As the critical July 1 review deadline for the United States-Mexico-Canada Agreement (USMCA) draws near, all three North American nations are widely expected to miss the target without a final resolution to the trade pact’s future. This Wednesday will mark the first formal trilateral meeting between the countries’ top trade representatives since the mandatory review of the 2018 agreement launched earlier this year. Both Canada and Mexico have publicly pushed for a full renewal of the accord, but the United States has so far declined to lay out a clear official stance.
Recent remarks from former President Donald Trump, who originally negotiated USMCA to replace the 1990s-era North American Free Trade Agreement (NAFTA), have deepened uncertainty: Trump has stated he believes the deal should “expire immediately,” arguing the U.S. would gain a stronger position without the trilateral pact. The agreement, which serves as the backbone of regional economic integration, currently supports $1.6 trillion in annual cross-border trade, enables integrated supply chains for core industries like automobile manufacturing, and sustains millions of jobs across the three countries. It also grants Canadian and Mexican goods exemption from most U.S. tariffs imposed by the Trump administration, a critical protection for North American exporters.
Public opinion in the U.S. leans heavily in favor of retaining the deal: a late 2025 Ipsos survey conducted by the Chicago Council on Global Affairs found that 75% of U.S. respondents view USMCA as beneficial to the American economy. Even so, negotiations have been tangled by tensions stemming from Trump’s existing tariffs, with Canada’s retaliatory trade measures adding extra layers of complexity to discussions. All three sides have already acknowledged that no final decision will come out of Wednesday’s meeting. Canadian officials have openly prepared for extended negotiations beyond the July 1 deadline, while Mexico and the U.S. have already scheduled a second round of bilateral talks for later this month.
In an official statement shared with the BBC, the office of Canadian Minister of U.S. Trade Dominic LeBlanc framed Wednesday’s gathering as a chance to build on the productive one-on-one talks LeBlanc has held with officials from both partner nations in recent weeks. “He is looking forward to continuing the work of supporting Canadian workers, farmers and businesses, on July 1 and beyond,” the statement read.
Since the review launched, the U.S. has held separate bilateral discussions with Mexico and Canada to address longstanding trade frictions. Many observers have noted Canada has fallen behind in visible progress, as Mexico and the U.S. have already held multiple formal negotiating rounds while U.S.-Canada talks were slower to materialize. But members of the trade advisory committee assembled by Canadian Prime Minister Mark Carney push back on that narrative, noting the list of U.S. demands for Canada is far shorter than the list presented to Mexico, and behind-the-scenes negotiations are advancing steadily.
Key U.S. demands for Canada include expanded market access for American dairy producers, the elimination of Canadian digital taxes on large U.S. streaming services, and the reversal of provincial alcohol boycotts that Canada put in place as a retaliatory response to Trump’s steel and aluminum tariffs. For its part, Canada’s top priority remains removing the existing U.S. tariffs on core Canadian exports including steel, aluminum and automobiles. Carney has repeatedly emphasized Canada will not accept a deal that harms national economic interests, a position echoed by Canadian business groups. While the current trade uncertainty has already inflicted harm on Canadian companies, most industry leaders are willing to extend negotiations to secure a favorable outcome, according to Dennis Darby, president of Canadian Manufacturers and Exporters and a member of Carney’s trade advisory committee.
U.S. Ambassador to Canada Pete Hoekstra revealed that a U.S.-Canada deal was nearly reached last October, but talks collapsed after Ontario ran an anti-tariff advertisement on U.S. television networks that angered Trump. “They were very, very close to having an agreement, and then you know, poof, it’s all gone,” Hoekstra told Canadian broadcaster CTV in an interview last week.
Even if no deal is reached by July 1, the existing USMCA will remain in effect until its scheduled expiration date in 2036. The three parties have three potential paths forward after the deadline: first, all three can agree to extend the deal for 16 additional years, pushing its expiry to 2042; second, if no consensus is reached, the agreement will move to an annual review process that will repeat until 2036; third, any one party can formally notify the others of its intention to withdraw, triggering a six-month waiting period before the exit takes effect.
Canadian business leaders overwhelmingly view a full U.S. withdrawal as the least likely outcome, even with Trump’s public criticism of the deal. “Everyone is hopeful that won’t be the case,” Darby said, adding that U.S. negotiators recognize the agreement has delivered mutual benefits to all three nations. Still, Darby noted that permanent annual reviews would be a bad outcome for Canadian business, as ongoing uncertainty would continue to disrupt investment and planning. Ultimately, most key players agree the final decision rests with Trump and Carney. Trump’s recent comments on the deal have been contradictory: he has both said he is “not looking to renew it” and claimed he is “open” to keeping the pact in place. While Carney acknowledged it is no secret that Trump is dissatisfied with USMCA, he noted U.S. negotiators have already accepted that the agreement’s core structure is sound. “What I have seen with the president is you’re not close to making a deal – and then you make a deal,” Carney told reporters recently.