{"id":3559,"date":"2026-07-01T19:07:08","date_gmt":"2026-07-01T19:07:08","guid":{"rendered":"https:\/\/southfloridamovingguides.com\/?p=3559"},"modified":"2026-07-01T19:07:08","modified_gmt":"2026-07-01T19:07:08","slug":"us-canada-and-mexico-begin-bumpy-negotiations-to-renew-north-american-trade-pact","status":"publish","type":"post","link":"https:\/\/southfloridamovingguides.com\/?p=3559","title":{"rendered":"US, Canada and Mexico begin bumpy negotiations to renew North American trade pact"},"content":{"rendered":"
\n

WASHINGTON (AP) \u2014 Tourists from Chattanooga check into beach resorts in Cancun. Canadian auto parts feed factories in the American Midwest \u2014 and vice versa. Happy hour revelers raise glasses of Mexican tequila and mezcal at bars in Seattle.<\/p>\n

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It adds up. The United States trades $1.9 trillion a year \u2014 $5 billion a day \u2014 worth of goods and services with its neighbors, Canada and Mexico. They have supplanted China as America’s top two trading partners.<\/p>\n

So the stakes are high when it comes to fiddling with the rules that govern trade between the three countries. And after a year of President Donald Trump\u2019s chaotic tariff policies, many U.S., Canadian and Mexican businesses would welcome the return of stability across North America.<\/p>\n

They are not likely to get it.<\/p>\n

The regional trade pact \u2014 the U.S.-Mexico-Canada Agreement or USMCA \u2014 that Trump negotiated and boasted about in his first term comes up for renewal Wednesday, a process that is likely to last months, maybe longer.<\/p>\n

And the path forward is lined with landmines.<\/p>\n

\u201cThere\u2019s going to be a lot of drama this summer,” Diego Marroqu\u00edn Bitar, a fellow in the America\u2019s program at the Center for Strategic and International Studies, said last week at a USMCA forum sponsored by the Cato Institute.<\/p>\n

A bumpy road ahead for North American trade<\/p>\n

The U.S. is making demands that could effectively force Canada and Mexico to surrender some automaking production to the United States. That might bring more auto factory jobs to the United States. But it would also upend established supply chains and would push up U.S. prices for new cars that now average nearly $50,000 at a time when American consumers are already furious about the high cost of living.<\/p>\n

Trump, characteristically, has added to the tension by threatening to pull out of his own agreement altogether.<\/p>\n

In 2020, the USMCA replaced the 1994 North American Free Trade Agreement, which tore down most trade barriers between the three North American countries.<\/p>\n

Trump and other critics had called NAFTA a job killer because it encouraged U.S. companies to move factories south of the border to take advantage of low-wage Mexican labor, then ship goods back to the United States duty free.<\/p>\n

His USMCA ended up being similar to NAFTA \u2014 though it pressured factories to pay higher wages and make sure that more of what they made originated in North America in an effort to prevent Chinese products from slipping across regional borders duty free.<\/p>\n

North America trade deal is up for renewal<\/p>\n

The USMCA included a novel provision requiring the pact to be renewed every six years. That deadline is Wednesday, but \u201cnothing is going to happen July 1,\u201d said Oscar Ocampo, director of economic development at the Mexican Institute for Competitiveness.<\/p>\n

Negotiators could agree Wednesday to renew USMCA as it is for another 16 years \u2014 until 2042. But that is considered highly unlikely. Instead, they are expected to keep working on ways to improve it; they have until the current term ends in 2036 to reach an agreement. Otherwise, the pact expires.<\/p>\n

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Meantime, any USMCA country can pull out of the pact provided it gives its two partners six months\u2019 notice \u2014 a red buzzer that Canada and Mexico, dependent on trade with the United States, fear Trump just might push.<\/p>\n

Trump, after all, said in June that he was \u201cnot looking to renew” the trade pact with Canada and Mexico. “We don\u2019t need anything that they have,\u201d he said.<\/p>\n

Ocampo suspects that Trump doesn’t really want to drop the treaty; he just wants to use the uncertainty to keep pressure on Mexico over security and immigration issues.<\/p>\n

Canada is out in the cold<\/p>\n

The United States and Mexico have held talks on renewing the trade agreement. But Canada has so far been stuck on the sidelines.<\/p>\n

Patrick Childress, a partner at the Holland & Knight law firm and a former U.S. trade negotiator, said: \u201cThe danger for Canada is this: that the U.S. government and the Mexican government reach agreement on changes to core provisions of the treaty and then show up in Ottawa and say: \u2018Here\u2019s what we\u2019ve agreed to. You can take it or leave it.”\u2019<\/p>\n

Canadian Prime Minister Mark Carney said that the three trading partners plan to meet virtually on Wednesday, adding: \u201cI\u2019m not looking for my pen.\u201d<\/p>\n

Carney later said in French his priority is to update the USMCA.<\/p>\n

Pushing production to the United States<\/p>\n

The U.S. wants a refreshed trade pact to do more to make sure that Chinese goods don\u2019t get in through the back door.<\/p>\n

But the most contentious issue is that the U.S. is also seeking a brand-new requirement: that 50% of cars be made in the United States, Carney confirmed in early June. Currently, none of the USMCA countries gets a guaranteed share of production. \u201cIt\u2019s a red line for both Mexico and Canada, and it goes against the spirit and the letter of regional integration,\u201d Ocampo said.<\/p>\n

Marcos Carias, economist at the credit insurer Coface, said only 1 in 5 Mexican and Canadian cars imported into the United States would currently meet the 50% standard.<\/p>\n

Vehicle models likely to be hit with higher costs under the plan, he said, include Ford\u2019s Maverick compact pickup truck, Chevrolet\u2019s mid-size Equinox SUV and some Nissan sedans \u2014 all made in Mexico. Carias\u2019 \u201cback of the envelope” calculations suggest that prices could increase 5% to 7% on the most-affected models.<\/p>\n

____<\/p>\n

AP Writers Maria Verza in Mexico City and Rob Gilles in Toronto contributed to this story.<\/p>\n

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WASHINGTON (AP) \u2014 Tourists from Chattanooga check into beach resorts in Cancun. Canadian auto parts feed factories in the American Midwest \u2014 and vice versa. 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