Global challenges, North American solutions

Initially planned for November 2022, the North American Leaders Summit (NALS), appears set to return on Jan. 9-10, 2023, in Mexico City. As is often the case, U.S. attention is elsewhere — Ukraine, the midterm elections, and runaway inflation — and our own neighborhood has been accorded a lower priority than it deserves. But for many of these same reasons, the meeting is an opportunity for the United States and its region that should not be missed.

Geopolitical competition is growing sharper, energy prices have shot up, the climate is shifting, and supply chains are shaky. These factors are forcing changes to the model of Globalization 1.0 as it emerged over the past three decades. Companies that long prioritized lower labor costs, logistical efficiency and working capital optimization above all else now must give greater weight to international uncertainty, a supply chain in disarray, and the pressing need for sustainability.

To prepare itself for Globalization 2.0, the United States should start closer to home — with a plan to create North America 2.0. 

In that light, the next North American Leaders Summit presents a timely opportunity to begin. President Biden ought to arrive in Mexico City with a bold vision for invigorating trilateral cooperation where that is needed and feasible — and for  bolstering U.S. leadership in the world through its broader neighborhood.

Instead of being seen as an opportunity to strengthen the United States, North America has too often served as a scapegoat for problems it undoubtedly caused in certain areas. It is blamed for shifting job markets or depicted as a source of insecurity. But it also has accounted for significant economic growth, job creation, and a massive increase in trade. In any event, the ample opportunities North America offers have not been grasped — and could again slip away absent inspired leadership informed by just how much the world is changing. 

Together, North America boasts an enviable array of strategic comparative assets to be developed in the new world order that is emerging. Our continental region has eminently favorable demographics, enormous conventional and renewable energy resources, and a massive and foundational shared production platform. While intra-regional disagreements certainly exist, it remains a zone of enviable geopolitical stability. North America’s societies are interwoven — and they share a widespread (if imperfect) respect for democratic values and practices. 

Together, trade among the three core North American partners — Mexico, Canada and the U.S. — now amounts to $1.5 trillion annually. Much of that is in advanced sectors like automobiles, aircraft, and medical devices. Services trade is booming, too. Because of the closely knit nature of North American economies, this trade provides greater economic benefit at home. Investments in Canada and Mexico amplify gains in the United States and vice-versa.

But to capitalize on those advantages, we need to rethink how the United States and its neighbors relate to one another. In fact, as supply chains are reconfigured and near-shoring is pursued, North America has never been more important for Canadian, Mexican, and U.S. business communities than it is right now. Better managed migration flows, coupled with real investments in workforce development and cross-border mobility, will boost our advantages and improve people’s well-being. Investments in infrastructure and regulatory coordination could make North American supply chains more efficient and stable than today’s far-flung, energy-hungry alternatives. North America can lead an energy revolution that adds to livelihoods while responding to climate change today.

The process of rethinking North America started with the renegotiation of the 1994 North America Free Trade Agreement (NAFTA) into the U.S.-Canada-Mexico Agreement (USMCA) of 2020. This update offered some real improvements in areas like digital trade and protection of workers’ rights. However, the USMCA emerged in the confrontational context of tariffs, border walls, and threats. As a result, the USMCA did not offer a platform for growing together — or an agenda to pursue it. 

Though these solutions are close to home, they too often are overlooked. Since the Second World War, the United States has cast its gaze far afield in keeping up with its geopolitical challenges, devoting inconsistent attention to its closest neighbors. Despite this neglect, there is no denying any longer the critical importance of Canada and Mexico — and the smaller countries of Central America and the Caribbean basin as well — for the United States’ own security and prosperity. Because our societies and economics are so interconnected, investments in these relationships can pay crucial, needed dividends at home.

Alan Bersin is a global fellow and the Inaugural North America Fellow at the Wilson International Center for Scholars. He served as Commissioner of U.S. Customs and Border Protection during the Obama Administration. Tom Long is associate professor of International Relations at the University of Warwick. Together, they are editors of the new book, “North America 2.0: Forging a Continental Future.”