The American Petroleum Institute (API) supports the proposed reforms for the North American Free Trade Agreement (NAFTA), as it will help sustain and strengthen the energy market in North America, API CEO Jack Gerard said.
Consumers will also benefit from the intended changes for the trading scheme, Gerard added. The association, which developed the internationally-recognized API 653 tank inspection standards, believes that modernizing NAFTA will be crucial in keeping the oil and energy industry and 9.8 million jobs afloat.
The U.S. government recently began negotiations for modernizing the 23-year-old trade deal. Its top priority for the talks involves a lower trade deficit with Canada and Mexico. To achieve this, the country will need to have improved access for its export products to its trade partners. Other priorities include establishing a dispute arrangement that will help settle anti-dumping and anti-subsidy grievances of U.S. firms.
While changes are necessary, Gerard said that keeping some of initial NAFTA’s benefits are important since they have been a great help in maintaining low fuel costs. Other benefits that remained in the pact include a protection for U.S. companies when settling investment disputes while ensuring that these firms receive fair treatment at the same time.
The proposed changes include a novel concept by the U.S. government, which seeks an “appropriate” provision against currency manipulation. In a 17-page document, proponents of the said reforms believe that manipulating currencies creates an unfair competitive edge.
Industry sources also noted that officials from the three NAFTA countries would likely meet in mid-August. In the meantime, trade experts suggested that increasing U.S. savings are a better alternative to reduce the country’s trade deficit under the trade deal.
The NAFTA trade deal has helped its members’ trade activities to be intact over more than two decades. With these changes, API and the rest of the U.S. sector are hoping for a stronger relationship between the U.S., Canada, and Mexico.