Canadian Foreign Minister Chrystia Freeland was upbeat in Washington after meeting US Trade Representative Robert Lighthizer, saying that "detailed" discussions to salvage the North American Free Trade Agreement as a three-nation deal would begin the following day.
Lighthizer told reporters in a call that the agreement with Mexico provided the "highest standards" of any existing agreement on digital trade, financial services and labor rights.
These are expected to continue for Mexico despite the new trade deal between the two countries.
"Given the encouraging announcement today of further bilateral progress between the US and Mexico, Minister Freeland will travel to Washington, D.C., tomorrow to continue negotiations", her spokesman said.
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Trump and some of his aides argued that Canada could be excluded from the agreement if they object to its terms. US law requires a three-month waiting period after a deal is completed before Congress can ratify it.
The minister also said that the revised trade agreement would maintain provisions from the original NAFTA accord which stated that new auto plants would for the first five years only need to meet a requirement of 50 percent regional content.
Trump backed off from an initial United States demand for a "sunset" clause that would kill the pact unless it was renegotiated every five years and which businesses said would stymie long term investment in the region.
There is some urgency as the United States seems eager to have the issue resolved before the November midterm elections and Pena Nieto wants to sign it before handing the reins over to Lopez Obrador on December 1.
Trudeau has previously said he could not sign a deal that has an expiry date on it, but that was when the U.S. If Canada won't come on board, the administration would have to get Congress' approval for a new, two-party deal to keep the fast-track option open, and CNBC reports that process would take months. "A lot of people thought we'd never get here", the president said as he entered the Oval Office to an array of news cameras. "But I think we'll give them a chance to probably have a separate deal".
"There is a possibility of getting to a good deal for Canada by Friday", Trudeau said.
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The U.S. has demanded that Canada move off its line on both issues as well as others.
While critics said Canada had been frozen out, Freeland has repeatedly stressed that she remained in close touch with her Mexican and USA counterparts throughout the summer and had already achieved "a high-level agreement with the US" on some of the pending issues on autos and labor rights. She said she was "encouraged" and "optimistic" upon her departure from the morning meeting, but she did not provide details. The agreement would have given the US and 10 other Pacific Rim countries access to 3.25 per cent of Canada's dairy market.
Jared Kushner, President Trump's senior adviser, chimed in, saying the U.S. -Mexico deal was done "in nearly record time" for a trade deal. If after the review there is no consensus to renew, a review will be conducted every year until disagreements can be worked out and the parties agree to then renew for another 16 years.
The American Farm Bureau has said lobbied for a rewrite of NAFTA to eliminate or reduce Canadian tariffs on dairy, poultry eggs and wine, as well as recently implemented barriers to imports of ultra-filtered milk.
In the US, any law must sustain a waiting period of three months. Trump himself has avoided directly calling for the dismantling of supply management during his frequent attacks on Canadian dairy, including during Monday's announcement with Mexico.
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