Sign up for TPR Today, Texas Public Radio's newsletter that brings our top stories to your inbox each morning.
President Donald Trump’s decision not to extend the U.S.-Mexico-Canada Agreement for another 16 years is creating economic uncertainty along the Texas-Mexico border, where businesses depend on predictable trade rules.
“I’m not looking to renew it,” Trump said in June. “We don’t need anything that Canada has. We don’t need anything that Mexico has, but they need everything that we have. They have to treat us better.”
The Trump administration subsequently declined to extend the agreement in its current form, saying it wants to address the pact’s “shortcomings” and U.S. trade deficits.
The USMCA, which Trump negotiated to replace NAFTA during his first term, remains in force until July 2036. The decision triggers annual reviews until the three countries agree to an extension or the pact expires.
Democratic Laredo Congressman Henry Cuellar said he views Trump’s threat as a familiar negotiating tactic and does not believe the president ultimately wants to eliminate North American free trade.
“He took the same approach when he said he was going to not do this NAFTA,” Cuellar said. “But at the end of the day, Congress played a role in this.”
Cuellar argues Trump cannot terminate the congressionally approved agreement without Congress, although the division of withdrawal authority between the president and lawmakers remains legally disputed.
“The only thing he can do is just start a cycle of yearly renewals,” Cuellar said. “But this renewal causes a lot of uncertainty.”
That uncertainty has immediate consequences for border communities, Cuellar said.
“Being in the largest port of entry in the United States, I’ve seen that uncertainty of the trade agreement really freeze investment — new warehouses, the new money coming in,” he said.
Laredo is the nation’s largest inland port. Cuellar warned that prolonged negotiations could delay warehouses, manufacturing plants and transportation projects throughout South Texas and the Rio Grande Valley, even though the agreement remains active and most compliant Mexican goods continue entering tariff-free.
