The review process of the USMCA will begin in the second half of 2025, in the context of the trade-tech war between the United States and China.
By: Roberto Morales
The administration of President Claudia Sheinbaum highlighted that with the U.S. Mexico CEO Dialogue 2024, held this Tuesday in Mexico City, the defense of the United States-Mexico-Canada Agreement (USMCA) began.
“We have the idea of maintaining the treaty with few modifications,” Sheinbaum said at a press conference, after a meeting with senior U.S. officials and about 240 CEOs from both countries, at a summit held at the National Palace.
Six years after its entry into force, in 2026, the USMCA will be reviewed and ideally renewed for a period of 16 years, until 2042.
During the review, each Party may make recommendations to the Free Trade Commission. The Commission will decide on these recommendations. To renew the USMCA, the three heads of state must confirm it in writing.
Claudia Sheinbaum held a press conference to share some details after the meeting with business leaders.
Claudia Sheinbaum held a press conference to share some details after the meeting with business leaders. Eric Lugo
Otherwise, annual reviews will be conducted from the sixth year until the end of the USMCA’s term (16 years). During this period, the Parties may at any time confirm their intention to extend the term of the Agreement.
“(The U.S. Mexico CEO Dialogue 2024 meeting) is the starting signal for the promotion and defense of the North American Free Trade Agreement,” said Marcelo Ebrard, Secretary of Economy, who accompanied Sheinbaum at the press conference.
“It is the starting signal for a better future, for increased investments,” Ebrard added.
Republican presidential candidate Donald Trump has stated that if he returns to the White House, he will seek not a review, but a renegotiation of the USMCA, which implies deeper changes.
“Upon taking office, I will formally notify Mexico and Canada of my intention to invoke the six-year renegotiation provision of the USMCA that I put in place,” Trump said last week during a speech at the Economic Club of Detroit.
Trump has also questioned China’s investments and trade flows to Mexico, often without providing data or with simplistic judgments.
Sheinbaum noted that in the meeting with business leaders, she detailed that the United States imports proportionally more inputs and components from Asia compared to Mexico’s corresponding purchases from that continent.
“The Mexican automotive sector imports 5.2% of the billions of pesos it produces from Asia; in contrast, the U.S. automotive sector imports 7.2% of what it produces from Asia,” she argued, as an example.
She then added: “It cannot be said that Mexico is importing from Asia and thus creating a distortion for the automotive industry. That is a hard fact.”
The U.S. Mexico CEO Dialogue was established in 2013 by the Business Coordinating Council (CCE) and the U.S. Chamber of Commerce (USCC), and is the main high-level interaction mechanism between the private sector and officials from both Mexico and the United States, with the aim of strengthening and promoting regional development and competitiveness.
“The trade agreement between the United States, Canada, and Mexico complements us, it does not create competition between us, it is a scheme of complementarity and also strengthens us to continue improving the economy of the entire continent and to be able to create a very important development pole,” Sheinbaum defended.
The review process of the USMCA will begin in the second half of 2025, in the context of the trade-tech war between the United States and China.
“Our narrative is, first we complement each other, we do not compete with each other, we are 30% of the world’s GDP and that complementarity strengthens us against other regions of the world,” said Sheinbaum.
Source: El Economista
