U.S. nears deal with Canada-Mexico over removing metals tariffs

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According to the cabinet minister, the U.S.is close to an "understanding" with its two neighbours about lifting the 25 percent duty on steel and 10 percent levy on aluminum imports.

Senate Finance Committee Chairman Chuck Grassley, an Iowa Republican, has said he would block ratification of Trump's revision of the North American Free Trade Agreement, called the U.S. -Mexico-Canada Agreement, until the metals tariffs are lifted on the U.S. neighbors.

Canada's Foreign Affairs Minister Chrystia Freeland is now in Washington, D.C., and discussed the tariffs with U.S. Trade Representative Robert Lighthizer this morning.

Mnuchin said Wednesday this was likely to be worked out soon.

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Mnuchin said he has also spoken to Finance Minister Bill Morneau and their Mexican counterpart about the tariffs, but that Lighthizer is actively leading discussions on them.

"We made the case as we have been doing for some time that the best outcome for both Canadians and Americans would be to lift those tariffs and to have free trade between our two countries who have this fantastic trading relationship in place", she told reporters after the meeting in Washington.

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Mexico says it has prepared a revised list of products to spread the pain to different sectors of the US economy if necessary, but has yet to apply them. None of the three countries have ratified the new U.S. -Mexico Canada Agreement (USMCA).

With Mr Lighthizer, Mr Mnuchin has led the United States delegation in 11 rounds of shuttle diplomacy aimed at resolving the trade dispute between the world's two biggest economies.

Freeland, Trudeau and others in the Canadian government have derided the tariffs as absurd, illegal and insulting.

Both Canada and Mexico are expected in the coming weeks to top up their respective retaliatory tariffs.

Lighthizer is also expected to meet House of Representatives Speaker Nancy Pelosi on Wednesday to discuss the Canada-Mexico tariffs and the broader USA tariff war with China.

Asked about prospects for a deal, Freeland said she would not discuss Canada's negotiating strategy. "Canada is a real supporter of union rights and we're happy to be discussing that important issue with our Mexican colleagues".

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