Mexican official says a deal is close to lift U.S. steel tariffs as Freeland heads to D.C.

A senior Mexican cabinet secretary said today she thinks Mexico is close to a deal to lift the United States' controversial 'national security' tariffs on steel and aluminum and suggested Canada, the U.S. and Mexico might negotiate a trilateral agreement to eliminate the tariffs.

Canadian gov't officials temper expectations, say a breakthrough doesn't look imminent

Foreign Affairs Minister Chrystia Freeland looks on as United States Trade Representative Robert Lighthizer delivers his statement to the media last January. The two will meet in Washington D.C. tomorrow to discuss trade, tariffs and blowback from China over the arrest of Huawei Technologies chief financial officer Meng Wanzhou on an extradition order from the U.S. (Graham Hughes/Canadian Press)

A senior Mexican cabinet secretary said today she thinks Mexico is close to a deal to lift the United States' controversial 'national security' tariffs on steel and aluminum and suggested Canada, the U.S. and Mexico might negotiate a trilateral agreement to eliminate the tariffs.

"Our chief negotiator Jesus Seade has been in Washington for a number of days in the past few months," Mexican Secretary of Economy Graciela Márquez Colín said Tuesday in an interview on CBC News Networks Power & Politics. "We are, I think, close to negotiating a lifting of the tariffs."

Colín went on to say that a possible trilateral agreement between the North American trading partners is on the table.

"So far we have been negotiating on bilateral terms, but if we get similar proposals we might go into a trilateral, but that's just a possibility," Colín told host Vassy Kapelos.

"That's why it's important to be here in Canada today, so that we can share opinions and sense how the negotiation is going in Canada, how the negotiation is going in Mexico."

Two government officials, speaking on background to CBC News, tempered Colín's optimism about a deal being reached soon to lift the so-called Section 232 tariffs.

Both sources stressed that from the Canadian perspective, a breakthrough does not appear imminent.

Foreign Affairs Minister Chrystia Freeland will be in Washington D.C. Wednesday to sit down with her American counterpart and hold a series of bilateral meetings with members of Congress.

Freeland and U.S. Trade Representative Bob Lighthizer will have plenty to talk about, starting with China's ongoing trade actions against both countries. Freeland also is expected to press the U.S. on tariffs, arguing Canada would have a hard time ratifying a revamped NAFTA deal while U.S. steel tariffs remain in place.

On June 1 of last year, the United States Department of Commerce imposed tariffs of 25 per cent on Canadian steel and 10 per cent on aluminum, citing national security interests.

Canada responded with its own tariffs of 25 per cent on steel and 10 per cent on aluminum, but also slapped a 10 per cent tariff on a long list of consumer items meant to target U.S. politicians in states where those products are made.

That product list included Kentucky bourbon, lawn mowers, ketchup, maple syrup, appliances, boats, and many other items. The federal government said it was targeting goods that Canadians could otherwise buy from domestic suppliers.

Since then, the Liberal government has rolled back some of the retaliatory tariffs, including ones imposed on recreational boats, while others remain in place.

Freeland's trip to Washington D.C. comes after Prime Minister Justin Trudeau had two telephone conversations with U.S. President Donald Trump within the past week, and another with U.S. Vice President Mike Pence today.

During the calls with Trump, Trudeau asked for an end to U.S. steel tariffs and additional diplomatic assistance in Canada's ongoing dispute with China.

Blowback from China

In December, Canada detained Huawei Technologies chief financial officer Meng Wanzhou at the Vancouver International Airport on an extradition request from the United States. She was later granted bail and is now awaiting court proceedings.

Shortly after Meng's arrest, the Chinese detained two Canadian expats living in China: Michael Kovrig and Michael Spavor. In March, China's Central Political and Legal Affairs Commission accused Kovrig of stealing state secrets passed on to him by Spavor.

According to a source with direct knowledge of one of the calls with Trump last week, Trudeau reminded Trump of the blowback Canada has faced from China since Meng's arrest, placing a special emphasis on the conditions of Kovrig and Spavor's imprisonment.

The pair have had limited access to consular officials and are not allowed to see family or loved ones. They have been confined to single rooms without the ability to turn the lights off in their cells at night.

One month after Kovrig and Spavor were arrested, China sentenced Canadian Robert Lloyd Schellenberg to death in a sudden retrial in January. Schellenberg already had been sentenced to a 15-year jail term for drug smuggling.

Last month, a Chinese court sentenced another Canadian, Fan Wei, to death for participating in a global methamphetamine operation.

Since Meng's arrest, China also has placed a number of trade hurdles in front of Canadian exporters — banning imports from two canola producers, tying up shipments of pork over paperwork issues and putting unusual obstacles in the way of Canadian soybean and pea exporters.

The Trump administration has signalled its concern over the plight of Kovrig and Spavor and has publicly voiced support for the campaign to free the men — but has shown itself far less willing to agree with Canada when it comes to tariffs on steel and aluminum.

Mexico Secretary of Economy Graciela Márquez Colín told Power & Politics Tuesday that she thinks Mexico is close to negotiating a deal with the U.S. that will see the steel and aluminum tariffs lifted. 8:04


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