With 70% of North American trade by value, transported by truck, international road transport has never been more important and CUSMA (Canada-United States-Mexico Agreement) that went into force in 2020 has helped modernize trade rules and mechanisms.
Mark Seymour, CEO Kriska Transportation Group, said a great example of cooperation is the pre-clearance initiative ahead of truck arriving at border. He said the Free and Secure Trade program, Customs-Trade Partnership Against Terrorism, Automated Commercial Environment and Advanced Commercial Information have made a tremendous difference getting back and forth from the border.
Out of sync
He pointed out things that have not gone well too. He said the U.S. and Canada were not in sync when announcing the vaccine mandate for cross-border truck drivers, and it may have led in part to frustration that paralyzed the Ambassador Bridge connecting Ontario and Michigan for some time.
Seymour also questioned why, as a Canadian, an empty trailer move in the U.S. is considered cabotage. “It is not something we want to do because it helps us, although it does, but more importantly it helps our customers, and they want us to be able of do that in name of efficiency.”
Radu Dinescu, president of the International Road Transport Union (IRU) that hosted the forum, said it provides a setting where industries and government can discuss ideas. “Road transport plays an essential part in trade, and as trade continues to grow, we must work together to facilitate commerce,” he said.
CUSMA is a fresh start in the North American trade relationship, said Daniel Watson, assistant U.S. trade representative, western hemisphere. Every agreement has a honeymoon period, where for example, tariffs are eliminated, but over time it starts to wane. He said the new deal has renewed energy on high-level engagement.
Luz Maria de la Mora, Mexico’s undersecretary for trade at the ministry of economy said the pandemic made it clear how collaborative action makes us stronger, despite how the three countries tackled Covid differently.
“We were able to overcome hurdles that were on the road,” the Mexican official said. She believes this agreement will be crucial in providing logistical advantages and cut red tape.
Like NAFTA, CUSMA will also become outdated, said Derek Leathers, chairman, president and CEO, Werner Enterprises. His trucks operate in all three countries and expressed the need for a forum to voice concerns about the impact of autonomous trucking, electrification, diesel fuel standards, hydrogen fuel, and dual fuel beta tests.
Leathers said there were also a lot of misses during the pandemic, and it is important to get industry, the three governments and border procedures on the same page. All three economies could benefit if the ability to cooperate, coordinate, and standardize is on display. “Look for opportunities to standardize approach,” he said.
Watson said CUSMA has much broader support than NAFTA because of the innovations that were made, strengthening the labor and environment provisions, and modernizing the agreement. “Maintaining support will rest on how well we implement it and see results from it,” he said.
Rojas Martin, IRU’s senior advisor for the Americas, moderated the webinar. He said the North American Free Trade Agreement was established before e-commerce, digitization, and innovations. CUSMA is an opportunity to modernize rules and processes for cross-border operations, trade facilitation and operational rules. He hoped it becomes a forum to share knowledge for industry and government and offer the freshest information to the supply chain.