Canada and U.S

NAFTA Talks To Resume This Week

Gold catches late NY bid on NAFTA headlines, but . . .

Foreign Affairs Minister Chrystia Freeland has returned to Washington resume heated North American Free Trade Agreement (NAFTA) negotiations.

It's unclear how long the talks are scheduled for this week.

Canada's foreign minister is to be in Saskatoon on Wednesday to update her fellow caucus members on the ongoing negotiations.

"We agreed that it would be useful to continue talking today, so we're back for more negotiations", Freeland told reporters as she entered USTR offices in Washington. A deal would see Canada join a preliminary trade agreement the Trump administration struck last month with Mexico.

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A couple of weeks ago the White House announced a new NAFTA deal between the USA and Mexico, which they sent up to Congress for possible consideration.

But if anything has encapsulated the shift since then, it has been the hard renegotiation of the North American Free Trade Agreement, which has dragged on for some 13 months already - and is only one part of the ongoing cross-border trade dispute.

"Without Chapter 19, NAFTA is utterly useless as it would subject Canada and Mexico to the vagaries of the US political system and its courts when determining trade policy actions", said Derek Holt, vice-president at Scotiabank Economics, in a note recently. Freeland said she would meet with Lighthizer when negotiators found issues that needed to be elevated to the ministerial level. "It appears as if there is not a whole lot of momentum right now".

Many argue that Canada has already made concessions in the sector to secure other trade agreements like the Trans-Pacific Partnership (TPP), and the dairy industry is a relatively small part of the economy. Under U.S. trade negotiating laws, a text for that agreement is due by October 1.

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Under that system, the USA exports about $500 million of dairy products duty free to Canada - three times what it imports from here - but faces tariffs of up to 300 per cent for anything more. He adds that Canada may still have recourse to an alternative, in particular, bring its dispute before the world trade Organization.

The latest talks between Canada and the United States have been intense but constructive, marking a departure from acrimonious tit-for-tat that surrounded past rounds.

Trudeau, facing elections in 2019, said on Sunday (June 10) that Canada "will not be pushed around", triggering a fierce attack from Trump and his advisers, on Tuesday (June 12). However, he said, Mr. Lighthizer is far more eager to dismantle this dispute-settlement provision. "I think it will be gone". "But right now the US position is to squeeze every last drop in concessions". Canada has the right to oppose such an agreement, he said.

"There is no question Canada and Mexico are going to get a haircut and the best you can hope for when you get a haircut is that it looks stylish", Mr. Ujczo said.

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