dairy quota regime, Ottawa's desire to keep a dispute resolution mechanism, and Canadian media laws that favour domestically produced content.

Canada expanded foreign access to its dairy sector in trade deals with the European Union and with 10 Pacific Rim countries.

A study commissioned by the Canadian Embassy says 9 million jobs "spread across every congressional district" are supported by the Canada-U.S. economic partnership. His announcement came with an ultimatum for Canada - join the U.S. -Mexico pact or suffer the consequences of punishing American tariffs on the auto sector.

The talks are focused on USA demands to scrap the so-called Chapter-19 dispute resolution mechanism in NAFTA, overturn some of Canada's current "carve-out" of cultural industries from free-trade rules and loosen protections under the dairy sector's supply management system.

Prime Minister Justin Trudeau said during an interview Tuesday with a Winnipeg radio station, CJOB, that there are certain positions Canada has and remain firm on. Overall, he said, he believes Canada is handling the talks well. "People are kind of sitting on the sidelines thinking, 'How will this affect us in the future?' If we were to lose the auto industry here that would put us into some type of recession", Chiodo said, noting that the auto trade has "always been pretty fair" for both the USA and Canada. Trump wanted changes that would destroy family farms across Canada, he said. "Nafta has been the worst trade deal ever".


"I don't think President Trump will go to the mat over Chapter 19".

Wednesday was the first day that negotiations between the two countries resumed after four intensive days of talks last week ended without a deal on Friday after the mood soured.

"Without Chapter 19, NAFTA is utterly useless as it would subject Canada and Mexico to the vagaries of the US political system and its courts when determining trade policy actions", said Derek Holt, vice-president at Scotiabank Economics, in a note recently.

Canada's politically powerful dairy farmers are likely to resist changes to the price controls and high tariffs that protect them from foreign competition.

"We have all been dealing in good faith", he said.


A Canadian source with knowledge of the NAFTA discussions says an agreement is within reach, but getting there will require flexibility from all sides.

"We've taken those hits for team Canada, and we are determined that there be no further concessions on dairy", said David Wiens, vice president of the Dairy Farmers of Canada.

"Forget what you read about NAFTA negotiations and Twitter wars, that's not who we are", Craft told the gathered crowd as she thanked Canada - and Gander - for playing host in 2001 to countless stranded American air passengers. "It would be a good modernized deal if Canada is brought into it".

Trudeau, for his part, added that: "we're just going to stay working constructively to get to that win-win-win that we know is there".


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