From NAFTA To USMCA: The New Deal and What’s Missing

by Rebeca Camacho
Staff Writer

On November 19, 2018, UC San Diego’s School of Global Policy and Strategy (GPS) hosted the one-day conference titled From NAFTA to USMCA: The New Deal and What’s Missing on the newest iteration of the long-controversial trade deal between Mexico, Canada and the United States. The conference was one of the last events in a series celebrating the thirty-year anniversary of GPS during the Fall 2018 quarter. From October 2018 through August 2019, there will be events in honor of the accomplishments of GPS, orchestrated to incite educational debates over multifaceted issues present in the international arena. A critical theme of the series is the future direction of United States foreign policy and the nature of international trade agreements in the 21st century, which was explored extensively at the “New Deal” event.

The event included several talks centered around the divergent interests of state and non-state actors affected by the new United States–Mexico–Canada Agreement (USMCA) deal, with the keynote address given by Jesús Seade—Mexican President López Obrador’s chief trade negotiator.

While the USMCA will account for more than $1.2 trillion in trade, the most important elements of the new deal can be summarized in five main points: country of origin rules and labor rule provisions in the automotive sector, regulatory changes in the Canadian dairy industry, intellectual property pertaining to digital trade, uplifting of section 232 “national security” tariff protections, and the establishment of a sunset clause. All three national leaders have signed the agreement, leaving only subsequent ratification by each nation’s respective legislature obstructing the passage of the first multilateral agreement since Trump and Obrador came into office.   

The most negotiated clauses in the deal were those pertaining to the country of origin rules, and the effect that such rules pose on the automobile industry.  The primary component of the rules of origin is that at least seventy-five percent of an automobile’s components (up from sixty-two percent under NAFTA) must be manufactured in Mexico, the United States, or Canada if they are to qualify for a zero tariff designation. In addition to this, forty-five percent of all production must be conducted at a minimum hourly wage of $16 by 2023.

Representing the Mexican perspective on the agreement, Beatrice Leycegui Cardoqui— former Undersecretary of Foreign Trade for Mexico’s Ministry of Economy who now works for the International Consulting firm SAI Derecho & Economía in Mexico City—called attention to the deal’s “poison pills.” Though the agreement may be “far from ideal,” she pushed Mexico to be pragmatic in accepting the new deal. She explained how with eighty percent of Mexico’s exports in the auto sector going to the United States and about ninety percent of U.S. imports in the industry coming from just south of the border, Mexico was left with little leverage to negotiate any modification of the rules of origin.

The overwhelming concern shared by Cardoqui and Seade revolved around how the new requirements will influence the reallocation of certain stages of production in car manufacturing, the distribution of labor income between borders and the eventual higher prices to compensate for increased production costs.

Through the question and answer portion of the first panel of speakers: remarks divided between Beatriz Cardoqui, Paola Avila (official representative of the San Diego Regional Chamber of Commerce) and Dr. Michael Hawes (political science professor and Executive Director of Fulbright Canada), the three representatives emphasized how the nature of White House negotiations is now more heavily shifting towards favoritism of bilateral accords.

With the primary trade negotiation meetings between the United States and its fellow deal members occurring separately, Avila warned that the “divide and conquer” approach taken by the United States is one the government may begin to employ more frequently and potentially as their primary negotiation model within the new paradigm of American foreign policy.

While President Trump has strongly advocated in favor of the USMCA, it remains to be seen whether or not the new deal will pass through the Democrat-controlled House of Representatives. With the Democrats objecting to parts of the deal— which must be passed in its entirety— the Trump administration is at risk of facing a taste of their own medicine and much of the same lack of compromise from Congress that they themselves previously exerted upon their North American trading partners.

Photo by:

UCSD School of Global Policy and Strategy

THE SHAPING OF A GLOBAL CITIZEN

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by Deborah Jeong

Staff Writer

The idea of a globalized world is well exemplified in the production trail of a simple t-shirt. From the cotton fields of Texas to the processing machines in China to being printed and sent back overseas to the United States, a video depicting the production process of a t-shirt served as the introduction to the ‘Global Forum: Shaping of a Global Citizen’ event. The idea of a “global citizen” emerges from a series of frequent and significant interactions between countries and individuals of different cultural and national backgrounds across the world. As part of the International Education Week, the International Studies Student Association (ISSA) co-hosted a Global Forum with I-House and the International Studies Program. The event hosted two guest speakers, Professor Nancy Gilson of the ISP Department at UC San Diego and fourth-year IS-Political Science student Alex Gunn, to share their insight on the keyword of the night: “global citizen”.

Alex Gunn is a current senior in the department of International Studies-Political Science, with a minor in Human Developmental Sciences. She studied abroad last year in Jordan, where she participated in refugee work while learning the Arabic language. Studying abroad for an entire year gave Gunn a unique opportunity to build relationships with the people she met. In comparing the characteristics of a tourist and visitor with the mindset of a global citizen, she explained that while a tourist is content to explore and enjoy their new surroundings, a global citizen will do all of that–and then take the extra step to truly immerse themselves in the local culture. Through enthusiastic story-telling, she wove the image of her cultural experience, describing the local schools she got involved with, UNICEF’s organization No Lost Generation and the close relationship she developed with her host family. Alex encouraged everyone, particularly students, to actively seek out opportunities to get involved in the community. She also advised students to take advantage of the programs offered at UCSD, including opportunities to study abroad and work at becoming an active, conscientious global citizen.

Professor Gilson, a professor in UCSD’s International Studies Program, delivered her presentation with a comfortable composure that engaged the audience. In contrasting the experience of present-day university students with her own, she praised the greater diversity and opportunities that we often have at our disposal. While she was growing up in a predominantly white neighborhood, Gilson rarely had the opportunity to interact with individuals that came from backgrounds different from her own. She went on to tell the story of her friend, Jean, who grew up in South Africa under apartheid and rather forcefully encouraged Gilson to get out of her own bubble and “go learn something.”

As she recounted a few travel stories, one story that stood out was her first experience abroad after earning her Ph.D. in Philosophy, to Taiwan. Notably, the year she went to visit was a very politically significant year for Taiwan: 1979 — the year that the United Nations (U.N.) decided to give China what had previously been Taiwan’s seat in the U.N. After a few weeks of being in Taiwan, an elderly gentleman came up to her and asked, “Why are you here?” He was clearly unhappy with the fact that she was a foreigner from a nation that, as part of the U.N., had just refused to recognize Taiwan as an independent nation. Gilson, rather than feeling insulted, decided that he was right — she had no real reason or purpose to be in Taiwan and decided to learn more about the foreign nation that she had decided to visit. She continued to account how she got to see, first-hand, the life of the people and for the first time experienced what it felt like to be an outsider — a minority.

Many years later, while visiting Istanbul, she was again reminded that despite her high level of education and apparent expertise, there was always more to be learned and new things to experience. She encouraged the audience to go somewhere that makes them uncomfortable, to learn the vernacular and idioms of foreign languages and to thoughtfully listen to the stories of those they meet.

Finally, Gilson defined citizenship as the legal expectation of the rights and privileges connected to status, where a global citizen has the right to privilege and protection under Human Rights Law — “the only law that circles the globe.” Gunn made a poignant point that in order to understand the value of our own privileges and protections, we need to expose ourselves to the circumstances of other people around the world. Both speakers urged the students in the audience to experience foreign cultures first-hand in order to, as Gilson aptly summarized, “learn to be uncomfortable, get over it and learn the tools to do something to have an effect in the world.”  

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ISSA/I-House and UCSD

DIGITAL INDIA: GROWTH AND CHALLENGES OF INDIA’S TECHNOLOGICAL BOOM

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by Pankhuri Prasad
Staff Writer

On Oct. 3, 2018, UC San Diego’s School of Global Policy and Strategy (GPS) hosted “Digital India: Opportunities and Challenges,” the latest event in a series celebrating the thirty-year anniversary of GPS. From Oct. 2018 through Aug. 2019, there will be events and activities to commemorate the accomplishments of GPS. These are designed to spark informative and meaningful conversations. A critical theme of the series is the fusion of technology and policy in the 21st Century, which was explored extensively at the “Digital India” event.

The event centered around a talk by Aruna Sundararajan, Secretary of the Indian Department of Telecommunications and Pacific Leadership Fellow. Sundararajan is a distinguished public servant with over three decades of experience in the telecom field. She talked about the current government’s ambitious project, “Digital India” which spans three fronts—services, infrastructure and public empowerment.

Sundararajan addressed the many public policy difficulties this project has brought upon India, which still faces the challenge of providing two-thirds of the population with access to the internet. Over the past two years, the telecom industry has transformed completely. With the emergence of new providers and competitive pricing, one can get two gigabytes of high-speed internet per day for as little as $3.50 a month. This means millions of Indians now suddenly have access to the internet and this has had a far-reaching impact. Many new businesses have emerged such as ride-sharing taxis, digital wallets and e-commerce portals. As a result of the project, increased social media use has led to direct, effective political interactions where you can see top government officials responding to complaints by citizens over Twitter. The process of digitization has been fast paced primarily due to “IndiaStack,” a set of standardized digital tools which allow governments, businesses and developers to utilize a unique digital infrastructure to solve one of India’s biggest problems—inefficiency. Something as basic as opening a bank account or renewing a driver’s license used to take months due to a combination of inflexible rules and archaic data collection methods. IndiaStack changed the status quo by utilizing internet access to provide software tools for paperless, cashless and digital service delivery.

According to Sundararajan, the process of digitizing India is unique because of the unprecedented aspirations attached to it. As a result, 1.3 billion people now feel they will be able to use the internet to change their lives for the better. Even a small business in a remote part of the country suddenly has the chance to make it big. However, it is important to remember that digitization, with all the great potential and ideas attached to it, has a dark side as well. Many Indians are resistant to the changes brought up by digitization. Traditional taxi drivers have engaged in violent attacks on drivers from Uber and other ride-share services. The government faces a massive challenge of curbing the spread of false information and its repercussions. Unsubstantiated information circulating over social media, such as allegations of child kidnappings, have led to incidents where mobs of people have lynched those accused to death.

The talk concluded with the speaker reiterating the need to promote innovation and manufacturing in order to sustain India’s growing digital-telecom appetite. Policy makers must account for factors such as cyber security, the spread of false information and the role of social media as they legislate on digital regulations. Access to internet and telecom services may have seemed like a luxury at first but it is now a necessity, if not a right, for people across the world. There are a lot of lessons to be learned from India’s story—a country with over 1.3 billion people and an intricate socio-economic setup. Increased government effort in actively digitizing all government services has been a major catalyst in changing India. Amid growing public concern about data privacy and mass surveillance, the talk was helpful in providing an insider’s knowledge about the evolution of India’s telecom sector.

Picture Reference: Digital India: Opportunities and Challenges. School of Global Policy and Strategy at UCSD, 2018.