US, Mexico resume USMCA trade talks as Trump hits Canada with new tariffs

American and Mexican trade negotiators are scheduled to begin the third round of talks on Tuesday as they seek to advance efforts to renegotiate the North American trade deal, amid Donald Trump's imposition of punitive tariffs against Canada.

The negotiations, which do not include Canada, will continue for three days, marking the first round of talks on changes to the USMCA since the Trump administration refused to renew the six-year-old regional trade deal in July 1.

That decision started a countdown clock to dismantle the USMCA within a period of 10 years unless the three countries could come up with improvements. Business organizations have called on Trump to maintain the trilateral nature and mostly free access for trade worth almost $1.6 trillion per year.

According to US Trade Representative Jamieson Greer, who is expected to participate in the talks, Trump's number one priority in the USMCA is to reduce trade deficits with Canada and Mexico, and bring back manufacturing to America.

"The outcomes have to be reasonable. We want to increase auto production here, and we're seeing it," Greer said Tuesday in an interview with CNBC. Greer cites efforts from some automakers that have made efforts to create new capacity for assembling vehicles in the US, including Toyota's plan to expand its Texas factory to assemble trucks currently assembled in Mexico.

"That's the outcome that he desires," Greer further stated. "Also, I think if we could have an arrangement with Mexico, Canada in which we try to highlight US, Canadian, and Mexican content in products being traded in North America, then that would be good outcome because it would help to move supply chains back into North America."

In May, during the bilateral discussions on the USMCA deal with Mexico, USTR had suggested making it mandatory for 50% of the value of vehicles maMexico's new ambassador to the US, Roberto Lazzeri, ​said on Friday that Mexico was expecting to reach a new deal by the end of the year, and that he believes the US. and Canada are aiming for the same goal.

"Every moment that we're losing, I think ‌we are ⁠losing competitiveness, market share and investment, so it's in the best interest of all three of us to get to a position of resolution soon," said Lazzeri, a former investment banker and finance ministry official.

He added that Mexico shares the Trump administration's goal of bringing more manufacturing to North America, including to the US Another key goal for Mexico is to win some relief from Trump's 25% national security tariffs on Mexican autos and 50% on its steel and aluminum products, duties also applied to Canada.de in North America to be of US origin.