Canadian Prime Minister Justin Trudeau is under high pressure to renew North American Free Trade Agreement (NAFTA)


Canadian Prime Minister Justin Trudeau

Canadian Prime Minister Justin Trudeau is under high pressure from Business and political leaders so as to agree on a deal to renew
North American Free Trade Agreement  (NAFTA) and drop his insistence that no deal is better than a bad deal.

Foreign Minister Chrystia Freeland will hold fresh talks on the North American Free Trade Agreement with US Trade Representative Robert Lighthizer in Washington on Wednesday as a US-imposed deadline of October 1 looms.

The two sides are far apart in some areas and Trudeau says his Liberal government will walk away if necessary.

Signs are growing that hitherto solid domestic support for Ottawa’s stance is fraying amid fears of the potential economic damage. The United States takes 75 pe rcent of Canada’s goods exports and President Donald Trump is threatening to impose tariffs on autos.

Freeland defended Ottawa’s stance on Tuesday, saying “any negotiator who goes into a negotiation believing that he or she must get a deal at any price … (will) be forced to pay the maximum price for that deal.”

That approach though is starting to worry some.

“The problem with the bold statement that ‘No deal is better than a bad deal’ is that a bad deal is very much in the eye of the beholder,” said John Manley, a former Liberal finance minister who heads the Business Council of Canada, which groups many chief executives.

“Anyone who thought we were going to get something better than what we had under NAFTA 1.0 was delusional. We knew that this was all about taking some things away,” Manley said on Tuesday.

Trump came to power last year threatening to tear up NAFTA unless major changes were made to a pact he blames for the loss of manufacturing jobs.

Last month he announced a side deal with Mexico and made clear he was prepared to exclude Canada if necessary.

“Canada has taken advantage of our country for a long time. We love Canada … but they are in a position that is not a good position,” Trump told reporters on Tuesday, complaining about high Canadian dairy tariffs.

US negotiators are pressing for more access to Canada’s protected dairy market.

Trudeau’s Liberals have no chance of winning a federal election set for October 2019 unless they do well in Ontario.

Trudeau told an interviewer on Monday that a decision point might be weeks away.

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