US, Canada hold last-minute NAFTA talks as deadline looms
| Reuters Photo


U.S. and Canadian negotiators were holding eleventh-hour talks on Sunday aimed at revamping the North American Free Trade Agreement ahead of a Washington-imposed deadline, with the outcome far from certain.

The talks were being held over the phone, unlike in previous rounds where Canadian Foreign Minister Chrystia Freeland had traveled to Washington.

Peter Navarro, an adviser to U.S. President Donald Trump on trade, told Fox News: "Everybody is negotiating in good faith right now as we speak."

"The deadline is midnight tonight to get the text into congress to make sure this goes forward."

On the Canadian side, Prime Minister Justin Trudeau's office indicated that the negotiations were ongoing and they had nothing to announce.

The United States and Mexico want to push a deal they separately negotiated through their respective legislatures before Mexican President-elect Andres Manuel Lopez Obrador takes office on December 1.

In the United States, Congress must have the text of the deal by Sunday if a 60-day review period is to be respected.

U.S. President Donald Trump has been pushing for a complete overhaul of the 25-year-old continental trade deal, which he says has been a "rip-off" for the United States.

Speaking at a political rally in Wheeling, West Virginia on Saturday night, Trump told supporters: "We'll see what happens with Canada, if they come along. They have to be fair."

Trump blames NAFTA for the loss of U.S. manufacturing jobs and wants major changes to the pact, which underpins $1.2 trillion in annual trade. Markets fear its demise would cause major economic disruption.

Two Ottawa sources directly familiar with the talks said a deal could be very close but stressed some challenging matters had yet to be solved.

One of the sources said Canada would take nothing for granted until Trump had signed off on the deal.

In August -- more than a year into the negotiations -- the United States and Mexico announced they had reached a two-way deal, after breaking away for bilateral talks on their outstanding issues.

But the ensuing talks to incorporate Canada have stumbled.

Ottawa and Washington remain at odds over Canada's managed dairy sector, and the dispute resolution provisions in NAFTA.

But concessions on dairy would be politically difficult for Trudeau's government, a matter complicated yet further by elections being held Monday in the key dairy producing province of Quebec.

The main Quebec parties and farmers' organizations are in favor of retaining the "supply management" system, which controls the production and price of milk and poultry and ensures stable incomes for Canadian farmers.