U.S., Canada reach NAFTA deal: sources
WASHINGTON — The United States and Canada have reached a last minute deal to salvage the North American Free Trade Agreement, according to people familiar with the negotiations, overcoming deep divisions to keep the 25-year-old trilateral pact intact.
The deal came after a weekend of frantic talks to try and preserve a trade agreement that has stitched together the economies of Mexico, Canada and the United States but that was in danger of collapsing amid deep divisions between President Donald Trump and Canadian Prime Minister Justin Trudeau.
The 11th-hour agreement was punctuated by a frenetic Sunday, with Canada’s leaders teleconferencing throughout the day with top American officials in Washington. Mr. Trudeau convened a 10 p.m. cabinet meeting in Ottawa to brief officials on the deal, as Jared Kushner, one of Mr. Trump’s closest advisers, and Robert Lighthizer, the president’s top trade negotiator, hashed out the final details. Mexico’s under secretary of foreign trade, Juan Carlos Baker, was expected to present the texts of the agreement to the Mexican senate just before midnight.
Text of the agreement was expected to be presented to Congress as early as Sunday evening.
The deal represents a win for Mr. Trump, who has derided NAFTA for years and threatened to pull the United States from the pact if it was not rewritten in America’s favor. The Trump administration struck a deal with Mexico last month to rewrite NAFTA and had threatened to jettison Canada from the pact if it did not agree to concessions like opening its dairy market to United States farmers. The White House had set a Sept. 30 deadline to release the text of its new trade agreement with Mexico.
According to people briefed on the negotiations, Canada will ease protections on its dairy market and provide access that is similar to what the United States would have gained through the Trans-Pacific Partnership, a trade treaty that Mr. Trump withdrew from last year.
The United States is poised to relent on its demands to eliminate an independent tariff dispute settlement system that Canada has said is a red line in negotiations, according to a person consulted on the negotiations.
The countries also appear to have reached an understanding that would protect Canada from the threat of automobile tariffs, which Mr. Trump has routinely threatened, though it is not clear how far those protections would extend. Canada also appears ready to accept assurances that steel and aluminum tariffs that Mr. Trump has imposed will be lifted, though it remains unclear whether the taxes would be replaced by quotas that limit metal imports.
After months of sputtering talks, momentum picked up this weekend as Mr. Trudeau inserted himself and made clear that he wanted to get something done.
Mexico has also scrambled to try and ensure that the 25-year-old NAFTA pact remains trilateral.