US optimistic on Canada trade but willing to go alone with Mexico deal, Mnuchin says

Treasury Secretary Steven Mnuchin said Friday that he was optimistic about U.S. talks with Canada on the North American Free Trade Agreement (NAFTA), but said the U.S. is willing to go alone on a deal with only Mexico. 

“I hope so,” Mnuchin told The Hill’s Bob Cusack when asked whether there will be a deal with Canada. “We have an important trading relationship with Canada, I think Ambassador [Robert] Lighthizer and others have done a great job negotiating this. I know there’s ongoing discussions.”

“We reached a deal with Mexico. Why shouldn’t we reach a deal with Canada? So I hope Canada will agree to the last few remaining open items,” he added. 

Mnuchin would not comment on a specific timetable for the U.S. reaching a deal with Canada. 

“If, for whatever reason, we don’t reach an agreement with Canada … we’ll have an agreement with Mexico. It’s a great agreement,” he said. “We couldn’t be more excited to work with the new administration. I think it’s a terrific opportunity for us to expand our economic relationship with them, and I’m confident that Congress will pass that.”

Mnuchin’s comments came as part of The Hill’s Newsmakers Series. 

The U.S. and Mexico reached an agreement to update the trade agreement last month after Canada was left out of negotiations. 

The Trump administration is pressing Canada to withdraw its dairy subsidies, but Canada is demanding that the U.S. withdraw threats of auto tariffs, as well as rethink its demands on how to settle trade disputes. 

Canadian Prime Minister Justin Trudeau said there is an opportunity to build on the U.S.–Mexico deal, but insisted that Canada would not sign a deal that goes against its interests.

“We know that Canada’s interests are what we have to stand up for and we will,” Trudeau said. “We are looking for the right deal.”

Lighthizer said he was doubtful about a potential deal with Canada.

“The fact is, Canada is not making concessions in areas where we think they’re essential,” he said. “We’re going to go ahead with Mexico,” the U.S. Trade Representative added. “If Canada comes along now, that would be the best. If Canada comes along later, then that’s what will happen.”

— Julia Manchester