{"id":152845,"date":"2025-09-18T14:53:15","date_gmt":"2025-09-18T14:53:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/152845\/"},"modified":"2025-09-18T14:53:15","modified_gmt":"2025-09-18T14:53:15","slug":"the-cusma-review-process-is-underway-heres-what-to-expect-national","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/152845\/","title":{"rendered":"The CUSMA review process is underway. Here\u2019s what to expect – National"},"content":{"rendered":"

The process leading up to next year\u2019s scheduled review of the Canada-United States-Mexico Agreement<\/a> on free trade (CUSMA) has officially begun \u2014 and the future of the North American economy is at stake.<\/p>\n

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The U.S. Trade Representative on Wednesday kicked off 45 days of public consultations leading up to a public hearing in November. That process, enshrined in the trade pact, will help inform the formal review of CUSMA<\/a> scheduled for next July.<\/p>\n

Canada-U.S. Trade Minister Dominic LeBlanc\u2019s office said Wednesday that Canada will launch its own public consultations \u201cin the near future.\u201d<\/p>\n

The review is looming as U.S. President Donald Trump\u2019s global trade war has unleashed multiple waves of tariffs and upset international economies.<\/p>\n

For now, most goods from Canada and Mexico entering the U.S. are avoiding tariffs because of CUSMA.<\/p>\n

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However, that could change if Trump seeks major changes to the agreement, or even withdraws from it altogether.<\/p>\n

\u201cAt best, we could see some adjustments that will be more favourable to the U.S. than either Canada or Mexico,\u201d said Gary Hufbauer, an economist and non-resident senior fellow at the Peterson Institute for International Economics.<\/p>\n

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The USTR\u2019s notice sets a 45-day deadline from its publication for the public to submit comments on CUSMA \u2014 including its operation, implementation, \u201cany issues of compliance,\u201d recommendations for action, impacts on investment and economic strategies.<\/p>\n

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That means comments will be accepted until Nov. 1. That\u2019s also the deadline for requests to appear at a public hearing set for Nov. 17.<\/p>\n

Industry leaders, small businesses, labour unions, workers and other members of the public are all being urged to participate in the public hearing.<\/p>\n

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The hearing will continue into the next business day \u201cif necessary,\u201d the USTR notice says.<\/p>\n

The formal review of CUSMA is expected to begin on July 1, 2026, according to the USTR. That\u2019s six years after the trade pact came into force, a timeline enshrined in the agreement itself.<\/p>\n

LeBlanc\u2019s office did not give a timeline for Canada\u2019s upcoming consultations, but said the government will engage with \u201cCanadian industry leaders, provinces and territories and Indigenous partners.\u201d<\/p>\n

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The statement said the engagements, \u201cwhich will build on consultations undertaken in 2024, will enable us to gather valuable feedback from Canadians.\u201d<\/p>\n

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Hufbauer said that, while public consultations have helped inform reviews of trade agreements in the past, the U.S. CUSMA process may simply be \u201ctheatre.\u201d<\/p>\n

\u201cThe trade policy is almost totally centred in the White House,\u201d he said, with minimal influence from administration officials like U.S. Treasury Secretary Scott Bessent and U.S. Commerce Secretary Howard Lutnick.<\/p>\n

\u201cI\u2019m skeptical that anything submitted will make any substantial difference at all in terms of how President Trump approaches the file.\u201d<\/p>\n

\t\t\t\tHow could the review play out?\n\t\t\t\t\t\t<\/p>\n

Under Article 34.7 of CUSMA, during the review, all three countries will have to agree on whether to extend the agreement for another 16 years, with a new joint review set no later than in six years\u2019 time.<\/p>\n

If one country does not agree to the 16-year extension, then joint reviews will have to be held every year until a longer extension can be agreed to.<\/p>\n

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Trump, Lutnick and U.S. trade representative Jamieson Greer have highlighted several issues with CUSMA that they want to address, particularly closing loopholes exploited by China to enter the North American market. Canada and Mexico have indicated they share those concerns.<\/p>\n

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But the Trump administration has also taken aim at Canada\u2019s supply management system, which sets high tariff rate quotas on foreign dairy products to protect the domestic industry.<\/p>\n

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Ottawa recently passed legislation aimed at ensuring supply management isn\u2019t targeted in future CUSMA reviews, and Prime Minister Mark Carney has promised it won\u2019t be on the table in the upcoming talks.<\/p>\n

Accusations of Canadian softwood lumber \u201cdumping\u201d by the U.S., as well as the rules surrounding automobile supply chains, could also be raised.<\/p>\n

Economists have predicted that Trump, as he has done with other countries in updating their free trade agreements with the U.S., could try to adjust tariffs on certain goods higher within CUSMA.<\/p>\n

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\t\t\t\tCould Trump withdraw from CUSMA entirely?\n\t\t\t\t\t\t<\/p>\n

Article 34.6 of CUSMA states that any country can withdraw from the agreement at any time by providing written notice to the other parties, with the withdrawal taking effect six months later.<\/p>\n

\u201cIf a party withdraws, this agreement shall remain in force for the remaining parties,\u201d the text reads.<\/p>\n

That means Trump\u2019s blanket tariffs on Canada and Mexico would apply to all goods entering the U.S.<\/p>\n

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\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tU.S. ambassador says Canada is \u2018pulling rug out\u2019 from free trade agreement\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/p>\n

It remains unsettled law as to whether a U.S. president can unilaterally withdraw from a trade agreement without approval from Congress, which had to pass legislation to enact CUSMA. The Canadian and Mexican parliaments did the same.<\/p>\n

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If Trump withdraws from CUSMA, this means the matter will likely be challenged in lawsuits and could end up in the U.S. Supreme Court.<\/p>\n

Business groups in all three countries are underscoring the importance of retaining and improving CUSMA, rather than scrapping it, to remove the trade uncertainty unleashed by Trump\u2019s tariff policies.<\/p>\n

\u201cCUSMA is too important to our prosperity \u2013 and to North America\u2019s global competitiveness \u2013 to allow it to unravel,\u201d Candace Laing, president and CEO of the Canadian Chamber of Commerce, said in a statement.<\/p>\n

\u201cWe cannot afford to find ourselves back in this same position next year.\u201d<\/p>\n

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