Canada, US agree to NAFTA replacement that includes Mexico
01 October, 2018, 11:40 | Author: Teresa Adams
MONTREAL: US and Canadian negotiators were holding eleventh-hour talks on Sunday aimed at revamping the North American Free Trade Agreement ahead of a Washington-imposed deadline.
"Today, Canada and the United States reached an agreement, alongside Mexico, on a new, modernized trade agreement for the 21st Century: the United States-Mexico-Canada Agreement (USMCA)", the USA and Canada said in a joint statement Sunday.
After a nail-biting weekend of talks, negotiators from both countries managed to hammer out a new deal, dubbed the United States-Mexico-Canada Agreement.
According to people briefed on the negotiations, Canada will ease protections on its dairy market and provide access that is similar to what the United States would have gained through the Trans-Pacific Partnership, a trade treaty that Trump withdrew from a year ago.
No substantial changes appear to have been made to the chapter 19 trade dispute settlement mechanism, nor the state-to-state dispute settlement.
The Trump administration had already agreed last month to an updated pact with Mexico, increasing the pressure on Canada to make concessions to join the deal.
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.
The US Congress is required go through a 60-day review of the draft agreement, which could potentially allow for NAFTA signing around December 1.
"The middle-ground approach looks like when they announce the deal, that the three parties will be meeting at such-and-such a date in the immediate future to resolve the steel and aluminum tariffs", he said.
The deal represents a win for Trump, who has derided Nafta for years and threatened to pull the United States from the pact if it was not rewritten in America's favor.
Peter Navarro, an adviser to Trump on trade, told Fox News: "Everybody is negotiating in good faith right now as we speak".
According to senior Trump administration officials, Chapter 11 - which allows investors to bring disputes against other NAFTA member governments - will be phased out with Canada, a key goal for the US. Vehicles imported to the United States from Mexico contain almost 20 to 30 percent US content. It replaces the 24-year-old North American Free Trade Agreement, which President Donald Trump had called a job-killing disaster.
President Donald Trump has said he wants to go ahead with a revamped NAFTA - with or without Canada.
Lawmakers from the three countries still need to approve the pact. They suspected that Canada, which had said it wasn't bound by USA deadlines, was delaying the talks until after provincial elections Monday in Quebec, where support for Canadian dairytariffs runs high.
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