Rep. Phillips wants improvements to enforcement mechanisms, biologics patent provisions for USMCA

U.S. Rep. Dean Phillips (D-Minnesota) says he wants to see the proposed U.S.-Mexico-Canada Agreement strengthened in certain areas, but says the trade deal would be important for the state and local economy.

The agreement was presented by President Donald Trump last fall as an update to the North American Free Trade Agreement, but it has not yet come to a vote in the House of Representatives. A June 11 MarketWatch article said the Wall Street Journal reported that Mick Mulvaney, the president's acting chief of staff, said House Speaker Nancy Pelosi (D-Calif.) would not bring the deal to a vote without changes such as improved enforcement of rules to make Mexico's labor rights stronger.

Phillips, who represents Minnesota's 3rd District, told Minnesota Business Daily in an email interview that he is optimistic that Congress can get to a yes on the trade deal. He cited U.S. Trade Representative Robert Lighthizer as someone engaging with organized labor and congressional Democrats. However, the recent threat by Trump to impose tariffs on Mexico over immigration – a threat that was rescinded after working out a deal with the country – was a setback, Phillips said.

“We need the administration to quit with the unproductive rhetoric if they sincerely wish to see the USMCA become law,” he said.

Phillips said he wants to see enforcement mechanisms strengthened in the proposal, and has concerns about biologics patent provisions in it that he said would keep prescription drug prices artificially expensive for Americans.

The congressman did warn against letting the perfect stand in the way of the much-improved, however. He also stressed the importance of Canada and Mexico to Minnesota's economy and workers and that approval of the deal would give stabilization and encouragement to businesses as far as investment and boosting the area's economy, which includes small businesses and Fortune 500 companies.

“At the same time, we must ensure adequate protections for workers, consumers, and the environment are included so benefits of the agreement are broadly shared,” Phillips said.

Canada and Mexico combine for about 32 percent of Minnesota's exports and total about $7.2 billion, said Vicki Stute, vice president of programs and business services for the Minnesota Chamber of Commerce, in an interview with Minnesota Business Daily. There are about 250,000 jobs in Minnesota dependent on trade with those countries, she said.

The Minneapolis-St. Paul-Bloomington area's exports to Canada in 2017 totaled about $3.25 billion, according to the U.S. Department of Commerce International Trade Administration.

Stute said the USMCA would have updates to NAFTA in areas like technology, and would solidify the trading partnerships among the three countries involved.

A leader in the agriculture industry, American Farm Bureau President Vincent “Zippy” Duvall, said the USMCA would deal more with biotechnology than NAFTA, end what he called an unfair Canadian pricing plan in dairy, and give better access for the poultry industry.

Taking away the current ability to trade without tariffs in North America could cost Minnesota's manufactured goods exports extra taxes to the tune of $124 million to $778 million, according to the National Association of Manufacturers.

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