and desire to see their communities share in the same technological advancements as other U.S. cities.
Shipping infrastructure is critical to the economic viability of the Arctic, and may also present the best business plan for the region. An Arctic Seaway that guarantees port access, icebreaking services, and search and rescue capabilities could reduce liability for international transport companies. The plan’s user fee model could recoup infrastructure construction and operating costs as shipping traffic is expected to increase in the Arctic. Mike Sfraga from Wilson Center Polar Initiative, Mead Treadwell, PT Capital and Jeremy Mathis, National Oceanic and Atmospheric Administration spoke about the opportunities for arctic shipping in the region and outlined a couple innovative ideas on working together on transiting the region. An example of similar program conducted in the St. Lawrence Seaway was showcased as a possible solution for collecting fees for managing the northwest passage waterway. When a ship transits the waterway, the U.S. and Canada coordinate with each other throughout a ship’s transit. Some challenges exist as far as infrastructure and rules for ships traveling through the region. Additionally, Canada and the U.S. still have a dispute on sovereignty of the region and the national border. More work needs to be done in both countries to create a shared system for monitoring ships and collecting fees for managing the waterway. The Wilson Center is hosting a conference on Arctic port infrastructure later this summer.
The event concluded by looking towards the future. In particular, the roundtable discussed the proposed Alaska LNG pipeline and potential Chinese investment in the project. China and Alaska have signed memorandum of understanding to develop the project with a percentage of the gas supply guaranteed for the Chinese market. The Roundtable was an exciting chance for arctic experts to share ideas and topics impacting the North American Arctic.
Steve Myers, Senior Program Manager, PNWER and Michael Mauer, M.A. Candidate, May 2018, International Economics & Conflict Management, Johns Hopkins School of Advanced International Studies (SAIS) contributed to this article.
TARIFFS: THE WRONG WAY TO ACHIEVE GREATER ECONOMIC GROWTH, RESILIENCE, AND SECURITY IN NORTH AMERICA
PNWER Statement on Steel and Aluminum Tariffs
March 7, 2018
TARIFFS – THE WRONG WAY TO ACHIEVE GREATER ECONOMIC GROWTH, RESILIENCE, AND SECURITY IN NORTH AMERICA
The highly integrated North American steel and aluminum industry supports critical manufacturing supply chains in both the US and Canada. Because of our interdependent economic ties, the proposed 25% steel and 10% aluminum tariffs will have unintended consequences which will seriously impact jobs and local economies in the US and Canada.
If tariffs are imposed they most likely will lead to higher prices for consumers in the US and in Canada which will limit economic growth. Canada buys more American steel than any other country and accounts for 50% of U.S. exports. The U.S. has a $2-billion surplus in steel trade with Canada, and US exports of aluminum to Canada support more than 160,000 US jobs.
Should any tariffs be considered on steel and aluminum, Canada deserves an exemption due to our shared economics ties, supply chain integration and mutual defense partnership.
Senator Arnie Roblan, (Oregon) PNWER President: “PNWER stands for the strong economic connection between our two countries. We have the longest open border in the world, and our trade policy should reflect that. The integrated supply chains that allow us to build world class airplanes depend upon stable, reliable, and open trade relationships with Canada that would be disrupted by any tariffs between us.”
"Canada and the U.S. share a long history of economic and security cooperation that has created one of the world's most enduring and prosperous international partnerships. Exempting Canada from the proposed steel and aluminum tariffs is the right choice for both our countries. It would mean these highly integrated industries can continue providing the prosperity and security that support so many businesses and hundreds of thousands of jobs on both sides of the border,” said Graham Sucha, Member of the Legislative Assembly of Alberta, and PNWER Vice President.
PNWER supports the modernization of NAFTA to enhance the existing economic relationships within PNWER jurisdictions in a mutually beneficial manner.
PNWER Letter to President Donald J. Trump - March 7, 2018
More information about PNWER's trade advocacy here.
*UPDATE: Trump's steel, aluminum tariffs exempt Canada, Mexico
BIG NEWS in the trade world this week as President Trump announced his intention to implement tariffs on steel and aluminum, a threat that now hangs over NAFTA negotiations. Prime Minister Trudeau called the tariffs "unacceptable" and many in Canada and the U.S. are urging the U.S. administration to exempt Canada from any steel tariffs.
The seventh round of negotiations got underway earlier this week as representatives from the U.S., Canada. and Mexico convened in Mexico City for more talks. The latest news today is that negotiators have reached an agreement on regulatory best practices.
The last round of talks, which took place in Montreal in January, was described by USTR Robert Lighthizer as a "step forward, but we are progressing very slowly". Click here for a quick summary of where each issue stands following the Montreal round.
Here at PNWER, we have been closely tracking the progress of NAFTA. This week, a PNWER delegation, including CEO Matt Morrison, PNWER VP Rep. Mike Cuffe (MT), and Steve Myers, visited D.C. to speak with our Congressional offices and partners, including a meeting with Chief of Staff for Congressman Dave Reichert (R-WA) Chair of the International Subcommittee of Ways & Means, and the lead for NAFTA negotiations in the House. They also met with the US Dept. of Agriculture, US Department of Interior, and the State Department and discussed PNWER's NAFTA Resolution and Modernization Recommendations, as well as the upcoming Farm Bill and Country of Origin Labeling (COOL).
In January, PNWER conducted our annual capital visits with President Arnie Roblan (OR) and had the the opportunity to meet and discuss NAFTA with our governors, legislative leaders, state commerce departments, and business stakeholders in Olympia, Boise, and Juneau.
PNWER CEO Matt Morrison also had the opportunity to speak Feb 22 at the Greater Vancouver Board of Trade's Beyond NAFTA event. on the importance of the deeply integrated U.S.-Canada trade relationship.
Catch up on everything you need to know for the seventh round of NAFTA talks:
Attached is a handy reference sheet breaking down the costs to U.S. businesses, farmers, and key industries of withdrawing from NAFTA.
NAFTA negotiations round 7 underway as Mexico-U.S. tensions flare
Time crunch looms over seventh round of NAFTA talks
The Real Game Trump is Playing on NAFTA
A year later, NAFTA is still alive
Study: Withdrawing from NAFTA will cost 1.8 million jobs in the first year
In other news, the U.S. ambassador to Mexico Roberta Jacobsen has unexpectedly announced her retirement. .
Finally, I'd like to once again point out the great resource that our friends at the Business Council of Canada have developed which demonstrates the dollar value of each U.S. state and individual Congressional district's exports to Canada. The annual value of U.S. exports to Canada is $321 billion, and $13.8 billion in the PNWER states alone. We encourage you to utilize this resource - http://thebusinesscouncil.ca/canada-us-partnership/
Olympia, WA | Jan 16-17
Brief Overview on Topics, including:
- North American Free Trade Agreement (NAFTA)
- The Columbia River Treaty
- Cascadia Innovation Corridor
- Carbon Tax
- Presentation on Invasive Species (PPT)