The most awaited new version of NAFTA (North American Free Trade Agreement), i.e. USMCA (United States–Mexico–Canada Agreement) has put one step forward to its realization. As it gets cleared through the House of Representatives, a clearer picture is emerging. As far as the provisions go, it has become the first American trade agreement that has a clear and distinctive chapter on digital trade.
The tech industry is believed to be very optimistic about this deal as it has been allegedly facing discrimination from the member nations. The industry also hopes that this agreement should become a base for many more future deals. Here are the three major points on which the deal is being lauded by the tech industry.
Free Flow of Data-
The outline of the agreement calls for the free flow of data between the three nations. The sharing of data has been on the contention for long. It has been getting resistance from Canada specifically.
Data Localization refers to the storing of data locally. This mandate is impacting many big tech companies like Amazon Web Services, Microsoft Azure, and Google Cloud Platform. The USMCA calls for no more data localization mandates by the member nations. Cloud Companies have been calling for this ban as it is likely to enhance the way of operation.
This point has been one of the most controversial parts of the agreement. It gives the tech companies or social media platform legal immunity for the contents that have been created by its users. This point faced initial resistance from the House Speaker Nancy Pelosi. However, after much debate and discussions, she seems to have come on the board.
The biggest advantage of the agreement is going to be fetched by the business houses as it would give them certainty on the legal regulations by the member nations. They can start investing more without worrying about any unprecedented change overnight. This may lead to a higher American GDP and some degree of job creation. As per analysts, the USMCA may boost the American GDP by 1.2% and create 589,000 jobs in total. This is considered a huge victory for the whole tech industry and business houses as there has not been any mention of the word “Internet” in the current version of NAFTA.