Trump Warns Canada: Fair Deal or No Deal

US President Donald Trump warns Canada that any renegotiated North American Free Trade Agreement (NAFTA) must be “a fair deal, or there will be no deal at all”.

His statement was an apparent response on Canadian Prime Minister Justin Trudeau’s announcement of retaliatory tariffs.

Trudeau said in a planned meeting with Trump to potentially seal a NAFTA deal collapsed after US Vice-President Mike Pence called and insisted the meeting was conditional on adding a sunset clause.

Trump said in a statement released Thursday night by the White House, "The United States has been taken advantage of for many decades on trade. Those days are over. Earlier today, this message was conveyed to Prime Minister Justin Trudeau of Canada: The United States will agree to a fair deal, or there will be no deal at all."

On Thursday, the US announced the imposing of 25 percent tariffs on steel and 10 percent on aluminum imported from the European Union (EU), as well as Canada and Mexico.

As a result, US’ closest allies plan to slap billions of dollars in tit-for-tat tariffs on the country’s goods, which further broaden trade tensions.

Economists of Goldman Sachs said, “The decision to impose tariffs on Canada and Mexico suggests that prospects for a NAFTA agreement in the near-term are fading."

"The administration's negotiating stance is often unpredictable so there is a risk of over-interpreting any single event. That said, this represents another signal that prospects for a near-term NAFTA deal are fading, just a few weeks after it had appeared fairly likely that a "skinny" agreement involving the auto sector might be reached."

Quitting NAFTA, a free trade agreement by the US, Mexico, and Canada since 1994, would be yet another crucial move by the US administration. Its members trade more than a trillion dollars in goods annually, and both Mexico and Canada are the top two buyers of US exports.

“No NAFTA is better than a bad deal, and we’ve made that very clear to the president,” the prime minister said.

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