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Canada, U.S. reach new NAFTA deal

Canada, U.S. reach new NAFTA deal

By DANIEL DALE, Washington Bureau Chief & TONDA MACCHARLES, Ottawa Bureau

Sunday, September 30, 2018

WASHINGTON—Canada and the U.S. have agreed on a new North American free trade agreement, concluding an acrimonious 13-month negotiation that had hindered the Canadian economy and damaged relations between the two countries.

They released the full text of the deal after 11 p.m., leaving experts little time on Sunday to pore over the specifics on which the deal will ultimately be judged. The news that they have struck any kind of deal, though, means Prime Minister Justin Trudeau has achieved a long-sought goal: convincing U.S. President Donald Trump to preserve a trade accord Trump has repeatedly threatened to terminate.

Prime Minister Justin Trudeau leaves the Office of the Prime Minister and Privy Council after an agreement was reached in the NAFTA negotiations in Ottawa on Sunday. “It’s a good day for Canada,” Trudeau said.
Prime Minister Justin Trudeau leaves the Office of the Prime Minister and Privy Council after an agreement was reached in the NAFTA negotiations in Ottawa on Sunday. “It’s a good day for Canada,” Trudeau said.  (JUSTIN TANG / THE CANADIAN PRESS)

Trump, meanwhile, began touting the deal as a fulfilment of his campaign promise to secure a better arrangement for American workers.

“It’s a great win for the president and a validation of his strategy in the area of international trade,” said a senior Trump administration official, saying it includes a “host of provisions that will rebalance our trade relationship with Mexico and Canada.”

On Twitter on Monday morning, Trump called the deal “wonderful” and a “historic transaction.”

“It is a great deal for all three countries, solves the many deficiencies and mistakes in NAFTA, greatly opens markets to our Farmers and Manufacturers, reduces Trade Barriers to the U.S. and will bring all three Great Nations together in competition with the rest of the world,” he said.

The deal makes substantial changes to the rules governing the North American auto industry. And it will affect dozens of other industries and the consumers who buy their products, from milk to medicine.

Canadian sources said the deal would include significant protection for Canada against the auto tariffs Trump has repeatedly threatened to impose. A Canadian official said the first 2.6 million Canadian car exports to the U.S., significantly higher than the current 1.8 million, would be shielded from tariffs. Trump could hypothetically impose tariffs on cars above that number, but the threshold is so high that the Canadian official said Canada had been effectively exempted.

Both sides said there would be no changes to the “Chapter 19” dispute-resolution system or the cultural exemption Trudeau had made his “red lines” in the last weeks of the negotiations.

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