Let’s Bring NAFTA Into the Digital Age

Forty-one million jobs across the United States depend on trade. If you look around your community, there is a good chance that either yours or one of your neighbor’s jobs exist because of it. Free trade has been a catalyst for economic growth and fuel for innovation across the globe. Historic trade agreements like the North America Free Trade Agreement (NAFTA) have been crucial to the economic success of the United States: today, 14 million U.S. jobs are tied to trade with Canada and Mexico.

Whether it is the farmer in Indiana, a small business in Florida, or an engineer in Silicon Valley, NAFTA has been vital to their success and ability to reach new customers and markets. Since renegotiations began last year, ITI has consistently emphasized the importance of this trade agreement and encouraged the administration to focus on the modernization of the decades-old agreement to adapt it to the fundamentally digital economy in which we live through new rules on digital trade, intellectual property, and trade in goods.

In 2016, U.S. companies exported $67 billion in technology goods to Mexico and Canada alone, and, in 2015, U.S. companies exported $400 billion of services that utilize information technology networks. NAFTA modernization is an opportunity to build on our strengths, enabling U.S. firms to export more, driving employment and economic growth at home.

The original NAFTA agreement put into place a framework that allowed for innovation, trade, and economic growth to flourish – that same opportunity exists today, and the renegotiated NAFTA can set a new standard for digital trade that will usher in even further growth and opportunity. We encourage the administration to take the appropriate amount of time to get the agreement right, as there is still a great deal of work to be done. We encourage the administration to find resolutions that boost the American economy for the NAFTA provisions on data localization, non-IP intermediary liability, de minimis thresholds and expedited customs procedures, balanced copyright and safe harbors, and increasing the ability of our companies to access the government procurement markets here and in Mexico and Canada.

ITI has been committed to these efforts since the beginning of the modernization process and has provided statements, testimony and other supporting documents that highlight our priorities to assist the administration as it progresses towards a modernized NAFTA:

  • In our comprehensive recommendations to the U.S. Trade Representative (USTR), ITI encouraged the United States to modernize NAFTA and support digital trade provisions.
  • In testimony at the ITC, ITI urged the U.S. trade commission to enable digital trade in NAFTA modernization. Our testimony emphasized the importance of the tech sector in U.S. exports, jobs, and competitiveness and the digital trade outcomes that we believe are essential for a truly modernized NAFTA.
  • In a recent blog post, we explained how a modernized NAFTA will support a more tech-enabled economy and outline which objectives need to be included in future negotiations.
  • In an op-ed in Morning Consult, we advised the Administration to stay focused on what is important for U.S. manufacturers, innovators, service providers, and workers by taking a pragmatic approach to the discussions and by securing strong outcomes on digital trade.
  • In a subsequent blog post, ITI expressed concern regarding the administration’s proposed changes to the government procurement chapter which would have a negative impact on the agreement.
  • We submitted a letter expressing the need for a strong and balanced approach to copyright in NAFTA.
  • These efforts build on a recent report by ITIF that identifies the importance of digital trade in an innovation-driven and high-tech economy.
Public Policy Tags: Trade & Investment