Federal bureaucrats in Ottawa have been instructed to prepare for the end of the North American Free Trade Agreement (NAFTA) as talks aimed at modernizing the 24-year-old trade agreement continue to be fractious and difficult, according to various news reports.
Both CBC News and Reuters reported that bureaucrats have received marching orders from their political masters in Ottawa to prepare for the likelihood that the United States will announce that it is puling out of NAFTA even as Canadian trade representatives remain at the negotiating table with their American and Mexican counterparts.
The next round of NAFTA talks — the sixth so far — will be held in Montreal from January 23 to 28. However, the chances of a new trade deal being reached seem increasingly remote and were made even more unlikely after Canada filed a formal complaint to the World Trade Organization on Wednesday against the U.S. over the long running softwood lumber dispute.
Media reports say that Canada is “increasingly convinced” that U.S. President Donald Trump will abandon renegotiation talks and announce that he is initiating the withdrawal process from NAFTA. A party's withdrawal takes effect six months after it provides written notice to the other member countries – Canada and Mexico.
Canadian officials, speaking to CBC News, said they are prepared for President Trump to signal an intent to withdraw in six months by January's end. Talk of walking away from NAFTA comes as Canada announced it would appeal some of the tariffs — which have recently been levied on a host of Canadian goods, including softwood lumber, by the Trump administration — to the World Trade Organization. U.S. Trade Representative Robert Lighthizer was quick to label Canada's complaint as bad for the bilateral relationship and trade in general.
