Canada Says NAFTA Talks Making Very Good Progress

Canada’s top trade negotiator said on Friday she and her US counterpart were making “very good progress” in talks to save the North American Free Trade Agreement amid increasing Canadian optimism that a deal could be reached, even if a conclusion did not appear imminent.

Canadian Foreign Minister Chrystia Freeland repeated her upbeat assessment of the negotiations, again terming them constructive, as she spoke to reporters after a meeting in Washington with US trade representative Robert Lighthizer, Reuters reported.

“We are certainly making very good progress at understanding each other, understanding what each side needs,” Freeland said.

But the talks on Friday were not headed toward an immediate conclusion. Freeland was due to fly out of Washington on Friday evening, a senior Canadian official said, adding that further minister-level discussions would not likely be held until sometime next week.

Lighthizer is scheduled to be in Brussels on Monday for trade talks with the European Union’s trade commissioner, Cecilia Malmstrom, and is due back in Washington on Tuesday.

The main sticking point in the US-Canada NAFTA talks appeared to be Canada’s dairy quota regime, according to the White House’s top economic adviser, Larry Kudlow, who spoke before the start of the latest talks.

President Donald Trump has struck a trade deal with Mexico and threatened to push ahead without Canada, a move that would kill NAFTA, which covers $1.2 trillion in trade between the three countries, and further spook financial markets.

Other sticking points include Ottawa’s desire to keep the 1994 pact’s Chapter 19 dispute resolution mechanism, and Canadian media laws that favor domestically produced content.

Meanwhile, Trump said Friday he does not want to hurt Canada’s economy but also warned that if he imposes taxes on cars it would be “devastating” for the neighboring country, AP reported.

“If I tax cars coming in from Canada, it would be devastating. But I don’t want to do that,” Trump told reporters aboard Air Force One. “I do use that as leverage in negotiating, where they don’t want to give us some points. I say, that’s ok, I’d rather tax your cars coming in, and I win a lot of points because of it.”