USMCA (NAFTA 2.0): Tightening the Constraints on the Right to Regulate for Public Health

In 2018, the United States (US), Canada and Mexico signed their ‘NAFTA 2.0’ agreement, referred to as the United States-Mexico-Canada Agreement (USMCA). The new agreement was the first major trade treaty negotiated under the Trump administration’s unilateral imposition of tariffs to pressure other countries to accept provisions more favorable to US economic interests. The agreement was widely seen as indicative of how the US would engage in future international trade negotiations.

A journal article in Globalization and Health by Ronald Labonté, Eric Crosbie, Deborah Gleeson and Courtney McNamara assesses the health implications of the USMCA. The authors conduct an initial reading of the entire agreements as well as multiple line-by-line readings of key chapters. The article compares the World Trade Organization (WTO) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) as comparisons to highlight changes in the USMCA.

The authors find that the USMCA expands intellectual property rights and regulatory constraints that will lead to increased drug costs, particularly in Canada and Mexico. It also opens up markets in Canada and Mexico for US food exports without reducing the subsidies the US provides to its own producers and weakens public health oversight of food safety. The agreement reduces regulatory policy space through new provisions on ‘technical barriers to trade’ and requirements for greater regulatory coherence and harmonization across the three countries. It puts some limitations on contentious investor-state dispute provisions between the US and Mexico, provisions often used to challenge or chill health and environmental measures. Ultimately, the USMCA places new, extended and enforceable obligations on public regulators that increase the power of corporate interests during the development of new regulations.