As she emerged from the high-stakes meeting with her US counterpart Wednesday in Washington, Freeland emphasized the "compromises" by Mexico in their bilateral trade deal with the U.S.to increase the wages of its auto workers. That's not going to be enough of a tax to get companies to move an assembly plant to the USA from Mexico, but it'll raise the price of vehicles, said Michelle Krebs, a senior analyst with AutoTrader.
That "set the stage for very intensive conversations and negotiations that we're going to have". Canada had rejected an earlier US proposal that NAFTA 2.0 be renegotiated - or sunsetted, in trade lingo - every five years.
"On that particular issue, what benefits the United States also benefits Canada". "We are in regular contact with our negotiating partners, and we will continue to work toward a modernized NAFTA" but "we will only sign a new NAFTA that is good for Canada and good for the middle class".
"We recognize that there is a possibility of getting there by Friday, but it is only a possibility, because it will hinge on whether or not there is ultimately a good deal for Canada", he said at a news conference in northern Ontario on Wednesday. During the 2016 presidential campaign, Trump hammered NAFTA as the "worst trade deal in history".
Trudeau's office sent out a signal later Wednesday that NAFTA 2.0 talks were progressing.
Zive said there appeared to be an ISDS agreement, but the only details were provided in calls Monday from the office of U.S. Trade Representative (USTR) Robert Lighthizer.
Freeland said the higher Mexican wages would result in "better conditions for working people in Canada and also in the United States in high wage countries". Canada officials are likely to argue that the United States has high tariffs on some products, too, said John Horn, professor of practice in economics at Washington University in St. Louis.
"I think they're going really well", Trump said about the Canada talks, which are "probably on track" to meet the Friday deadline. He even added later in the day that he had "just signed a trade agreement with Mexico", which can not happen without the United States first nixing NAFTA. Lighthizer noted that any signing would be delayed until Congress was informed and a 90-day waiting period passed. Electing to not speak with them about a major trade agreement is just completely wrong.
"The legalities I think would lead me to believe that's strictly posturing from the Trump administration", he said.
The report said it's part of the effort to save an important NAFTA dispute-settlement system, maintain safeguards for cultural industries and avert tougher pharmaceutical patent protections.
"I don't see why Canada wouldn't be OK with the terms as is", Wakefield said by phone.
The fresh agreement between USA officials and their Mexican counterparts mandates up to 45 per cent of auto content from high-wage jurisdictions, and includes a 75 per cent North American content-per-vehicle threshold. It's a tremendous amount of money and it's a very simple negotiation.
Negotiators have worked for a year to update and rewrite NAFTA, but in the last five weeks Washington and Mexico City worked to resolve their bilateral issues without Ottawa.
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