Mexico’s USMCA violations threaten American energy

When U.S. and Mexican trade officials meet in Washington this month to continue the joint review of the U.S.-Mexico-Canada Agreement (USMCA), one unresolved trade issue should be at the top of the agenda: Mexico’s discriminatory treatment of American energy companies.

In his first term, President Trump secured historic commitments from Mexico in USMCA to open its energy markets to American investment and guarantee fair treatment for U.S. producers, but a deal is only as good as our willingness to enforce it. Although USMCA includes a clear dispute settlement chapter to resolve infractions, Mexico’s government has repeatedly violated the agreement since 2021 by enacting policies that gave its state-owned industries an unfair advantage over U.S. companies and undermined existing investments.

In 2021, the Mexican government enacted reforms that forced the country’s grid to prioritize electricity generated by its state-owned electric utility over private power generation. The Office of the U.S. Trade Representative challenged those policies in 2022 by opening consultations with Mexico — the first step in USMCA’s dispute process — but the administration stopped there. It never took the next step of requesting a formal dispute panel that could lead to meaningful enforcement.

In the meantime, Mexico went even further.

Changes to Mexico’s constitution in 2024 and new energy laws enacted........

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