The United States will maintain tariffs on Canada and Mexico under the USMCA trade pact, according to U.S. Trade Representative Jamieson Greer. The decision, announced Wednesday, keeps in place duties that had been expected to expire under the 2020 agreement, threatening to fray ties with America’s two largest trading partners.
Why the tariffs stay
Greer confirmed the tariffs during a press briefing, citing unresolved disputes over rules of origin and market access. He did not specify which products would remain covered or provide a new expiration date. The USMCA, which replaced NAFTA, was designed to phase out most tariffs on goods traded among the three countries. The administration’s move signals a tougher line on enforcement.
Strained relations ahead
Canada and Mexico have pushed for tariff removal since the pact took effect. Ottawa’s trade minister called the decision “disappointing” and said Canada would review its options. Mexico’s economy secretary warned the tariffs could “destabilize” supply chains in the auto and agricultural sectors. No formal retaliation has been announced, but both governments have signaled they may challenge the tariffs under USMCA dispute mechanisms.
Impact on negotiations
The tariffs complicate future talks. The USMCA is set for a joint review in 2026, and the tariff issue is expected to dominate the agenda. Trade analysts say the move could also affect ongoing discussions about digital trade and energy cooperation. The three countries have yet to schedule the review meetings.
Economic ripple effects
Cross-border trade is worth roughly $1.5 trillion annually. Tariffs raise costs for manufacturers on both sides of the border. American farmers, who rely on Canadian and Mexican buyers, may face retaliatory duties. The U.S. Chamber of Commerce warned that the tariffs “undermine the very purpose of the USMCA.” No official estimates of the economic impact have been released.
The next step is unclear. Canadian and Mexican officials are expected to meet separately this week to coordinate a response. The U.S. has not set a timeline for renegotiating the tariff schedule.
