The United States’ recent decision not to support extending the United States-Mexico-Canada Agreement (USMCA) beyond its current expiration date of 2036 reflects a strategy aimed at maintaining leverage in future trade negotiations rather than signaling the end of the pact, experts say.
Under the USMCA, which took effect in 2020, the three member countries agreed that the deal would last until 2036 with the possibility of a 16-year extension if all parties concur during periodic reviews. However, the U.S. Trade Representative, Jamieson Greer, has stated opposition to extending the agreement beyond 2036, creating uncertainty about the pact’s longer-term viability.
Julian Castro-Rea, a political science professor at the University of Alberta, described the U.S. position as a negotiating tactic designed to exert pressure on Canada and Mexico during ongoing discussions. He noted that the agreement remains fully operational until 2036 with annual reviews, and the current stance does not signal an abandonment of the process. Castro-Rea said both Canada and Mexico have become adept at handling such declarations, often interpreting them cautiously while engaging in detailed negotiations.
Key issues expected to shape future talks include Washington’s aims to reduce its trade deficit with its North American partners, increase the proportion of U.S.-made content in vehicles sold across the region, and gain expanded access to Canada’s dairy market. Mexico and Canada, meanwhile, are anticipated to pursue lower U.S. tariffs on agricultural products and steel, aluminum, and finished vehicles, respectively.
Kim Richard Nossal, professor emeritus of political studies at Queen’s University, characterized the situation as unsurprising given the limited feasibility of the two alternatives: a full termination of the agreement or an immediate 16-year extension. Terminating the USMCA, he argued, would be prohibitively costly due to the deeply integrated North American supply chains. On the other hand, a full extension is unlikely given the Trump administration’s prior skepticism of the agreement and the slow progress of renewal talks, especially with Canada.
Instead, Nossal suggested that the existing arrangement—where the agreement remains in force until 2036 with ongoing annual reviews—is a pragmatic compromise that maintains current trade flows while allowing Washington to assert influence over key sectors like autos, steel, and aluminum through the review process. This framework preserves tariff structures favorable to the U.S. and ensures a continued platform for pushing American demands.
While Canada and Mexico would prefer a longer-term renewal to foster greater predictability for businesses and investors, the current scenario is seen as a preferable alternative to termination. Both countries, according to Nossal, regard the ten-year extension with annual reviews as "second best" but less risky than losing the agreement altogether.
Looking ahead, analysts expect trade discussions to focus more on bilateral negotiations addressing sector-specific disputes rather than sweeping changes to the agreement itself. Castro-Rea anticipates Washington will maintain a firm tone, seeking separate arrangements with Ottawa and Mexico City while leveraging its position in ongoing talks.