United States Trade Representative Jamieson Greer announced Wednesday that the U.S. will not renew the Canada-United States-Mexico Agreement (CUSMA), known in the U.S. as the USMCA, in its current form. The announcement came after a virtual meeting among the three countries as required under the trade pact's joint review.
"The United States did not agree to renew the USMCA in its current form," Greer said. "As a result, the USMCA is not renewed." However, the agreement remains in force for another 10 years, subject to annual reviews, and could be terminated if any country withdraws entirely. If a new deal is reached, the agreement would extend for 16 years.
U.S. Demands Changes to Address Trade Deficits
Greer emphasized that the U.S. will continue engaging with Canada and Mexico to address the agreement's shortcomings and trade deficits. "The United States will continue to engage with Mexico and Canada to address the agreement's shortcomings and our trade deficits with these countries," he said. "However, the agreement remains in force pending resolution of these issues or until the agreement's termination."
Major trade irritants for the U.S. include Canada's supply-managed dairy, poultry and egg sectors, the Buy Canadian policy for government contracts, provincial measures blocking American companies from procurement competitions, and alcohol import bans responding to U.S. President Donald Trump's tariffs on Canadian exports not covered by the free-trade deal.
Canada Reaffirms Support for Trade Deal
Dominic LeBlanc, Canada's minister responsible for trade relations with the U.S. under Prime Minister Mark Carney's Liberal government, expressed Canada's unwavering support for the trade pact. "The CUSMA supports millions of jobs across North America and ensures Canadian businesses retain secure and predictable access to two of our most important trading partners," he said in a statement.
LeBlanc noted that he, Greer, and Mexico Secretary of Economy Marcelo Ebrard agreed to continue discussions on trade issues hindering renewal. He raised U.S. tariffs on Canadian steel, aluminum, autos, and lumber. "Canada approaches these discussions from a position of strength and with the goal of preserving and strengthening one of the most successful trading relationships in the world," LeBlanc added.
Trump's Longstanding Discontent with USMCA
Trump has long expressed dissatisfaction with the trade deal he signed during his first term on July 1, 2020. The deal governs nearly $2 trillion in annual goods and services. A senior administration official told the Washington Post on condition of anonymity, "The president has already changed the dynamic between U.S., Canada, and Mexico. He’s already, I would say, subsumed USMCA under new trade and tariff policies."
