United States and Mexico Reach a Preliminary Trade Deal

In announcing the tentative accord Monday at the White House, Trump said a new pact would be called "the United States-Mexico Trade Agreement".

"We are encouraged that negotiators have reached a preliminary agreement to modernize our trade relationships", said API President and CEO Mike Sommers in a statement.

"As we have said all along, progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement", Freeland's spokesman Adam Austen said. Mexico's outgoing President Enrique Pena Nieto, who was on a speaker phone with Trump, said that Canada would now enter bilateral talks with the U.S.

"Mr. President, you've been my friend, and you have been somebody that's been very special in a lot of ways, we talked a lot, we talked a lot about this deal, and I'd like to congratulate you and the Mexican people", said President Trump to President Nieto.

Observers have raised concerns that Canada's absence from the talks could put Ottawa in a position where it might be pressured into accepting a deal reached between the US and Mexico.

USA and Mexican officials say the two countries have reached a deal on revamping the North America Free Trade Agreement.

Some Republicans in the US Congress called the deal a positive step but said Canada must be part of the new pact to avoid hurting US jobs.

Behind the scenes, though, the Trump administration is attempting to get Canada to sign off on a trilateral deal, and Trump's words could be viewed as a threat for Canada to get onboard as quickly as possible. The new rules would also likely require key components to have more domestic content.

On autos, for instance, Canada told the U.S.in the spring that it was willing to agree to what the Americans want. Canada has been on the sidelines for the last month, as the US and Mexico have tried to work through their problems. "It's going to come out", Seade said, Reuters reported.

Talks to overhaul the agreement began a year ago and have proven contentious.

It's unclear yet if Canada will be a part of any revised agreement.

Talks will resume at 9am (1300 GMT) Monday, Guajardo said.

In a press conference today, Mexican foreign minister VLidegaray has repeated over and over again "we don't really need Canada to do this deal". The deal does not resolve the tariffs the Trump administration put on steel and aluminum earlier this year, taxes that have proved a major sticking point in trade relations and led to Mexican retaliation against US goods. He previously called it a "terrible deal".

"We'll see if Canada can be part of deal", he said, saying the USA might simply opt for new agreements with both its neighbors.

"This wasn't created to put pressure on anybody", a senior administration official said, before later adding that the USA planned to submit its NAFTA renegotiation plans to Congress by the end of the week with or without Canada's agreement.

According to the reports, provisions of the deal haven't yet been fully agreed upon but the two countries could significantly change how automakers build cars within the NAFTA zone.

  • Anthony Vega