Canada's Trudeau faces hard choices at NAFTA talks

Geraldine Edwards
September 7, 2018

Canada and the U.S. need to present a text to the U.S. Congress by October 1 in order to join the deal the Trump administration signed with Mexico last week.

The negotiations are aimed at bringing Canada into the NAFTA fold, but Canada and the US remain far apart on several issues including culture, dairy and the Chapter 19 dispute resolution mechanism. I want to make sure we continue to get trade.

The U.S. and Mexico reached a side deal last month, leaving Canada to negotiate separately with the U.S.

Perhaps more than anything else, it is Trump's stated willingness to conclude a bilateral deal with Mexico that leaves Canada out that alarms supporters of the North American partnership. "If I say no, then you're going to put that, and it's going to be so insulting they're not going to be able to make a deal", he reportedly said, adding: "I can't kill these people". USA senators Marco Rubio and Bill Nelson quickly warned that the agreement needs to better protect the state's agricultural industry, and state Agricultural Commissioner Adam Putnam said Trump's newly negotiated agreement "wasn't quite the deal we hoped it would be" in Florida.

"We have also been negotiating with Canada throughout this year-long process".

"There is good faith and good will on both sides".

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Foreign Affairs Minister Chrystia Freeland went out of her way to praise her counterpart, USA trade czar Robert Lighthizer, saying he was acting with "good faith" and "good will".

The goal of this week's talks is to reach a deal by December 1 so Congress can give its approval to a revised three-country NAFTA before Mexico's new president takes office.

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Trudeau said on Tuesday: "There are a number of things we absolutely must see in a renegotiated NAFTA", and reiterated he would not sign a bad deal. A lot is riding on a new NAFTA deal.

But for Canada there is no urgency, Leblond said.

"We're not going to accept that we have to sign a bad deal just because the president wants that". It allows Canada to regulate and subsidize the production of Canadian content on the airwaves to boost Canadian producers, distributors, artists and performers without having to provide the same subsidies to foreign companies.

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"Anything other than a trilateral agreement won't win congressional approval and would lose business support", Donohue said in a statement after talks failed last week.

"Yes, Mr. Trump is going to say the worst things possible about Canada - even yesterday, he announced that the rest of the world is profiting from the United States - but that's rhetoric and we should not be too anxious about it", said Leblond.

Sources familiar with Canada's bargaining position insist Ottawa's push to maintain the cultural exemption has remained unresolved between the two neighbours.

Veuger also notes that Canada is deepening its trade relationship with Beijing in part by expanding its oil and gas exports to China.

Lighthizer also said American broadcasters operating in border states have also complained about Canadian counterparts picking up the US signals and redistributing in Canada without consent.

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