WASHINGTON -- North American trade officials say harmonizing regulations and improving infrastructure at ports of entry are just as important as trade agreements to facilitate cross-border goods movement.
Talks to modernize the North American Free Trade Agreement are expected to start this year, with potentially huge implications for the auto industry. Newly confirmed U.S. Trade Representative Robert Lighthizer officially notified Congress last week of the administration's intention to renegotiate the 23-year-old accord.
But if shipments can't easily cross land borders between the U.S., Mexico and Canada because of regulatory and other hurdles, the potential benefits of an improved trade agreement will be undercut, the officials argue.
"Trade facilitation and regulatory harmonization are the only way that we can continue to remain competitive," Geronimo Gutierrez Fernandez, Mexico's ambassador to the U.S., said last week at a supply-chain forum here hosted by the U.S. Chamber of Commerce.
The auto industry has developed a shared production platform in all three countries, and stakeholders envision a day when finished vehicles and components cross international borders as seamlessly as they move across state lines.
Inefficient customs clearance, inadequate infrastructure and complex rules -- especially on the southern border where multiple handoffs between long-haul and cross-border shuttle trucks are the norm -- create delays and add costs for manufacturers.