Canada Likely to Reach Nafta Accord Sunday, Announcement Is ‘Imminent’

Canadian Foreign Minister Chrystia Freeland

Canadian Foreign Minister Chrystia

Canadian and US negotiators were racing against a midnight Sunday deadline (0400 GMT Monday) to reach a deal to revamp NAFTA, but thorny issues including Canada's dairy market and USA tariffs were still unresolved, a Canadian official and other sources said.

The deal will preserve a trade dispute settlement mechanism that Canada fought hard to maintain to protect its lumber industry and other sectors from United States anti-dumping tariffs, Canadian sources said.

A U.S. official said a few minutes earlier that the United States and Canada were "very close" to a deal.

"Everybody's negotiating in good faith right now as we speak".

Prime Minister Justin Trudeau called the cabinet meeting inside his office across the street from Parliament Hill, where high-level staff and Freeland had been working over the weekend to secure a NAFTA deal.

-Canadian negotiations to a successful finish, a USA official briefed reporters that the us won greater access to the Canadian dairy market, in part via an increase in Canadian dairy import quotas.

What began as a marathon in the summer of 2017 ended in a flat-out sprint as negotiators in Ottawa and Washington worked around the clock to put the finishing touches on language adding Canada to the deal reached over the summer between the USA and Mexico.

Trump blames NAFTA for the loss of American manufacturing jobs and wants major changes to the pact, which underpins $1.2 trillion in annual trade.

The key one concerns the dairy system in Canada.

The Trump administration repeatedly threatened to move forward with the bilateral deal, excluding Canada.

Earlier this month, Trump went as far as saying he could cause the "ruination" of Canada if he applied a 20% tariff on Canadian automotive exports.

Walkom writes, "A trade pact that can be upended on the whim of the US president is of no use to Canada".

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Ottawa and Washington remained at odds over Canada's subsidized dairy sector, and the dispute resolution provisions in NAFTA.

A source within the administration told the Times that Canada and Mexico would receive "accommodations" if Trump imposes auto tariffs.

Officials have blown through several deadlines since the talks started in August 2017, and a third Canadian source said that if the two sides were close enough at midnight, negotiations could spill over into Monday.

US and Canadian negotiators have been negotiating around the clock this weekend to make a deadline that would allow the countries to sign the deal as the final act before Mexico's outgoing President Enrique Pena Nieto leaves office at the end of November.

"It's a good day for Canada", Prime Minister Justin Trudeau said as he left his office.

A side letter published along with the main text of the agreement exempts a percentage of eligible auto exports from the tariffs.

The Trump administration had threatened to proceed with a Mexico-only trade pact as US talks with Canada foundered.

U.S. negotiators reached a bilateral deal with Mexico late last month.

Trump wanted Canada to open its dairy market to US farmers, and Canada wanted to preserve a mechanism for resolving disputes. Lawmakers have said they do not expect Congress to vote on the deal until early next year.

The new agreement will be called the United-States-Mexico-Canada Agreement (USMC).

They suspected that Canada, which had said it wasn't bound by United States deadlines, was delaying the talks until after provincial elections Monday in Quebec, where support for Canadian dairy tariffs runs high.

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