Momentum Builds in Canada to Kick Mexico Out of North America Trade Deal
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Ontario Premier Doug Ford said on Wednesday that all of his fellow provincial leaders are united behind his call for a bilateral trade agreement with the United States under the second Trump administration, rather than a continental deal that would also include Mexico.
“I just got off the phone with all the premiers, and there’s a clear consensus that everyone agrees that we need a bilateral trade deal with the U.S. and a second bilateral trade deal with Mexico,” Ford said at a press conference on Wednesday afternoon.
Ford’s enthusiasm for a bilateral deal apparently stems from President-elect Donald Trump’s criticism that Mexico offers China a means of slipping cheap products past high U.S. and Canadian tariffs.
Ford said on Tuesday that the existing trilateral U.S.-Canada-Mexico Agreement (USMCA), which began in 2020 as the successor to the controversial 1992 North American Free Trade Agreement (NAFTA) and comes up for review in 2026, allows Mexico to serve as a “backdoor for Chinese cars, auto parts and other products into Canadian and American markets.”
“If Mexico won’t fight transshipment by, at the very least, matching Canadian and American tariffs on Chinese imports, they shouldn’t have a seat at the table or enjoy access to the largest economy in the world,” he said.
“Instead, we must prioritize the closest economic partnership on Earth by directly negotiating a bilateral U.S.-Canada free trade agreement that puts U.S. and Canadian workers first,” he urged.
On Wednesday, Ford said he had successfully worked the phones and gotten all ten of Canada’s premiers, plus its three territorial leaders, behind his proposal. He said the next step will be a meeting with left-wing Prime Minister Justin Trudeau to get him onboard, and then it will be on to Washington, where they will probably find a receptive audience in the new U.S. administration.
Trudeau might not be a tough nut to crack. He has criticized China’s unfair trade practices and his administration slapped a 100-percent tariff on Chinese electric vehicles (EVs) and hybrids in October.
Trudeau prefers striking a better trilateral deal with the U.S. and Mexico, but he and his ministers have also expressed sympathy for the arguments made by Ford and Trump. On Tuesday, Deputy Prime Minister Chrystia Freeland said her government shares America’s “very grave” concerns about China.
“We are perfectly aligned with the United States and that means we are not a back door to unfair Chinese traded goods. The same cannot be said about Mexico,” Freeland said.
“We believe that China’s intentional overcapacity is unfair and a threat to key Canadian industrial sectors. It is a threat to Canadian jobs and that’s why we’ve imposed 100% tariffs on Chinese EVs, 25% tariffs on Chinese steel and aluminum,” she added.
On the other hand, Mexican President Claudia Sheinbaum said on Wednesday that Trudeau “very clearly” told her that he “does not agree” with kicking Mexico out of the trilateral trade deal.
“They are also having their own elections soon, so they are also using these subjects as part of an electoral campaign. But the Prime Minister does not agree,” Sheinbaum said, implying that Trudeau and Freeland were lying to keep their sagging poll numbers up.
Sheinbaum was confident that when USMCA is reviewed in 2026, it would be only a “revision,” and “not even a renegotiation.”
Trudeau said on Thursday, independently of Pardo’s comments, that he discussed some “real and general concerns about Chinese investment into Mexico” with the Mexican president and, while he wants to keep USMCA alive, he is willing to look at “other options.”
As for Trump, he called NAFTA “disastrous” and “the worst trade deal in the history of the United States” on Wednesday when he chose Pete Hoekstra, former congressman from Michigan, as his ambassador to Canada.
“We brought Trade with Mexico and Canada to a level playing field for our wonderful Farmers and Working Families. In my Second Term, Pete will help me once again put AMERICA FIRST,” Trump said, with his usual exuberance for capital letters.
Not everyone in Canada is eager to end 30 years of trilateral trade management. Canadian Manufacturers & Exporters Association President Dennis Darby said on Wednesday he hoped Ford’s bilateral proposal was meant as a tough bargaining tactic to get a better trilateral agreement with Mexico.
“I hate when we negotiate with ourselves. Many Canadian companies are invested in all three countries. So I don’t think it serves anyone’s interest at this point to start saying, ‘let’s cut Mexico out,’” said Darby.
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