Published: Fri, September 07, 2018
Global Media | By Garry Long

Canada's Trudeau faces hard choices at NAFTA talks

Canada's Trudeau faces hard choices at NAFTA talks

But the issue has been overshadowed by higher-profile obstacles, such as USA access to Canada's dairy market, dispute-settlement mechanisms and the proposal that NAFTA 2.0 contain a sunset clause.

Canadian officials have lately adopted an adamantly nationalist stance in trade negotiations, with Canada's foreign minister Chrystia Freeland pointing out that she is "paid in Canadian dollars". "We are concerned that excluding Canada from a final agreement will limit our export opportunities and hurt the USA economy", said Gary Shapiro, the head of the Consumer Technology Association, in a statement.

But despite the public optimism, negotiators face a tough task ahead. But on the sidelines, President Trump and Prime Minister Justin Trudeau have dug into seemingly irreconcilable positions.

As the two sides met for talks, new economic data showed that the USA trade deficit with Canada continues to grow, hitting US$3.1 billion in July, potentially providing ammunition to Trump who has accused Canada of "cheating" Americans.

Trump has notified Congress that he intends to sign the trade deal reached last week with Mexico by the end of November, and officials said the text would be published by around October 1.

Negotiations between Canada and the United States are to resume in Washington on Wednesday. It was obvious that for Trump anything that replaced NAFTA had to reflect US primacy in North America even more than the already lopsided deal, whereby the USA got privileged access to Mexican and Canadian energy resources, and a bill of rights for its giant corporations.

"If we don't make a fair deal for the USA after decades of abuse, Canada will be out", he tweeted. "The United States is exploring avenues to address these concerns", Lighthizer wrote.

The tentative deal struck with Mexico calls for a horizon of 16 years for the new terms, with provisions for a review of the revised pact every six years.

Trump hinted there might be progress towards a deal with Canada.

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"The atmosphere continues to be productive and constructive", she said Wednesday evening, adding that both countries' officials would continue negotiating late into the night.

"We will not sign a deal that is bad for Canadians and, quite frankly, not having a Chapter 19 to ensure that the rules are followed would be bad for Canadians".

The tone of the NAFTA renegotiation "has painted the U.S. as an antagonist that has to be handled", he says.

With the USA midterms eight weeks away, and Trump facing pressure to maintain the Republican hold on the House and Senate, the influence of Congress will permeate the resumption of Wednesday's talks.

"Today the president notified the Congress of his intent to sign a trade agreement with Mexico - and Canada, if it is willing - 90 days from now", Lighthizer said in a statement Friday.

It's a perennial issue for some US industry groups, but Ujczo said they're not the type that typically make up Trump's blue-collar base of support.

"We really are confident, as we have been from the outset, that a deal which is good for Canada, good for the United States and good for Mexico is possible", Freeland said, as she departed the office of the U.S. Trade Representative on her way to the Canadian Embassy. The best known Chapter 19 cases involving Canada have had to do with softwood lumber, and in the mid-2000s, the dispute resolution panels ruled repeatedly against the U.S., strengthening Ottawa's negotiating position. "And we know we have a president who doesn't always follow the rules as they are laid out".

"It won't be fine for Canada, but we love Canada", he is quoted in the report as saying.

Canada was frozen out of the bilateral talks between the two other NAFTA partners. "That would not be good for Canada, it would not be good for our identity, it would not be good for our sovereignty".

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