Trudeau stands firm on US deal demands as talks set to resume

WASHINGTON - Canada and United States are set to tackle their contentious issues in bilateral talks on Wednesday, as the two nations work to salvage the North American Free Trade Agreement amid signs Ottawa was open to taking a more conciliatory approach.

After more than a year of talks, Mexico and the US announced a bilateral deal on Monday, setting the stage for Canada to rejoin negotiations to modernize 24-year-old NAFTA which accounts for over $1 trillion in annual trade between the three nations.

Mexico's President Enrique Pena Nieto and President-elect Andres Manuel Lopez Obrador both said NAFTA should remain a trilateral deal.

Canadian Foreign Minister Chrystia Freeland told reporters on Tuesday that Mexico's concessions on auto rules of origin and labor rights was a crucial breakthrough, clearing the way for Ottawa to resume talks with US this week.

After being sidelined from the talks for more than two months, Freeland will be under pressure to accept terms the US and Mexico worked out. The US Congress also wants a deal that includes Canada.

"The fact that agreement on those difficult issues for Mexico was able to be reached definitely clears the way for us to have significant, substantive, and I hope productive, conversations with the US this week," Freeland said after a brief meeting with US Trade Representative Robert Lighthizer.

US President Donald Trump said on Monday that he could go ahead without Ottawa in the new agreement, adding that he would take a tough line with Canada on autos and dairy tariffs - -long a source of tension between the neighboring countries.

But Canadian Prime Minister Justin Trudeau said he would only sign a new trade pact that was good for his country and vowed not to give in to Washington's demands to dismantle Canada's supply-managed dairy market.

"My position on defending supply management has not changed. We will defend supply management," Trudeau said.

White House economic adviser Larry Kudlow hammered the point on Tuesday, saying the US would not accept continued steep tariffs on dairy exports, which can reach as high as 300 percent.

Reuters - Afp

(China Daily 08/30/2018 page12)