A trade agreement with Canada might not be happening by the end of the week after all, media outlets reported on Friday.
As explained in an earlier story this week, officials from the US and Canada have been engaged in discussions since early this week in an attempt to keep the trilateral free trade agreement NAFTA intact.
Ideally, the terms need to be agreed upon with enough time for Congress’s required 90-day review period to pass before December 1, the day López Obrador, a populist with a shoddy record on trade and commitment to principles in general, assumes the presidency. Obrador has signaled a willingness to accept any agreement already in place by the time he takes office; anything to take effect afterwards would likely require renegotiation. And Obrador, a socialist, would likely be less amenable to liberalization of commerce than current Mexican president Enrique Peña Nieto.
After President Trump announced on Wednesday that the US and Mexico had reached a preliminary agreement, attention turned towards Canada. President Trump had offered to make them a separate deal, while Canada and Mexico both expressed interest in forming a single trilateral accord.
But negotiations seemed to be making little progress Friday morning, as a spokeswoman for United States Trade Representative Robert Lighthizer told Reuters in a statement that Canada has yet to make any concessions to the United States on agriculture as part of negotiations.
“The negotiations between the United States and Canada are ongoing. There have been no concessions by Canada on agriculture,” the spokeswoman said.
Meanwhile, Canadian newspaper Globe and Mail reported Friday that the talks had soured over transcripts obtained by the Toronto Star containing private remarks that President Trump made during a Bloomberg interview in the Oval Office on Thursday, in which Trump boasted that any agreement reached with Canada would be “totally on our terms.”
[President Trump] suggested he was scaring the Canadians into submission by repeatedly threatening to impose tariffs.
“Off the record, Canada’s working their ass off. And every time we have a problem with a point, I just put up a picture of a Chevrolet Impala,” Trump said, according to the source. The Impala is produced at the General Motors plant in Oshawa, Ontario.The Toronto Star
Trump also allegedly recounted to Bloomberg how “Again off the record, [Canada] came knocking on our doors last night. ‘Let’s make a deal. Please.’”
According to the Star, Canadian president Justin Trudeau and his staff considered the remarks accurate and viewed them as evidence Trump had not been bargaining with them in good faith, raising the subject of Trump’s comments at the start of Friday’s negotiations.
Whether true or not, Trump’s comments about a refusal to compromise pose a problem in selling any completed deal to both sides.
President Trump responded to the reports about his off-the-record comments in a Tweet Friday afternoon, evidently confirming the remarks as accurate:
Why It Matters
For most of the twentieth century, Canada and the United States have worked towards liberalized trade. Years before the signing of NAFTA in 1994, the two countries had already eliminated most of their trade restrictions following 45 years of bilateral agreements and the Canada-United States Free Trade Agreement, signed in January 1988. If Trump can’t reach a mutually beneficial deal with Canada, it will really speak ill of his ability to negotiate with anyone.
Also, with the United States now having withdrawn from the Trans-Pacific Partnership, the Paris Agreement, and the Joint Comprehensive Plan of Action (the Iran deal), while also calling into question its commitment to the UN and NATO, its inability to maintain the first trade agreement of its kind, especially due to the President negotiating in bad faith, will damage US credibility among allies even further. Throw in Trump’s threats from this week to withdraw from the Word Trade Organization, and we really have a recipe for shattered trust on our hands.
Speaking of shattered trust, Congress could stop such a thing from happening. But that would involve opposing one of Trump’s key campaign promises. And whether they have the stomach for such a fight remains doubtful.