Loonie soars in wake of trade deal

Loonie soars in wake of trade deal

Loonie soars in wake of trade deal

Canada, the United States' No. 2 trading partner, was left out when the USA and Mexico reached an agreement last month to revamp the North American Free Trade Agreement.

All food and agricultural products that have zero tariffs under the North American Free Trade Agreement (NAFTA) will remain at zero tariffs, according to the office of US Trade Representatives.

"It'll probably or possibly be just USM".

Word of an agreement followed an emergency cabinet meeting called by Canadian Prime Minister Justin Trudeau at 10:00 pm (0200 GMT) - two hours ahead of a Washington-imposed midnight deadline for getting the text of a revised agreement to the United States Congress. "The door closes on trade fragmentation in the region", Jesus Seade, trade negotiator for Mexico's incoming president, said via Twitter.

Canada's high tariffs on most US dairy products had become the main point of contention that had stalled the negotiations for months, making the prospect of Canada joining the US-Mexico deal, struck in August, increasingly feeble.

Washington and Ottawa immediately began negotiations that culminated in a deal just before midnight on September 30. Farmers have developed export markets in Canada and Mexico. The deal struck Sunday offers a measure of protection for both Canada and Mexico, ensuring each country won't be affected by any auto tariffs unless exports top 2.6 million units annually.

The pact preserved a key trade dispute settlement mechanism sought by Canada even as Ottawa agreed to open up its dairy markets to USA farmers. The official was not authorized to speak publicly and requested anonymity.

Trump also said he is employing tariffs as a negotiating tactic, which were effective in helping solidify the USMCA.

Initial reports indicate that the revised agreement will allow the U.S. greater access to Canada's dairy market and addresses Canadian concerns about potential auto tariffs, sources told CNN.

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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. They suspected Canada, which had said it wasn't bound by USA deadlines, was delaying the talks until after provincial elections Monday in Quebec, where support for Canadian dairy tariffs runs high. "I think Justin's a good person who's doing a good job".

Canada fought hard to retain Chapter 19, a holdover from NAFTA that USA trade ambassador Robert Lighthizer worked tooth and nail to eliminate.

Trump had made criticism of NAFTA a centerpiece of his successful 2016 election campaign, terming it the worst trade deal in history and blaming NAFTA for the loss of American manufacturing jobs since it went into effect in 1994.

"For those babies out there who keep talking about tariffs", this deal would not have happened without tariffs, Trump told reporters during a almost 80-minute event in the White House Rose Garden.

"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 USA and will bring all three Great Nations together in competition with the rest of the world", he continued.

Trevor Hargreaves, director of producer relations and communications for the B.C. Dairy Association, said the new agreement could cause some dairy farmers to sell out or go out of business because they no longer have faith in the industry.

Canada and Mexico will push to resolve the steel and aluminum tariffs over the next two months, leading up to the signing of the new USMCA deal, three people familiar with talks said, speaking on condition of anonymity.

That's a huge relief to a slew of industries that were rattled by Trump's repeated attacks on NAFTA, the governments in Mexico City and Ottawa and Republicans on Capitol Hill who support free trade.

Canada also agreed to get rid of its two-year-old Class 7 pricing agreement that has restricted USA exports of ultra-filtered milk used to make dairy products.

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