NAFTA talks to resume in the afternoon - Reuters

6 September 2018, 00:53

As reported by Reuters, NAFTA renegotiations between the US and Canada are set to resume today as another round of talks gets underway. US President Donald Trump recently made a play to shut down NAFTA and open bilateral talks between Canada and Mexico independent of each other, but both countries have no interest in this strategy, and Mexico recently pumped the brakes on Trump's strategy, noting that Mexico will not be making any further moves without Canada's involvement.

Key quotes

"Canada insisted there was still room to salvage the North American Free Trade Agreement as its officials met U.S. negotiators for a second round of talks on Wednesday. Yet there were few signs that a deal was near, and comments by Canadian Prime Minister Justin Trudeau on Tuesday indicated there would be little compromise from Ottawa on its red-line issues.

Canada wants a permanent exemption from Trump’s steel and aluminum tariffs and the threat of auto tariffs to be removed. It also wants to continue protections for its dairy industry and defend lumber exports to the United States, which have been hit with duties.

As the two sides met for talks, new economic data showed that the U.S. trade deficit with Canada grew to $3.1 billion in July. This could provide ammunition to Trump who has accused Canada of “cheating” Americans.

Trump nearly tore up the NAFTA pact last year after visiting farmers in Wisconsin, a major U.S. producer of dairy products that Washington says has been hurt by Canadian protectionism. Trump charges that the 1994 pact, which underpins $1.2 trillion in trade between the three countries, has caused the loss of hundreds of thousands of U.S. jobs, a statement most economists dispute.

Data released on Wednesday showed the U.S. trade deficit hit a five-month high of $50 billion. The shortfall with Canada shot up 57.6 percent. Trump has notified Congress that he intends to sign a trade deal reached last week with Mexico by the end of November and officials said the text would be published by around Oct. 1.

Negotiators have blown through several deadlines since the talks started in August 2017. As the process grinds on, some in Washington insist Trump cannot pull out of NAFTA without the approval of Congress. “Trump is relying on bluster and bullying in a desperate attempt to get Congress to swallow his half-baked deal. You can’t fix NAFTA without fixing issues with Canada,” said Senator Ron Wyden, the top Democrat on the Senate Finance Committee, which oversees trade."