When USMCA was first signed, it was hailed by some as the most consequential trade agreement on the planet. Nearly a decade later, that agreement faces its first major test as it enters its first major review. The process will be different than the original negotiation, but the stakes are high as tariffs and, supply-chain security have reshaped the way North America thinks about trade.

At the Conference de Montréal, the Honourable Scott Brison, BMO Vice-Chair and a former Member of Parliament, moderated a panel titled “USMCA at a crossroads: Building North America’s next competitive edge.” The session featured:

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  Steve Verheul, Canadian Co-Chair of the Coalition for North American Trade

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  Kevin Brady, U.S. Co-Chair of the Coalition for North American Trade

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  Ken Smith Ramos, Mexican Co-Chair of the Coalition for North American Trade

The discussion with the co-chairs of the Coalition for North American Trade (CNAT) centered on what the review could mean for the three countries as trade, supply chains and national security become harder to separate.

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Below are the highlights:

Kevin Brady said the USMCA still draws strong support in Congress because the U.S. economy depends heavily on trade across the continent. Combined, Canada and Mexico are the United States’ largest trading partners, accounting for roughly one-third of U.S. exports—far more than any single other country.

The agreement, which underpins much of North American commerce, reaches across sectors and touches companies large and small in nearly every state. A more complicated political environment is testing that support.

Ken Smith Ramos said Mexico’s commitment to the agreement has held across three presidencies, from Enrique Peña Nieto to Andrés Manuel López Obrador and now Claudia Sheinbaum. With 83% of Mexican exports going to the U.S., Smith Ramos said preserving and extending the USMCA remains central to the economy.

Steve Verheul said the coming USMCA review is more contained than the negotiation that produced the agreement in 2018. The original talks covered all 34 chapters, whereas this process focuses on a narrower set of difficult issues. Canada’s first concern, he said, is to avoid damaging an agreement that is largely working as intended.

Smith Ramos said the U.S. has little appetite for reopening chapters, or rewriting the text, since such changes would need Congressional approval. That makes enforcement and targeted cooperation more likely than a formal rewrite of the agreement.

Uncertainty over the past year has left some investors questioning whether North America will return to the pre-existing trade relationship or operate by a new set of rules. “They want to know what the expectations are, so they can start to make long-term commitments,” he said. “We need more predictability and more assurances that obligations are going to stick.”

Brady said U.S. priorities for the review go beyond the agreement’s text, with the administration looking to lower trade deficits and increase domestic production. It also wants a broader economic security package to make North America more competitive by having the three countries work together on production, supply chains and trade.

Smith Ramos shared a similar view. Rather than changing the text itself, he said the three countries could use the agreement they already have to strengthen their position. That could mean closer customs cooperation to prevent transshipment, stronger shared supply chains and more capacity in strategic sectors.

Verheul said diversification should mean broadening the range of trade relationships rather than swapping one dependence for another.

As the panel wrapped, Brison urged the panelists to find ways to improve how the three economies can work together and resist any attempts to reintroduce trade barriers. “I hope you dig into the potential for regulatory cooperation much more deeply, which could significantly improve our competitiveness in North America,” he said.