Day 601 — First Formal U.S.–Mexico USMCA Bilateral Review Round Opens in Mexico City

On May 25, 2026 (Day 601), the first official bilateral U.S.–Mexico USMCA Review negotiating round opened in Mexico City, as agreed by USTR Ambassador Jamieson Greer and Mexican Economy Secretary Marcelo Ebrard in their joint statement (April 2026). This opens the substantive phase of USMCA renegotiation — the July 1, 2026 decision deadline under the treaty's six-year review clause approaches. KEY ISSUES: (1) RULES OF ORIGIN: The U.S. seeks stricter automotive content requirements to ensure vehicles meet North American origin thresholds and are not assembled from Chinese-origin parts through Mexican supply chains. (2) CHINESE NEARSHORING: USTR Greer has declared that preventing Chinese companies from exploiting Mexico as a tariff-free backdoor to the U.S. market is a 'non-negotiable' U.S. demand, requiring enhanced monitoring of foreign investment in Mexican manufacturing. (3) STEEL AND ALUMINUM TARIFFS: Mexico seeks termination of Section 232 steel and aluminum tariffs on Mexican exports, which it views as inconsistent with USMCA's spirit. The U.S. confirmed these tariffs remain in place during talks. (4) ENERGY ACCESS: The U.S. is pushing for expanded access to Mexico's electricity and oil sectors, which Sheinbaum has defended as sovereign state prerogatives under the constitutional energy reform. (5) LABOR STANDARDS: Enforcement of the 2019 labor reform (rapid response mechanism) and new collective bargaining requirements continue to be evaluated. CANADA EXCLUDED: The current bilateral round is a Mexico-U.S.-only discussion; Canada is expected to join the full trilateral USMCA Joint Review scheduled for July 1, 2026. Greer also met with Mexico's Business Coordinating Council (CCE) and AmCham during the week. CONTEXT: The round begins three days after the historic EU-Mexico Summit (May 22) at which Sheinbaum signed the Modernised Global Agreement and Interim Trade Agreement — providing Mexico with strategic diversification leverage in the negotiations. U.S. Section 122 tariffs (10%) on Mexican imports remain active until approximately July 24, 2026; Section 301 probes (targeting potential tariff restoration) continue in parallel. Citi's Mexico survey (May 21) lowered the 2026 GDP growth forecast to 1.1%, reflecting business uncertainty over trade outcomes.