US, Canada reach trade deal hours before self-imposed deadline

Geneva Stokes
October 1, 2018

MONTREAL: US and Canadian negotiators were holding eleventh-hour talks on Sunday aimed at revamping the North American Free Trade Agreement ahead of a Washington-imposed deadline.

A USA official said a few minutes earlier that the United States and Canada were "very close" to a deal.

Federal cabinet ministers were summoned to a late Sunday meeting at the prime minister's office near Parliament Hill, and the White House called its own late-night trade briefing.

"In short, we think this is a fantastic agreement for the USA, but also for Canada and Mexico", said the American officials, who cheered the fact that USA dairy ranchers would soon have "substantial" expanded access to lucrative markets north of the border.

OTTAWA - An 11th-hour NAFTA deal has been reached that allows Canada to rejoin the trilateral trade pact, sources tells The Canadian Press.

USA lawmakers and business have urged the administration to keep Canada in the deal but the trilateral nature had been in jeopardy after Trump on August 27 announced he reached a deal with Mexico that Canada could join if it's willing to make concessions. He blames the treaty for the loss of American manufacturing jobs and has repeatedly threatened to abandon the trade past signed in 1994, during the Clinton administration.

The North American Free Trade Agreement (NAFTA) has hurt Mexicans, Americans, Canadians, Quebecers, and Indigenous peoples.

On top of that, Canada's 270 per cent tariffs on dairy products that exceed the established quota have long left a sour taste in the president's mouth.

Canada's The Globe and Mail cited four sources as saying an outline of a deal had been reached but Trump and Trudeau still needed to approve it.

As part of any agreement, Canada looks set to offer increased access to its highly protected dairy market, as it did in separate pacts with the European Union and Pacific nations. "It makes no sense to me to repeat that with a new NAFTA".

After months of sputtering talks, momentum picked up this weekend as Trudeau inserted himself and made clear that he wanted to get something done.

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It also appears to preserve the key dispute-resolution provisions - Chapter 19 - which allow for independent panels to resolve disputes involving companies and governments, as well as Chapter 20, the government-to-government dispute settlement mechanism.

"Our focus remains on the substance of the issues, not on timelines, and of course on getting a good deal for Canadians".

When that text is finally released, it would be advisable to evaluate it in relation to the progressive principles outlined in the Trade: time for a new vision The Alternative Trade Mandate report. That is more than the 2 million units now exported.

Canada and Mexico rank first and second among export markets for US companies.

Under U.S. trade law, an agreement must be published for 60 days before it can be signed by leaders of any of the participant countries, putting negotiators on the clock to reach a deal that can be signed by November 30.

While TPA gives Trump the ability to send a deal to Congress for a simple majority vote, it also includes a statutory 60-day notification period.

Keeping chapter 19 will not affect Washington's enforcement of anti-dumping and anti-subsidy laws, said a US official.

The White House and Mexico announced on September 28 that they would release the full text of the bilateral deal that the two countries reached in August.

The Trump administration had already agreed last month to an updated pact with Mexico, increasing the pressure on Canada to make concessions to join the deal.

The deal is likely to boost global stock markets today, which have been dragged down by concerns about United States trade disputes with China, the European Union and others.

U.s. Trade Representative Robert Lighthizer and Kushner were at the USTR office in Washington on Sunday afternoon negotiating final details by conference call with the Canadians in Ottawa.

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