Retailers outline priorities for NAFTA modernization

Digital commerce, customs and trade facilitation updates are critical

WASHINGTON – The National Retail Federation today submitted comments to the Office of the U.S. Trade Representative outlining retail’s priorities for the negotiation of a modernized North American Free Trade Agreement.

"The agreement has benefited U.S. importers and exporters, and more importantly, U.S. workers and consumers."

Matthew Shay
NRF President and CEO

“The agreement has benefited U.S. importers and exporters, and more importantly, U.S. workers and consumers,” NRF President and CEO Matthew Shay said in a letter to USTR Robert Lighthizer detailing the retail industry’s comments on NAFTA modernization. “We applaud the administration for the reevaluation of NAFTA. NRF and its members are very supportive of NAFTA, as well as other free trade agreements that not only open up sourcing opportunities for retailers to provide high quality products to U.S. consumers, but those that also open foreign markets for U.S. retailers to sell U.S.- made goods to foreign consumers.”

“Since the agreement was negotiated over two decades ago, it does not reflect today’s global value chain or many new ways of doing business in the global economy” Shay said. “A number of its provisions affecting ‘old’ ways of doing business need to be updated and modernized to reflect today’s business environment as well as what may come in the future.”

Broadly, retailers encourage the administration to: first do no harm to the existing trade relationship, keep the pact trilateral, conclude negotiations quickly and provide a seamless transition for any changes that are agreed upon. NRF notes that NAFTA has spurred economic activity supporting 14 million U.S. jobs in farming, manufacturing and a wide range of service sectors. 

The comment letter also outlines key principles on tariffs, rule of origin, customs and trade facilitation, digital commerce, labor and environment, and enforcement provisions that would improve trade and support better regional integration among the NAFTA partners.

NRF’s suggestions, while specific to Canada and Mexico, are also broad enough to apply to other U.S. trading partners. That is because retailers recognize that the modernized NAFTA will become a model for the Trump Administration’s efforts to negotiate future trade agreements with countries with which the U.S. does not yet have such agreements.

For further detail on retail’s priorities in a modernized NAFTA, click here.

Lighthizer officially notified Congress on May 18 that President Trump intends to renegotiate NAFTA, setting in motion the 90-day consultation clock under Trade Promotion Authority. USTR set today – June 12 – as the deadline for comments on the negotiating objectives, and will hold a hearing on June 27. Under TPA, negotiations with Canada and Mexico could begin in mid-August.

About NRF
The National Retail Federation is the world’s largest retail trade association. Based in Washington, D.C., NRF represents discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private-sector employer, supporting one in four U.S. jobs — 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy.