Estimated reading time: 6 minutes

The Government Circuit: USMCA Review—A Crucial Opportunity to Fortify North American Electronics

As the 2026 review of the U.S.-Mexico-Canada Agreement (USMCA) approaches, policymakers have a rare opportunity to reinforce a partnership that powers their shared competitiveness, resilience, and growth.

That is the message that I will have the honor of delivering on behalf of the Global Electronics Association in a public hearing at the U.S. International Trade Commission in Washington on Dec. 4. We’ve also submitted our views formally to the U.S. Trade Representative, and we’ve shared our position far and wide.

In short, we are “all in” on the USMCA—or any comparable or improved successor agreement—because predictable, rules-based trade is good for our members, for all three countries, and for the world.

Over three decades, from the North America Free Trade Agreement (NAFTA) launched under President Clinton in 1992 to the USMCA spurred by the first Trump administration in 2018, North American electronics manufacturers have thrived under rules-based trade that fosters regional supply chains, shared investment, and deep integration.

According to our latest research report, “Why Mexico Matters to U.S. Manufacturing,” in electronics specifically, 67% of U.S. imports from Mexico and 48% of U.S. exports to Mexico were intra-firm, highlighting deep supply chain integration. Aerospace, defense, medical devices, and semiconductors all depend on the same bi-national production ecosystem.

With Mexico now serving as a major production hub and re-export platform for electronics, maintaining tariff-free access is essential to sustaining America’s global competitiveness and resilience.

Meanwhile, Canada brings its own strengths to the table, including advanced R&D, semiconductor and aerospace expertise, and close integration with U.S. defense and clean-energy manufacturing. More than half of electronics imports from Canada feed directly into U.S. production of finished goods. That’s a partnership that makes the United States stronger and more competitive globally.

The 2026 USMCA review is an opportunity to reinforce that three-way partnership. North American electronics manufacturing depends on seamless coordination across borders. Tightening rules of origin too far or applying new penalties too broadly could disrupt legitimate production and raise costs for U.S. companies investing in this region.

As the Trump administration weighs its next moves on North American trade, the Global Electronics Association urges them to:

• Maintain tariff-free access for USMCA-compliant trade. 
• Ensure workable rules of origin for complex, high-value production like ours. Indeed, many electronics components and systems cross the U.S. border multiple times before ending up in finished products in U.S. customers’ hands. 
• Target law enforcement at preventing circumvention of USMCA rules without disrupting legitimate production.
• Treat Mexico and Canada as strategic partners by investing jointly in workforce, innovation, and infrastructure efforts.

When the U.S., Mexico, and Canada operate as a region, we all win: Our industries grow, our workers thrive, our supply chains become more secure, and our collective resilience deepens. 

What’s at stake if we get the 2026 review wrong? Billions in investment, tens of thousands of jobs, and the future of regional innovation.

The Global Electronics Association and our 1,700 member companies stand ready to work with our members and the governments of all three countries to strengthen the ecosystem that keeps innovation, jobs, and manufacturing leadership anchored in North America.

A Tumultuous Season for Global Trade
In the past 60 days alone, U.S. trade talks with various partners have shifted in varying directions.  

Mexico and Canada: In early November, Mexico and the United States agreed to postpone the imposition of higher tariffs on each other for at least a few more weeks following a conversation between the two nations’ presidents. Around the same time, the U.S. broke off trade talks with Canada after Ontario’s provincial government aired an anti-tariffs TV commercial in the United States. Those talks were focused on trade rules for the steel, aluminum, automobile, lumber, and copper industries, and the outlook remains unclear.

East Asia: During a weeklong visit to Asia, President Trump reached trade agreements of various descriptions with seven nations: China, Japan, South Korea, Malaysia, Thailand, Vietnam, and Cambodia. Among those, President Trump and Chinese President Xi reached a one-year deal in which China will suspend its recent export restrictions for rare earth minerals, which are used in semiconductors, circuit boards, and electric motors, while the United States rolled back certain export blacklists on Chinese firms. 

Our industry welcomes the easing of trade tensions and greater supply chain clarity that should result from these deals.

U.S.-Europe: The only quiet front in the global trade revolution in recent weeks has been between Washington and Brussels, which inked a “framework” deal in July that a European official called “the most favorable trade deal the U.S. has extended to any partner.” Negotiations continue on the details of that agreement.

Chips, machinery, and other inputs: In October, Dr. John W. Mitchell, president and CEO of the Global Electronics Association, wrote to the U.S. Dept. of Commerce to open a dialogue on the potential impacts of planned tariffs on semiconductor chips. Although we share the Administration’s goal of strengthening U.S. economic and national security, the rumored direction of the investigation was raising concerns about costs, complexities, and unintended consequences for electronics.

However, in recent days, news reports have indicated the Trump administration may delay any semiconductor tariffs to avoid negative impacts on U.S.-China negotiations. 

Finally, the Association also submitted official comments on the national-security-based investigations of robotics, industrial machinery, and medical technology.

And the Trump administration rolled back tariffs on more than 200 food products, revealing a growing sensitivity to higher prices at the grocery store.

The U.S. Supreme Court Could Unravel It All
During a hearing in early November, Supreme Court justices on both sides of the political spectrum questioned President Trump’s use of “emergency” powers to impose tariffs on countries around the world, casting doubt on the future of one of his signature economic policies. 

The Trump administration says the underlying law, known as IEEPA, allows the president to “regulate” imports, which includes the use of tariffs. But a majority of justices questioned the administration’s interpretation of the nearly 50-year-old law. Administration officials and independent experts say Trump could potentially use other legal authorities to reimpose many, if not all, of the IEEPA tariffs.

'Affiliates' Rule Raises Export Controls Threat
In late September, the U.S. government adopted an “interim final rule” (IFR) that dramatically expands the scope of export controls in a way that may do more harm than good. But the rule may soon be paused.

The IFR aims to prevent adversaries from acquiring U.S. technology through loopholes in corporate ownership—a goal we support. But as we noted in comments sent to the U.S. Department of Commerce, the rule is “operationally unworkable” and “risks inflicting severe, long-term damage on U.S. technological leadership and economic security.” Fortunately, we hear the Trump administration is considering pausing the rule’s rollout and adjusting its content.  

As the trade landscape continues to shift, the Global Electronics Association will remain steadfast in its advocacy for policies that strengthen—not constrain—the flow of technologies that power our modern world.

Chris Mitchell is VP of global government affairs for the Global Electronics Association. Contact him at ChrisMitchell@ipc.org.