The United States has sought to deepen regional trade integration in a variety of ways across all areas of the manufacturing sector.
These include the negotiation of the Mexico-United States-Canada Agreement (USMCA, which includes new rules of origin for the automotive sector aimed at increasing regional content and benefiting the North American auto industry.
Other examples include the Indo-Pacific Economic Framework for Prosperity (IPEF) and the U.S.-EU Trade and Technology Council (TTC), both of which focus on developing more secure, diverse and resilient regional supply chains.
For the first time in a U.S. trade agreement, the USMCA includes a specific chapter on SMEs, recognizing their role in each signatory country’s economy.
U.S. companies with fewer than 500 employees account for two-thirds of the companies that trade goods with Canada and Mexico.
Trade Integration
The USMCA promotes cooperation and information exchange to create more trade and investment opportunities for SMEs in the region. It reduces formalities for shipments under US$2,500, increases de minimis levels, and eliminates the local presence requirement for cross-border service providers. The agreement also facilitates the exchange of information and best practices to support SME participation in government contracts.
Furthermore, effective July 2020, the agreement includes amendments on various matters. These include minimum wage adjustments, increased access to Canadian dairy markets, and an extension of copyright protection to 70 years after the author’s death.
The USMCA also updates NAFTA’s Chapter 11, specifically for the United States and Mexico, revising investor-state dispute settlement procedures.
Additionally, the agreement includes a 16-year «sunset» clause. This means the terms will expire after a set period and will be reviewed every six years. At that point, the United States, Mexico, and Canada can decide whether to extend the USMCA.
If the USMCA is terminated or modified, such changes could significantly affect Mexico’s aviation sector.