Federal government and Ontario spar over USMCA trade deal

04 October, 2018, 19:25 | Author: Mary Valdez
  • Trump and Trudeau agree on a revised NAFTA deal

Canada gave up some access to its dairy, egg and poultry industries but will keep its agricultural supply management system and avoid punishing auto tariffs under the new North American trade deal.

The agreement reached Sunday shows a give-and-take between the two countries: It gives USA farmers slightly greater access to the Canadian dairy market, but provides Canada protection if Trump goes ahead with plans to impose tariffs on cars and auto parts imported into the U.S. Nicknamed the "Trump veto" by some Canadian politicians, Clause 32 Section 10 allows signatories to pull out of the USMCA if one country pursues a separate free trade agreement with a "nonmarket country" - a thinly veiled warning, in other words, against any side deals with China. The President lauded the new deal, calling it a "great deal for all three countries" that solves the "deficiencies and mistakes in NAFTA" and will "bring all three great nations in competition with the rest of the world".

The agreement provides extra protection to drug companies in the much larger US market, as well.

But it keeps a NAFTA dispute-resolution process that the USA wanted to jettison and offers Canada protection if Trump goes ahead with plans to impose tariffs on cars, trucks and auto parts imported into the United States.

In Ottawa, PMO officials said there would be another cabinet meeting Monday and a news conference likely as well. "We fail to see how this deal can be good for the 220,000 Canadian families that depend on dairy for their livelihood". White House National Economic Director Larry Kudlow said the deal shows "the continent as a whole now stands united against what I'm going to call unfair trade practices by you know who - it starts with a C and ends with an A".

"Late last night, our deadline, we reached a wonderful new Trade Deal with Canada, to be added into the deal already reached with Mexico".

"The deal is far from flawless, but other, decidedly more negative potential outcomes - such as Canada's exclusion from a revised agreement, a "zombie" NAFTA, and steep tariffs on Canadian auto exports to the US - have likely been avoided", he wrote in an analysis Monday. The goal for Trump, Trudeau and outgoing Mexican President Enrique Pena Nieto is to sign it before Nieto is replaced on December 1 by populist Andres Manuel Lopez Obrador.

Trump threatened to go ahead with a revamped NAFTA, with or without Canada.

Some lawmakers immediately expressed relief that Canada had been reinstated in the regional trading bloc.

"That's not the intent of worldwide trade deals nor anything we've sought in any USA trade agreement". "NAFTA is a proven success". The agreement will spare automakers from tariffs on cars imported from Mexico and Canada.

Guajardo, the former Mexican ambassador, said there is a growing recognition in Beijing - and Washington - that the Trump administration has engaged in trade disputes with many countries but that there's been a far more profound struggle with China.

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Trump campaigned on a promise to rewrite NAFTA or get rid of it. Talks on a rewrite began more than a year ago. There are also some auto issues including better pay for assembly line workers in Mexico.

Shares of American automakers traded marginally higher following this announcement.

After weeks of hunkering down in Washington, Freeland and David MacNaughton, Canada's ambassador to the US, had spent the day in Ottawa taking part in an aggressive, long-distance, last-minute push to get Canada into the trilateral free trade deal ahead of a key congressional deadline.

But relations between Ottawa and Washington soured. Trump called Trudeau "weak" and "dishonest".

The two countries need each other economically. Beijing responded by announcing tariffs of 5 percent to 10 percent on an additional $60 billion worth of USA imports.

The Canadian dollar jumped to a four-month high in response to the deal.

"It has been shocking and disappointing and upsetting", said Bruce Heyman, a former USA ambassador to Canada.

The unprecedented attacks on America's closest ally left a bitter taste.

"It has been shocking and disappointing and upsetting".

Aaron Padilla, senior adviser for global policy at the American Petroleum Institute lobbying group, said companies pushed for the arbitration clause because they are investing big sums over many years in offshore oil projects and want to be sure they have some protection from changing politics.


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