US Commerce Secretary Howard Lutnick has sharply criticized the US-Mexico-Canada Agreement, calling it a ‘bad deal’ that President Donald Trump believes must be ‘reconsidered and reimagined’ before the critical July deadline for its extension.
Lutnick, speaking at the Semafor World Economy conference in Washington, DC today, expressed frustration over the trade pact’s structure, arguing it treats Mexico and Canada akin to US states like Georgia and Alabama without equivalent commitment.
‘There’s plenty of good in it, but there’s a huge amount of bad in it,’ he stated, emphasizing the need for revisions that prioritize American interests. His comments come as the Trump administration prepares for a formal review of the agreement, with US Trade Representative Jamieson Greer set to unveil the US position on June 1.
The commerce secretary reserved particularly harsh words for Canada, accusing the country of exploiting the US’s $30 trillion economy. He dismissed Canada’s trade strategy as ineffective and mocked Prime Minister Mark Carney’s outreach to China for export opportunities, questioning the logic of engaging an export-driven economy. ‘They suck off of our $30T economy,’ Lutnick said, though a Commerce Department spokesperson later clarified this as a reference to an unfair trade imbalance.
Despite his criticism, Lutnick acknowledged the importance of specific economic ties with both neighbors. He highlighted energy and other sectors in Canada as vital to US interests, alongside fundamental dependencies on parts of Mexico. However, he condemned practices like relocating auto plants from Ohio and Michigan to Mexico to undercut unions, calling such moves ‘nuts’ and detrimental to American workers.
The looming USMCA review has already sparked concern among businesses, particularly in Canada, where duty-free access to the US market underpins much of the export economy. Uncertainty over potential changes has dampened investment and hiring plans across the border. Meanwhile, nearly 40 US senators from both parties have pressed Greer to enforce existing terms, aiming to preserve stability for American farmers, ranchers, and rural communities.
Lutnick’s broader economic outlook also touched on global factors influencing trade dynamics. He noted a 10% drop in oil prices on April 17, following the reopening of the Straits of Hormuz, suggesting that reduced global threat levels could reshape risk premiums in markets. With Trump’s visit to Beijing later this year, Lutnick firmly ruled out any prospect of Chinese automakers like BYD establishing factories in the US.
As negotiations approach, the administration’s stance signals a contentious road ahead. Greer recently noted progress in talks with Mexico but flagged unresolved issues with Canada, adding another layer of complexity to the July deadline for extending the pact.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
