After a month of tense negotiations and with one day to go until the Sept. 30th deadline, the US and Canada are poised to announce a deal on NAFTA at the last minute, ending the impasse that has jeopardized $500 billion in annual trade between the two North American neighbors, Bloomberg reports citing people familiar with the talks.
The reason for the scramble – which also includes a “heavily involved” Justin Trudeau as well as Jared Kushner – to announce a deal by Sunday is so that it can be signed by Mexican President Enrique Pena Nieto before he leaves office, one month after the U.S. and Mexico reached their own bilateral agreement, triggering talks between the U.S. and Canada, which are being held around the clock this weekend. Under U.S. trade law, an agreement must be published for 60 days before it can be signed by leaders of any of the participant countries, putting negotiators on the clock to reach a deal that can be signed by Nov. 30, Pena Nieto’s final day in office.
So who “bent the knee?”
While the final document has yet to be published, the Globe and Mail reports that the Trump administration was ready to concede to Canada’s wish to keep Chapter 19′s dispute-settlement mechanism in place in exchange for greater access for U.S. dairy products.
Canada is prepared to allow U.S. dairy into Canada at rates that are higher than the 3.2 per cent under the eleven country Trans-Pacific partnership, sources said. Ottawa also made concessions on section 7, which is part of the country’s milk classification system that is used to set prices for skim milk, whole milk powder and protein concentrates. Canada was also ready to agree to the same arrangement as Mexico to raise its duty-free limit to $100, according to a source. Canada’s duty free is currently $20.
A senior Canadian official involved in the talks said there is no final written sign-off on Chapter 19 or dairy access but the insider said the two sides are close to a deal.