Trump, Trudeau muse about walking away from deal agreement

WASHINGTON — Donald Trump and Justin Trudeau raised their trade brinkmanship to a new level Wednesday with each saying they were willing to walk away from the North American Free Trade Agreement if they don’t get what they want.

Trudeau started the day by branding Trump a rule breaker to argue in favour of keeping a mechanism to resolve trade disputes, while Trump hours later said Canada had more to lose than the United States if the two countries can’t make a deal to preserve the three-country NAFTA.

“That’s going to be fine for our country,” Trump said. “It won’t be fine for Canada.”

The bombast of the two leaders contrasted with the insistence of negotiators that the mood inside the room was constructive as talks hit what is being descibred as an intense phase. Foreign Affairs Minister Chrystia Freeland went out of her way to praise her counterpart, U.S. trade czar Robert Lighthizer, saying he was acting with “good faith” and “good will.”

Negotiations, now in their 13th month, are key to determining the economic and trade relationship among the three North American countries, with many workers’ and industries’ prospects hanging in the balance.

At the same time, Trump needs a win on trade ahead of the U.S. midterm elections in November that will test the president’s ability to keep control of Congress.

“We’re not going to accept that we should have to sign a bad deal just because the president wants that,” Trudeau told Edmonton radio station CHED.

Trudeau offered some of his sharpest criticism of the unpredictable American president, saying that Canada won’t give an inch to Trump’s desire to scrap NAFTA’s Chapter 19 dispute resolution panels. The chapter allows companies to have their differences settled by independent arbiters — something Trump views as an infringement of U.S. sovereignty.

“We need to keep the Chapter 19 dispute resolution because that ensures that the rules are actually followed. And we know we have a president who doesn’t always follow the rules as they’re laid out,” Trudeau said.

Freeland, when asked about the comments, said she didn’t want to negotiate in public, but added: “I agree with the prime minister in public all of the time, and in private 99.99 per cent of the time . . . he made some important comments.”

The U.S. and Mexico reached a side deal last month, leaving Canada to negotiate separately with the U.S.

Trump hinted there might be progress towards a deal with Canada.

“I think we’ve come a long way toward them treating us fairly,” Trump said.

But other issues have yet to be worked out, including Canada’s cultural exemption in NAFTA. Sources familiar with the Canadian bargaining position say the cultural exemption Canada has insisted on preserving since NAFTA talks reopened remains an 11th-hour sticking point.

Part of the disagreement on culture revolves around Canada’s decision to allow the broadcast of glitzy American Super Bowl commercials, a decision that irks Lighthizer. Continued on page A4