U.S. trade chief casts doubt on Canada joining new NAFTA deal

U.S. trade chief casts doubt on Canada joining new NAFTA deal
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U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerChinese, US negotiators fine-tuning details of trade agreement: report The Trump economy keeps roaring ahead Trump says no discussion of extending deadline in Chinese trade talks MORE on Tuesday cast doubt on the prospects of the U.S. and Mexico reaching a deal with Canada on an updated North American Free Trade Agreement (NAFTA) by the Sunday deadline.

“The fact is, Canada is not making concessions in areas where we think they’re essential,” Lighthizer told the Concordia Summit in New York.

“We’re going to go ahead with Mexico,” he added. “If Canada comes along now, that would be the best. If Canada comes along later, then that’s what will happen.”

The U.S. and Mexico reached a deal last month on updating the three-country trade agreement after excluding Canada from negotiations. President TrumpDonald John TrumpCould Donald Trump and Boris Johnson be this generation's Reagan-Thatcher? Merkel backs Democratic congresswomen over Trump How China's currency manipulation cheats America on trade MORE hopes to use fast-track trade legislation to get the deal signed before the new, leftist Mexican president Andrés Manuel López Obrador takes office in December.

The fast-track deadline requires Trump to submit the final legislation to Capitol Hill by Sept. 30, leaving just a few days to close significant policy gaps with Canada. Congress appears unlikely to approve an agreement that excludes Canada.

"I think Canada would like to be in the agreement,” Lighthizer said. “I think the U.S. would like them to be in the agreement, but there is still a fair amount of distance between us. There are very large issues."

The Trump administration is pushing Canada to withdraw its dairy subsidies, while Canada is demanding that the U.S. withdraw threats of auto tariffs and reconsider its demands on how trade disputes are settled.

Canadian Prime Minister Justin Trudeau told the Council on Foreign Relations in New York that there is room to build on the U.S.-Mexico deal, but reiterated that Canada would not sign a deal that goes against Canada’s interests.

“We know that Canada’s interests are what we have to stand up for and we will,” Trudeau said. “We are looking for the right deal.”

Updated at 2:59 p.m.