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News: Pipeline

CIPH Recommendations: NAFTA

July 27, 2017  
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Trade agreements are critical to the economic success of Canada and no agreement has been more significant since its inception than the North American Free Trade Agreement (NAFTA).

 

Given that understanding the operating environment is critical to business planning we need to be critically aware of possible changes to this agreement and the processes by which we can exert our influence.

 

Since the US has threatened the agreement as it currently stands, the Canadian government has been proactive in learning about different facets that are key to continuing economic success. They have encouraged Canadian businesses and industries to share what matters most to them, and CIPH, on behalf of members, has identified some key issues that are important to industry prosperity.

 

Four key recommendations were put forward that could strengthen any agreement for our industry: 

 

Recommendation # 1: Revise NAFTA without Commercial Disruption

As simple as it sounds this is critical. Any change has many cascading effects and we need those negotiating the agreement to appreciate that business is ongoing.

 

Recommendation # 2: Facilitate Harmonization of Product and Performance Standards by Properly Defining “International Standards”

When the original NAFTA was drawn up it did not do enough to acknowledge international standards in terms of testing and efficiencies for equipment. This is a significant opportunity to expand the language and reduce redundancies.

 

Recommendation #3: Align Conformity Assessment Procedures

Like the above, any changes to the agreement should increase alignment so that unnecessary duplication is eliminated from the system and no individual participating country can use it as a barrier to market entry.

 

Recommendation #4: Modernize the rules of origin to reflect the more complex supply chains today.

Globalization has increased significantly and this needs to be reflected in any new agreement.  New rules need to reflect the interrelatedness of many businesses that could not have been anticipated when the agreement was formed and to respond to the realities of supply chains as they exist.

 

The opening of trade agreements are unique opportunities. North America has always been a dynamic market given the interdependence and size of the countries involved. Canada, true to its roots, is looking to engage in ways that will create a fair environment for all business operators and we hope it will consider the recommendations put forth by the association as it executes its strategy.

 

For the complete letter of recommendations submitted to NAFTA Secretariat, Canadian Section click here


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