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Wednesday , November 14 2018
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Cornyn Urges USTR to Strengthen Agricultural Trade in NAFTA Negotiations

WASHINGTON — On Wednesday U.S. Senator John Cornyn (R-TX) joined a bipartisan letter to U.S. Trade Representative Robert Lighthizer, urging him to strengthen agricultural trade as the Administration prepares to begin negotiations to update the North American Free Trade Agreement (NAFTA).

“As Senators representing states with significant agricultural exports, we appreciate the careful approach the administration is taking to strengthen the NAFTA agreement, while ensuring that no changes are made that could result in harm to U.S. agriculture,” Sen. Cornyn and others wrote. “We look forward to working with you throughout the congressional consultation process to ensure that NAFTA continues its substantial economic contributions to U.S. farmers and ranchers and to the growth of our agricultural economy.”

Last month, the Trump Administration notified Congress of its intent to open negotiations with Canada and Mexico with respect to NAFTA.

The notification triggers a 90-day consultation period under the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA), and the Administration is required to provide specific negotiating objectives at least 30 days before any negotiations begin.

Since NAFTA was signed into law in 1993, Canada and Mexico have been two of the top five destinations for U.S. agriculture products. Last year, the two countries accounted for 28 percent of the value of total agriculture exports from the United States.

Since NAFTA’s enactment, livestock and meat exports to Canada have doubled and agriculture commodity exports to Mexico have increased significantly. South Dakota’s exports to Canada and Mexico have increased by $1.2 billion (969 percent) since NAFTA went into effect in 1994.

In addition to Sen. Cornyn, the letter is signed by Sens. Roy Blunt (R-Mo.), John Boozman (R-Ark.), Steve Daines (R-Mont.), Joni Ernst (R-Iowa), Deb Fischer (R-Neb.), Jeff Flake (R-Ariz.), Chuck Grassley (R-Iowa), John Hoeven (R-N.D.), Johnny Isakson (R-Ga.), Pat Roberts (R-Kan.), John Thune (R-S.D.), Claire McCaskill (D-Mo.), Jerry Moran (R-Kan.), Rob Portman (R-Ohio), Mike Rounds (R-S.D.), and Thom Tillis (R-N.C.).

Full text of the letter can be found below:

The Honorable Robert Lighthizer

U.S. Trade Representative

Office of the U.S. Trade Representative

600 17th Street, N.W.

Washington, DC  20508

Dear Ambassador Lighthizer:

As you prepare to begin negotiations to update the North American Free Trade Agreement (NAFTA), we write to emphasize the economic significance of agricultural trade between the United States, Canada, and Mexico and the critical role that NAFTA plays in the trade relationships.

NAFTA has been an important trade agreement for the United States for more than 20 years. While we strongly support continued participation in the agreement, we also support the administration’s effort to review and strengthen NAFTA.  Given the significance of agricultural products in U.S. exports, we request that you avoid any revisions to NAFTA and other previously negotiated trade agreements that would diminish the opportunities for U.S. farmers and ranchers to export their products, particularly given the current depressed state of the agriculture economy.

Since NAFTA was signed into law in 1993, Canada and Mexico have been two of the top five destinations for U.S. agriculture products.  Last year, the two countries accounted for 28 percent of the value of total agriculture exports from the United States.  Since NAFTA’s enactment, livestock and meat exports to Canada have doubled and agriculture commodity exports to Mexico increased significantly.  The longstanding trade agreement between the three countries has proven to be an important success within the agriculture industry.

As Senators representing states with significant agricultural exports, we appreciate the careful approach the administration is taking to strengthen the NAFTA agreement, while ensuring that no changes are made that could result in harm to U.S. agriculture.  We look forward to working with you throughout the congressional consultation process to ensure that NAFTA continues its substantial economic contributions to U.S. farmers and ranchers and to the growth of our agricultural economy.

Rep. Hurd: Mexico City Trip Strengthens Bilateral Relationship

WASHINGTON, DC – U.S. Representative Will Hurd joined a bipartisan group of 11 Members of Congress to Mexico City Monday for the U.S.-Mexico Interparliamentary Group (IPG) meeting.

While in Mexico, the group along with 15 Members of Mexico’s Congress, were inaugurated into the 53rd US-Mexico Interparliamentary Group and met with their counterparts to discuss our trade relationship, migration and human safety, national security cooperation and a 21st Century border.

“We have an enormous opportunity to work with our partners in Mexico to enhance the physical and economic security of people on both sides of the border,” said Hurd, who represents more miles of the U.S.-Mexico border than any other Member of Congress. “In a district that is both heavily dependent on cross-border trade and ground zero for energy production, I am especially optimistic about modernizing NAFTA to account for the digital marketplace and promoting North American Energy Security. I look forward to working with my colleagues to make sure Texans benefit from NAFTA renegotiation.”

Dring the meeting, members of the 53rd IPG also approved a Joint Declaration affirming the mutual benefits of shared understanding, respect, and cooperation in the areas of Immigration and Human Safety, Trade and Economic Relations, National Security and a 21st Century Border. Read the full Joint Declaration here.

Hurd was appointed to the IPG in February, which is tasked with fostering dialogue between members of the United States’ and Mexican legislative bodies on issues of bilateral importance. This week’s bipartisan delegation was led by House Homeland Security Committee Chairman Michael McCaul (R-TX).

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UTEP Report: Trade Ambiguity Triggers Lower Mexico Economic Forecast

The potential disruption in trade relations between the U.S. and Mexico was among the reasons why economists who monitor Mexico’s business cycle developments have lowered their 2017 projections of gross domestic product, according to UTEP’s Border Region Modeling Project.

“The Trump Effect” is the title of the fourth quarter Mexico Consensus Economic Forecast that reports a GDP growth rate projection of 1.4 percent, 90 basis points lower than the 2.3 percent rate predicted in September 2016.

The projection includes a climb in the short-term 28-day treasury certificates (CETES) interest rate to 5.9 percent in 2017, while the nominal peso per dollar exchange rate will average P/$20.70 next year.

“Currency market erosion of the peso usually translates into greater direct foreign investment in maquiladora-related manufacturing in Ciudad Juárez,” said Tom Fullerton, Ph.D., director of the BRMP and professor of economics.

“It is not clear, however, that such a dynamic will materialize next year due to Trump administration suspicions about international trade impacts on the national economy. Any investments in export-oriented manufacturing in Ciudad Juárez are also accompanied by additional warehousing and transportation investments in El Paso,” Fullerton Added.

This quarterly report is published by the BRMP, a research unit within Department of Economics and Finance in the College of Business Administration at The University of Texas at El Paso.

The report synthesizes macroeconomic forecasts from nine prominent banks, universities and other U.S. and Mexican institutions.