09/19/2018 17:18 EDT | Updated 09/19/2018 17:36 EDT

Trudeau: Canada Won’t Back Down On NAFTA Demands

Chrystia Freeland was in a reflective mood with reporters in Washington.

Sean Kilpatrick/CP
Prime Minister Justin Trudeau pauses to talk to media as he arrives to a caucus meeting on Parliament Hill in Ottawa on Sept. 19, 2018.

WASHINGTON — Canada wants more from its negotiating partners before signing on to a revamped North American Free Trade Agreement, Prime Minister Justin Trudeau suggested Wednesday as his well-travelled foreign affairs minister resumed her place at the talks in Washington.

Chrystia Freeland, after arriving in the U.S. capital in a T-shirt emblazoned with the slogan, "Keep Calm and Negotiate NAFTA," sounded a contemplative note as talks began, thanking journalists for keeping vigil and ordinary Canadians for their expressions of support.

"People come up to me on the street or in airports, which is where I am often found, just saying how strongly they support Canada in these complex negotiations," Freeland said before departing midday for a meeting with Ontario Premier Doug Ford.

Alex Brandon/AP via CP
Foreign Affairs Minister Chrystia Freeland arrives at the Office of the United States Trade Representative on Sept. 19, 2018, in Washington.

"I just want to say to everyone who has done that, thank you very much. It means a lot to me. I always share your messages with the negotiating team, and that gives us real strength and reminds us of how important the work we're doing is for Canadians."

Her reflective mood had some wondering whether a breakthrough was nearly at hand — a notion one insider wasted little time in batting down.

"No," said the source, speaking freely in exchange for anonymity. "Not at all."

Then there was the all-nighter pulled by one of Canada's negotiating teams, which Freeland said didn't wrap up its marathon session until 7 a.m. Wednesday morning. "There is some very intensive work happening," she acknowledged as she thanked negotiators, too, for their tireless efforts.

Earlier in the day in Ottawa, Trudeau said Canada isn't backing down from its own demands — a position that has some U.S. legislators bristling at what they consider a stalling tactic.

"We've been very clear that we're interested in what could be a good deal for Canada, but we're going to need to see a certain amount of movement in order to get there," Trudeau said.

Pressure is mounting on the federal government to get a deal done. On Wednesday, Texas Republican Kevin Brady, head of the influential House Ways and Means committee, told CNBC the two sides are "close enough" and the time has come for Canada to "step it up" and get on board.

And on Tuesday, House of Representatives majority whip Steve Scalise (R-La.) warned of "growing frustration" on Capitol Hill with what he calls Canada's "negotiating tactics."

Trade observers say that while many in Congress want Canada to be part of a three-way deal, they may not be willing to sacrifice an agreement in principle between Mexico and the U.S. negotiated earlier this year.

That deal is widely seen to require congressional approval before Dec. 1 in order to survive the arrival of an incoming Mexican government whose supporters have mixed feelings about the agreement.

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Canada, meanwhile, has been pushing back against deadlines declared by the Trump administration — first the end of August, then the end of September.

"While we would all like to see Canada remain part of this three-country coalition, there is not an unlimited amount of time for it to be part of this new agreement," Scalise said in a statement.

"Mexico negotiated in good faith and in a timely manner, and if Canada does not co-operate in the negotiations, Congress will have no choice but to consider options about how best to move forward and stand up for American workers."

Gerry Dias, head of Unifor, Canada's largest public-sector union, said Canadian negotiators remain unmoved by the recent rumblings on Capitol Hill and focused on getting a deal that's in the country's best economic interests.

That includes an intact and effective dispute-resolution mechanism, which remains one of the key stumbling blocks, he added.

"There's not going to be an agreement where disputes are handled in the American courts. Why would we do that?" Dias said.

"Having Colonel Sanders take care of the chickens — in other words, having all disputes handled in the U.S. courts — just doesn't make any sense for Canadians."

Canada has been negotiating in good faith throughout the process, Freeland repeated Wednesday.

"Our negotiators have been really, really hard at it ... we are working very, very hard," she said. "I think a national talent of Canadians ... is we are a country that is good at finding compromises. That's a talent that our negotiators certainly demonstrate."

While Canada has been pushing for wording in NAFTA aimed at strengthening labour protections and gender equality, the overall negotiations are said to have stalled over Canada's insistence that an agreement contain an independent dispute-settlement mechanism.

Supply management not on the table

Trudeau has also vowed to protect Canada's so-called supply management system for dairy and poultry products against U.S. demands for greater access by its farmers to Canada's dairy market. Sources say Canada has offered some limited concessions on access while also ring-fencing the system itself.

Supply management has been a big issue in the provincial election campaign in Quebec, home to about half of Canada's dairy farms. Quebec Liberal Leader Philippe Couillard has warned there will be "serious political consequences" if there is any further dismantling of the protections for dairy farmers through NAFTA negotiations.

As for timing, Dias said his deadline-talks experience tells him nothing will be forthcoming this week.

"I bargain for a living," he said.

"There's going to have to be some willingness (on the part of the U.S.) to get the deal, and I think the U.S. understands how far Canada is prepared to go — and I think they understand where we aren't going."