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October 1, 2018 | Local, Naval

Canada and the U.S. reach 11th-hour trade deal

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After almost 14 months of tough bargaining, Canada and the United States have settled their trade differences and reached an agreement on a new North American free trade agreement. This one won't be called NAFTA, however.

The trilateral deal will now be known as the United States-Mexico-Canada Agreement (USMCA). The new name seems to be a nod to U.S. President Donald Trump, who has said he didn't like the name NAFTA.

The federal cabinet met at 10 p.m. Sunday for about an hour to discuss the agreement and, after it ended, the prime minister said it was “a good day for Canada” as he left the building. He said he'd have more to say on Monday.

Officials from the Prime Minister's Office said there will be another cabinet meeting in the morning and likely a news conference, too.

A joint statement was released by Foreign Affairs Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer.

“Today, Canada and the United States reached an agreement, alongside Mexico, on a new, modernized trade agreement for the 21st Century: the United States-Mexico-Canada Agreement (USMCA),” it stated.

“USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region. It will strengthen the middle class, and create good, well-paying jobs and new opportunities for the nearly half billion people who call North America home.”

The two lead negotiators added: “We look forward to further deepening our close economic ties when this new agreement enters into force.”

They thanked their Mexican counterpart, Economy Secretary Ildefonso Guajardo, for his work on the deal.

On Twitter, Conservative Leader Andrew Scheer said “a good NAFTA deal is critical to Canada's economy.”

“Millions of Canadian jobs rely on having free trade with the U.S. and Mexico. We will take a close look at the agreement's provisions as soon as they're available to evaluate the deal Justin Trudeau and the Liberals have signed.”

Perrin Beatty, the president and CEO of the Canadian Chamber of Commerce, said that with a deal like this, it's important to see all the elements, but details are still scarce.

“However, if the broad lines are as reported, @cafreeland and the Canadian negotiating team have managed to preserve the most important elements of #NAFTA under very challenging circumstances,” he said on Twitter.

Canada and the United States have been working hard to resolve their NAFTA differences since the end of August, after American and Mexican officials reached a bilateral agreement of their own.

However, the prime minister has said throughout the process that his government would not sign a modernized NAFTA just to get a deal. Issues at the table have included the automotive industry, dairy, dispute resolution, cultural industries and intellectual property.

Canada's dairy industry, in particular, has been in American crosshairs for months, with the United States demanding more access to this country's market, as well as changes to parts of Canada's domestic milk-pricing system.

The U.S. has wanted access to about 3.5 per cent of Canada's dairy market, which is similar to what Canada granted under the Comprehensive and Progressive Trans Pacific Partnership. There were strong indications this was also part of the deal reached Sunday night. Media reports say farmers will be compensated. The Americans have also asked for changes to several dairy classes. iPolitics has learned that the contentious Class 7 has been eliminated in this deal. Class 7 is a domestic pricing class that governs milk ingredients such as skim milk powder and milk proteins.

The difficult politics of the trade deal were immediately on view with Parti Québécois Leader Jean-François Lisée saying on social media that Quebec dairy farms had been sacrificed by Trudeau. Quebec voters will elect a new government on Monday, with all parties saying the new trade deal could not touch Canada's dairy market.

The Toronto Star is reporting that Canada has been able to preserve the dispute-resolution mechanism known as Chapter 19. The federal government had wanted to hold onto that to avoid having disputes settled in U.S. courts.

Other reports say Canada has been able to maintain its exemption for culture.

Ministers had arrived for the cabinet meeting Sunday amid strong indications the end was in sight for a renewed NAFTA.

Freeland and Ambassador to the United States David MacNaughton had spent the day in Ottawa, taking part in an aggressive, long-distance, last-minute push to get Canada into a free trade deal.

Trudeau arrived at his downtown office, located directly across from Parliament Hill, around 7:30 p.m. He did not comment as he headed into the building, but media reports from the U.S. capital were indicating a deal was near.

While most ministers also stayed mum, Agriculture Minister Lawrence MacAulay said he's “always concerned about the agriculture industry.” He was joined in the meeting room by his deputy minister Chris Forbes.

With files from the Canadian Press

https://ipolitics.ca/2018/09/30/canada-and-the-us-reach-11th-hour-trade-deal/

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