US chip lobby urges tariff-free treatment for North American semiconductors under USMCA

In precocious 2023, Mexico and the United States launched a associated “semiconductor enactment plan” that aims to marque North America the world’s “most powerful” chip-producing region.

A cardinal purpose of the program is for North America to trim its reliance connected Asia for semiconductors, captious components successful a immense scope of products, including computers, smartphones, electrical vehicles and precocious aesculapian devices.

The model of the USMCA escaped commercialized pact — which volition beryllium reviewed by its 3 signatories successful 2026 — volition supply important enactment for that objective.

In that context, the Semiconductor Industry Association (SIA), a Washington, D.C.-based commercialized and lobbying group, wrote to the Office of the U.S. Trade Representative (USTR) to remark connected “specific USMCA provisions of involvement to the semiconductor industry,” including the pact’s rules of origin.

In a Nov. 3 missive addressed to Assistant U.S. Trade Representative for the Western Hemisphere Daniel Watson, the SIA wrote that “the USMCA is captious to the occurrence of the U.S. semiconductor industry,” and noted that “Canada and Mexico are adjacent U.S. trading partners successful semiconductors,” with each playing “a chiseled but important relation successful North America’s semiconductor proviso chain.”

“The USMCA supports a competitory and resilient North American semiconductor proviso concatenation that is tightly linked passim the accumulation process, with subcomponents and semiconductors crossing betwixt the U.S., Canada, and Mexico earlier being integrated into a wide scope of downstream industries specified arsenic automotive, concern manufacturing, telecommunications and user electronics,” the relation said.

SIA: Rules of root should promote concern successful North American semiconductor proviso chains 

In bid for North America to go the world’s apical chip-producing region, important concern successful the semiconductor assemblage volition beryllium required, including from large Asian companies specified arsenic Taiwan’s Foxconn.

Third 4th planetary #semiconductor income were $208.4 billion, an summation of 15.8% compared to the 2nd 4th of 2025. September 2025 planetary income were $69.5 billion—an summation of 25.1% compared to September 2024. Market maturation was driven by accrued request crossed a range… pic.twitter.com/4aEKBKkcf3

— SIA (@SIAAmerica) November 3, 2025

When launching the associated semiconductor enactment program successful October 2023, past U.S. caput of authorities Antony Blinken noted that among the aims of the inaugural were “to accelerate” semiconductor assemblage integration betwixt the United States and Mexico and “to standard our efforts to pull caller investment.”

For its part, the SIA urged the USTR to “ensure the USMCA’s rules of root fortify U.S. semiconductor competitiveness, promote greater concern successful North American proviso chains, and relationship for differences successful existing and planned proviso concatenation operations to nutrient antithetic types of semiconductors.”

“Tailored rules of root tin play an important relation successful encouraging the integration of U.S. semiconductors into assorted finished goods manufactured successful North America,” the relation said.

The SIA said that, “should USTR see immoderate imaginable changes to rules of root and related calculations during the [USMCA] reappraisal process” successful 2026, “we powerfully urge U.S. negotiators clasp meaningful consultations with strategical sectors, including the semiconductor industry.”

With respect to “any imaginable changes,” the SIA said that the “negotiating parties should guarantee a realistic timeline for implementation and compliance by North American companies.”

Asian semiconductor companies volition put successful North America if it makes economical consciousness for them to bash so. A large inducement to manufacturing successful the portion is preferential entree and proximity to the United States, the world’s largest system and a person successful technological innovation, including AI, which ensures a immense request for semiconductors.

Within North America, Mexico tin beryllium a peculiarly advantageous spot to manufacture owed to factors including its privileged entree to the United States market, via the USMCA, and the affordability of labour costs.

However, that privileged entree has been undermined to immoderate grade this twelvemonth by the Trump administration, which has imposed tariffs connected a scope of imports from Mexico.

The SIA indicated that it would not similar to spot immoderate U.S. duties connected semiconductors and related components that are made successful North America and which comply with the USMCA.

“As the U.S. authorities considers imaginable tariff actions, we anticipation the USMCA reappraisal process ensures the U.S. semiconductor manufacture retains its rod presumption successful the contention to beryllium the astir globally competitive. Given the far-reaching consequences of imposing tariffs connected semiconductors, semiconductor manufacturing equipment, and related parts and components, maintaining a straightforward tariff authorities for semiconductors and related technologies, including due attraction of products that are compliant nether USMCA, is crucially important,” the relation said.

Investment successful Mexico’s semiconductor assemblage would make jobs present and assistance to summation exports. In the archetypal 7 months of the year, Mexico’s semiconductor assemblage exports to the United States declined much than 50% annually to $427 million, leaving it good down countries specified arsenic Taiwan, Malaysia and adjacent Costa Rica arsenic a supplier of the important components to the U.S. market.

Trump’s spot tariff poses mixed fortunes for Mexico’s increasing semiconductor industry

‘Harmonization is needed crossed North America’

In effect to the USTR’s telephone for nationalist remark connected the USMCA up of its scheduled reappraisal successful 2026, the SIA besides referred to a scope of different “provisions of interest” successful the commercialized pact that superseded NAFTA successful 2020.

With respect to “economic security,” the relation encouraged the Trump medication “to align with the governments of Canada and Mexico connected … measures to code contented from countries of concern.”

“… We promote the Administration to enactment with Canada and Mexico to align enforcement and compliance rules that fortify determination economical security. For example, continued customs practice tin assistance combat diversion, forestall commercialized successful stolen IP [intellectual property], and facilitate goods shipments,” the SIA said.

“… Harmonization is needed crossed North America to debar costly and diverging economical information regulations and practices. We applaud the Canadian government’s efforts to fortify its overseas concern screening mechanics successful caller years,” the relation said, adding that “we anticipation the U.S. authorities tin proceed to marque advancement successful moving with the Mexican authorities connected akin overseas concern screening measures.”

In precocious 2023, Mexico and the United States agreed to cooperate connected overseas concern screening arsenic a measurement to amended support the nationalist information of some countries. The program appeared to beryllium motivated to a ample grade by a tendency to halt problematic Chinese concern successful Mexico, which U.S. President Donald Trump and different politicians successful the U.S. and Canada person expressed interest about.

Among different comments, the SIA urged the USTR to “preserve the integrity of Chapter 19 (Digital Trade) [of the USMCA] to enactment North American innovation and competitiveness.”

“The semiconductor proviso concatenation relies connected unfastened and unafraid information flows crossed planetary borders, arsenic virtually each measurement successful the worth concatenation involves the physics transmission of data,” the relation said.

With reports from El Economista