Canada and Mexico are preparing to launch a bold new trade initiative that could reshape North American commerce—and significantly impact the U.S. economy. As reported by PPR Mundial, the two countries are finalizing a plan to create a joint land-and-sea trade corridor that bypasses the United States entirely, aiming to reduce transhipment tariffs and taxes while increasing efficiency and economic cooperation.

Dubbed the “North Belt,” the corridor is projected to be fully operational by 2028. An agreement between the two nations is expected to be signed as early as September. The plan is ambitious: by facilitating smoother container and data movement across a border-free, clean-energy route, Canada and Mexico hope to not only deepen their own economic ties but also attract international trade that might otherwise flow through the U.S.

The potential economic impact on the U.S. is enormous. Estimates suggest it could cost the country up to $245 billion over five years—$69 billion in lost tax revenue, $17 billion in indirect economic activity, and a $39 billion blow to employment, with the U.S. Midwest particularly vulnerable to a projected 2.8% economic decline.

While the U.S. could, in theory, re-enter a rules-based trade framework, experts note that the long-term efficiencies of this new corridor make it likely to endure regardless. The North Belt is shaping up to be not just a regional shift, but a signal of changing tides in global trade.