Foreign Affairs Minister Chrystia Freeland said Canada is ready to "modernize" the North American Free Trade Agreement, after U.S. President Donald Trump’s administration announced its intent to renegotiate the 23-year-old trade accord.
In a letter sent Thursday to Republican and Democrat Congress and Senate leaders, U.S. Trade Representative Robert Lighthizer said the president “intends to initiate negotiations with Canada and Mexico regarding modernization” of NAFTA.
The letter gives Canada and Mexico a 90-day notice before the negotiations could begin.
Freeland said Thursday that Ottawa has been anticipating the notice for a long time and is ready for NAFTA talks.
“We are ready to roll up our sleeves. We have been from day one,” Freeland told reporters.
Late last month, Trump said that he had planned to withdraw from NAFTA, rather than try to renegotiate it. But he said he changed his mind after speaking with Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto.
Trump has repeatedly called NAFTA unfair to the U.S. and a “terrible” deal.
Lighthizer’s letter said the White House is looking to improve “U.S. opportunities” under NAFTA, adding that many chapters of the trade accord are “outdated and do not reflect modern standards.”
Lighthizer said the U.S. wants to include new provisions to address intellectual property rights, state-owned enterprises, and customs procedures, among others.
Freeland said modernizing international trade agreements is good practice, and Canada will take a “very thoughtful and very strategic approach” in NAFTA talks.
“Our focus in Canada is on getting a good deal,” she said, noting that the renegotiation needs to be done in a “trilateral fashion,” with Canada, U.S. and Mexico all at the table together.
Freeland said it’s premature to talk about NAFTA timelines, but she is heading to Mexico City next Tuesday, in part to discuss the trade accord with Mexican officials. Lighthizer says that NAFTA could be renegotiated by the end of the year.
The Mexican government said Thursday says it "welcomes" the opportunity to renegotiate NAFTA.
In a statement issued earlier Thursday, Freeland said the federal government will continue to consult on NAFTA with provinces, territories, industry and union stakeholders, as well as citizens.
Steve Verheul will be the chief negotiator on Canada’s NAFTA renegotiation team, CTV News has confirmed. Verheul was also the lead negotiator on the Canada-European Union trade agreement (CETA)
In recent weeks, U.S.-Canada trade tensions have escalated. After Trump publicly slammed Canada’s dairy, softwood and energy industries, the U.S. imposed a 24 per cent tariff on Canadian softwood lumber.
The Canadian government said it was considering retaliation, including a possible ban on exports of U.S. coal from B.C.
The view in the U.S. that Canadian logging companies get unfair subsidies pre-dates the Trump administration.
In a statement, the Canadian Chamber of Commerce said it’s ready for NAFTA renegotiation, and intends to focus on areas of digital trade, e-commerce and worker mobility.
“This agreement was negotiated nearly 25 years ago, and the economies of all three countries have changed considerably in that time,” Chamber of Commerce President Perrin Beatty said in a news release.
Randy Hoback, the Conservative Party’s critic for Canada-U.S. relations, said Thursday that NAFTA has been a good agreement over the years, so there’s a good base for the three countries to build upon.
But he noted that trade deals can take years to negotiate and that U.S. mid-term elections, as well as a presidential election in Mexico next year, will take place during NAFTA talks.
"I want to be optimistic because I think it's important that we get a good agreement,” Hoback said. “I'd sure hate to see us being pushed on timelines rather than getting a good agreement."
With files CTV’s Ottawa Bureau Chief Joyce Napier, Laura Payton, and files from The Canadian Press