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Authors

  • Jean Daudelin

  • José Antonio Muñoz

  • Duane Bratt

Issue

Was This Year’s ‘Three Amigos’ Summit a Success?

This post is also available in: Português Español

U.S. President Joe Biden, Mexican President Andrés Manuel López Obrador and Canadian Prime Minister Justin Trudeau met on Jan. 10 in Mexico City to discuss strengthening economic ties, clamping down on drug trafficking and improving legal migration pathways. The summit took place amid an ongoing dispute over Mexico’s controversial energy policies, which the United States and Canada have denounced as being discriminatory. Meanwhile, shortly after the summit concluded, news emerged that Mexico and Canada won their dispute with the United States under the USMCA over its automotive industry proposal, which was deemed protectionist. What were the main goals of the summit, and what has been achieved? What challenges stand in the way of greater North American cooperation?

Tara Hariharan, managing director of global macro research at NWI Management: “The ‘Three Amigos’ Summit prioritized inclusive growth, prosperity and North American trade integration, particularly in green energy. A semiconductor forum and coordinated supply chain mapping aim to bolster investment in chips, critical minerals and electric vehicle batteries, but no financial commitments were specified. Confusingly, Mexico alluded to ‘import substitution,’ evocative of 1970s-era Latin American trade barriers. Leaders pledged to cut waste-related methane emissions by 15 percent by 2030. Migration and drug-trafficking initiatives were incremental: U.S. work permits for 30,000 migrants monthly provided Mexico accepts an equal number, streamlined online legalization applications and information-sharing on the fentanyl supply chain. Under the USMCA and predecessor NAFTA, regional trade surged by 770 percent from 1994 to 2021. However, energy, automotive and agricultural disagreements frustrate North America’s potential reshoring gains from U.S.-China competition. The summit sidestepped the ongoing dispute regarding Mexico favoring its state-owned energy companies over foreign and private entities, but Mexico risks substantial punitive tariffs should arbitration ensue. The United States’ loss regarding regional automobile content legitimizes the USMCA’s dispute resolution process but could jeopardize regional unity. While the United States sees strict content rules supporting regional jobs and lowering imports, automakers may produce offshore at low cost anyway if facing U.S. tariffs. Separately, Mexico plans an import ban on genetically modified U.S. corn by 2025. Biden’s and AMLO’s interpersonal frictions further dampen U.S.-Mexico ties, and AMLO criticized U.S. ‘abandonment’ of Latin America while urging further U.S. investment. The energy dispute also overshadows Canada-Mexico relations and highlights broader concerns regarding AMLO’s undermining of Mexican democratic institutions.”

Nicolás Mariscal, member of the Advisor board and chairman of Grupo Marhnos in Mexico City: “The North American Leaders’ Summit was very positive, as it was an opportunity for the three leaders to establish personal ties and broaden communication channels. Nevertheless, much of the announced policies had already been agreed upon, and some thorny issues were not discussed at all. The three presidents got what they wanted. President Andrés Manuel López Obrador, or AMLO, succeeded since energy policy was not at the center of the debates, as many were expecting. Furthermore, Ovidio Guzmán was arrested before the summit, giving AMLO an upper hand in talks on security and fentanyl. President Joe Biden also had his victories as AMLO committed to receiving 30,000 migrants per month to depressurize both the U.S. border and Republican objections. Lastly, Prime Minister Justin Trudeau brought up the energy topic at his bilateral meeting with AMLO, agreeing that the Mexican government would receive Canadian companies to examine the matter. Some argue that we are giving birth to a new moment in international relations, where globalization will give way to regionalism. It is a fact that the United States, because of national security, is bringing back its supply chains. And this is an excellent opportunity for all three countries to thrive and deliver to their populations the development and improvement in lives they deserve.”

Jean Daudelin, associate professor in The Norman Paterson School of International Affairs at Carleton University in Canada: “Justin Trudeau arrived at the Three Amigos Summit with the same two messages he has tried to convey to Washington since Joe Biden was elected: ‘We matter!’ and ‘You need us economically and strategically.’ On both counts, he did not bring much back to Ottawa. Given the mess Biden has to deal with in Washington, in Europe, in Asia and at the Mexican border, Canada suffers from not giving headaches to the White House, having few outside options and not being very credible as a strategic ally. The trilateral setting made things worse because framing Canada’s argument in continental terms weakens them sharply. In Washington, no one needs to be reminded that Mexico matters. Moreover, the idea that the security of the United States could depend on nationalists like AMLO or his likely successor makes North-American ‘onshoring’ a rather scary prospect. While it desperately seeks extra-regional partners—in the Indo-Pacific region, most recently–Ottawa may be better off framing its message to Washington in narrowly bilateral terms. Mexico can still be an ally in areas like the auto sector. Canada also needs it to protect the trilateral arrangements that prevent the emergence of a hub-and-spoke trade regime that would drive all investments to the United States. But Mexico’s never-ending low-intensity civil war and the increasing unpredictability of its economic policy make it a poor ally in a push for deeper integration. The war in Ukraine and relations with China also leave the two Northern ‘friends’ at odds with Mexico—and much of the Global South, for that matter.” 

Arturo Sarukhan, board member of the Inter-American Dialogue and former Mexican ambassador to the United States: “Given what’s at stake geopolitically today in the world, the summit has likely been the most consequential one since 2005 in the aftermath of the terrorist attacks of 2001. It was undoubtedly encouraging to see the Biden administration sending a geopolitical message as to the intent and potential of North America. It was also extremely important for the three nations to jointly support democracy in Brazil ahead of the summit. But most previous North American Leaders’ Summits have underwhelmed and underdelivered, more symbolic than substantive. Unless this summit can deliver on implementation and at the same time close the gap between opportunity and reality among the three partners, it could end up being symbolic too. The United States is in the midst of the most important recalibration of its foreign policy since the end of the Cold War as it recasts strategic ties with China. If that recalibration–and the strategic paradigm that results from it–is to prove successful, chiefly in trade and the economy, Canada and Mexico need to become an integral part of that vision, particularly when it comes to supply chains, reshoring/friend-shoring, creating incentives for semiconductors, electric vehicles and batteries, achieving a joint paradigm for regional energy security, resilience, sustainability and independence, and enhancing cybersecurity. Nonetheless, reality paints another picture. Whether it’s Washington bandwidth focused elsewhere or Mexico City’s public policy mix and lack of diplomatic appetite and vision, the truth is that the opportunity to forge a more cohesive and forward-leaning North America may be harder to implement on those issues, particularly energy. More importantly, the ongoing deterioration of Mexico’s democratic underpinnings could be the most salient challenge to the cohesion, well-being and security of North America in the coming years.”

José Antonio Muñoz, Central America chairman and managing partner at Dentons Muñoz: “A rules-based and strengthened USMCA is an ideal response to both disruption of global supply chains and trade tensions between China and the West, and also within the West itself. A strengthened North American market will cement a manufacturing, services and transportation and logistics system of unrivaled dimension and efficiency. For Latin America, and the world at large, the integration of the Canadian, U.S. and Mexican economies into a global engine would make real the promise of near- and friend-shoring and the consolidation of markets for raw materials, intermediary products, labor and brain power. For this vision to become a reality, economic benefits must be palpable soon, and the political will of Canadians, Americans and Mexicans must stand up to the pressures of protectionism and demagoguery. The power of a billion-person market across North America and Latin America and the Caribbean is a powerful incentive for politics, business and social advancement to come together under the vision of a successful North American compact. The compact, in turn, should from the start seek to grow and attract other Latin American and Caribbean countries committed to market economy and the rule of law. The USMCA and the continent must remain steadfast in its adherence to stable norms and procedures for this vision to withstand and hold true.”

Andrés Rozental, member of the Advisor board, president of Rozental & Asociados and former deputy minister of foreign affairs of Mexico: “The Mexico-U.S.-Canada Summit, as in the case with most of these events, was first and foremost an opportunity to show a degree of camaraderie among the leaders of the three countries at a time when the concept of North America as a true partnership is showing signs of decline. Three bilateral conversations, a joint meeting and a press conference were held over as many days in Mexico City, with expectations that the substantive agenda of trilateral issues would be the focus of the gathering. Much of the agenda between Mexico and the United States revolved around the migration issue, which was President Joe Biden’s main political goal in getting his Mexican counterpart, Andrés Manuel López Obrador (AMLO), to accept monthly deportations of up to 30,000 Venezuelans, Haitians, Cubans and Nicaraguans who reach the United States seeking asylum, thus easing domestic political pressures on the Biden administration. The existing USMCA dispute over Mexico’s energy policy was carefully omitted from the talks–at least publicly–so as not to show dissent over an issue that promises to determine whether existing U.S. and Canadian investments in Mexico’s energy sector will continue to benefit from the reforms enacted during the Peña Nieto administration, or whether AMLO’s hostility toward these investments will eventually drive them away. Notwithstanding trade and investment disputes, the summit did lead to agreements on cooperation in attracting Asian investment to North America, and giving Mexico an opportunity to benefit from nearshoring in the high technology sector. Finally, the objective of showing a ‘good’ relationship with our northern neighbor was achieved thanks to President Biden’s unlimited patience with AMLO’s capricious behavior.”

Duane Bratt, professor of political science at Mount Royal University in Canada: “The ‘Three Amigos Summit’ was the first summit since the renegotiation of NAFTA into the USMCA. Despite the rise in trilateral trade and investment, many of the participants’ objectives related to bilateral issues. Justin Trudeau was focused on Canada-U.S. relations, and for Joe Biden and López Obrador it was about U.S.-Mexico relations. For Trudeau, it was a success. Biden accepted an invitation to make his first trip to Canada as president in March, and a deal was reached over backlogs over NEXUS applications (which allow easier travel across the Canada-U.S. border). In addition, Canada and Mexico were victorious over the United States in a key USMCA dispute on North American content in the auto sector. López Obrador was also likely pleased by the outcome. In addition to the auto sector win, the announcement that the United States wanted to be a hub for semiconductor manufacturing (avoiding China) would benefit Mexican supply chains as well as Canadian production of critical minerals used in microchips. More importantly, López Obrador did not have to make concessions on Mexico’s efforts to protect its domestic energy sector (notwithstanding its USMCA commitments) although he likely faces a USCMA trade dispute panel. For Biden, it was a much less successful summit. Not only did the United States lose the auto case, but little progress was made on U.S.-Mexican border issues, namely migrants and drugs, nor on Mexico’s efforts to protect its domestic energy sector, notwithstanding its USMCA commitments.”

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