Mexico charts its own path in pursuit of trade deal with U.S.

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Mexican President Claudia Sheinbaum greeted news of Canada’s pursuit of a new partnership with the European Union by expressing “deep respect” for Prime Minister Mark Carney, adding, “He is making the best decisions for his country.”

Then, at her regular Monday morning news conference, she announced plans for Mexico to buy more U.S. imports and narrow the trade deficit with its northern neighbour. “We’re the main exporter to the United States,” she said, and what U.S. President Donald Trump wants “is for us to import the same as we export to the United States.”

On Friday she also reiterated her intention to continue seeking an agreement with the U.S. to reduce tariffs on Mexican autos, steel and aluminum, insisting, “Progress is being made toward a potential deal.”

While Mr. Carney has pursued a strategy of diversifying Canada’s export markets, spoken of middle powers banding together rather than currying favour with an increasingly protectionist U.S. and pivoted toward the EU, Ms. Sheinbaum has doubled down on negotiations with the Trump administration.

Reuters recently reported that the U.S. and Mexico are racing toward reaching a deal before the Nov. 3 U.S. midterm elections. A fourth round of talks to renew the United States-Mexico-Canada Agreement is scheduled for Sept. 28 and 29 in Washington, according to Politico.

A source familiar with the discussions confirmed the desire on both sides to reach an agreement by the midterms. But the source said “it’s the same dynamic as Canada.” The U.S. side has “moved the goalposts,” and the size of the trade deficit between the U.S. and Mexico remains a stumbling block.

The Globe and Mail is not identifying the source because they were not authorized to discuss the continuing negotiations.

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Diversifying away from the U.S. market appears to be out of the question for Mexico. The country sends more than 80 per cent of its exports to the U.S. – a figure that has remained stable even in Mr. Trump’s second term, as Mexican factories produce computer components for the AI boom. Mexico has not pursued diversification beyond implementing a modernized agreement with the EU in May.

The EU is Mexico’s third-biggest trading partner. But the US$137-billion in trade between the two in 2025 is dwarfed by the US$964-billion in goods and services traded by the U.S. and Mexico last year.

“Europe might be important for some companies, have a very attractive market, high purchasing power, but it’s not going to substitute the U.S.,” said Juan Carlos Baker Pineda, a former Mexican vice-minister of foreign trade and a researcher at the Universidad Panamericana in Mexico City.

Talk of a Mexican trade deal with the U.S. has lit up Canadian social media, including the idea that Mexico would abandon Canada after reaching a bilateral deal.

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Mexican analysts argue that the recent Canadian negotiations with the U.S. – which broke down in the final hours – could have put Mexico in a bind. A Canada-U.S. bilateral agreement would have served as a template for Mexico’s continuing negotiations.

“I would expect Canada to do the best that they can do, following up on their own interests and their own needs,” Mr. Baker Pineda said. “I would not expect them to negotiate on behalf of Mexico as much as Canadians should not expect Mexico to negotiate on their behalf.”

Mexico still faces a series of commercial and non-commercial obstacles to reaching a potential deal. U.S. Secretary of State Marco Rubio recently warned while touring South America: “There are vast territories in Mexico that are not governed by the state − they are controlled by these narco-terrorist organizations. … The Mexicans have done more than they’ve ever done before to go after these groups. But it is still not nearly enough.”

The U.S. has pressed Mexico to bring drug cartels to heel, even indicting the governor of western Sinaloa state and a senator – both from the ruling Morena party – on drug trafficking charges. Other Morena politicians have had their U.S. visas revoked, including the son of former president Andrés Manuel López Obrador, an act Ms. Sheinbaum decried as “interference” in Mexican politics.

“You can’t compare a pressure point like potentially jailing the leader of the political movement currently governing Mexico with something like, ‘I’m going to slap a tariff on your milk and cheese and I don’t like French labels,’” said Luis Antonio Espino, a Mexican political analyst in Toronto.

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Ms. Sheinbaum has offered constant concessions to keep the U.S. border open to Mexican goods since taking office nearly two years ago. Mexico stepped up security co-operation with the U.S., stopped shipping oil to Cuba to avoid U.S. sanctions and even settled an old water debt with its northern neighbour.

The Sheinbaum administration has addressed trade irritants, too. Imports from China dropped more than 28.4 per cent during the first five months of 2026, Economy Secretary Marcelo Ebrard said in August, as Mexico imposed 50-per-cent tariffs on countries with which it does not have a free-trade agreement. Mexico also introduced new traceability rules for steel and aluminum imports to avoid Chinese transshipments. The 2027 budget proposes reducing electromagnetic spectrum prices for cellular operators, addressing a longstanding U.S. concern. The country even updated its intellectual property law.

“These gestures would seem to suggest that Mexico is doing everything possible to try to reach a bilateral agreement. Obviously, the trilateral agreement is off the table,” said Carlos Ramírez, a political risk consultant in Mexico City.

On Friday Canada and Mexico marked the first anniversary of a joint action plan on strengthening co-operation – with both countries’ ministers and diplomats celebrating the occasion with social media posts. But analysts see realpolitik superseding good intentions – for the time being.

Mexico “does not want to be categorized in the same way as Canada from Donald Trump’s perspective,” said Solange Márquez, a political science professor at the University of Toronto. “Mexico wants to move away from the idea of a Canada that’s much more aggressive toward the United States,” without “distancing itself from Canada.”