Canada reaches 11th-hour NAFTA deal with U.S., Mexico

Canada reaches 11th-hour NAFTA deal with U.S., Mexico

Canada reaches 11th-hour NAFTA deal with U.S., Mexico

A side-letter to the agreement showed that Trump preserved the ability to impose threatened 25 percent global tariffs on autos while largely exempting passenger vehicles, pickup trucks and auto parts from Canada and Mexico.

President Donald Trump long promised to renegotiate or rip up NAFTA. It was unclear, however, whether Trump had authority from Congress to pursue a revamped NAFTA with only Mexico, and some lawmakers said they wouldn't go along with a deal that left out Canada.

The Trump administration is growing confident that a trade deal with Canada is moving close, and that a trilateral Nafta agreement will be published before the midnight deadline Sunday, five people familiar with the matter said.

"USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region", the joint statement said. The United States and Mexico had already clinched a bilateral agreement in August.

Trudeau declined to comment to reporters as he arrived at his office Sunday night ahead of the unusual 10pm meeting with his ministers, which was confirmed by two senior government officials.

Canada's The Globe and Mail cited four sources as saying an outline of a deal had been reached but Trump and Trudeau still needed to approve it.

The White House and Mexico announced on September 28 that they would release the full text of the bilateral deal that the two countries reached in August.

But this came at a cost.

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 Trump withdrew from previous year. Although Canadian sources said its government was prepared to offer compensation, dairy farmers reacted angrily.

We have heard from both sides on this issue that no deal is better than a bad deal.

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Negotiators for the United States and Canada were able to overcome major sticking points between the two countries, including Canada's protection of its dairy market and a system for settling trade disputes.

"It is a good night for Mexico, and for North America", Mexican Foreign Minister Luis Videgaray tweeted.

Additionally, Mexico will get an auto parts quota of $108 billion annually, while Canada will get a parts quota of $32.4 billion annually in the event of USA autos tariffs.

One of the toughest obstacles was Canada's demand for an exemption or other form of protection from the president's tariffs on imported steel and aluminum, which may potentially be extended to automobiles from Canadian factories. It is also well above the 1.8 million cars and SUVs Mexico sent north previous year.

A central objective for the new agreement is restoring "North America as a manufacturing powerhouse" by encouraging USA companies to use domestic suppliers rather than companies based elsewhere, Navarro said.

The U.S. Chamber of Commerce has said it would be "unacceptable to sideline Canada, our largest export market in the world".

"It will strengthen the middle class, and create good, well-paying jobs and new opportunities for the almost half billion people who call North America home", the two countries' joint statement said.

A revised Nafta that includes Canada has a far greater chance of being ratified by Congress but its fate is still somewhat uncertain. But López Obrador said Friday that he would not try to reopen talks, calling into question the validity of the negotiators' self-imposed deadline.

Last year, the USA goods trade deficits with Mexico and Canada were $71.1 billion and $17.5 billion, respectively.

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