The USMCA, signed on November 2018, is making its way through
the legislative processes in the United States, Mexico, and Canada.
Both Mexico and Canada will be closely looking at the eventual
progress in the United States before moving forward on their
own.
The biggest hurdle in the United States is, in general, the
reticence to provide a "victory" to the Trump
administration and, in particular, the requirements of the
Democrat-controlled House of Representatives to (i) wait and see
how the recently-passed labor reform in Mexico is actually
enforced, as well as (ii) seek still undisclosed modifications
regarding environmental provisions. We do not anticipate that such
requirements would amount to reopening the negotiations among the
three countries, as Congress may utilize U.S. domestic implementing
provisions to strengthen the parts that are seen as
insufficient.
