Canada and U.S. clash over sunset clause in 'forceful' NAFTA talks

Foreign Affairs Minister ChrystiaFreeland and her American counterpart in the NAFTAtalks had a "fairly forceful" exchange of views Tuesday over the American side's demand for a sunset clause, a source tells CBC News.

A senior source with direct knowledge of the situation said tensions emerged when Freelandand U.S. Trade RepresentativeRobert Lighthizer began discussing the proposal to write a time limitinto a new NAFTAdeal.

The sunset clause, put on the table by the Americans, would force all three countries to proactively agree every five years that they will remain in the trade pact. If they do not agree, the deal will be automatically killed.

• NAFTA talks are at a 'decisive moment,' Freeland says

Canada and Mexico do not support the demand; both countries say it would create economic instability.

Freeland told reporters Wednesday she has two problems with the sunset clause idea.

First, she said it would add an element of uncertainty to what she thinks would be a good agreement. Second, she pointed out that NAFTA already has a clause allowing countries to leave.

"Canada's position on the sunset clause is unchanged," Freeland told reporters on her way into the U.S. trade building for her next meeting with Lighthizer.

"Our view is that this is absolutely unnecessary."

The senior source said that when the issue came up during Tuesday's bilateral meeting between Freeland and Lighthizer, there was a "fairly forceful" exchange of views indicating neither side is willing to compromise.

The source was careful to add, however, thatthe overalltone of recentNAFTA talks hasbeen positive, and expressed the hope thatTuesday's incident won't impede progress.

A second source familiar with the meeting dismissedthe suggestionthat tensions are emerging over this issue, adding "no voices were raised."

The source said "LighthizerandFreelandhave a cordial and close relationship."

Freeland arrived in Washington Tuesday for another series of high-level meetings with her American and Mexican counterparts.

NAFTA talks

6 years ago

Duration 4:22

Flavio Volpe of the Automotive Parts Manufacturers' Association on the state of NAFTA talks in the automotive sphere

Talks continuetoday, with officials focusing mostly on the auto sector.

The source said the Americans have come to the table withcreative ideas and compromises on auto, but Canada and Mexico are waiting for more details.

Chief negotiators have been meeting in Washington around the clock for nearly four weeks straight as all three countries work to reach an agreement in principle in the nearfuture.

If an agreement is not reached in the weeks before the July 1 Mexican federal election, talks could be delayed significantly.

As well, the upcoming midterm elections in the U.S. alsocould slow down the negotiating process.