U.S., Mexico Reach Trade 'Understanding' That Could Lead To NAFTA Overhaul

Evan Vucci  AP

Evan Vucci AP

And there are political reasons to keep Canada inside the regional bloc: "Mexico will have a hard time selling "Trump's deal" back home if Canada does not think it is a good deal", said Daniel Ujczo, a trade attorney with Dickinson Wright PLLC.

A voice could be heard over the speakerphone saying "President Pena Nieto", but still there was no Mexican leader on the line.

Trudeau spoke about the possibility of resolving a trade war last week, saying that he was "encouraged by the optimism expressed by the USA and Mexico", but added that "we also recognize that we will only sign a good deal for Canadians".

Canadian Foreign Minister Chrystia Freeland is headed to Washington on Tuesday to restart talks to replace the three-way NAFTA pact.

"It's quite clear that the White House wants Canada to feel the heat of a threatened auto tariff and is going to try to seek some visible concessions from Canada relative to what's in the existing NAFTA deal", he said.

Flavio Volpe, president of Canada's Automotive Parts Manufacturers Association, who said that Trump's rhetoric on tariffs could be easier said than done.

Negotiations among the three partners, whose mutual trade totals more than $1 trillion annually, have dragged on for more than a year, putting pressure on the Mexican peso and the Canadian dollar.

The word you're searching for is "threatening". "Given the encouraging announcement today of further bilateral progress between the USA and Mexico, Minister Freeland will travel to Washington, D.C., tomorrow to continue negotiations", her spokesman said.

US law requires Trump to give Congress 90 days' notice of his intention to sign a new trade deal. "Canada's signature is required", he said.

Not according to Trump.

There's no obvious reason Canada couldn't live with those auto-sector revisions. However, President Trump considers NAFTA "one of the worst deals" in trade history, and in his ongoing global trade war, he has mentioned wanting to rewrite the deal.

"We're very interested in building on this, making NAFTA a better, modernized agreement", Kerr said.

The draft deal reached by the U.S. and Mexico boosted American stocks to record highs on Monday.

This preliminary agreement does not include Canada. Both U.S. and Mexican officials said Monday they are now focused on Canada. "He would have to go back and settle with Congress his negotiating objectives with Mexico". The three countries had been having trilateral negotiations for a year, until May. For another, a Congress that has been divided on trade issues would have to give its final approval.

So the situation for the rest of this week in Washington is shaping up as complex and tense.

President Trump complained again on Monday about stiff Canadian tariffs on dairy products.

A key element of the US-Mexico talks has been content requirements for autos.

"Canada has been isolated", he says.

The president is critical of Canada's lopsided treatment of the US, especially with the northern nation's tariffs on dairy products that be almost 300 percent.

"I think people must take him seriously". "The Congress, and only the Congress, can agree to the termination of Nafta by the United States".

Latest News