Basics

The United States-Mexico-Canada Agreement (USMCA) is the free trade agreement that entered into force on July 1, 2020 and replaced the North American Free Trade Agreement (NAFTA). USMCA has a 16-year term and is intended to strengthen trade and economic cooperation among the U.S., Canada, and Mexico. A full Center Forward policy Basic on USMCA can be found here. 

USMCA mandates the U.S., Canada, and Mexico begin a trilateral review of the original agreement by July 1, 2026. This joint review will assess the agreement’s efficacy and include negotiations over updates and changes to the framework. Following the review, all three signatories must decide whether to extend the agreement for another 16-year term beginning in 2036. If there is no unanimous agreement to renew after this initial review, there will be annual reviews until 2036 with corresponding opportunities for extension. Unless one party exits the agreement prematurely, it will be terminated only if there is no consensus to renew by 2036.

This Basic outlines the major provisions of USMCA and anticipated areas of negotiation, including automotive manufacturing, tariffs, critical minerals, digital trade, labor, energy, agricultural biotechnology, and national security.