In Nafta Rewrite, Canada Took Cue From Mexico: Make a Big Concession

As Trump’s deadline for the negotiation neared, Canadian negotiators struggled to make the U.S. give ground.

This Friday morning, Mr. Guajardo, Ms. Freeland, and their American counterpart, U.S. Trade Representative Robert Lighthizer, are scheduled to reunite to sign that pact, rebranded the U.S.-Mexico-Canada Agreement.

The ceremony—to be held in Buenos Aires on the sidelines of the Group of 20 summit of advanced and developing economies—is a signature achievement for Mr. Trump, whose claims that the pact was unfair to the U.S. were a central theme of his campaign.

[Previously], Canadian Foreign Minister Chrystia Freeland was frustrated as the deadline approached for renegotiating the North American Free Trade Agreement.

Meeting her Mexican counterpart at the Lexington Hotel in midtown Manhattan, she told him things weren’t moving forward as she had hoped, with the U.S. refusing to bend on Canada’s key demands with just four days to go. It didn’t help that President Trump said of Canada at a press conference that day, Sept. 26, “We don’t like their representative very much.”

Mexican Economy Minister Ildefonso Guajardo offered advice: Make a key concession to the U.S. to break the logjam. Mexico had bent to U.S. pressure on policies aimed at shifting auto production from Mexico back north, opening the way for Mexico and the U.S. to strike a broader deal a month earlier.

“They know that they will not get everything, but within their priorities you have to give them a clear signal,” Mr. Guajardo told her, according to a Mexican official.

For Canada, the equivalent of Mexican cars was dairy. Canadian negotiators had already been thinking along the same lines, and the next day, Canada sent the U.S. a document that included detailed plans for easing curbs on American milk and cheese products, a Canadian official said. That triggered three days of near-round-the-clock talks, paving the way for an agreement announced barely an hour before the midnight Sept. 30 deadline set by the Trump administration for moving ahead with a new Nafta that excluded Canada.

More From The Wall Street Journal (subscription required):