After talks in Mexico with President Claudia Sheinbaum, Canadian Prime Minister Mark Carney said the pair were “committed” to the United States-Mexico-Canada Agreement (USMCA), saying it had “helped make North America the economic envy of the world.”
Sheinbaum said she was “optimistic” about the future of the accord, which Trump wants to renegotiate on terms more favorable to US manufacturers.
“I believe that the USMCA will prevail,” she said.
The agreement, in place since 2020, is up for review next year.
It is critical to the economies of both Mexico and Canada, which send around 80 percent and 75 percent of their exports to the United States, respectively.
Trump has already imposed tariffs on some exports from Canada and Mexico that don’t fall under the agreement and threatened further punishment if they fail to curb cross-border migration and drug trafficking.
“In an interdependent world, no country can isolate itself,” Carney told a joint press conference with Sheinbaum, adding: “USMCA is strength together, of the three countries together.”
The USMCA replaced the North American Free Trade Agreement signed in the 1990s.
The successive deals fundamentally reshaped North America’s economy over three decades, creating a high degree of interdependence between the three partners.
However, Trump’s trade war has already significantly disrupted cross-border supply chains.
He has hit Canadian goods that fall outside the agreement with 35-percent duties and similar Mexican goods with 25-percent levies.
The tariffs are hurting Canada’s crucial auto, steel and aluminum sectors, leading to job losses, and also causing pain for Mexico’s auto and steel industries.
Move forward together
Both Sheinbaum and Carney have been attempting to reach side deals with Trump, but on Thursday they insisted they were not in competition with each other.
“We will move forward together,” Carney assured.
The pair also vowed to boost bilateral trade using Canadian and Mexican ports, rather than sending goods by road or rail across the United States.
Bilateral trade between Mexico and Canada last year totaled under $32 billion — more than 20 times less than the amount each has with the United States.
Mexico is Canada’s third-largest partner and Canada is Mexico’s fifth-largest.