Episode summary
Can USMCA Survive Trump’s Second Term?
Wall Street Week
· · 12 min · Hosts: Chrystia Freeland, David Westin · Guests: Kirsten Hillman, Geronimo Gutierrez, Kelly Ann Shaw
Summary
The discussion centered on whether the USMCA review could destabilize the North American trading system or ultimately reinforce it. The host pressed former Canadian Ambassador Kirsten Hillman, former Mexican Ambassador Geronimo Gutierrez Fernandez, and former USTR General Counsel Kelly Ann Shaw on the risk of no deal, a possible U.S.-Mexico agreement that excludes Canada, and whether President Trump actually values the pact. Hillman argued that the agreement remains in force even if the parties miss the July 1 renewal deadline, making outright collapse unlikely.
The panel repeatedly returned to the idea that USMCA is broader than tariffs. Hillman said it governs intellectual property, agriculture, services, and customs coordination, and warned that if it went away, the three countries would no longer be bound by those rules. Gutierrez Fernandez argued that the agreement is the foundation of a more integrated North American economy and that it has already improved intra-regional trade, while acknowledging the political environment is more dangerous than at any point in the past 30 years.
Shaw said the Trump administration is likely to push for tougher rules of origin in autos, aimed at limiting Chinese content and strengthening North American production. Gutierrez Fernandez said Mexico’s export deficit debate should account for the fact that roughly 40% of every dollar exported from Mexico to the U.S. is actually tied to a U.S. company, and he said both sides have incentives to preserve certainty for investment and trade.
Key takeaways
- Hillman said USMCA stays in place even if the parties miss the July 1 renewal deadline, lowering the odds of a full breakdown.
- Shaw said President Trump has always been skeptical of the pact, but the review clause was built in to avoid NAFTA-style permanence.
- Shaw said the administration likely wants stricter auto rules of origin to reduce Chinese content and push more production into the United States.
- Gutierrez Fernandez said the agreement is the foundation of North American economic integration and has already improved intra-regional trade.
- Hillman said the pact covers far more than tariffs, including intellectual property, agriculture, services, and customs coordination.
Notable quotes
“the agreement stays in place. So I think the chances of the deal staying in place are very high”
“it is extremely important for North America as a region. So trade negotiations are never easy. Even less so nowadays”
“the North American trading relationship is the biggest trading relationship on the planet. It is incredibly important”
“the agreement is the foundation of the integrated nature of our relationship. If it goes away, none of us are bound by those rules anymore”
“And almost none of that car should be made by any components from China”
How the episode opens
Negotiations over the USMCA are about the sectors most directly involved, like autos and agriculture and energy. But ultimately, they're about three countries, what they hope to achieve from any revisions to the trade agreement and what they need to protect. For these 3 perspectives, we welcome now Kirsten Hillman, she's former Canadian Ambassador to the United States, Geronimo Gutierrez Fernandez, former Mexican Ambassador to the U.S., and Kelly Ann Shaw, former USTR General Counsel, now with the Aiken Group here in Washington.
I'll start with you, Kirsten, because you were involved in the USMCA negotiation. Let me ask the really scary question. What is the chance we end up with no deal?
-Yeah, well, I think the first thing, and there's a lot of complicated process around what's going on right now. I think the one thing that's important for people to understand is that there is a deal, and even if on July 1st the parties don't agree to renew it, it stays in place. And we work to find ways to come to an agreement on modifications.
But while we're working on that, the agreement stays in place. So I think the chances of the deal staying in place are very high. Then arrangements around the modifications, I also think we have a very good chance.
There's a lot of things in particular that the USTR said they're looking for that I think both Canada and Mexico can work with. Westin: Let's ask a different kind of risk, because I've also seen some people say there's a possibility that the U.S. would do a deal with Mexico and leave Canada out given some of what the Prime Minister of Canada has been saying.
Is there any prospect for that, Geronimo? -I think we saw it during the first USMCA negotiation.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- usmca
- north america trade
- supply chains
- agriculture
- intellectual property
Watch the episode
Watch “Can USMCA Survive Trump’s Second Term?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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