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Trump hamstrings NAFTA

The ongoing effort to rescue and revamp NAFTA has made only limited progress because U.S. officials at the table find themselves hamstrung by the demands of the Trump White House and the talks are taking place too quickly, Canada's chief negotiator says.

Tuesday's hard-hitting and sobering update from Steve Verheul came on the same day that U.S. trade czar Robert Lighthizer took another shot at Canada by suggesting more progress on the continental trade pact was being made with Mexico.

Verheul described the current NAFTA talks as the most unusual negotiation he's ever been involved in.

"They do not come to the table — our counterparts — with a lot of flexibility. This is being driven to a large extent from the top, from the administration, and there's not a lot of flexibility," the veteran negotiator told the Canadian Global Affairs Institute.

The U.S. strategy is to strengthen its position by weakening Canada and Mexico — a tactic that could end up having dire consequences for all three countries, Verheul said.

President Donald Trump's threat to trigger NAFTA's six-month withdrawal notice remains a possibility and Canada is ready for any eventuality, he said.

If it happens, Verheul said it might simply be a negotiating tactic.

The normally reserved Verheul warned "the worst possible outcome" would be for the United States to go it alone — a scenario he warned would weaken North America, allowing other countries and regions to take easy advantage.

"If the U.S. is to go alone, not only would North American be weakened, but I think the U.S. would also be weakened economically."

Canada is particularly concerned with a controversial U.S. Buy American proposal that would limit access to public contracts.

The U.S. has proposed limiting Canada and Mexico to one dollar of contracts for every dollar in contracts granted by Canada and Mexico to American companies, an idea Canada and Mexico alike have branded a non-starter.

That "is the worst offer ever made by the U.S. in any trade negotiation," Verheul said.

"(It) would leave us in a position where the country of Bahrain would have far better access to U.S. procurement markets than Canada would, or that Mexico would, and we've clearly said this kind of offer is not possible."

Canada will stay at the negotiating table for as long as it takes, Verheul said, but it's impossible to predict the next move of a notoriously unpredictable president.

Even though three chapters have been closed, the pace has been "fairly limited progress over all because there hasn't been enough time between rounds to re-evaluate positions, he said.

"The pace has been a bit too fast to do a lot of the kind of homework that needs to be done domestically to allow further progress to be made," Verheul said.

"That is a consequence of trying to move too quickly in a negotiation like this."



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