The United States want to review its trade agreement with Mexico and Canada, known as the USMCA, instead of simply extending it, US Trade Representative Jamieson Greer said on Wednesday.
Washington believes that the concerns of US farmers, manufacturers and businesses were not being sufficiently taken into account, Greer said in a virtual conference with his counterparts from the other countries.
Still, the trade official stressed that the US "will continue to engage with Mexico and Canada as appropriate, but and during that time, the USMCA will remain in effect."
In redesigning the agreement, President Donald Trump's administration wants to involve Congress.
Up to 10 years for a new version
The new mechanism calls for the agreement to last a maximum of 10 years. This can be extended if all three agree by 16 years. If no agreement is reached, the USMCA will expire.
Greer noted that Trump also retains the option of withdrawing from the pact earlier if necessary. The three countries plan to hold a third round of talks on July 20.
German economic development agency Germany Trade and Invest said the review process could give Washington leverage: "The US could use the mechanism to exert political pressure on Mexico and Canada - for example on issues of drug trafficking or energy policy," it said.
Agreement was meant to secure better terms for the US
USMCA is the successor agreement to the North American Free Trade Agreement, or NAFTA, which came into force in 1994 and which Trump had called "the worst deal of all time" in his first term. Trump pushed through negotiations on a new version then.
The new version of the deal came took effect in 2020 under the name United States-Mexico-Canada Agreement, or USMCA, and regulates tariff-free trade between the three countries. It is largely based on the NAFTA framework, but included new rules for the automotive industry and gave US farmers better access to markets in neighbouring countries. It also included provisions for the protection of intellectual property and trade in the digital sector.
