Canada launches NAFTA challenge of 'illegal' USA tariffs on solar panels

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Canada has requested a NAFTA Chapter 20 review of the safeguard tariffs imposed by the USA on imports of solar photovoltaic (PV) cells and modules, it was announced on Monday.

Mexican President-elect Andres Manuel Lopez Obrador on Tuesday released a one-page letter from Donald Trump in which the US president urged a speedy renegotiation of the North American Free Trade Agreement.

Mexico is preparing for a change of power after a July 1 election and Foreign Affairs Minister Chrystia Freeland, Finance Minister Bill Morneau and new International Trade Minister Jim Carr will try to take the measure of newly elected leftist leader Andres Manuel Lopez Obrador and plot strategy.

Trump's letter, which was sent in English and in Spanish, was seen by AFP and read to the press by incoming foreign minister Marcelo Ebrard with American approval.

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The finance ministers for Mexico and Canada on Sunday said they were optimistic about NAFTA talks with the United States, even as trade tensions spurred by USA tariffs dominated the G20 meeting of world economic leaders in Argentina.

Former Canadian government trade official Matthew Kronby, now a partner with Borden Ladner Gervais, said he expects the Canadians will be seeking to ensure Canada and Mexico work effectively together and "resist the Trump administration's divide and conquer efforts".

"The aim was to strengthen the links between the two most important trade blocs in Latin America", said outgoing Mexican President Enrique Pena Nieto, who has spent much of the past two years mired in trade negotiations with Trump. Obrador wrote in the letter that was delivered to Trump at talks in Mexico on Sunday. He announced that Mexico would establish a free trade zone all along the Mexico-U.S. border, and in the rail corridor that will be built across the Tehuantepec Isthmus, as part of his job-creation strategy. But Paris said he found it "striking" that the runaway second-place result - at 16 per cent - was the "United States (and) Canada's proximity to the U.S".

Trump has had harsh words for Mexico on trade and immigration throughout his presidency. An agreement depends on USA willingness to back off proposals that are opposed by Mexico, Canada and American business groups, such as an automatic expiration of the deal after five years and the end of dispute resolution panels, according to the people. It had a margin of error of 2.5 per cent.

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