Remember NAFTA? It’s Back, It Impacts You and It is Up for Grabs Starting This Week

For the typical North American business, USMCA (US Mexico Canada Agreement) is the quiet plumbing behind your costs, your suppliers, and your customers and this week it gets inspected! This is the ‘old’ NAFTA – North American Free Trade Agreement from the 1990s.

On July 1, the United States, Mexico, and Canada formally sit down for USMCA’s first-ever “joint review.” This is the ‘old’ NAFTA – North American Free Trade Agreement from the 1990s.

Think of the current negotiations as this massive trade deal’s 6-year check-up. This is when the three governments decide whether to renew it for another 16 years, downgrade it to nervous annual reviews, or start a six-year countdown to its 2036 expiration. Nearly $2 trillion in trade and roughly 17 million jobs in the three countries ride on the answer.

The USA and Mexico have been meeting since March to seek needed changes. Canada had now come to the table also in the past two weeks.

Having been on four USMCA panels in the past two months taught me something: almost everyone knows the agreement matters, but few people understand the impact this trade agreement has had and has day to day for our three countries.

Here’s what the three countries are actually negotiating about now:

1. Renew or sunset? The headline question. A clean 16-year extension keeps businesses confident; anything less injects years of uncertainty into every cross-border investment decision.

2. Cars and the “China backdoor.” Washington wants to stop Chinese parts from slipping into Mexican-made products that then cross into the U.S. tariff-free. Expect a push for tougher “made-in-North-America” rules.

3. Mexico’s energy control. The U.S. and Canada argue Mexico’s state grip on oil and electricity locks out their investors. It’s widely seen as the make-or-break test for Mexico City. U.S. energy companies are owed US$2.5 billion is unpaid invoices.

4. The digital services fight. U.S. tech giants want Canada to drop the special taxes and streaming rules they call discriminatory toward American digital services platforms.

5. Do the current labor rules still work? Whether the factory-wage and union-rights promises baked into the deal are actually being enforced on the ground in the three countries.

Here’s why I think it’s worth your five minutes this week to red this post. Most of this trade has flowed tariff-free for 30 years, so we barely notice it. The cars, the avocados, the gasoline, the streaming you watched last night are all touched by these rules. July 1 is the day that quiet machinery gets pried open and re-examined, and the outcome will shape North American business for the next decade. Look at the size of trade between our three countries and the employment of this agreement. You are impacted by this agreement and by changes that are made to it this year!!!