Ottawa and Washington remain at odds over Canada’s protected dairy sector and cultural subsidies (Lars Hagberg)

Washington (AFP) – There is still a way to go to reach a new North American Free Trade Agreement, Canada’s prime minister said Wednesday, brushing off US pressure for a quick deal as high-level talks resumed in Washington.

“Our team is in Washington this morning to continue to see if we can get a good deal for Canada, a good deal for everyone,” said Prime Minister Justin Trudeau.

“We remain confident that there is always a deal possible, but it will take more work,” he added.

Meanwhile, Canada’s top diplomat Chrystia Freeland was meeting with US Trade Representative Robert Lighthizer in Washington for the second time on Wednesday, as the sides work towards a rewrite of the 25-year-old pact.

US President Donald Trump, who called NAFTA “one of the worst trade deals in history,” spoke to Trudeau late Tuesday by telephone, and “the two leaders discussed trade,” White House press secretary Sarah Sanders said in a statement.

Trump demanded negotiations to modernize the 1994 accord between Canada, the United States and Mexico, and the talks started a year ago. Trump blamed the trade pact for sending many manufacturing jobs — notably in the auto sector — to Mexico.

Freeland told reporters on Wednesday that negotiators had worked through the night and were “tired but in good spirits.”

“Our negotiators have been really hard added including an all-night session last night of one team. So we are working very, very hard,” she said.

In between meetings with US trade officials, Freeland huddled at the Canadian Embassy with Ontario Premier Doug Ford, the Conservative leader of the province home to much of Canada’s automotive industry.

The United States and Mexico sealed their own two-way deal at the end of August, which they say will be signed by December 1. Since then Trump has ramped up pressure on Canada to accept his terms.

But Ottawa has seemed reluctant to give in to Trump’s push to agree to a deal before US midterm elections in November, and the transfer of power December 1 to Mexican President-elect Andres Manuel Lopez Obrador. 

Trudeau’s Liberals also need a win to hold up to voters when they return to the polls in one year.

– Dairy farmers on edge –

Ottawa and Washington remain at odds over Canada’s protected dairy sector and cultural subsidies, as well as Canada’s demand for an international system for resolving disputes.

Earlier, dairy farmers publicly urged Trudeau not to cave to demands for increased access to the nation’s dairy market, noting that the US already sells five times more milk to Canada than Canada sells to the US.

“We call on the government to ensure that any final NAFTA deal has no further negative impact on our dairy sector,” Pierre Lampron, the president of the Dairy Farmers of Canada, said at a news conference.

Flanked by dairy farmers from all of Canada’s 10 provinces, he said Ottawa had given milk and cheese carve-outs to the EU and 10 member nations in the Trans-Pacific Partnership trade pact in order to secure free trade with those blocs.

This cost Canada Can$250 million (US$193 million) in lost milk production, Lampron said. The Canadian industry is valued at Can$19 billion.

“This doesn’t only hurt dairy farmers. From equipment dealers, to feed manufacturers to veterinarians to truck drivers, to processors, all are negatively impacted by these (trade) deals,” Lampron said. “Enough is enough.”

The supply-managed sector sees milk, egg and poultry production and prices controlled by the government, resulting in higher prices for consumers but a stable income for farmers.

“We will continue to defend supply management,” Trudeau said. “This is a system that works for Canadians. It works for our agricultural industry.”

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