Trade deal proceeding with tariffs in place
OTTAWA — Finance Minister Bill Morneau says he’s hopeful the newly struck North American free-trade deal will be signed ahead of next week’s deadline — and suggests Canada could sign even with U.S. tariffs in place.
Morneau made the remark Thursday in a speech as he was talking about concerns he has been hearing from the business community about trade.
“Of course, that situation was improved when we signed the new NAFTA — or when we will sign the new NAFTA, I hope, next week,” Morneau told the audience, referring to the new United-States-Mexico-Canada Agreement or USMCA.
The three countries reached an agreement-in-principle on the trade pact, which, if ratified, would replace North American Free Trade Agreement (NAFTA). They want the deal signed before Dec. 1, when a new president takes office in Mexico.
After his speech to the Economic Club of Canada in Ottawa, Morneau was asked whether the government should still consider signing the new continental trade deal if the United States keeps its heavy import taxes on Canadian aluminum and steel.
He said Canada is still negotiating in an effort to get the “unjust” U.S. tariffs lifted — but insisted it will be dealt with separately.
“Our approach has been to make sure that we have a stable and confident business sector to make investments and that means that we need to sign the new NAFTA that we got to, which is a good agreement for the future of our three economies,” Morneau told reporters.
At the same time, he acknowledged Canada has to address the “challenging” steel and aluminum tariffs, as well as an ongoing dispute over how Canada manages its softwood-lumber industry.
“Those are ongoing and critically important issues that we are working with Americans to solve,” Morneau said. “We are not going to make one set of negotiations contingent on the other and, most importantly, we want the stability of a new NAFTA that we’ve been able to deliver for Canadians.”
Morneau also said there’s work going on behind the scenes to make sure the legal document defining the USMCA is exactly as agreed. He added he has every reason to believe the work is moving along at a good pace.
The USMCA is scheduled for what Canadian officials have said will be a low-key signing when the three countries gather next Friday for this year’s G20 meetings in Buenos Aires.
Trade tensions that flared up during the talks have yet to subside, largely because Canada and Mexico both remain subject to the Trump administration’s tariffs. Canada responded with levies of its own on imports from the United States.
Sources close to the talks said Canada and the U.S. remain a long way from reaching any sort of an agreement; and expect American talks with Mexico to go down to the wire before Dec. 1.