Mexico Braces for Years of Annual USMCA Reviews

Mexico's Economy Minister Marcelo Ebrard has publicly acknowledged that the USMCA review will not produce a 16-year extension by the July 1, 2026, deadline, with both Mexico and the US Trade Representative confirming that unresolved demands, 52 from Washington and 12 from Mexico, will likely trigger a decade-long cycle of annual reviews. The prolonged uncertainty raises investment risk for exporters, manufacturers, and nearshoring operators across automotive, steel, semiconductors, medical devices, and pharmaceuticals. 

Mexico's Minister of Economy Marcelo Ebrard said the review of the USMCA will not reach a swift resolution and could result in a cycle of annual negotiations extending a decade or more, signaling that the July 1, 2026, deadline set under the treaty will pass without a comprehensive deal.

"I believe that thinking about a quick closure … it is not going to happen, because I heard Jamieson Greer yesterday saying that's not going to happen," Ebrard said at a forum organized by El Financiero. "We will probably end up going to non-conclusive reviews over the next 10 years, having to keep discussing, I do not know if every year or something like that."

The statement, made days before the first formal bilateral negotiating round scheduled for the week of May 25, marks one of the clearest public acknowledgments by a senior Mexican official that the review will not produce a clean 16-year extension by the deadline.

A Structural Disagreement, Not Just a Timeline

Under Article 34.7 of the USMCA, the three parties must meet on July 1 and confirm their intent to extend the agreement for 16 years or enter a mandatory annual review cycle for 10 years, after which the pact expires. Any country can withdraw on six months' notice.

US Trade Representative Jamieson Greer confirmed the same outlook from Washington's side. "I think we probably will not resolve all the issues by July 1," Greer said, adding that President Donald Trump "has made clear that he is dissatisfied with many of the outcomes of the USMCA," citing increased US imports of vehicles, steel and aluminum produced in Mexico.

Ebrard acknowledged the Mexican government is working through 52 demands the United States has placed on Mexico, while Mexico has put 12 demands on the United States in return. Formal bilateral talks between both countries opened March 16, and a second round is set for the week of May 25. No date has been set for formal trilateral talks involving Canada.

Despite the complexity, Ebrard argued that Mexico's goal is not speed but certainty. "What do we need to do? Reduce the level of uncertainty, I am not going to be discussing everything. But I don't foresee a very quick closure scenario," he said.

Mexico's Negotiating Position

Ebrard framed the current review as fundamentally different from the 2019 renegotiation that produced the USMCA. The key distinction, he said, is that the United States is now simultaneously rewriting the rules with all its trading partners, not just its North American neighbors.

"What makes this negotiation different from 2019 is that right now you are also changing the rules for Mexico's competitors. And that is a major shift," he said. "It is a system based on comparative disadvantages, you charge for market access based on where something was made."

Within that framework, Ebrard argued Mexico holds structural advantages that competitors cannot easily replicate. "Mexico is the largest trading partner of the United States, nobody buys more from Mexico than Mexico. That is a real limit that conditions the entire treaty review and the entire relationship with the United States," he said, adding that Mexican exports have continued to grow even under the new tariff environment.

The minister pointed to the shift in negotiating focus toward reducing North American dependence on Asian supply chains as a central pillar of Mexico's strategy. Priority sectors include semiconductors, medical devices, electronics, AI, and pharmaceuticals. "Today it is more important to figure out how we stop depending 90% on APIs we bring from India or China, and reduce that to a manageable percentage," he said.

He cited existing investments as evidence of momentum: Nvidia in Guadalajara, Flex in data center equipment, and a Cisco plan to bring 300 advanced technology supplier companies to Mexico. Mexico's medical device exports already stand at US$17 billion annually. "Today they make it in Vietnam. Why cannot we make it here? We are going to start making it here," Ebrard said.

Canada on the Margins

Canada's position in the review process contrasts sharply with Mexico's. While Mexico has completed two rounds of preparatory talks and has a formal round scheduled, Canada's trade minister Dominic LeBlanc said his team only re-engaged with the Trump administration over the past month after almost no contact following a breakdown in talks last October, offering few details on substantive progress.

Canadian Prime Minister Mark Carney has signaled openness to a "Fortress North America" framework for deeper integration in selected sectors, while simultaneously pursuing trade diversification, including a limited tariff arrangement with China allowing 49,000 Chinese electric vehicles into Canada at reduced rates. That move drew a sharp reaction in Washington. "Actually going so far as to cut a deal with the Chinese was just seen as really just too much," said Kimberly Breier, former US Assistant Secretary of State for Western Hemisphere Affairs.

Analysts offered little optimism for a clean resolution by July. "My money is on us being in a scenario where it is a constant negotiation," said Kellie Meiman Hock, Senior Counsellor at McLarty Associates. "Nothing is ever settled with this administration, so hoping for a certain date where we agree on a determined outcome and certainty can reign in North American trade, I strongly believe that is not going to happen on July 1 or any other date."

Sixty-nine US business associations backed extending the agreement in early March, describing the USMCA as "critical to the competitiveness and export success of the United States" in a letter to Greer, and expressing support for a 16-year extension.