- Title: Winners, losers from new USMCA trade deal
- Date: 25th October 2018
- Summary: WASHINGTON, D.C., UNITED STATES (RECENT) (REUTERS) (SOUNDBITE) (English) BROOKINGS INSTITUTION SENIOR FELLOW, JOSHUA MELTZER, SAYING: "The gains and losses are very incremental. I mean this really just a small updating of that agreement in some respects." ROSSER, MANITOBA, CANADA (RECENT) (REUTERS)) VARIOUS OF DAIRY FARMER SQUEEZING COWS' TEATS COW PRODUCING MILK
- Embargoed: 8th November 2018 14:31
- Keywords: dairy market Canada auto makers trade deal trade negotiations Giacomo Santangelo China cows car buyers USMCA Donald Trump Joshua Meltzer Nafta Mark Stephenson U.S.-Mexico-Canada Agreement TransPacific Partnership
- Location: ROSSER, MANITOBA, ST. CLAUDE, MANITOBA + OTTAWA, ONTARIO, CANADA; MEXICO CITY, MEXICO; WASHINGTON D.C. + NEW YORK, NEW YORK + MADISON, WISCONSIN + FLINT, MICHIGAN + LOS ANGELES, CALIFORNIA, UNITED STATES; BEIJING, CHINA
- City: ROSSER, MANITOBA, ST. CLAUDE, MANITOBA + OTTAWA, ONTARIO, CANADA; MEXICO CITY, MEXICO; WASHINGTON D.C. + NEW YORK, NEW YORK + MADISON, WISCONSIN + FLINT, MICHIGAN + LOS ANGELES, CALIFORNIA, UNITED STATES; BEIJING, CHINA
- Country: USA
- Topics: Government/Politics,International Trade
- Reuters ID: LVA00593KFS7H
- Aspect Ratio: 16:9
- Story Text: Trade negotiations always have their sacred cows. Canada gave up little access to its dairy market and left its protectionist system in place, making Canada one of the winners in the U.S.-Mexico-Canada Agreement, what some call Nafta 2.0. Include President Donald Trump, who can boast about getting a trade deal done before the mid-term elections.
But for the U.S. economy, compared to the Trans-Pacific Partnership trade deal that Trump scrapped, Brookings Institution senior fellow Joshua Meltzer said the changes brought about by the new trade agreement are minor. Meltzer said, "The gains and losses are very incremental. I mean this really just a small updating of that agreement in some respects."
The U.S. couldn't squeeze a lot out of the dairy talks. Canada agreed to open less than 4 percent of its dairy market to U.S. farmers, not a big dent considering Wisconsin alone produces more milk than what's consumed in all of Canada.
University of Wisconsin-Madison director of dairy policy analysis, Mark Stephenson, said, "For the U.S. dairy producers, again, you have to look at this as a small win. It's not going to add much money at all to milk producers' checks and what it does add is going to be out there some time. It's phased in over a six-year time period. Probably pennies, nickels, and producers milk check, not much."
U.S. auto makers and car buyers could stand to lose. The deal will result in more car parts sourced from the U.S. and Canada instead of lower wage Asia. Add to that the steel and aluminum tariffs that are still in effect, and manufacturing costs could go up.
Fordham University senior lecturer in economics, Giacomo Santangelo, said, "Costs absolutely go up. That gets passed on to the consumer. For example General Motors is not going to eat the increased cost of having more of the car produced in the United States. But on the other side, people in favor of the USMCA will say, 'But costs won't go up by that much.' But again costs will be going up."
Another potential loser: China. The USMCA aims to forbid the three trading partners from entering free trade deals with "non-market" countries. Brookings' Josh Meltzer said, "China is also going to find that now that this agreement has been concluded, there'll be a lot more focus I think on the bilateral trade issues and the ratcheting up of tariffs and tensions on that front. And one would expect that with this new found confidence after having completed this agreement that the administration will continue to push China hard on this front."
Those U.S. trade talks with China appear to be in hiatus for now. - Copyright Holder: REUTERS
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