Canada neither in nor out as Trump’s NAFTA deadline passes

US President Donald Trump gave Canada until Friday to sign on to a new NAFTA agreement. That deadline came and went yesterday, with no new deal, but without Canada being officially excluded as the two countries continue to negotiate the trade pact.

The negotiations between Canada and the US this week came after the US reached an agreement with Mexico, an agreement Canada says helps its negotiating position.

“Some big changes were needed by Mexico in particular,” Foreign Affairs Minister Chrystia Freeland told reporters in Washington, in a press conference live-streamed on CBC.

“The most important progress was in rules of origin (for automobiles), a deal that required a lot of flexibility from Mexico that has put us in a place where we can move on to the other issues.”

The deal with Mexico includes provisions that require 75 per cent of a vehicle to be made in the U.S. or Mexico, compared with the current 62.5 per cent threshold. A second requirement mandates that 40 to 45 per cent of a vehicle must be made with labour earning at least $16 US an hour, according to the National Post.

‘We understand the pressures on working Canadians in the 21st-century economy,” Freeland said.

“We understand that working Canadians have sometimes elt trade agreements have hurt them. What is really significant about the rules of origin agreement is it will be good for Canadian workers and for American workers. That is an essential part of this NAFTA modernization.”

That was as much as Freeland would say about NAFTA negotiations. According to several media reports, Canadian sticking points include the dispute resolution mechanism, which the Americans want to scrap, and the Canadian supply management regime for dairy, which Trump has called out on several occasions.

“We are making progress,” Freeland said. “We are not there yet. This is a complex agreement and we are going to continue working at it. Our goal in these discussions is to update and modernize NAFTA in a way that is good for Canada, good for Mexicans and good for Americans. We know a win, win, win agreement is within reach. With good will and flexibility on all sides, I know we can get there.”

Freeland refused to comment on specific priorities, insisting on many occasions that she would not negotiate in public. She refused to comment, for example, on whether dairy supply management remained a sticking point.

She also refused to comment on a bombshell revelation from Toronto Star reporter Daniel Dale from Friday morning.

Dale obtained comments made by Trump during an off-the-record portion of an interview with Bloomberg News. In the comments, Trump said he would make no concessions to Canada on the trade deal.

Trump confirmed the comments over Twitter.

While reports said Canada confronted US officials with the story during negotiations, Freeland wouldn’t comment on the matter.

“My negotiating counterparty is ambassador Lighthizer,” Freeland said, adding that the parties are closer than they were when discussions began over a year ago.

“It is going to take flexibility on all sides to make a deal,” she said.

“Canada will only sign a deal that is a good deal for Canada. Over the course of the entire year, we understand each other’s positions and we’re working hard to find those compromises we need.”

In a statement released Friday afternoon, Conservative critic for Foreign Affairs Erin O’Toole said his party is “ready and willing to assist the government at this critical time.

“Canada’s conservatives, like all Canadians, want the best deal for families, workers and businesses,” he said.

After spending three months on the sidelines, Canada is now back at the negotiating table trying to make up for lost time. However, it is becoming clear that Mexico and the United States have reached major agreements that impact millions of Canadian jobs. Canadians are rightly concerned that our government was not at the table while these decisions were being made.

“Canadians I have spoken to are frustrated and want to know why Canada is on the outside looking in, while major sectors of our economy and millions of jobs hang in the balance.”

Freeland criticizes steel tariffs

As her press conference came to a close, Freeland did respond to a reporter’s questions about US tariffs on Canadian steel and aluminum.

That issue is “entirely separate from NAFTA,” Freeland said.

“We re very much opposed to these tariffs. They are unjustified and illegal. The notion that Canadian steel or aluminum could pose a national security threat to the United States is absurd.”

Steel tariffs are a cause for concern for Saskatchewan, as they could impact the Evraz steel plant in Regina.

 

 

Thierman Financial