Published: Sat, May 18, 2019

United States nears deal with Canada, Mexico over removing metals tariffs

United States nears deal with Canada, Mexico over removing metals tariffs

The Trump administration is nearing a deal with Canada and Mexico to remove US steel and aluminum tariffs as part of discussions about a new trade agreement among the three countries, Treasury Secretary Steven Mnuchin said Wednesday.

Mexico has gotten out of them by agreeing to stricter monitoring and the tracking of its own steel and aluminum imports, to ensure its exports to the US aren't simply China or another country's shipments trying to evade USA tariffs. Both Canada and Mexico have so far resisted such a plan.

Both Canada and Mexico have imposed their own tariffs on American agricultural exports and other goods in retaliation for the levies.

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"My sense is that we're making progress but there's obviously more work to be done", Finance Minister Bill Morneau said of the tariff situation in Ottawa Wednesday.

The steep United States tariffs on steel and aluminum that Washington imposed last year on national security grounds have become a major stumbling block on the road to ratifying a new North American trade pact that the three countries negotiated last year.

"I've spoken to the finance ministers", he said. "I wouldn't say I'm confident", Mnuchin added. And, "this is a very important part of passing USMCA which is a very important economic agreement for two of our largest trading partners..."

With US Trade Representative Robert Lighthizer, Mnuchin has led the US delegation in 11 rounds of shuttle diplomacy aimed at resolving the US-China trade war.

Canadian Foreign Minister Chrystia Freeland and Mexican officials on Tuesday called for the United States to lift steel and aluminum tariffs in order to create "true free trade" on the continent.

Lighthizer planned to meet House of Representatives Speaker Nancy Pelosi on Wednesday to discuss the Canada-Mexico tariffs and the broader USA tariff war with China.

Pelosi and fellow Democrats in the House have raised concerns about ratifying the new trade deal because of concerns over labour rights in Mexico, among other things.

Asked about prospects for a deal later in the day, Freeland said she would not discuss Canada's negotiating strategy.

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