United States, Mexico Start Discussions On USMCA Renewal

Representatives from the U.S. and Mexican governments launched negotiations last week on the required review of the United States, Mexico, Canada Agreement (USMCA). Canada was not involved in the discussions. Economy Minister Marcelo Ebrard announced on March 16 that his team would hold a preliminary virtual meeting between negotiators on March 17, followed by the first round of formal talks starting the next day.

According to Mexico Business News, Ebrard said planned to propose maintaining the trade deal and eliminating tariffs, and that steel tariffs will be the top item on Mexico’s agenda for the first formal round of conversations with the United States. He also said the discussions will address three main topics: reducing dependence on imports from outside the USMCA bloc, strengthening rules of origin, and strengthening the security of North American supply chains.

The Chicago Council on Global Affairs (CCGA) provided an assessment of the landscape for negotiations going into last week, noting that U.S. exports of goods and services to Canada and Mexico have increased by 56 percent since 2020, when the USMCA came into force. <Despite trade uncertainty, intraregional capital investment flows have also reached record highs, and Mexico and Canada — in that order — are now the United States’ top trading partners and most important customers for the large majority of US exports,” the CCGA explained.

The CCGA also explained the while U.S. Trade Representative Jamieson Greer “warned that there will be no ‘rubberstamp’ extension of the agreement if specific bilateral and trilateral ‘shortcomings’ are not satisfactorily addressed, the fact that the preparatory dialogue is beginning should be seen as a positive sign of what is expected to be vigorous U.S. engagement toward July’s formal review.”