WASHINGTON — The Trump administration has initiated a review of trade agreements with Mexico and Canada, focusing on the United States-Mexico-Canada Agreement (USMCA) ahead of a mandated joint review in July 2026.
President Donald Trump said on Wednesday that he is “not looking to renew” the USMCA in its current form, citing concerns over trade deficits and other issues, according to reports. The agreement, which replaced the North American Free Trade Agreement (NAFTA), is subject to a six-year review provision that requires the three countries to decide by July 1 whether to extend it for another 16 years.
U.S. Trade Representative officials have indicated that the administration seeks concessions on trade imbalances, manufacturing, and non-trade matters including migration and drug trafficking. Mexico and Canada have formally expressed support for extending the agreement, with Canada requesting renewal on June 1 for another 16 years, describing it as beneficial to all parties.
The USMCA entered into force in July 2020 and governs about $1.8 trillion in annual U.S. goods and services trade with its neighbors. It includes updated provisions on digital trade, labor, environment and automotive rules of origin. The review process, outlined in the agreement’s terms, allows for potential revisions or a shift to annual reviews if full consensus on extension is not reached.
Trade experts and industry groups have noted the importance of the pact to North American supply chains, particularly in autos, agriculture and energy. Negotiations are underway on bilateral and trilateral tracks, with additional rounds scheduled in coming weeks. The administration has previously used tariffs on imports from both countries to address border security concerns, later exempting goods compliant with USMCA rules.
“USMCA is highly beneficial to each of our countries,” Canadian officials stated in communications regarding the review, while acknowledging possible areas for improvement.
Mexico has also indicated willingness to engage in discussions to maintain the framework. Details on specific U.S. demands for changes remain under discussion, with some analysts expecting emphasis on tighter enforcement of rules of origin and addressing Chinese influence in regional supply chains.
As of Thursday, no final decisions on extension have been announced. The three countries continue talks, with the possibility that failure to agree by the July 1 deadline could trigger a period of annual reviews leading up to potential expiration in 2036. Business groups have urged stability to avoid disruptions to cross-border commerce.
The U.S. Trade Representative’s office is expected to provide further updates following ongoing consultations with Congress and stakeholders.
