US, Canada wow new NAFTA deal by Friday
30 August 2018
US President Donald Trump and Canadian Prime minister Justin Trudeau are now looking to arrive at a renegotiated North American Free Trade (NAFTA) deal by Friday, after the US and Mexico hammered out a bilateral trade deal on Monday.
The US-Mexico deal put pressure on Canada to rejoin talks to modernise the 24-year-old NAFTA with leaders of the United States and Canada expressing optimism on Wednesday that they could reach new NAFTA deal by a Friday.
While negotiators prepared to talk through the night to beat the Friday deadline, Canada has warned that a number of tricky issues remained.
Canadian foreign minister Chrystia Freeland said late on Wednesday that talks were at “a very intense moment” but said there was “a lot of good will” between Canadian and US negotiators.
“Our officials are meeting now and will be meeting until very late tonight. Possibly they’ll be meeting all night long,” Freeland said. She and US Trade Representative Robert Lighthizer had agreed to review progress early on Thursday.
US President Donald Trump has set a Friday deadline for the three countries to reach an in-principle agreement, which would allow Mexican President Enrique Pena Nieto to sign it before he leaves office at the end of November. Under US law, Trump must wait 90 days before signing the pact.
Trump has warned he could try to proceed with a deal with Mexico alone and levy tariffs on Canadian-made cars if Ottawa does not come on board, although US lawmakers have said ratifying a bilateral deal would not be easy.
“They (Canada) want to be part of the deal, and we gave until Friday and I think we’re probably on track. We’ll see what happens, but in any event, things are working out very well.” Trump told reporters at the White House.
The upbeat tone contrasted with Trump’s harsh criticism of Canada in recent weeks, railing on Twitter against Canada’s high dairy tariffs that he said were “killing our Agriculture!”
Canadian Prime Minister Justin Trudeau said he thought the Friday deadline could be met.
“We recognise that there is a possibility of getting there by Friday, but it is only a possibility, because it will hinge on whether or not there is ultimately a good deal for Canada,” he said at a news conference in northern Ontario on Wednesday. “No NAFTA deal is better than a bad NAFTA deal.”
Freeland, who is Canada’s lead negotiator, was sidelined from the talks for more than two months, and will be under pressure to accept the terms the United States and Mexico worked out.
Trump said the 24-year-old NAFTA was outdated and unbalanced, hurting American jobs and businesses. It had resulted in closed factories, exported jobs, and broken political promises hurting many Americans.
NAFTA has contributed to America’s ballooning annual goods trade deficit, which grew from $115 billion in 1993, the year before NAFTA’s implementation, to nearly $800 billion in 2017.
The United States went from a $1.6 billion goods trade surplus with Mexico to a $70 billion goods trade deficit during that same time period.
The NAFTA included many provisions that have not been updated to reflect modern standards, new technologies, or the 21st century global economy.
Since assuming office, President Trump has undertaken multiple trade negotiations in addition to NAFTA that will benefit American workers, according to the US commerce department.
These include an agreement with the European Commission to work toward zero tariffs, increase energy exports, reduce non-tariff barriers, and address unfair trade.
The Trump Administration also successfully secured key amendments to the trade agreement with South Korea to strengthen America’s manufacturing base, it said.