Canada still optimistic for new NAFTA deal


Canada still optimistic for new NAFTA deal

The US is trying to include the "Buy American" policy in the NAFTA (North American Free Trade Agreement ) also, though the Canadian government said they are resisting the pressure.

Trudeau joined Trump in the Oval Office at the start of a new round of talks over the North American Free Trade Agreement, which the USA president has threatened to withdraw from if he can't negotiate a better agreement with Canada and Mexico. It's time after all of these years and we'll see what happens.

Quote "There is no relationship in the world quite like the Canada-U.S. relationship".

US President Donald Trump said this week that while an agreement is possible for NAFTA renegotiations, the option of making a pact with Canada that excludes Mexico remains on the table.

The country's foreign relations secretary said this week it would not be a big deal for Mexico to just walk away from the talks, and that Mexico won't accept "limited, managed trade", an apparent reference to demands for higher USA and regional content rules on products like auto parts.

Terminating the deal is one option he alluded to, and in the past Trump's said doing so would allow something completely new to be written.

The top US business group pledged to fight to preserve the pact, a congressional committee said it was committed to successful talks, and Mexico signaled it can live without the accord.

"Thus far, we have made good progress, and I look forward to several days of hard work", Lighthizer said in the statement Wednesday.

"Absolutely it's possible we won't be able to reach a deal with one or the other, but in the meantime we'll make a deal with one", Trump said in the Oval Office, seated next to Trudeau. "Two countries that are interwoven in our economies and our cultures and our peoples", Trudeau said.

With a nationalist economic agenda, Trump has denounced the agreement as a job destroyer and a "disaster" for the United States, vowing to reverse offshoring by renegotiating the treaty.

NAFTA negotiators face tough new USA demands to increase regional content for autos to 85 percent from 62.5 percent, with 50 percent from the United States, according to people briefed on the plan. Reuters-London reports Britain could join a formal trade alliance with the United States, Canada and Mexico if the European Union refuses to finalize a post-Brexit trade deal by 2019. NAFTA requires at least 62 percent of a car's parts to be made in North America before the auto can avoid import tariffs and taxes.

U.S. Chamber of Commerce CEO Thomas Donohue, speaking in Mexico City on Tuesday, said the rules of origin proposal would send more business overseas. The United States takes in three quarters of Canadian exports, but trade relations have been strained since Trump's inauguration earlier this year.

The hard issue of rules of origin will be addressed mostly at the end of the current talks, according to a schedule obtained by Reuters.

-Canada deal that would leave Mexico out entirely.

One of the most contentious US proposals is around so-called rules of origin for vehicles, which govern what share of a auto must be built within NAFTA countries to receive the pact's benefits.