Published: Tue, October 02, 2018
Money | By Armando Alvarado

Canada, US secure revised NAFTA deal in last minute effort

Canada, US secure revised NAFTA deal in last minute effort

Despite the fact that Ottawa had long pushed back hard against allowing the deal to be periodically revisited, officials in the USA briefing said the new language includes a provision that will indeed see the deal reviewed every six years.

"There were moments that were frustrating and hard and I was delighted that it all came together in the last while, because I think it removes a lot of uncertainty", MacNaughton said.

He said it was "privilege" for other countries to trade with the US: "So we have negotiated this new agreement [with Mexico and Canada] based on the principle of fairness and reciprocity - to me it's the most important world in trade, because we've been treated so unfairly by so many nations all over the world".

The tariff measure "is still staying where it is", he said, adding, "but I don't think you will need to use the tariffs".

"We don't like their representative very much", Trump said, in a comment widely believed to be directed as Canada's Foreign Affairs Minister Chrystia Freeland.

It replaces the 1994 North American Free Trade Agreement (NAFTA), which had been called "perhaps the worst trade deal ever made" by US President Donald Trump.

"The agreement will govern almost one point two trillion in trade which makes it the biggest trade deal in the United States history...."

With limited details on what USMCA entails, the Times reports that with the new agreement, Canada's dairy management system will ease its protections, allowing the us more access to Canada's dairy products.

During a news conference in Ottawa, Prime Minister Justin Trudeau welcomed the agreement, saying it will be good for both Canadian workers and families.

Like all negotiations, there was horse trading, but for the Canada there were elements of the new pact that could be viewed as victories. Canada will be allowed to export as many as 2.6 million autos before any US tariffs on foreign cars kick in - effectively an exemption.

The deal appears to preserve the key dispute-resolution provisions- Chapter 19-which allow for independent panels to resolve disputes involving companies and governments, as well as Chapter 20, the government-to-government dispute settlement mechanism. Starting in 2020, to qualify for zero tariffs, a auto or truck must have 75 per cent of its components manufactured in Canada, Mexico or the United States, a substantial boost from the current 62.5 per cent requirement.

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Former prime minister Brian Mulroney welcomed news of an agreement in a statement Monday, calling it a "highly significant achievement for Canada, while benefiting all three countries as it should".

Steve said he has sympathy for affected dairy farmers but noted that with every trade agreement concessions must be made - and this deal was too vital to lose.

- CP24 (@CP24) 1 October 2018Trump says steel and aluminum tariffs will remain in place for the time being, but he says "we are working on that now".

Access for other agricultural goods: Canada will give the U.S. more access to its chicken, turkey, and egg markets, and British Columbia will allow the sale of USA wines at its state-owned liquor stores. Canada has a complex milk and dairy system.

Mexican President-elect Andres Manuel Lopez Obrador has embraced the new deal, his incoming foreign minister said. "Right now, we're at break even or below".

The pact also gives the US greater access to Canada's dairy market. It offers Canada protection if Trump goes ahead with plans to impose tariffs on cars, trucks and auto parts imported into the United States.

Meanwhile, the president said he would continue to employ tariffs on other countries only in instances where the governments are "absolutely not willing to do what's fair and reciprocal". The official was not authorized to speak publicly and requested anonymity.

However, the new agreement has B.C. agreeing to scrap the restrictions that prevent USA wines from also showing up on grocery-store shelves.

In regards to China, Trump said the USA could "go $267 billion more" when it comes to tariffs on products.

Canada fought hard to retain Chapter 19, a holdover from NAFTA that USA trade ambassador Robert Lighthizer worked tooth-and-nail to eliminate.

The new United States-Mexico-Canada Agreement (USMCA) is aimed at bringing more jobs into the United States, with Canada and Mexico accepting more restrictive commerce with the United States, their main export partner. The president, long a NAFTA critic, complains that the original treaty cost the United States millions of factory jobs and led to persistent USA trade deficits with its southern neighbor.

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