Energy Industry Awaiting Details on Tentative U.S.-Mexico Trade Pact

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The U.S. and Mexico have apparently agreed that 75 per cent of the content of cars sold must come from the U.S. or Mexico. For Trump and other critics of NAFTA, the 1994 landmark deal might have helped companies trade more freely across national borders, but it also caused the gutting of the industrial Midwest.

Later Monday, Freeland spokesman Adam Austen said in a statement: "Given the encouraging announcement today of further bilateral progress between the USA and Mexico, Minister Freeland will travel to Washington, D.C., tomorrow to continue negotiations".

Canada's top diplomat and trade negotiator Chrystia Freeland cut short her trip to Europe to travel to Washington on Tuesday, August 28, to rejoin the talks.

Sklar couched that by noting this is a tentative agreement without reference to Canada. Freeland will be on the call as well as Dominic LeBlanc, intergovernmental affairs minister, and David MacNaughton, Canada's ambassador to the U.S.

One sticking point for Canada is the USA effort to dump the Chapter 19 dispute-resolution mechanism that hinders the United States from pursuing anti-dumping and anti-subsidy cases.

Negotiators have worked for a year to update and rewrite the 25-year-old free trade pact. Congress approved the NAFTA; they would have to approve US withdrawal, and change a whole slew of USA laws that implement the trilateral agreement.

"In areas like digital trade, financial services, IP, all of the kinds of things you think of as a new economy, we are setting newest high-level standards that are not only better than NAFTA 1.0, but are also better than TPP or, I would suggest, any other agreement that's been negotiated", said the administration official, who called the new agreement "innovative".

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"I think it is fair to say we'll do a rebalancing", Lighthizer said.

"It seems like a set of things that are very easy for Canada to come in on", Brett House, deputy chief economist at Bank of Nova Scotia, said in an interview about what the US and Mexico agreed to.

Trump said Monday he would call Canadian Prime Minister Justin Trudeau very soon, adding that their northern neighbor has two choices - either it can join the U.S. -Mexico trade deal, or make a separate trade agreement with the U.S.

The Friday deadline is meant to start the mandatory 90-day waiting period soon enough that the outgoing Mexican president, Enrique Pena Nieto, would be able to sign the agreement.

He said the Fed will continue to raise interest rates, but noted that the USA central bank sees no clear sign of inflation accelerating above 2 percent. But in the last five weeks, Washington and Mexico City held talks to resolve their bilateral issues, especially on the auto industry rules, without Ottawa. Trump himself has avoided directly calling for the dismantling of supply management during his frequent attacks on Canadian dairy, including during Monday's announcement with Mexico. Analysts have said they don't necessarily need a full agreement by then, and Lighthizer has said he might be able to send a letter that leaves a door open to Canada joining. "And we are going to remain firm on that principle because Canadians expect us to stand up for them".

The U.S. Trade Promotion Authority (TPA) requires the White House to give Congress 90 days' notice that it plans to sign a trade deal. She said she was "encouraged" and "optimistic" upon her departure from the morning meeting, but she did not provide details.

The NAFTA renegotiations had dragged on for a year before the tentative agreement with Mexico was announced Monday.

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