In a move that signals the beginning of a critical economic assessment, the United States Trade Representative announced yesterday it will commence formal public consultations on the Canada-United States-Mexico Agreement (CUSMA) ahead of the planned 2025 review. This development marks the first comprehensive evaluation of the trade pact that replaced NAFTA in 2020, setting the stage for potential adjustments that could reshape North American economic relations for years to come.
“This review represents a pivotal moment for continental trade relations,” said Katherine Tai, U.S. Trade Representative, during the announcement in Washington. “We’re committed to ensuring CUSMA delivers on its promises of creating balanced trade opportunities while protecting workers across all three nations.”
The consultation process, scheduled to begin next month, will solicit input from industries, labor groups, environmental organizations, and consumer advocates across the three countries. The Biden administration has emphasized that while the agreement has largely functioned as intended, several key areas warrant closer scrutiny, including labor standards enforcement, environmental protections, and digital trade provisions.
Canadian officials have responded cautiously to the announcement. Minister of International Trade Mary Ng stated that Canada “welcomes the opportunity for evaluation” but emphasized that the agreement has been “fundamentally beneficial for Canadian businesses and workers.” According to CO24 Business analysis, Canadian exports to the United States have increased 7.8% since the implementation of CUSMA, despite pandemic-related disruptions.
Mexico, meanwhile, faces particular scrutiny regarding labor reform implementation. The Mexican government has been under pressure to demonstrate meaningful progress on workers’ rights commitments made under the agreement. Recent CO24 World reporting revealed that 17 labor complaints have been filed under the agreement’s rapid response mechanism, with 14 targeting Mexican facilities.
Economic analysts suggest the review could highlight tensions in several sectors. The automotive industry remains particularly sensitive, with rules of origin requirements mandating that 75% of a vehicle’s components be manufactured in North America to qualify for duty-free treatment.
“The automotive provisions have been contentious since day one,” explains Dr. Elena Ramírez, economics professor at the University of Toronto. “U.S. manufacturers want stricter enforcement, while Canadian and Mexican producers argue the current rules already create significant compliance costs.”
Agricultural trade also remains a flashpoint. U.S. dairy producers have repeatedly claimed that Canada has not fully opened its markets as promised under CUSMA, while Canadian CO24 News sources indicate that Canadian farmers worry about potential further concessions in any renegotiation.
The 2025 review, formally called the “joint review,” was built into the original agreement as a mechanism to evaluate its effectiveness after six years. Unlike NAFTA, which had no formal review process, CUSMA includes this provision specifically to address emerging issues before they become intractable problems.
The timing of this review process coincides with political transitions in all three countries. The U.S. presidential election in 2024, recent Canadian leadership changes, and Mexico’s upcoming elections create a complex political backdrop for these negotiations.
Business leaders across North America are closely monitoring developments. “Regulatory certainty is essential for long-term investment planning,” noted Carlos Gutiérrez, former U.S. Commerce Secretary and current board member of several multinational corporations. “Companies need to know the rules won’t suddenly change midway through major capital projects.”
As Canada News has documented, supply chain resilience has become a primary concern following pandemic disruptions and growing geopolitical tensions with China. Many experts believe the CUSMA review will emphasize nearshoring initiatives and strengthened regional manufacturing capacity.
The initial public consultation period is expected to last 60 days, followed by trilateral technical discussions. Any substantial changes would require legislative approval in all three countries, potentially extending the process well into 2026.
As North America stands at this crossroads of trade policy recalibration, one question remains particularly pressing: Can these three diverse economies find a balance that strengthens continental competitiveness while addressing the legitimate concerns of workers, environmental advocates, and industries undergoing rapid technological transformation?
