BROWNSVILLE, Texas - The Border Trade Alliance says it is extremely concerned about the uncertainty that will follow if the United States does not extend the United States-Mexico-Canada Agreement.
Under the agreement’s six-year review process, the presidents of Mexico and Canada have signed to renew the trade pact.
“The Border Trade Alliance is concerned that any sign that the U.S. might eventually exit USMCA injects unnecessary uncertainty into the future of North American trade at a time when businesses need stability to invest, hire, and grow,” said Border Trade Alliance Chairman Pete Sepulveda Jr. and BTA President Britton Mullen, in a joint statement.
“For more than three decades, free trade among the U.S., Mexico, and Canada has helped build one of the world’s most competitive economic regions, supporting millions of jobs, strengthening supply chains, lowering costs, and expanding opportunities on both sides of our borders. That integrated framework should not be taken for granted.”
Sepulveda and Mullen were reacting to a news story by Reuters that said the U.S. would not renew USMCA. Reuters reporter David Lawder said President Trump's administration is “expected to formally declare on Wednesday that it will not extend the U.S.-Mexico-Canada Agreement on trade. This would start a decade-long clock to wind down the 32-year-old North American free trade zone.”
The USMCA was created by President Trump during his first administration.
The two BTA leaders continued:
“We strongly support modernizing USMCA where appropriate. We have deep concerns, however, about any action that would dismantle or weaken the trilateral framework that underpins North American commerce.
“Still, the review process will move forward, and the agreement stays in place while negations continue. We urge all three governments to pursue reforms that strengthen USMCA while preserving the certainty and market integration that have made North America more competitive.
“The stakes are high, affecting the manufacturers, farmers, retailers, transportation providers, border communities, and consumers that comprise the dynamic North American economy.”
Since 1986, the BTA has served as a grassroots, non-profit organization that provides a forum for discussion and advocacy on issues pertaining to border development and quality of life and trade in the Americas. A network of public and private sector representatives from the United States, Mexico and Canada, BTA’s core values include a commitment to improving the quality of life of border communities through trade and commerce.
Mexican President Claudia Sheinbaum told the nation Tuesday: “What can happen is set out in the treaty. It is not something someone just came up with. So, one possibility, for example, is to extend it for another 16 years. That letter has to be signed before Wednesday, before tomorrow. So, I, for example, have already signed Mexico's position, which is to extend it for another 16 years. Canada's economy minister did what was required, and now we are waiting for the United States response. If they do not decide to extend it for 16 years, then a review process begins. That does not mean it will always be reviewed every year, but rather that a formal review process would begin, and in that formal review process, it would be assessed whether any adjustments need to be made to the current treaty.”
The BBC has penned a news story about the issue headlined: "What to know about the looming deadline on North American free trade." If the July 1 milestone is missed, USMCA will remain in place for another ten years until its set expiry date of 2036, the news outlet states.
The US, Canada and Mexico have three options, according to the BBC:
“The US is not expected to renew the trade deal, setting the stage for annual reviews. While President Trump has made his displeasure with the USMCA known, business leaders in Canada believe an outright withdrawal is the least likely outcome,” the BBC wrote.
The Atlantic Council’s Madeline Chalecki has also written an article about the future uncertainty of the USMCA. It is titled: "The five stages of a USMCA shakeup."
Diego Marroquín Bitar, a fellow of the Americas Program at the Center for Strategic & International Studies, has penned an op-ed titled: "Don’t Let the USMCA Drift Away." The op-ed starts:
“President Trump says the United States would do better without the United States-Mexico-Canada Agreement (USMCA). On July 1, the three countries are set to begin the agreement’s first formal review. The pact does not expire that day; July 1 only starts the clock, toward either a 16-year renewal or a slow countdown to termination. The real question is whether the review ends quickly or drags on for years. The greatest threat to North American competitiveness isn’t withdrawal. It’s uncertainty.
“North America builds things together. When a supplier in Mexico cannot deliver wiring harnesses, layoffs appear in Toledo and Spring Hill. When Canadian aluminum is late, an aerospace plant in Wichita, Kansas, burns through overtime to catch up. This is how cars, planes, and medical devices are built now: across borders. Rather than a weakness to be unwound, this integration is the closest thing the United States has to a secure allied industrial base. Pulling that production home would take years and cost more than it could ever earn back. The USMCA holds it together, and that is precisely what is now in question. Capital is patient, but it is not fond of ambiguity, and the wait is already pulling growth out of all three economies.”
Meanwhile, Politico reporter Daniel Desrochers has penned a news story titled: "Trump now 'hates' his own trade deal. But he'll have a hard time killing it."
“President Donald Trump keeps saying he wants to walk away from the $1 trillion-plus North American trade deal he negotiated in his first term. Nobody believes he will,” Desrochers writes.
“But Trump’s refusal to commit to the tariff-lowering pact means that his administration must now enter a protracted period of negotiations with Mexico and Canada — extending what has already been a year of uncertainty for major U.S. industries like automakers and dairy farmers who rely on multibillion dollar supply chains and export markets across the continent.”
