Mexico's Soto Speaks on NAFTA at 25, New USMCA Agreement

Mexico's Soto Speaks on NAFTA at 25, New USMCA Agreement

If there’s one acronym that sums up recent business trade history involving the United States and its neighbors to the north and south, Canada and Mexico, it’s unquestionably what’s transpired under the North America Free Trade Agreement, better known as NAFTA.

Ahlers April 23 International Speaker Series

The trilateral trade accord signed by Canada, Mexico and the U.S. went into effect on Jan. 1, 1994, 25 years ago. It actually grew from an initial bilateral agreement that the U.S. and Canada signed and started Jan. 1, 1989 and then Mexico joined in the negotiations two years later to begin the process that eventually became NAFTA.

Multiple decades later, though, things change. People change. People in charge of the decisions change and countries change.

Today, there’s a new agreement at the forefront, one signed in November 2018 involving current U.S. President Donald Trump and his administration. Known as the USMCA (United States-Mexico-Canada Agreement), it signals NAFTA’s conclusion.

On April 23, the University of San Diego School of Business’ Ahlers Center for International Business hosted Guillermo Malpica Soto, head of the Trade and NAFTA Office, Ministry of Economy, Embassy of Mexico, as part of Ahlers’ International Speakers Series.

Soto’s talk centered on three main areas: discussing the results of NAFTA after 25 years, challenges he sees with USMCA and next steps in bilateral trade relations.

In his current role, which he’s been in under two years, Soto did express his thankfulness of having something foundational in place when things do change. “You have to have a long-term view of this,” he said. “The trilateral relationship and investment relationship is longer than any administration we have.”

But, Soto indicated, “After 25 years of NAFTA, it was time to update the agreement as many provisions had become obsolete. In this process of renegotiating USMCA we came up with new chapters on digital trade, sustainable energy, telecommunications” and more.

However, “The negotiation of NAFTA 2.0, or USMCA, was very different because each country had a different view of what the new agreement should be.”

The history of trade relations between the North American countries has been successful in some areas and difficult in others, but again, having agreements bilaterally between the U.S. and Mexico, Mexico-Canada and U.S.-Canada are also important to compete globally.

“We have an intertwined production process in the region between Mexico, the U.S. and Canada and we believe that this is a competitive advantage for our region to compete as a bloc in our global economy,” Soto said.

But there’s little to deny that when the respective countries’ government leadership and administration philosophies change, anything is possible in the foreseeable future.

From Soto’s perspective of Mexico, “the position of the current administration in Mexico in relationship to the U.S. is that we are neighbors and we will continue to be friendly as we need to coexist.”

Among those in attendance to listen to Soto's talk were more than 40 students from Tijuana's CETYS.

Ahlers International Business Speaker Series

Guillermo Malpica Soto’s talk on NAFTA and USMCA concluded the Ahlers Center’s Spring 2019 speaker series.

He was preceded by Joseph Bradley, Global Vice President, Customer Experience, Incubation Services and Technology, Cisco, whose Feb. 20 talk was titled, “Do People Matter in the Digital Era: The Power of Digital Humanism to Balance Value and Ethics”; and a March 12 co-presentation by Jane Mosbacher Morris, CEO and Founder, To The Market, and Dr. Helder Sebastiao, Innovation Strategist and Lean Launch Specialist, HJS Consulting, who discussed “Selling the Change People Say They Want: Lessons Learned Making Global Supply Chains More Ethical and Transparent.”

For more information on the Ahlers Center program, an archive of past International Business Speaker Series events (view videos) or other aspects of the School of Business’ international center’s resources, visit the website.

— Ryan T. Blystone and Renata Ramirez

Photos by Ryan T. Blystone and Renata Ramirez

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