As Nafta Talks Resume, U.S. and Canada Stand Firm on Their Key Priorities

WASHINGTON — The United States and Canada resumed talks on Wednesday aimed at keeping the North American Free Trade Agreement intact, but leaders of both countries continued to insist they would not concede on their key priorities.

On Saturday, President Trump repeated his threat to leave Canada out of a revised Nafta and move ahead with just Mexico, saying it was not necessary to keep a trilateral deal alive.

“There is no political necessity to keep Canada in the new NAFTA deal,” Mr. Trump said in a tweet on Saturday. “If we don’t make a fair deal for the U.S. after decades of abuse, Canada will be out.”

Canada’s prime minister, Justin Trudeau, also insisted this week that he was not willing to relent on some areas of disagreement between the two countries.

Discussions between Canada and the United States ended last week without a deal, prompting Mr. Trump to inform Congress that he would move ahead with a trade pact with Mexico and give Canada the chance to remain in a revised Nafta “if it is willing.” Canada now has until the end of September to reach its own agreement with the United States, allowing the three-country pact to remain intact.

Several big obstacles remain, including an independent dispute resolution system that Canada wants to retain and that the United States wants to eliminate. The system allows Canada to appeal the duties that the United States imposes on Canadian products, like lumber, as a penalty for providing subsidies and dumping products into the American market. The provision was eliminated in the agreement the United States reached with Mexico, but the Canadians have insisted that it is necessary to protect industries from biased rulings in the United States.

Last week, the United States International Trade Commission overturned the Trump administration’s decision to impose tariffs on Canadian newsprint. The Commerce Department had hit Canadian newsprint with levies after determining the government was unfairly subsidizing its manufacturers and hurting American companies.

Mr. Trudeau said on Tuesday that Canada “will hold firm” on keeping the dispute mechanism in the agreement.

Agriculture also continues to be a hurdle, as Canada’s dairy industry is heavily protected and Mr. Trump has made opening it to American exports a top priority. The Canadians have also been insistent on maintaining exceptions that would limit foreign ownership of cultural industries.

Mr. Trudeau said on Tuesday that the cultural exemption, which among other things prevents American media companies from acquiring Canadian television networks, is critical to protect his country’s sovereignty.

Chrystia Freeland, Canada’s foreign minister, said on Wednesday that her team of trade negotiators worked throughout the weekend in hopes of finding common ground on the remaining issues.

“We are looking forward to constructive conversations today,” Ms. Freeland said ahead of a meeting with Robert E. Lighthizer, the Trump administration’s top trade negotiator.

Despite the sticking points, it is unclear whether the United States could actually move ahead without Canada or withdraw from Nafta entirely.

In an interview on Fox on Sunday, Richard Trumka, the president of the powerful A.F.L.-C.I.O., said that the economies of the United States and Canada were so integrated that excluding Canada from a trade treaty would be logistically difficult and counterproductive.

“It’s pretty hard to see how that would work without having Canada in the deal,” Mr. Trumka said.

Republicans and Democrats in Congress have also been largely in agreement that Canada must be included in a final Nafta. Since Congress is unlikely to vote on such an agreement until next year, and Democrats could win control of the House or, less likely, the Senate, Mr. Trump may need to heed to the concerns of lawmakers.

“Trump is relying on bluster and bullying in a desperate attempt to get Congress to swallow his half-baked deal,” said Senator Ron Wyden of Oregon, the top Democrat on the Finance Committee. “You can’t fix Nafta without fixing issues with Canada.”

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