A Storm is Coming for Mexico under USMCA
In Washington, Ottawa and Mexico City, there is a celebratory mood as the governments of the three North American partners prepare for the coming into force of the United States-Mexico-Canada Agreement (USMCA) on July 1. By the same token, businesses are heralding not only the continuation of free trade in North America but the modernization of an existing relationship that goes back to the implementation of the North American Free Trade Agreement (NAFTA) in 1994.
This enthusiasm is not unwarranted. We know that the economic relationship between the USMCA partners is worth an astonishing $1.2 trillion and supports 14 million jobs. The modernization of NAFTA in the form of the USMCA protects those jobs and seeks to deepen the competitiveness and prosperity of all three countries.
But this may be just the calm before the storm. Let us not forget that the Trump administration has been pursuing an aggressive international trade strategy based on principles of economic nationalism since President Trump took office in January 2017. Figures such as Peter Navarro, Wilbur Ross and the president himself have spoken repeatedly about the need to use the United States’s extensive power resources to bring fairness to bilateral and multilateral trading relationships.
About the Author
The Mexico Institute seeks to improve understanding, communication, and cooperation between Mexico and the United States by promoting original research, encouraging public discussion, and proposing policy options for enhancing the bilateral relationship. A binational Advisory Board, chaired by Luis Téllez and Earl Anthony Wayne, oversees the work of the Mexico Institute. Read more