Moving to end a multi-trillion partnership, the Trump administration has announced that the United States will not continue its participation in the U.S.-Mexico-Canada Agreement.
The agreement was made official during Trump’s first term in July of 2020 and was designed to replace the controversial North American Free Trade Agreement.
The new USMCA has comprised one of the world’s largest free trade zones, representing more than 510 million people and a combined Gross Domestic Product of just under $31 trillion.
By design, the agreement has been tasked with modernizing rules governing duty-free trade between the three countries, while upgrading and expanding provisions dealing with environmental standards, labor, digital trade, and agriculture.
A White House official told Time magazine that the reason for the withdrawal is because the agreement has not been working to the advantage of the U.S. “Our trade deficits with both Mexico and Canada shot up during the Biden Administration.”
The official added: “We’ve started to get it under control, thankfully, but we believe that the USMCA does not operate to control the deficit like the President intended.”
In an essay looking at the history of the USMCA, the Center for Strategic & International Studies has contended that if the agreement is to fall entirely by the wayside, goods will face “tariffs and regulatory barriers, making them more expensive and less competitive in global markets.”
This, in turn, says the study, will give “an opening to rivals like China, which already competes aggressively in key sectors.”
For the present, the USMCA will remain in effect, with scheduled annual reviews of the agreement that could lead to future major re-negotiations.
In comments appearing in the publication Food Business News, Joe Glaubner, a research fellow with the International Food Policy Research Institute, said the withdrawal announcement is “disappointing because I think this is an agreement that’s worked very well for agriculture.”
In a press release, the U.S. Chamber of Commerce remarked that the USMCA is “essential to sustaining economic growth, promoting investment, and ensuring North America remains one of the most competitive and dynamic regions in the world.”
But, in a statement, Bill Bullard, chief executive office of the Ranchers Cattlemen Action Legal Fund, remarked, “Now is our opportunity to begin managing the trade with these two countries that has been displacing our domestic production opportunities.”
July 7, 2026
By Garry Boulard
