USMCA review could extend to 2027, toughen rules, Mexican economists warn

MEXICO CITY, Nov. 25 (Xinhua) -- The upcoming review of the U.S.-Mexico-Canada Agreement (USMCA) could extend into 2027 and bring stricter rules for the automotive industry and other technology-related areas, Mexican economists said Tuesday.

The three USMCA partners are scheduled to begin updating the agreement in January 2026, as stipulated during the renegotiation of its predecessor, the North American Free Trade Agreement.

Gabriela Siller, director of economic and financial analysis at Grupo Financiero Base, said Mexico faces a "very challenging" environment, mainly due to shifts in U.S. trade policy pushed by President Donald Trump since taking office in January.

Those policies have reshaped Mexico's export landscape, including a 25 percent U.S. tariff on the automotive industry -- a sector the U.S. president has turned into an "ideological banner" ahead of the USMCA review.

"In my base scenario, the USMCA review will not conclude next year. Trump will want to extend it into 2027, and all of this will create uncertainty," Siller said at the 2025 Automotive Forum organized by the Mexican Association of Automotive Dealers.

The new pact might include tighter rules of origin for the automotive sector and for labor content, which would push up costs over the long term.

Alejandro Padilla, chief economist and deputy general director of economic and financial analysis at Grupo Financiero Banorte, said U.S. trade policy has triggered "structural changes" in globalization.

Those shifts come amid rapid technological development and artificial intelligence, part of a long-lasting "macrotrend," he noted.

"I think the USMCA review process will conclude in one or two years, but it should be an update of the current agreement," Padilla said at the roundtable "Direction of the Mexican Economy."

The revised pact could include strengthened regional-content rules, changes in the digital economy and new technology provisions tied to the rise of artificial intelligence, he added.