TRUMP’S WAY OR THE HIGHWAY
Canadian negotiators facing new pressures from U.S. officials ahead of renewed NAFTA talks //
WASHINGTON — Canada and the U.S. agreed Tuesday that one of NAFTA’s most significant hurdles — defining the content rules of North American autos — may have been resolved by Monday’s side deal between the Trump administration and Mexico.
The White House is calling on Canada to endorse what President Donald Trump has described as the North American Free Trade Agreement’s replacement, by the end of the week. Trump has already rebranded it the “United States-Mexico trade agreement.”
Top members of Canada’s negotiating team made an abrupt return to NAFTA talks in Washington where they face stiff pressure from Trump to join the deal his administration struck Monday with Mexico.
Both Larry Kudlow, the director of Trump’s National Economic Council, and U.S. Commerce Secretary Wilbur Ross turned up the heat on Canada’s negotiators during televised interviews prior to Canada’s return.
Differences remain on other issues, including agriculture, how to settle disputes and a U.S. proposal for a sunset clause. But Ross also said the progress the U.S. and Mexico made on autos would be palatable to Canada.
The U.S. and Mexico agreed that 75 per cent of automobile content would come from within North America, an increase from the current 62.5 per cent. They also agreed workers earning at least $16 an hour should make 40 per cent to 45 per cent of autos.
“We’ve already resolved the automotive issues with Mexico, and those are not issues that are particularly adverse to Canada,” Ross told the Fox Business News program Mornings With Maria.
Prime Minister Justin Trudeau signalled agreement.
“There’s been some very positive progress particularly on autos and we’re glad to be engaging as we have been,” he told reporters Tuesday in Longueuil, Que. If Canada declines to join the U.S.-Mexico deal, Trump has threatened automotive tariffs that would cause considerable damage to both economies.
He also warned he would terminate the 24-year-old NAFTA, a treaty between Canada, the U.S. and Mexico that has been economically significant for the continent.
Kudlow told the Fox Business News show Varney & Co. that Trump would “love to make a deal with Canada” but it has to be in the interests of American workers and farmers.
Kudlow said he didn’t want to pre-empt what U.S. Trade Representative Robert Lighthizer would put before Canada’s Foreign Affairs Minister Chrystia Freeland on Tuesday, but he said Canada “really ought to look at what the U.S. and Mexico just completed as an example of what can be done if there’s good faith negotiating and a willingness to compromise in the interests of both parties.”
For the last five weeks, Ottawa has watched from afar as Canada’s two continental partners moved forward with one-on-one trade talks of their own.
Freeland arrived Tuesday afternoon in the U.S. capital, cutting short a weeklong diplomatic trip to Europe. Freeland has said she stayed in close contact with Lighthizer and Mexican Economy Minister Ildefonso Guajardo throughout their summertime talks.
Trump, who has called NAFTA a “rip off” for the U.S., called Monday’s announcement a big win. He then delivered his ultimatum to Canada. “One way or the other, we have a deal with Canada,” Trump said from the Oval Office, where he was joined on a speakerphone by Mexican President Enrique Pena Nieto.