By Paul Vieira

TORONTO--The U.S. ambassador to Canada played down fears Tuesday about a possible renegotiation of the North American free trade agreement, with a review of the treaty scheduled for 2026.

"I think it's generally been working quite well. There's no interest in the United States and Canada in renegotiating the agreement," said David Cohen, at a U.S.-Canada conference in Toronto, co-hosted by Bank of Montreal and Eurasia Group.

He said officials from the U.S. and Canada have discussed the pending review, and the possibility of making improvements to the deal. The U.S. and Canadian governments, Cohen said, "are calmer about this than some of the external forces in the media."

The U.S.-Mexico-Canada trade pact, known as USMCA, replaced the original continental trade treaty in 2020, following a renegotiation demanded by the Trump administration. Donald Trump is seeking a second term, and holds a lead over President Biden in some polls, and has vowed to deploy tariffs again to protect America's economic interests. At the time, Trump administration officials said the revised pact reduces incentives for American companies to shift production to Mexico.

The renegotiated trade accord called for a review of the pact in 2026, at which time the parties will decide whether to extend the agreement for another 16 years.

Some fear a second Trump administration could mean trouble for USMCA. "A period of uncertainty would prevail in the period leading to the 2026 review process. Indeed, the possibility that the former president may be re-elected in November may already be costing the North American economy," James Haley, a senior fellow at the Canada-based Centre for International Governance Innovation, said in an analysis published in April.

Write to Paul Vieira at paul.vieira@wsj.com


(END) Dow Jones Newswires

06-11-24 1037ET