The United States and Mexico could move ahead without Canada in a new version of the North American Free Trade Agreement, US Trade Representative Robert Lighthizer said Tuesday, according to media reports.
Momentum appeared to have stalled last week in efforts to bridge differences between Washington and Ottawa in negotiations to rewrite NAFTA, which began last year.
Washington and Mexico City last month announced agreement on a new trade pact, but a separate track of intensive talks with Canada have so far failed to produce results.
"There is still a fair amount of distance between us," Lighthizer said at a conference in New York, according to press reports. "If Canada comes along later, then that's what will happen."
President Donald Trump has informed Congress he intends to sign a new deal, with or without Canada, by late November before Mexico's new president takes office.
But Ottawa has resisted pressure to meet Washington's self-imposed September 30 deadline for agreeing to terms to revise the 25-year-old trade deal.
Canada's Prime Minister Justin Trudeau said earlier Tuesday that there was "a possibility to build on what they agreed," but that his priority is to reach "the right deal."
Lighthizer said negotiators were "sort of running out of time" to finalise the terms by the weekend, according to The Washington Post.
If differences with Ottawa cannot be resolved by then, the Trump administration will ask Congress to approve a Mexico-only deal, he said.
Remaining sticking points concern Canada's state-managed system of dairy production, protections for Canadian cultural industries and provisions for resolving dispute that arise among NAFTA partners, which Trump is seeking to eliminate.
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