North America remains a complex economic landscape. Significant elections are taking place in the USA. Canada is an attractive destination for both economic opportunities and its inclusive immigration policies.

Mexico

BACKGROUND

Mexico is a federal republic composed of 31 states and the federal district Mexico City. The constitution divides governmental powers into executive, legislative and judicial branches — the presidency, the congress and the courts. At the federal level, the president of the United Mexican States is head of the executive branch and serves as the chief of state and army. The president is directly elected by the people for a six-year term. Presidential reelection is prohibited in the constitution. The federal legislative branch is a bicameral legislature known as el Congreso de la Unión. Legislative authority is divided into an upper chamber, la Cámara de Senadores, and a lower chamber, la Cámara de Diputados. The upper chamber has 128 members (senators) who are elected for six-year terms and may be reelected for up to two consecutive terms. The lower chamber has 500 members (deputies) who serve three-year terms. Deputies are eligible for reelection for up to four consecutive terms.

General elections were held on June 2 to elect a new president to serve a six-year term, as well as all 128 members of la Cámara de Senadores and all 500 members of la Cámara de Diputados. The world’s most populous Spanish-speaking country held its largest ever elections with an estimated 98 million voters. Claudia Sheinbaum of the Morena political party was the top contender to succeed President Andrés Manuel López Obrador. Xóchitl Gálvez of the Fuerza y Corazón por México party served as opposition along with Jorge Máynez of the Citizens’ Movement party. This was the first general election in Mexico’s history in which the main contenders for the country’s presidency were women. The newly elected president’s foreign affairs policies will be significantly impacted by the outcome of the 2024 U.S. presidential election, and the outcome of the Mexican elections will not only have a tremendous impact on regional neighbors but also the European Union (EU).

OUTLOOK

On June 2, Claudia Sheinbaum won the presidential election with almost 60% of votes. The Morena-led coalition also received the most votes in the legislative elections and secured a two-thirds majority in the lower house. The former Mexico City mayor will become the first female president in the country’s 200-year history and will start her six-year term on Oct. 1. The election will continue the legacy of the Morena party that is currently being led by López Obrador, who was elected president in 2018.

The newly elected leader in Mexico will have an important task leading one of the most powerful countries in the Americas and managing a complicated relationship with the United States, specifically as it concerns the response to a growing irregular regional migratory situation. President-elect Sheinbaum has stated that she will continue López Obrador’s policies on migration, mainly providing increasing economic aid and other possible solutions to Guatemala, Honduras and El Salvador to address the root causes of migration. Economic instability and safety concerns may also be a driver of increased internal displacement of professionals and investors leaving Mexico.

Sheinbaum won the election largely on a message of continuity with López Obrador, including policies restricting private and foreign investment in oil, gas and electricity. Mexico’s next president will need to decide whether to reopen the country’s oil, gas and electricity sectors to foreign investment. The new administration may try to propose new solutions to these issues from the previous administration, but this may also be determined by how things evolve in the U.S. elections in November.

RECENT IMMIGRATION NEWS

The U.S. Embassy and its nine consulates throughout Mexico issued 2.3 million visas in 2023, the highest number to date. Recently, the U.S. Embassy in Mexico City launched a program allowing first-time B1/B2 visitor visa applicants to move appointments to an earlier date without additional fees. The new program is designed to reduce wait times for hundreds of thousands of applicants and facilitate travel for more Mexican nationals to the U.S.

Internationally, the Mexican government recently announced that Peruvian nationals arriving for tourism or business will now require a Mexican visa to enter the country. The government of Peru later announced a similar policy for Mexican nationals traveling to Peru for short-term business travel and visits in response. Mexico has also recently suspended diplomatic relations with Ecuador and ordered all Mexican diplomatic personnel in Ecuador to return to Mexico. The Embassy of Mexico in Quito has suspended all services, including consular services, until further notice.

Under bilateral agreements, certain nationalities are eligible for temporary nonimmigrant visas in the United States, including the TN classification for citizens of Mexico in designated professional categories. The TN classification was created by the North America Free Trade Agreement (NAFTA) and continued in the United States-Mexico-Canada Agreement (USMCA). The USMCA entered into force on July 1, 2020, and created a reciprocal policy supporting high-paying jobs and economic growth in the three North American countries. The USMCA has a review clause dated July 1, 2026, at which time each nation will need to confirm in writing whether or not they will continue the agreement. The new Sheinbaum administration will have an important decision to make whether or not to renew the agreement, and even though the six-year review is two years away, the continuation of this important bilateral agreement will be a significant focus point for the business communities in all three countries for the foreseeable future.

Canada

BACKGROUND

The bicameral legislature of Canada is made up of the Crown, the Senate (upper chamber) and the House of Commons (lower chamber) of the Parliament. Currently in session is the 44th Canadian Parliament, which began Nov. 22, 2021, led by the Liberal Party minority government under the premiership of Justin Trudeau and supported by the New Democratic Party. Their official opposition is the Conservative Party.

By-elections (special elections) to the 44th Canadian Parliament are being held this year to fill vacancies in the House of Commons, including a recent by-election that was held in the federal riding of Toronto—St. Paul’s in Ontario on June 24. The election was won by Conservative Party candidate Don Stewart, making him the first Conservative MP since 1993 to represent the riding.

Additional by-elections are expected in four other electoral districts in 2024 before the 45th Canadian federal election will take place on Oct. 20, 2025, to elect members of the House of Commons to the 45th Canadian Parliament.

OUTLOOK

The recent by-election in the federal riding of Toronto—St. Paul’s was considered a referendum on the premiership of Prime Minister Trudeau and the current ruling Liberal Party. Prior to the by-election, Toronto—St. Paul’s was considered a safe Liberal seat and had been held since the 1993 federal election.

The Liberal Party suffered a major upset in the special election, and rising doubts toward leadership prompted Trudeau to comment that, “These are not easy times … and it is clear, that I and my entire Liberal team, have much more hard work to do to deliver tangible, real progress that Canadians can see and feel.” Trudeau intends to lead the party into the next election, and further changes in immigration policy may be expected as the administration attempts to create real progress that balances key foreign investment and fills skill gaps in key sectors, while at the same time creating stricter policies to balance the needs of Canadian workers.

RECENT IMMIGRATION NEWS

The Canadian government is making important updates to encourage immigration in key sectors, while at the same time creating stricter policies to balance the needs of Canadian workers. In 2023, the Canadian government launched the Tech Talent Strategy to attract highly skilled foreign nationals to live and work in the country. The strategy created an open work permit stream for H-1B specialty occupation visa holders in the United States to apply for a Canadian work permit and offered study or work permit options for their family members. An Innovation Stream under the International Mobility program was also created to attract highly talented individuals, and improvements to the Start-up Visa program were prioritized as part of this effort.

Alternatively, reforms to the post-graduation work permit program and international student permits are designed to better align with labor market needs and alleviate growing pressures on housing, healthcare and other services, and reduce growing migration levels by targeting temporary residents and international students. These reforms include:

  • An intake cap on international student permit applications for a period of two years.
  • Changes to the Temporary Foreign Worker program as part of an effort to reduce the number of temporary residents in Canada.
    • Canadian officials also confirmed that certain sectors within the Temporary Foreign Worker program have returned to a 20% cap on low-wage foreign workers, previously set at 30% as a temporary measure in 2022.
  • Starting Sept. 1, the government will also make changes to the post-graduation work permit program. At that time, international students will no longer be eligible for a post-graduation work permit upon graduation if they are part of a curriculum licensing arrangement study program.
    • Private colleges licensed to deliver associated public college curriculums under current licensing agreements have attracted increased international student enrollment in recent years. Canadian officials stated these programs have less oversight than public colleges and may act as a loophole with regard to post-graduation work permit eligibility.

Recent diplomatic disagreements

In an attempt to relieve pressure on their immigration system and strive for a balanced migration policy that aligns with domestic priorities, including housing and affordability, the Canadian government reimposed visa requirements for some Mexican nationals amid a surge in asylum claims, the majority of which are ultimately denied. Current President Andrés Manuel López Obrador of Mexico offered a “respectful” criticism of Canada’s decision and indicated that Mexico would act with “prudence” in response.

Tensions between Canada and India also escalated recently following the Canadian government’s announcement reducing its number of employees in India from 27 to five in direct response to the Indian government’s decision to remove certain immunities for Canadian diplomats and demand parity in diplomatic staffing. The changes with both India and Mexico have increased the time and money required to travel and delays in overall processing times.

Changes in permanent residency policy

The Canadian government has also released new initiatives to ensure the integration of immigrants within the country, create more inclusive citizenship policies and increase permanent residency pathways. Parliament introduced legislation that would extend citizenship by descent beyond the first generation and provide an opportunity for those with extended family ties in Canada to apply for permanent residency.

In addition, officials announced a new policy that allows Hong Kong permanent residence pathway applicants to extend their status and apply for new work permits while their permanent residence applications are pending. The policy also created a new humanitarian permanent residence pathway for up to 11,000 Colombian, Haitian and Venezuelan nationals who have extended family connections in Canada.

Digital nomad/remote work

Canadian officials recently provided additional guidance on the requirements for digital nomads. Officials clarified that an individual only needs visitor status to relocate to Canada while they perform their job remotely for a foreign employer or, if they are self-employed, work for themselves or provide services to clients outside of Canada. A person may enter as a digital nomad to work remotely for up to six months at a time and additional documentation is not required. If intention to find a Canadian employer is declared at that time, or if an individual finds an employer who wishes to hire them while in Canada, they will need to apply for a work permit. Individuals still need to speak with immigration authorities and confirm their intention to leave at the end of their authorized stay.

The previously discussed Tech Talent Strategy promoted Canada as a destination for digital nomads and created improvements to the Start-up Visa program, developed an Innovation Stream under the International Mobility program to attract highly talented individuals, returned to the 14-day service standard for work permits under the Global Skills Strategy and created a STEM-specific draw under category-based selection to issue additional invitations to apply under the Express Entry program. The Tech Talent Strategy, and specifically the creation of the digital nomad program, are designed to attract and retain highly skilled foreign nationals to live and work in the country.

This alert has been provided by the BAL Global Practice Group.

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