The Bayern Munich star has been linked with a move to the Premier League, with Manchester United and Arsenal keeping tabs.
And Bayern chief executive Karl-Heinz Rummenigge believes the clock is ticking on the 23-year-old's future.
"Mario has to make a decision," Rummenigge said.
"Of course there is a big competition at his position but we all know how long his contract is - he has two more years."
Rummenigge has also told Manchester United Thomas Muller is not for sale.
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Mario Gotze could turn his back on Bayern Munich
Reports earlier today suggested a £50million deal could be back on for the Bayern striker.
But Rummenigge has urged the Red Devils to abandon their pursuit as he said: "Muller is not for sale. Our English colleagues seem to be unable to spend all of their money."
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Louis van Gaal is expected to complete a £22m deal for the 28-year-old Barcelona winger.
And Hargreaves was effusive in his praise for Pedro, telling BT Sport: "He's one of those very unselfish wingers that can score goals and does a job for the team.
"You think about Chelsea, Manchester City, Man United – I think they could all do with him in a wide area."