Now that all three countries have ratified the US-Mexico-Canada Agreement (USMCA) and it’s set to go into effect on July 1, business leaders should be thinking about the details that need to change to comply?
PwC surveyed more than 400 C-suite executives to see how USMCA is changing how they do business.
More than half of executives surveyed know what to expect from the new trade deal, but they may not realize all the steps needed. Whether it’s changing over forms or revisiting the supply chain, complying with USMCA can have a greater business impact than they think. But time to prepare is now. A good first step is to evaluate how your business is employing NAFTA to currently limit your exposure to tariffs.
Once you know how you’ve been compliant with NAFTA in the past, you should assess whether your firm can meet new requirements under USMCA. This isn’t a one-department job; you should bring together a variety of different functions to help enable a smooth transition from NAFTA to USMCA. Tax, supply chain, and customer/supplier relations are the top three areas coordinating with compliance teams at companies.
Put automation in place to manage your supply chain and help make it more flexible.
Assess the impact your company makes on the environment — from emissions to the impact on marine life — and see where you can increase efficiencies.
Reconnect with your suppliers and make sure they are also thinking about compliance.
Think about wage requirements when hiring new workers. Some industries are required to pay certain workers a rate of $16 per hour.
Assess whether it’s still cost efficient to maintain manufacturing in certain locations.
Evaluate our supply chain
Adjust the sourcing of our products that were previously subject to NAFTA
Raise environmental standards
Hire new workers
Source: PwC USMCA C-suite Pulse Survey, February 2020