Canada races to save NAFTA deal

Canada races to save NAFTA deal

The US and Mexico have cut a bilateral trade deal; Canada is seeking to keep trilateral trade relations alive.

When it comes to North American trade, Canada suddenly finds itself on the outside looking in.

Following US President Donald Trump’s announcement Monday that a new bilateral trade deal has been agreed with Mexico to supplant the North American Free Trade Agreement (NAFTA), the government of Canadian Prime Minister Justin Trudeau is scrambling to keep trilateral trade relations alive.

Canadian trade negotiators headed to Washington in the wake of Trump’s announcement looking to prevent the US and Mexico going it alone after 24 years as members of the three-way NAFTA pact.

On Monday, Trump announced a breakthrough in bilateral talks with Mexico, describing a deal that will tentatively be known as the US-Mexico Trade Agreement (USMTA).

The White House wants Canada to endorse what President Trump has touted as NAFTA’s replacement by the end of the week. If Canada declines, Trump has threatened to hit his northern neighbour with automotive tariffs that would potentially hurt both economies.

In response, Prime Minister Trudeau said Tuesday that he was encouraged by the progress made between the US and Mexico, especially on the subject of auto parts.

“This was an important step to moving forward on renegotiating and improving NAFTA,” Trudeau told reporters in Montreal-area Longueuil. “Our team is right now in Washington digging into the progress made and looking at what the next steps are.

“There’s a lot of documents and a lot of texts to dig into in terms of what has been worked on by Mexico and the United States.”

Trudeau’s comments came shortly after US Commerce Secretary Wilbur Ross and Larry Kudlow, the director of the president’s National Economic Council, said in separate interviews that concessions from Canada on dairy are essential to nailing down a deal by Friday.

“We’re pushing hard to conclude an agreement that is win, win, win — a modern and progressive agreement that is in line with our values and our ambitions and that will benefit not only Canadian businesses but all Canadians,” Trudeau said.

“If we want to create long-term growth, we can’t allow ourselves to neglect or minimize the impact of this type of agreement on Canadian families.”

The future of North American internal trade has been a bone of contention since Trump took office in 2017 vowing to withdraw the US from NAFTA if a revamped version of the 24-year-old trade deal could not be reached.

Trudeau said Canada is “determined to conclude an agreement that’s equitable for all the concerned parties.”


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Anthony Moran
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