U.S. Will Not Renew USMCA Trade Deal, Will Conduct Annual Reviews

The United States decided on Wednesday not to renew its trilateral trade agreement with Mexico and Canada. A senior U.S. administration official told reporters the country would not rubber-stamp renewal in its current form. Instead, Washington will conduct annual reviews of the deal’s conditions until its term expires in 2036. The reviews open the door for new trade negotiations.

Background on the agreement U.S.

President Donald Trump first proposed the United States-Mexico-Canada Agreement during a 2018 G-20 summit as a replacement for the North American Free Trade Agreement. Trump described the deal in 2020 as the fairest and most beneficial trade agreement the United States had signed.

Mexico and Canada had both expressed support for extending the agreement ahead of the renewal deadline. Trump later said the pact had not done enough to reduce U.S. trade deficits with the two countries.

Mexico have already begun new talks, with a third round scheduled for July 20 in Mexico City. Similar conversations with Canada have not started. U.S. Trade Representative Jamieson Greer said the administration will continue to engage with Mexico and Canada to address the agreement’s shortcomings.

Mexican Economy Secretary Marcelo Ebrard warned that repeated reviews could create instability and deter investment.