The United States has revealed that it will not renew the trilateral trade agreement—USMCA—covering approximately $1.6 trillion in trade between the U.S., Mexico, and Canada, just one day before its scheduled joint mandatory review. In a statement issued on Wednesday, U.S. Trade Representative Ambassador Jamieson Greer said that the United States would not agree to extend the agreement in its current form.
“The United States will continue to engage with Mexico and Canada to address the Agreement’s shortcomings and our trade deficits with these countries. However, the Agreement remains in force pending resolution of these issues or until the Agreement’s termination,” the statement read.
The USMCA (U.S.–Mexico–Canada Agreement) will remain in effect for an additional 10 years, even if it is not extended by the deadline. Under its current structure, the free trade pact will undergo annual reviews unless any of the member countries choose to withdraw from the agreement entirely.
The U.S. decision not to renew the agreement follows President Donald Trump’s remarks that the trade pact was unnecessary. In January, he stated that there was “no real advantage to it; it’s irrelevant.”
The trilateral agreement came into effect on July 1, 2020, during Trump’s first term, replacing the North American Free Trade Agreement (NAFTA). According to the U.S. Department of State, the USMCA was established to create a more balanced and reciprocal trade framework aimed at supporting higher-paying jobs for Americans and strengthening the North American economy.
The agreement also introduced chapters on digital trade, anticorruption measures, and good regulatory practices, along with provisions ensuring small and medium‑sized enterprises benefit from the framework.
Greer further noted that additional time is required to address challenges within the USMCA, including the United States’ widening trade deficits with Mexico and Canada, which reached $197 billion and $48.3 billion in 2025.
For Canada, the imbalance was largely driven by crude oil imports, as it remains the largest supplier of crude oil to the United States. Meanwhile, the deficit with Mexico has expanded as companies increasingly relocated supply chains from China to Mexico in response to U.S. tariffs on Chinese goods, resulting in a greater volume of imports being recorded as originating from Mexico.
The United States and Mexico have already initiated a series of bilateral negotiations that will continue beyond the July 1 deadline, with a third round scheduled for the week of July 20. By contrast, discussions between the United States and Canada have not yet commenced.
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