This week, the United States and Mexico engaged in bilateral negotiations under the first joint review of the U.S.–Mexico–Canada Agreement (USMCA). The United States Trade Representative announced a schedule of talks that began with a negotiating round in Mexico City on May 28–29 and continued with sessions in Washington, D.C. on June 16–17. The stated agenda includes economic security, rules of origin for key industrial goods, agriculture, and measures to ensure a level playing field.

Negotiators are focusing primarily on tightening rules of origin, especially for autos and related parts, so a larger share of vehicle content must be North American (with some U.S.-specific content proposals reportedly under consideration). Economic-security issues, critical‑minerals cooperation, and agricultural market access are also on the table, along with dispute‑resolution and enforcement mechanisms intended to preserve the USMCA’s balance.

Due to the upcoming mid-term elections in November, the trade talks are politically charged for the United States. U.S. lawmakers have pressed the Trump administration for substantive reforms ahead of the USMCA review, and any perceived concessions or new tariffs could become campaign‑period issues.

In Mexico, negotiations are perceived as sovereign policy debates and public concern about job‑security in manufacturing. Canada is not attending the negotiations, and the Trump Administration has threatened to cut Canada out of the deal…

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U.S. negotiators are pushing for stronger, U.S.-favorable content and enforcement language, while Mexico seeks to protect its manufacturing competitiveness and sovereign policy space (notably on energy in prior discussions). Mexican and U.S. officials have signaled the review process will likely extend past the originally anticipated July milestone, meaning a protracted set of bargaining rounds and technical talks. Thus far, progress in the talks has been incremental, a pattern that is likely to continue.

Energy is an issue that sits at the intersection of Mexico’s sovereignty agenda and its USMCA commitments, and it’s been a prominent factor thus far in the second round of discussions. Mexico’s constitutional energy reform, approved in October 2024, and the secondary legislation enacted in March 2025, reinforced the role of the state in the energy sector.

This included provisions requiring the Federal Electricity Commission to maintain at least 54 percent of domestic electricity generation. The U.S. has expressed concerns about the growing power of Mexican state-owned enterprises (SOEs), though many other oil rich countries use similar SOEs.

The third round of talks between the U.S. and Mexico are scheduled to begin on July 20, 2026. Thus far, negotiators from both sides have been more cautious than the statements made by U.S. and Mexican top officials would suggest.

The current agreement between the U.S., Mexico, and Canada was signed during President Trump’s first term, but he appears to be having second thoughts about the deal. If Congress and the Trump Administration continue to seek different outcomes for the negotiations, it will likely become an important issue for the mid-term elections and could hinder the negotiations themselves.

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