Mexican, Canadian steel lobbies urge fix to US tariff dispute

Randal Sanchez
October 5, 2018

Trudeau said Canada has successfully preserved key elements of the original North American Free Trade Agreement while building on the agreement to expand opportunity and improve protections for workers across North America.

But he stressed the government is committed to compensating them for any financial hit.

USA farmers will gain access to 3.5% of Canada's dairy market worth $16bn a year, while another requirement stipulates that 40% of components for vehicles produced in the USMCA area must be made in areas paying wages of $16 an hour.

President Trump on Monday announced the agreement, which replaces the North American Free Trade Agreement (NAFTA), calling it "historic" and "a great deal for all three countries".

"It's definitely a waiting game to see how things will pan out but I do think it's going to be very promising for the dairy producers in Iowa" he said. Marshall said the US had set the deadline to finalize its agreement with Mexico before the new Mexican administration takes over.

That money comes in the form of grants to farms to update their equipment. Under Canada's supply-managed dairy system, Ottawa effectively sets production quotas and the price of milk, which raises prices to consumers but provides farmers with a stable income.

A Canadian official told The Associated Press that the agreement preserves a NAFTA dispute-resolution process that the US wanted to jettison. The U.S. had previously negotiated a deal with Mexico in late August.

Dairy was a major sticking point during negotiations.

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This was with the goal of keeping the production of vehicle parts in the United States and help bring back some that had moved overseas. "We are concerned, however, with increasing barriers for product sourcing (country of origin requirements) and wage standards that drive up costs for everyone, while protecting only a few jobs at the expense of many others", they wrote. "The government has said repeatedly that it values a strong and vibrant dairy sector - they have once again put that in jeopardy by giving away more concessions".

The trade deal with Canada follows an agreement last month between the us and Mexico, which eliminated some tariffs on goods traded between the two countries.

"Calling the new accord "truly historic news for our nation - and indeed, for the world", the U.S. leader said he hoped to sign it by the end of November".

But the president noted that the deal would need to be ratified by Congress, a step that could be complicated by the outcome of the fall congressional elections.

Canada has agreed to provide U.S. dairy farmers access to about 3.5 percent of its approximately $16 billion annual domestic dairy market.

For example, Freeland said the deal gets rid of the ISDS, the investor state dispute settlement mechanism between Canada and the US, which she said allows foreign companies to sue the Canadian government.

Flanked by Cabinet members, Trump said the pact is the "most important deal we've ever made by far", covering $1.2 trillion in trade.

Co-owner Pat McCormick believes the change will help his sixth-generation family farm rebound.

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