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WASHINGTON / OTTAWA (Reuters) – Canada said it was still possible to save the North American Free Trade Agreement after Wednesday's talks with the United States and that the two sides would meet later in the day. after separate discussions on this morning's proposals.
Canadian Foreign Minister Chrystia Freeland participates in a press conference at the Canadian Embassy in Washington, DC, on August 31, 2018. REUTERS / Chris Wattie
There were few signs, however, that an agreement was about to be reached and comments by Canadian Prime Minister Justin Trudeau on Tuesday indicated that there would be little compromise in the timing of the deal. Ottawa on its red line problems.
Canada wants a permanent exemption from President Donald Trump's steel and aluminum tariffs and the threat of tariff cuts. She also wants to continue to protect her dairy industry and defend softwood lumber exports to the United States.
"We continue to work hard," said Canadian Foreign Minister Chrystia Freeland after meeting with US Trade Representative Robert Lighthizer.
"There is good faith and good will on both sides."
US officials made no comment after Wednesday's meeting, which was held after Trump said he was willing to forgo Canada from the $ 1.2 trillion trade pact after he reached an agreement with Mexico last week.
As the two sides met to discuss, new economic data showed that the US trade deficit with Canada continued to grow, reaching $ 3.1 billion in July, which could provide Trump with ammunition.
Trump almost tore up the NAFTA pact last year after visiting farmers in Wisconsin, a major US dairy producer, which, according to Washington, has been hit by Canadian protectionism.
Trump alleges that the 1994 pact, which supports $ 1.2 billion in trade between the three countries, has caused the loss of hundreds of thousands of jobs in the United States, a statement disputed by most economists.
Data released Wednesday showed that the US trade deficit reached its highest level in five months, at $ 50 billion. The deficit with Canada climbed 57.6%.
Trump told Congress he intended to sign a trade deal with Mexico at the end of November last week, and officials said the text would be released by Oct. 1.
But Canadian officials, who note growing political pressure on Trump from US business and labor circles to keep NAFTA a trilateral agreement, said they were in no hurry.
"We are not saying that we do not want to act quickly to try to reach an agreement. But I certainly think that we still had the intention of taking as long as it was going to take, "said a government source who declined to be identified given the sensitivity of the situation.
"We see goodwill from all sides and if we see more flexibility, then I think we can start to see things move in the right direction," the source added.
Negotiators have exceeded several deadlines since talks began in August 2017. In Washington, some say that Trump can not withdraw from NAFTA without congressional approval.
"Trump relies on brutality and intimidation in a desperate attempt to get Congress to swallow his half-prepared agreement. You can not settle NAFTA without fixing the problems with Canada, "said Sen. Ron Wyden, a senior Democrat on the Senate Finance Committee, who oversees trade.
Written by David Ljunggren and David Chance; Edited by Paul Simao and James Dalgleish
