NAFTA DEAL GETS DONE
Canada, U.S. finally agree on pact
Canada and the U.S. reached a tentative NAFTA deal Sunday that would give American farmers major new access to the dairy market here, but preserve the dispute-resolution system the United States wanted to scrap, said a source briefed on the talks.
Other compromises were reached on lifting tariffs on steel and aluminum imposed earlier by the U.S., protecting Canada from possible auto tariffs, and raising the value of goods Canadians can order online from outside the country without paying duty, the source said.
A special federal cabinet meeting convened at 10 p.m. ET to discuss a trade accord that already includes Mexico, while an announcement was planned for 11 p.m. at the White House.
Ildefonso Guajardo, the Mexican economy minister, was scheduled to address his country’s senate at 11:30 p.m. ET on the pact.
A Mexican official confirmed that a deal with Canada appeared to be at least close.
Earlier, Sunday evening, Canadian government officials were more cautious, suggesting there had been progress but no handshake yet.
The agreement would end more than a year of hard slogging talks on revamping the North American Free Trade Agreement, and cap a weekend of last-ditch negotiations designed to meet a Monday deadline set by the U.S.
Mexico agreed to a revamped NAFTA last month, triggering weeks of hectic bargaining with the U.S. to try to bring Canada into the agreement, as President Donald Trump and other administration officials threatened to go it alone with Mexico if Canada did not make “concessions.”
By 7:30 p.m. Sunday, the outline of a deal had been reached, leaving both countries’ chief negotiators to brief their respective leaders and get approval from Trump and Prime Minister Justin Trudeau, the source said.
“They’re in the final strokes,” said the person, based on information from U.S. administration officials. “I’ve got a feeling they will say they are done tonight.”
A Canadian official was more circumspect, suggesting at about 6:30 p.m. that anyone saying an accord has been tentatively struck “might be a few steps ahead of themselves.”
David Macnaughton, Canada’s ambassador to Washington, also tamped down talk of a deal during brief comments to reporters in Ottawa, saying he was “cautiously optimistic” but not sure the discussions would be resolved Sunday or Monday.
Asked what issues still remained to be resolved, he suggested “there’s lots of them,” and added that “You never know with these things. It’s never done until it’s done.”
The U.S. source said common ground had been reached on all of the most difficult issues.
Canada, for instance, agreed to give the Americans access to five per cent of the Canadian dairy market, about the same it granted to European and Pacific-rim nations in the CETA and TPP accords combined, the source said. Dairy access was a key U.S. demand, made repeatedly by Trump, though the U.S. already exports about $500 million of milk products duty-free to Canada every year.
The U.S., in turn, has agreed to preserve the “Chapter-19” mechanism for resolving disputes over antidumping and anti-subsidy duties, but with some limitations to address American concerns about the tool usurping domestic courts and undermining its sovereignty, the person said.
Canada agreed to a cap on auto exports to the U.S. — of about 40 per cent above current production levels — that would be free of any auto tariffs Trump might impose, the source said. And only vehicles that failed to meet the rules of origin for auto parts agreed to by the U.S. and Mexico would even potentially be subject to the proposed auto tariffs.
Canada agreed to some kind of quota on how much steel and aluminum it exports to the States, in exchange for the tariffs being lifted, the person said.