Canada and Mexico are seeking to strengthen their bonds as a potential response to the looming threat of tariffs imposed by the U.S. under Trump's administration.
In a bid to further strengthen economic ties, Canadian Prime Minister Mark Carney and Mexican President Claudia Sheinbaum are currently in talks to find common ground regarding the USMCA free trade pact.
The discussions come amid ongoing tariff threats from US President Donald Trump, with the recent threats including doubled steel tariffs, although specific details about this issue were not provided. Trump has expressed a desire for renegotiations with better terms for US manufacturers.
Carney and Sheinbaum have indicated they will present a common front rather than pursuing bilateral side deals with Trump. The Canadian Prime Minister credited the USMCA for making North America the economic envy of the world due to the cooperation between Canada and Mexico. Sheinbaum's comments suggest a plan to strengthen economic ties beyond the USMCA.
The US is the largest export market for both Canadian and Mexican products. However, goods outside the USMCA are subject to a 35% tariff for Canada and a 25% tariff for Mexico. These tariffs have affected various sectors, including automotive, steel, and aluminum.
In an effort to bypass US ports, Mexico and Canada are exploring potential bilateral trade deals. Maritime routes are being considered for bilateral trade under the free trade agreement. This plan could bring a new era of further strengthening economic ties.
After several rounds of negotiations and exemptions, scattershot tariffs remain on some goods not covered under the USMCA. The USMCA is up for review in 2026, but it has already been affected by tariff threats from Trump.
Public consultations for the USMCA review process have started this week. Carney expects 'much greater amounts of trade, much greater amounts of investment' as a result of these discussions. He stated that Canada and Mexico make the United States stronger and that they are all stronger together.
In February, Trump threatened 25% tariffs on imports from Canada and Mexico, citing fentanyl trafficking. However, it seems that the two countries are determined to navigate these challenges and build a stronger economic future.
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