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WASHINGTON (Reuters) – US and Canadian negotiators have made progress in talks to save the North American Free Trade Agreement on Thursday, but some lingering issues have hindered an agreement, including dairy products, protecting media companies and solving future problems trade disputes.
PHOTO: The flags of Canada, Mexico and the United States are visible on a lectern before a joint press conference following the seventh round of NAFTA talks in Mexico City, March 5, 2018. REUTERS / Edgard Garrido / File Photo
An American source familiar with the Washington talks said it was still unclear whether the two sides could fill their gaps or whether US President Donald Trump would opt for a bilateral trade deal exclusively with Mexico.
"We have three issues: chapter 19, cultural issues and dairy products. We have created leverage and brought Canada to the table, "said the source. "Part of our problem is that Canada has pulled back on its commitments (on dairy products).
Trump has set a deadline for an agreement this week, prompting officials from US Trade Representative Robert Lighthizer and Canadian Foreign Minister Chrystia Freeland to work late into the evening to find ways to move forward.
Freeland continued his positive discussions on the talks for a second day in a row, saying the talks were "constructive and productive."
"The atmosphere continues to be good. There is goodwill on both sides, "she said at the end of a meeting with Lighthizer, adding that officials on both sides would continue the detailed discussions.
She declined to discuss specific issues being negotiated.
US President Kevin Brady, a powerful voice in the Congress on Trade, told reporters on Thursday that there are still differences between Canada's milk quota system and a long-standing process of resolving trade and other issues.
The Trump administration accuses Canada of discriminating against its exports of US dairy products. He also wants to end the Chapter 19 arbitration panels for the settlement of anti-dumping disputes, which Canada has used to defend its softwood lumber exports to the United States, even though the United States
"They continue to push for the conclusion of this agreement. A depends on Canada's seriousness in resolving these final disputes, "Brady told reporters after speaking with Lighthizer earlier on Thursday. "My feeling is that everyone is at the table with the intention of working on these last issues always difficult."
The third unresolved issue is the fact that Canada insists that the cultural exemptions of NAFTA that protect its publishing and media companies be acquired by US corporations. Prime Minister Justin Trudeau said that this issue was important for the
Lighthizer called the exemptions "cultural protectionism" because Canadian companies are free to buy American media.
Trump has threatened to continue with a bilateral deal with Mexico, which effectively killed the three-nation deal of NAFTA, which covers a $ 1.2 trillion trade.
The United States and Mexico reached an agreement on the revision of NAFTA early last week, exerting pressure on Canada to accept new conditions.
Trump said on Wednesday that he was expecting it to be clear if there would be an agreement to include Canada in a few days. The Canada-US talks resumed Wednesday after failing to reach a conclusion last Friday.
Canada also wants a permanent exemption from Trump's steel and aluminum tariffs and Washington eliminates the threat of auto tariffs in the United States.
But Freeland said the national security tariffs in Section 232 on metals were not part of the current NAFTA negotiations.
"Canada's position on the 232 tariffs is unchanged. These rates are unjustified and illegal, "she said Thursday.
Trump asserted that the 1994 NAFTA pact had caused the loss of hundreds of thousands of jobs in the United States, which most economists question.
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 informed Congress that he intended to sign the trade agreement reached last week with Mexico at the end of November, and officials said the text would be posted to October 1st.
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.
Written by David Ljunggren and David Chance; Additional report by Chris Prentice in New York; Editing by Bernadette Baum and Alistair Bell
