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

Foreign Affairs Minister Chrystia Freeland and her American counterpart in the NAFTA talks 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 Freeland and U.S. Trade Representative Robert Lighthizer began discussing the proposal to write a time limit into a new NAFTA deal.

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

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

The 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, that the overall tone of recent NAFTA talks has been positive, and expressed the hope that Tuesday's incident won't impede progress.

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

The source said "Lighthizer and Freeland have a cordial and close relationship."

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

Talks continue today, with officials focusing mostly on the auto sector.

The source said the Americans have come to the table with creative 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 near future.

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. also could slow down the negotiating process.