U.S. Rejects 16-Year USMCA Extension but Keeps Pact in Force Until 2036

The United States decided not to extend the United States-Mexico-Canada Agreement until 2042, the Office of the United States Trade Representative said on July 1. July 1 marked the deadline for the three countries to agree on an extension. The USMCA therefore remains in effect and will undergo annual reviews for the next 10 years until it expires in 2036, unless the parties reach another agreement.

U.S. Trade Representative Jamieson Greer said the United States will continue to engage with Mexico and Canada to address the agreement's shortcomings and trade deficits. "However, the agreement remains in force pending resolution of these issues or until the agreement's termination," Greer stated.

President Trump signed the USMCA into law in 2020, replacing the 1994 North American Free Trade Agreement. The pact requires that 75 percent of each vehicle be produced in North America to avoid import duties. A senior Trump administration official said the USMCA has not eased the U.S.

"We believe that the USMCA does not operate to control the deficit like the president intended," the official said. The Office of the U.S. Trade Representative said the United States is scheduled to meet with Mexico the week of July 20 to discuss rules of origin, intellectual property, and Mexico's compliance with labor obligations.

Canada and Mexico last month sought a 16-year extension of the pact. The Trump administration could decide to withdraw from the USMCA before 2036, though that step would likely depend on the outcome of further talks.