NAFTA deal not yet in sight, Canada stands firm on auto tariffs

Canadian market restrictions have remained an irritant to the U.S. wine industry.
Gavin Young  Postmedia

Canadian market restrictions have remained an irritant to the U.S. wine industry. Gavin Young Postmedia

That's the section of USA trade law that lets President Donald Trump use national security as justification to impose crippling tariffs on foreign imports, a sword of Damocles the federal Liberal government desperately wants to blunt.

Elements from a proposed Indigenous chapter "could be moved to other chapters" of the agreement, Bellegarde said in his letter - an alternative approach being explored, according to sources who spoke to The Canadian Press under condition of anonymity given the sensitivity of talks.

Rather than demanding absolute immunity, Canada is working hard to try to make the president's favourite trade cudgel "more difficult to reach for", the source said.

Sources say Mexico believes it has also done much of the "heavy lifting" on getting the Americans to back down on its demand to limit the ability of Canadian and Mexican firms to bid on USA infrastructure projects, while seeking greater access for American firms to Mexican and Canadian government projects.

Not everyone agrees: senior Republicans on Capitol Hill have been agitating, pressing Canada to hurry up and make a deal.

Foreign Affairs Minister Chrystia Freeland was expected to leave Washington late on Thursday without an agreement.

And there was the all-nighter pulled by one of Canada's negotiating teams, which Freeland said didn't wrap up its marathon session until 7 a.m. Wednesday morning.

"One has to superimpose the elements of what we are dealing with this current USA administration. but I have not heard a reason why they would deny something that is beneficial to their own Indigenous communities".

But as some of the more fundamental differences fall away, Sec.

While Canada has been pushing for wording in NAFTA aimed at strengthening labour protections and gender equality, the overall negotiations are said to have stalled over Canada's insistence that an agreement contain an independent dispute-settlement mechanism.

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He said that rather than splintering, we could see a China-led internet and the current USA -led internet. The Belt and Road Initiative (BRI) is a development strategy adopted by the Chinese government.

"I just want to say to everyone who has done that, thank you very much".

"The communities that are directly impacted by this trade chapter are already in favour of it", he said.

"There's not going to be an agreement where disputes are handled in the American courts".

Section 232 of the decades-old U.S. Trade Expansion Act allows the president, under certain circumstances, to impose duties recommended by his commerce secretary under the notion that the goods being imported are a threat to national security. He also said he might impose a 25 percent tariff on Canadian autos exports, which would badly hurt the economy. The Trudeau government has said it would respond to auto tariffs with its own countermeasures.

Canadian Foreign Minister Chrystia Freeland has held talks with U.S. Trade Representative Robert Lighthizer in each of the last four weeks and on Thursday opened another round. And multiple supposed deadlines set by US negotiators have been missed with no apparent consequences.

President Donald Trump has threatened to leave Canada out of an agreement the US struck with Mexico and impose auto tariffs on his northern neighbor.

"We're not going to sit there and let Trump put an economic gun to our head anymore", Dias said.

"If it doesn't make its way (in) because President (Donald) Trump is - let's just say - a little challenging to negotiate with, we won't stop on getting this chapter within NAFTA, but also other global trade agreements", he said in an interview this week.

Pressure is mounting on the federal government to get a deal done.

That deal is widely seen to require congressional approval before December 1 in order to survive the arrival of an incoming Mexican government whose supporters have mixed feelings about the agreement.

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