WASHINGTON _ In an eleventh-hour breakthrough that may have saved the North American Free Trade Agreement, the Trump administration and Canada came to terms late Sunday on a deal _ opening the way for the United States, Canada and Mexico to sign a renewed trade pact at the end of November.
The agreement still needs to be ratified by legislatures in all three countries, which won't happen until next year at the earliest. But in striking an accord with Canada after settling with Mexico last month, U.S. negotiators hit a critical Sunday midnight deadline that otherwise could have pushed President Donald Trump toward a breakup of the trilateral accord.
The U.S.-Canada deal came after furious negotiations and repeated threats from Trump and his chief negotiator, Robert Lighthizer, that the administration was prepared to leave Canada behind.
The agreement marks a milestone in Trump's efforts to rewrite the United States' most consequential free-trade pact, which he promised to overhaul or tear up. And it may help soften criticisms of his overbearing negotiating style and heavy use of tariffs, as the administration can now lay claim that it successfully completed a revamping of a major trade agreement.
The revisions to NAFTA include notable changes on auto-sourcing rules and labor rights, as well as new or updated provisions on digital trade, financial services and other areas of commerce that were not major factors when the pact was ratified a quarter-century ago under the Clinton administration. NAFTA took effect in 1994 and has integrated the economies and boosted trade among the three countries to more than $1 trillion last year. Many feared a collapse in negotiations would cause huge disruptions to sales and supply chains.
Lawmakers, business interests and labor activists have said it is too early to estimate the potential gains from the deal for American workers and companies. The White House has released publicly only a few pages summarizing some of the changes. People familiar with the substance of the accord that was struck with Mexico, most of which Canada earlier also had negotiated, say some important details have yet to be hammered out.
Late Sunday, Trump administration officials were briefing key members of Congress, and they scheduled a call afterward with reporters. A full text was expected to be posted before midnight.
Trade officials for the three countries have been at it for more than a year. Earlier this summer Lighthizer, the U.S. trade representative, took a different tack by negotiating separately with Mexico and ultimately forging a bilateral agreement, putting pressure on Ottawa to join or face the possibility of being left out. Just before Labor Day, Trump sent a notice to Congress of his intention to sign a new trade pact solely with Mexico.
Trump's hardball tactics have not made it easy for Canadian officials to cede ground. Two of the last and most sticky issues involved Canada's dairy market and an existing NAFTA dispute-resolution mechanism that has allowed Canada to fend off U.S. anti-dumping duties on lumber and other goods.
The U.S. and Mexico sought to complete the talks by the end of September, to satisfy a congressional procedural requirement so they could sign a renewed trade pact Nov. 30. That was an important political consideration for Mexico, as its president-elect takes office Dec. 1 and did not want NAFTA hanging over him at the start of his term.
Canada's prime minister, Justin Trudeau, faced considerable domestic pressure to stand up to Trump, who is highly unpopular in Canada. At the same time, Trudeau did not want to risk of a breakup of the trilateral pact and the potential damage to Canada's economy.
In addition to repeated threats to withdraw from NAFTA, Trump also slapped tariffs on steel and aluminum from Mexico and Canada, among other countries, to gain leverage in negotiations. Analysts were hopeful that those tariffs _ a bargaining chip for Trump but bitterly resented by Canada _ are expected to be lifted soon now that the parties have reached a deal on a new NAFTA, which Trump has said he would call by another name.
