NAFTA talks heat up in Montreal

Canada is shooting back at American criticism it is being inflexible and unconstructive at the North American Free Trade renegotiation that resumed this week in Montreal.

Canadian officials are taking direct aim at the narrative that its negotiators are being inflexible – or even obstinate – when it comes to discussing the controversial U.S. proposals to raise continental content on automobiles, scrap the dispute resolution mechanism, and institute a five-year sunset clause.

They say Canada has tabled complete chapter proposals on more than half of NAFTA’s 30 sections, and has put forward substantive proposals and text on every part of the entire agreement already. Senior officials with direct knowledge of the negotiations discussed the Canadian approach with The Canadian Press on condition of anonymity.

With written Canadian proposals sitting on all tables, the sixth round in Montreal is about returning in earnest to the bargaining to find a creative space that works for everyone, officials say.

Canada put most of its text on the tables by the end of the second round, and all of it by the third, officials said.

The so-called American poison pills on autos, dispute resolution and the sunset clause were tabled after that. That makes them counter-proposals as far as Canada is concerned, they added.

Because of that, Canadian officials are perplexed by reports the Trump administration is annoyed at Canada’s unwillingness to engage, as well as its insistence on including so-called progressive trade elements.

All four tenets of Canada’s progressive agenda – gender, labour, environment and Indigenous issues – are on the agenda for talks this week, officials said.

Foreign Affairs Minister Chrystia Freeland hosted Mexican Economy Minister Ildefonso Guajardo in Toronto on Monday in attempt to compare notes on the upcoming NAFTA round.

“The two agreed that all parties must show goodwill and that negotiators must continue to focus on issues that will promote economic prosperity in North America. Both ministers committed to achieving real progress during this round of NAFTA negotiations in Montreal,” Freeland’s office said in a statement that appeared aimed directly at U.S. Trade Representative Robert Lighthizer.

Environment Minister Catherine McKenna was in Mexico City on Monday, meeting with Mexican Environment Secretary Rafael Pacchiano Alaman. NAFTA’s environment chapter was at the top of their agenda.

McKenna said Canada and Mexico are on the same page about the issues, including the right to regulate the environment at home free from foreign trade challenges and the need to take action on climate change. Both countries want that reflected in the agreement but the U.S., not so much so far.