Published: Mon, October 01, 2018
Worldwide | By Angelina Lucas

Basis of Canada-US NAFTA deal has been reached, official says

Basis of Canada-US NAFTA deal has been reached, official says

The agreement came just hours before a deadline set by the Trump administration, will pave the way for a vote in Congress to approve the deal after more than a year of negotiations among the US, Canada, and Mexico over the trilateral agreement.

"Specifically, we will seek clarity on how the agreement addresses the existing tariffs on Canadian steel and aluminium, as well as how it will ensure that tariffs and quotas upon Canada's auto sector exports will be avoided", Beatty said in a statement.

The U.S. and Canada are on the verge of a deal after making progress on contentious issues, people familiar with the talks said, speaking on condition of anonymity as negotiations continue.

"We still have a couple of tough issues, so we're doing our best".

A special federal cabinet meeting was convened at 10 p.m. ET to discuss a trade accord that already includes Mexico, while an announcement was planned for 11 p.m.at the White House.

The two countries are also working on an agreement that would shield Canada if Trump goes ahead with his threat to tax imported cars, truck and auto parts.

Canada has reached a deal with the U.S.to rescue NAFTA, the landmark trade agreement that Donald Trump has called the "worst deal ever", according to multiple reports.

Trump's primary objective in reworking NAFTA was to bring down US trade deficits, a goal he has also pursued with China, by imposing hundreds of billions of dollars in tariffs on imported goods from the Asian giant.

Canada's The Globe and Mail cited four sources as saying an outline of a deal had been reached but Trump and Trudeau still needed to approve it. Trudeau said it made no sense to sign on to a new NAFTA only to be hit by new tariffs, and is seeking safeguards.

Negotiators from the three countries began talks about updating NAFTA more than a year ago.

So much American trade depends on the 1994 agreement that USA markets have been jittery about a possible collapse of negotiations - and because Mr. Trump made campaign promises to get rid of the agreement.

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Ujczo said the two sides have also largely settled on a dispute-resolution mechanism similar to that in the original NAFTA known as Chapter 19 - an issue that has always been a major stumbling block in the talks - and on a higher duty-free threshold for goods shipped into Canada: $100, up from $20.

The US-Canada deal appears to be a victory for both sides.

According to industry experts, the rule would also allow the Trump administration the ability to impose higher tariffs on national security grounds if vehicles do not comply with the new thresholds.

"The ideal is a trilateral deal, but we're prepared for the possible need of a bilateral", he told Bloomberg News.

Canada, for instance, agreed to give the Americans access to five per cent of the Canadian dairy market, about the same it granted to European and Pacific-Rim nations in the CETA and TPP accords combined, the source said.

The U.S. and Mexico held off on a plan to publish the full text of their deal on Friday as American and Canadian negotiators rushed to narrow differences. That is more than the 2 million units now exported.

The United States and Mexico want to push a deal they separately negotiated through their respective legislatures before Mexican President-elect Andres Manuel Lopez Obrador takes office on December 1.

The new deal will replace the North American Free Trade Agreement (NAFTA), which had always been derided as unfair to the United States by Trump.

MacNaughton is flying back to Washington Sunday night, one official said.

The U.S. senior administration officials told reporters on Sunday night's call that the deal will be signed at end of November and will be submitted to Congress after that for the next Congress at the beginning of 2019.

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