WASHINGTON — President Trump has decided not to renew the United States-Mexico-Canada trade pact that he negotiated during his first term, US Trade Representative Jamieson Greer said Wednesday.
Trump celebrated USMCA as “truly fair and reciprocal” when he signed the deal in 2020, but he has recently been more critical, making the action unsurprising.
“We think there are substantial issues,” Greer told Bloomberg News in an interview shortly before a scheduled call with a broader group of news outlets where an official who declined to be identified by name made the same point.
The USMCA won’t actually expire for at least 10 years — well after Trump leaves office — but the non-renewal triggers a decade of limbo featuring annual renegotiation, starting with a July 20 summit.
The official who refused to be quoted by name said that Trump’s decision was primarily motivated by US trade deficits with Canada and Mexico.
“The USMCA did not operate to control the deficit like the president intended, so that’s really the heart of it,” the official said.
“And part of it also extends to market access opportunities in Canada and Mexico.”
The official cited batting down Canadian tariffs on US dairy products and Mexican interest in tariffing US corn as areas of focus — along with adopting a new rule requiring cars made in Canada and Mexico to have a certain percentage of US-origin material to be exempted from tariffs.
“We think we need to tighten those [car origin] rules, and we think we need to have similar robust rules for other industrial goods outside of the automotive space, and we’ve heard from the Mexicans that they are interested in this,” he said.
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“Our expectation too is that some of these rules of origin we do expect to have some US content level… What we don’t want is a situation where we make a deal with Mexico, we have tariffs on the rest of the world from fine, and [companies are] going to move everything to Mexico and import it to the US duty-free.”
Although a seemingly significant milestone, the official said the non-renewal actually wasn’t as major as it seems because Trump’s other trade policies had “subsumed” the pact.
“He’s already, I would say, subsumed USMCA under new trade and tariff policies,” the official said, adding, “We’ve been working, particularly with the Mexicans, over the past year to resolve a lot of issues that have been there.”
