OTTAWA-Canadian and US officials worked late into the evening Sunday in a drive to come up with a legal agreement that would allow Canada to join Mexico in a three-way free trade pact with the United States.
OTTAWA - An 11th-hour NAFTA deal has been reached that allows Canada to rejoin the trilateral trade pact, sources tells The Canadian Press.
The Trump administration plans to send the new deal to Congress, starting a 60-day review period before Trump can sign it. Congress can suggest changes during that time.
President-elect Andrés Manuel López Obrador of Mexico said on Friday that Trudeau had appealed to him to help pave the way for a three-nation deal and that he would insist that a revised Nafta include Canada.
The agreement "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".
The NAFTA negotiations have been in the works since August 16, 2017. In force since 1994, Nafta eliminated tariffs on most goods and governs more than US$1 trillion in trade on the continent.
Ultimately, Ujczo said he expects Canada and the U.S.to reach a so-called "side letter" to the main deal that would resemble a similar agreement reached last month between Mexico and the USA which preserves duty-free access to the US market for vehicles that comply with the agreement's rules of origin.
The agreement with Canada and Mexico -- two of the United States' biggest trading partners -- fulfills President Donald Trump's campaign pledge to renegotiate NAFTA and avoids his threat to exclude Canada if the talks failed. Canada will continue to impose severe tariffs on any United States dairy that exceeds the quota.
Canadian and U.S. negotiators came to an agreement just hours before the self-imposed midnight deadline, according to a CNN report.
But concessions on dairy would be politically hard for Trudeau´s government, a matter complicated yet further by elections being held Monday in the key dairy producing province of Quebec.
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The new deal will be called the U.S. -Mexico-Canada Agreement, or USMCA.
A source told Reuters that Mr Trump had approved the deal.
On dairy the official said Canada essentially gave the US the same access it offered in the Trans Pacific Partnership trade agreement that President Trump rejected.
Any agreement requires the approval of both Trudeau and U.S. President Donald Trump.
U.S. Trade Representative Robert Lighthizer and White House adviser Jared Kushner planned to brief Trump on Sunday on the talks, said a U.S. source familiar with the discussions.
"Lots of progress but we're not there yet", he said.
Canada and Mexico each agreed to a quota of 2.6 million passenger vehicles exported to the United States in the event that Trump imposes 25 percent global autos tariffs on national security grounds. But Trump and other critics said it encouraged manufacturers to move south of the border to take advantage of low-wage Mexican wages, costing American jobs.
In addition to opening the door for a NAFTA rewrite, the deal could also ease trade tensions between the U.S. and Canada over Trump's steel and aluminum tariffs.
Ottawa and Washington remained at odds over Canada's subsidized dairy sector, and the dispute resolution provisions in NAFTA.
But the USA and Canada had trouble dealing with other areas in the pact, including Canada's dairy industry, its insistence on a strong dispute settlement mechanism and concerns about intellectual property and culture.