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New North American trade agreement heads to Congress

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Donald Trump says he'll terminate Nafta

President Donald Trump said he might cancel NAFTA immediately, hoping to pressure Congress into approving its replacement deal.

The ambassador said he's pleased that a side letter to the treaty assures Canada that no similar tariffs can be applied to cars made in Canada and exported to the United States. The U.S. does about a $1 trillion worth of business each year with the two countries, and Canada (second) and Mexico (third) are America's most significant trade partners.

Only a day after signing a new trade agreement with Mexico and Canada, President Donald Trump said he is now free to cancel NAFTA in a move that will create major problems for global automakers.

Trump, joined by Canadian Prime Minister Justine Trudeau and outgoing Mexican President Enrique Peña Nieto, signed the United States-Mexico-Canada Agreement during a ceremony before the start of this year's G-20 summit in Buenos Aires, Argentina.

Trump had to submit the text of the agreement to Congress by Friday to set up a slim chance of passing implementation legislation for the deal before January, when Democrats will assume the House majority.

Trade experts have long suspected Trump, who has made beating up on NAFTA a central feature of his political career, might play the termination card in an effort to light a fire under the deal's critics.

On Sunday, Henry Connelly, a spokesman for Pelosi, told the New York Times that it was "disappointing but not surprising" that Trump was trying to force Congress to approve the new deal.

It remains unclear if President Trump can actually withdraw from NAFTA without congressional approval.

Not even all Republicans in Congress are on board just yet.

Asked whether Canada took Trump's comments seriously, Morneau replied: "We take everything seriously". MacNaughton said Canadian diplomats will rev up their machine to lobby members of Congress for their support.

"I'm in discussions with a variety of Democratic leaders on those points and they will be very much involved in the process moving forward and will have a strong influence on how we put things together, because I want them not only to vote for it, I want them to be happy".

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