September 25, 2017

In Case You Missed It: U.S. Commerce Secretary Discusses NAFTA Rules Of Origin

In a Washington Post opinion column published last week, U.S. Commerce Secretary Wilbur Ross outlined the Trump administration’s arguments for changing North American Free Trade Agreement (NAFTA) rules of origin. Secretary Ross argued that NAFTA rules of origin provisions “were intended to restrict the non-NAFTA content in final goods,” but since the agreement was signed 23 years ago “the opposite has … happened.” Therefore, to improve NAFTA for U.S. manufacturers, the Trump administration believes that a renegotiated NAFTA must raise the total NAFTA content requirement and also must increase the U.S. share of that requirement.

Secretary Ross concluded his column with this statement: “If we don’t fix the rules of origin, negotiations on the rest of the agreement will fail to meaningfully shift the trade imbalance.”

As a reminder, in written testimony submitted to the Office of the United States Trade Representative, the Metals Service Center Institute (MSCI) argued that U.S., Canadian, and Mexican NAFTA negotiators must “tighten and expand rules of origin standards to prevent parts from other countries [from] being assembled and shipped into the United States.” Click here to read MSCI’s full testimony.

The third round of discussions between the United States, Canada, and Mexico regarding how to update NAFTA began over this past weekend in Ottawa, Canada.