Published: Mon, August 13, 2018
Global News | By Stacy Ballard

Trump praises Mexico, threatens Canada with auto tariffs

Trump praises Mexico, threatens Canada with auto tariffs

Administration officials and congressional aides have said the auto tariff probe, like the metals tariffs, in part is aimed at winning concessions during ongoing NAFTA renegotiation talks.

Trump has often threatened to withdraw from the three-way pact unless US -proposed changes to the existing terms are accepted.

"Deal with Mexico is coming along nicely", Trump said.

The renegotiation of the regional free trade deal started in August 2017 at the request of U.S. President Donald Trump, who claims the original agreement harms U.S. industries and jobs. "New President of Mexico has been an absolute gentleman", Trump said on Twitter.

And as Canada waits on the sidelines, even some trilateral issues around an updated free-trade agreement are being discussed and potentially decided by the others, said one close observer of the process. "Will tax cars if we can't make a deal!" he said.

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A source familiar with the negotiations said that Canada will definitely not take part when the talks resume next Wednesday.

Asked as he arrived for Friday's talks in Washington if he could finish the U.S. -Mexico issues on Friday, Guajardo said "I don't think today but we are very close".

But people briefed on the talks expected Canadian officials to be brought in once U.S. -Mexico bilateral issues are cleared out of the way.

Mexico has repeatedly said it opposed to including such a clause.

It is unclear why they refused to talk about the almost two-hour meeting with U.S. Trade Representative Robert Lighthizer, though sources say the low-profile Lighthizer has been irritated in the past by impromptu press conferences held by his counterparts after such sessions.

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The parties had been working through outstanding items, Economy Minister Ildefonso Guajardo said.

Ujczo said discussion has focused narrowly on what tariffs to impose on those Mexican-made cars that don't comply with the proposed "rules of origin".

Industry officials also said the USA team had barely moved from its demands last May of a 75 percent overall regional content threshold with 40-45 percent content from high-wage zones - effectively the United States and Canada - with the only substantial change a slightly longer phase-in time.

NAFTA talks have dragged on almost a year, but have achieved a palpable momentum in the past few days.

The issues the two countries are hammering out include what percentage of auto industry components need to be made in North America to avoid tariffs, and how many cars and trucks need to be made in factories paying higher wages.

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