{"id":321735,"date":"2025-12-03T01:57:09","date_gmt":"2025-12-03T01:57:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/321735\/"},"modified":"2025-12-03T01:57:09","modified_gmt":"2025-12-03T01:57:09","slug":"trump-may-use-usmca-withdrawal-as-a-bargaining-tactic-trade-experts-warn","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/321735\/","title":{"rendered":"Trump may use USMCA withdrawal as a bargaining tactic, trade experts warn"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Vehicles cross the Ambassador Bridge, which carries about 25 per cent of all trade between the U.S. and Canada.JEFF KOWALSKY\/AFP\/Getty Images<\/p>\n

Canada needs to be prepared for the risk the United States may announce its withdrawal from the trilateral USMCA trade deal as a negotiating tactic, according to a legal expert who is testifying on the agreement at public hearings in Washington this week.<\/p>\n

Barry Appleton, a Toronto lawyer who is co-director of the Center for International Law at New York Law School, is speaking before the Office of the U.S. Trade Representative Wednesday as part of a scheduled review<\/a> of the U.S.-Mexico-Canada Agreement (USMCA).<\/p>\n

\u201cThe mere suggestion of USMCA termination serves as an exceedingly potent, almost extortionary, bargaining chip,\u201d Mr. Appleton said.<\/p>\n

Brian Clow, who served as deputy chief of staff to former prime minister Justin Trudeau<\/a>, said he is increasingly concerned that U.S. President Donald Trump<\/a> will issue a withdrawal notice. He said the Prime Minister\u2019s Office under Mr. Trudeau was worried about this during Mr. Trump\u2019s first term and Mr. Clow feels the likelihood of this \u2013 to put pressure on Canada and Mexico \u2013 is rising. <\/p>\n

A withdrawal notice from any country that is a signatory to the USMCA would trigger a six-month countdown to that member exiting the agreement. <\/p>\n

From airlines to winemakers, U.S. businesses push Trump to preserve North American free trade<\/a><\/p>\n

Mr. Clow, who worked on the USMCA during his years in the Prime Minister\u2019s Office, said he\u2019s pessimistic about how the mandated 2026 review of the USMCA will unfold. The U.S. under Mr. Trump is seeking gains from renegotiation without any interest in benefits for Canada or Mexico, he said.<\/p>\n

\u201cI think the Trump administration is not looking for deals that help all three countries. They\u2019re looking for unilateral concessions from Canada and Mexico. So, it\u2019s going to make getting through the review challenging,\u201d he said.<\/p>\n

Laura Dawson, executive director of the Future Border Coalition, a group that is working to eliminate trade barriers at the Canada-U.S. border, is also testifying at the three days of USTR hearings.<\/p>\n

She said she believes the U.S. benefits too much from the USMCA to abandon it. Canada and Mexico are among the U.S.\u2019s largest trading partners. The vast majority of American companies engaged in international trade are benefiting from integrated supply chains with countries such as Canada.<\/p>\n

Manufacturing meltdown: How Trump\u2019s tariffs are squeezing Canadian factories<\/a><\/p>\n

\u201cWithout the USMCA, the legal framework for U.S. trade would be completely fractured,\u201d Ms. Dawson said. \u201cThere are a lot of places in the United States that are both Trump supporters and trade supporters,\u201d she said. \u201cSo, I think it would be very difficult to find a constituency of support to abandon the North American trade deal.\u201d<\/p>\n

She predicted renegotiation will be difficult. \u201cThe Trump administration has proven that they are willing to rewrite the rules of global trade.\u201d<\/p>\n

It\u2019s still unclear how the White House will deal with revisions to the USMCA that would require Congressional approval, because Mr. Trump has not obtained trade promotion authority from Congress. Ms. Dawson said the U.S. could resort to annexes and side letters to address some revisions or additions to USMCA.<\/p>\n

Flavio Volpe, president of Canada\u2019s Automotive Parts Manufacturers\u2019 Association, is also appearing before USTR this week. He intends to mount a defence of the country\u2019s auto industry in the face of Mr. Trump\u2019s efforts to stop the importation of Canadian-made vehicles into the U.S. <\/p>\n

The U.S has placed a 25-per-cent tariff on Canadian-made cars with a carve-out for the value of a vehicle made from U.S. parts. Last year, around 90 per cent of the 1.3 million vehicles manufactured in Canada were exported to the U.S.<\/p>\n

Mr. Volpe said Canada should expect threats to withdraw from Mr. Trump \u201cbut work through it without being alarmed.\u201d <\/p>\n

He plans to draw USTR\u2019s attention to the fact that U.S. content in Canadian-made cars has been growing, with American parts per vehicle assembled here rising to $22,343 in 2024 from $15,327 in 2019.<\/p>\n

Opinion: U.S. use of poison pills in Asian trade deals signals trouble for Canada in USMCA renegotiations<\/a><\/p>\n

Mr. Volpe said he will tell Washington that Canada is the U.S.\u2019s No. 1 export market for vehicles and parts, and that Canadian companies employ tens of thousands of American workers. \u201cNo country buys more U.S.-built vehicles and parts than Canada,\u201d he said.<\/p>\n

Goldy Hyder, president of the Business Council of Canada, a lobby group, is also testifying before USTR this week.<\/p>\n

He said the fact that the scheduled review of the trilateral deal is under way \u201cis the best indication that that the USMCA is something that the administration wants to preserve.\u201d<\/p>\n

Mr. Hyder said abandoning the USMCA would be disruptive for U.S. businesses. \u201cAt a time where your economic security has never been as paramount as it is today, it would be very difficult to unravel all of that.\u201d<\/p>\n

He said it\u2019s imperative to ensure the negotiations are conducted collaboratively with all three countries, as opposed to Washington and Mexico City hashing out a deal on their own and then bringing it to Canada afterward. <\/p>\n

\u201cWe cannot let that happen. We must be at that table, which is why you hear me regularly say it is important that the Prime Minister remain engaged with the President.\u201d<\/p>\n

The Business Council president said another real risk is that the review doesn\u2019t end in 2026 and \u201cthis drags on longer.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Vehicles cross the Ambassador Bridge, which carries about 25 per cent of all…\n","protected":false},"author":2,"featured_media":321736,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[49,48,44,714],"class_list":{"0":"post-321735","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-canada","8":"tag-ca","9":"tag-canada","10":"tag-news","11":"tag-politics"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/321735","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=321735"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/321735\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/321736"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=321735"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=321735"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=321735"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}