Submission to Global Affairs Canada Regarding the 2026 Canada-United States-Mexico Agreement (CUSMA) Joint Review

On October 31, 2024, the Canadian Chamber of Commerce submitted feedback to Global Affairs Canada as part of the consultation process for the 2026 CUSMA joint review.

The submission highlights the importance of maintaining the continuity of the Agreement amidst rising protectionist sentiments in the U.S. and Mexico. We expressed our concern over the potential for renegotiation, especially in light of the upcoming U.S. Presidential election, which could jeopardize the stability that CUSMA provides.

Read the submission below.

Sent via email

October 31, 2024

Global Affairs Canada
Trade Negotiations – North America (TNP)
John G. Diefenbaker Building
111 Sussex Drive
Ottawa, Ontario K1N 1J1

Re: Consulting Canadians on the operation of the Canada-United States-Mexico Agreement

Good afternoon,

The Canadian Chamber of Commerce welcomes this consultation regarding the 2026 Canada-United States-Mexico Agreement (CUSMA) joint review.

The Canadian Chamber of Commerce is Canada’s largest business association, comprised of a network of over 400 chambers of commerce and boards of trade as well as more than 100 sectoral associations. Together, we represent over 200,000 businesses of every size, from all regions and economic sectors of Canada.

Since its entry into force in 2020, the CUSMA has been crucial to enabling the success of the North American economic partnership. Taken together, the combined economies of the three countries now account for nearly a third of global GDP. Given the uniquely integrated nature of North American economic and commercial ties, our close proximity, and extensive trade flows, Canada, the U.S., and Mexico share a common interest in strengthening North American economic growth, prosperity, and competitiveness. The concept of North American economic security is today especially relevant given the current highly uncertain global economic and security environment.

However, the future of the North American economic partnership faces an existential risk as we approach the 2026 CUSMA joint review. In recent years, a growing bipartisan consensus in the U.S. has developed in favour of protectionist trade and industrial policies. This is mirrored by similar developments in Mexico that call into question the commitment of the incumbent Morena Party to the Agreement. The 2024 Presidential election has further heightened this risk, with Vice President Kamala Harris having recently expressed that she intends to reopen the Agreement to protect U.S. manufacturing jobs, and former President Donald Trump explicitly stating his intention to renegotiate the Agreement. Moreover, as demonstrated in a recent report of the Canadian Chamber’s Business Data Lab, Partners in Prosperity: How the Canada-U.S. Trade Relationship Goes Beyond Buying and Selling, Donald Trump’s commitment to a 10% tariff on all U.S. imports would have a similarly disruptive negative impact for both the Canadian and U.S. economies.

Canada is a trading nation, with international trade being responsible for roughly two-thirds of our GDP. To a significant degree, Canada’s economic success is linked to trade with the United States and Mexico, which are our first and third largest international trading partners respectively. A constructive review of CUSMA in 2026, that strengthens rather than undermines the trilateral trading relationship, is of vital importance for the economic success of Canada.

For the government’s consideration, the Canadian Chamber of Commerce is pleased to share the attached comments to help inform Canada’s preparations for the first joint review of CUSMA in 2026 and priorities for work being undertaken in 2025, including Canada’s chairing of the fifth CUSMA Free Trade Commission meeting.

In order to ensure that the 2026 CUSMA review is a successful endeavour that advances Canada’s economic interests, the government should approach the review with the following strategic priorities.

• Canada should first and foremost prioritize ensuring the continuity of the Agreement and its existing key provisions. Given the importance of the Agreement to all three parties, it is imperative that the review preserve the continuity of the Agreement. The review should not become an opportunity for a renegotiation. A fractious review in 2026 would harm businesses in all three countries that rely on the stability and predictability of the trilateral trading relationship that CUSMA enables.
• Canada should work collaboratively with the U.S. and Mexico to advance targeted measures to strengthen the Agreement and enhance North American economic security. Rather than being a disruptive exercise, the review should be viewed as an opportunity to build upon the successes of the Agreement, address shared geopolitical challenges, and access the untapped potential of the North American economic relationship.
• In advance of the review, Canada should prioritize minimizing and resolving key irritants. To ensure that the review is constructive, it is important that Canada work with the U.S. and Mexico to proactively address key irritants that could obstruct or hinder the review process in 2026. Canada should adopt a strategic approach to key irritants, focusing on resolving ‘low hanging fruit’ that can help to strengthen our position with the U.S. when it comes to other major risks. Canada should also identify and take stock of the broader array of major irritants that are impeding Canadian businesses and work with the U.S. and Mexico to address them.

We cannot take the future of CUSMA and the North American trading relationship for granted. The preservation and strengthening of CUSMA is integral for a thriving and dynamic Canadian economy, and for enabling the success of Canadian businesses, workers, and communities.

For Canadian businesses, North American economic cooperation and a successful CUSMA review are a top priority. In the fall of 2023, the Canadian Chamber launched our U.S. engagement initiative to create opportunities for our members to voice their insights on the upcoming review as well as many other aspects of the North American economic relationship. Notably, this has included business-led trade missions to the U.S. on key areas where there are significant opportunities for growth and synergy with the U.S. economy. These missions have focused on critical minerals, life science supply chain resiliency, North American economic security, and artificial intelligence. Through these missions, Canadian businesses are proactively engaging with the U.S. government, legislators, businesses, and the wider U.S. public policy community in order to strengthen North American economic cooperation. The priorities and recommendations outlined in this submission are informed by these ongoing efforts, as well as a broad-based engagement of the Canadian Chamber’s membership.

We look forward to continuing to engage with the government on this important issue and would be pleased to provide further information.

Sincerely,

Matthew Holmes
Executive Vice President, International and Chief of Public Policy
Canadian Chamber of Commerce

For our complete recommendations regarding the 2026 CUSMA Review, please see the full submission below.