No new NAFTA without five-year sunset clause, Trump says at G7

Donald Trump says he wants to make a deal on NAFTA, and he's open to working with the current pact or striking separate agreements with Canada and Mexico - as long as they agree to renegotiate every five years.

Speaking before his departure from the G7 summit in Quebec on Saturday, Trump also defended the punishing steel and aluminium tariffs he has imposed on his fellow G7 leaders - all of whom are feeling the sting of those newly imposed measures.

Once again, he emphasized that the days of the U.S. getting the short end of the stick in its trading relationships with the world were over under his watch.

``It's going to change, a hundred per cent. And tariffs are going to come way down, because people cannot continue to do that. We're like the piggy bank that everybody is robbing.''

And he made clear that extends to the current deal the U.S. is renegotiating with its continental neighbours, Canada and Mexico.

``We're either going to have NAFTA in a better negotiated form or we're going to have two deals,'' the U.S. president said.

But there's a hitch.

Trump insisted that either version of the any future North American trade deal must have one key feature - a five-year sunset clause.

That leaves Trump diametrically opposed with Canada, which says renegotiating the deal every five years would create perpetual uncertainty and harm long-term investment.

Disagreement over the sunset clause was the deal breaker that scuttled a possible meeting between Trump and Prime Minister Justin Trudeau in Washington late last month in an attempt to bring the NAFTA talks to a conclusion.

Vice President Mike Pence told Trudeau he would have to agree to that before Trump would agree to meet him.

Trudeau refused, and the meeting was off. But the lead ministers from both countries talked trade on the sidelines of the G7 leaders' meeting on Friday.

``On NAFTA we either leave it the way it is as a three-some deal with Canada, the United States and Mexico and change it very substantially - we're talking about very big changes. Or we're going to make a deal directly with Canada, directly with Mexico,'' Trump said.

``If a deal isn't made, that would be a very bad thing for Canada and a very bad thing for Mexico. To United States, frankly, it would be a good thing but I'm not looking to do that. I'm not looking to play that game.''

Trump repeated his criticism of Canada's supply managed dairy industry, one of his favourite targets in Twitter posts, including this week prior to his arrival in Canada.

``Let's say Canada, where we have tremendous tariffs. The United States pays enormous tariffs on dairy. As an example, 270 per cent, nobody knows that.''

Pierre Lampron, the president of Dairy Farmers of Canada, shot back at Trump's claims about his industry.

``President Trump is targeting the dairy sector because he wants to dump U.S. dairy into Canada,'' Lampron told The Canadian Press, adding that Canada imports five times more dairy from the U.S. than it exports.

``President Trump wants nothing less than wiping out Canadian dairy farming.''

Trump also defended his recent imposition of punishing steel and aluminum tariffs was based on legitimate national security concerns, and said he stood firm against the concerns of his fellow G7 leaders during their talks.

Trudeau and the other G7 leaders used their meeting to try to persuade Trump to abandon the tariffs, which affect all of America's G7 allies.

Canada has said it will retaliate with more than $16 billion in tariffs on a range of goods. Mexico and the European Union have planned retaliatory tariff packages.

Trump said that would be a bad idea.

``If they retaliate they're making a mistake,'' he said.

``They do so much more business with us than we do with them ... the numbers are so astronomically against them … we win that war a thousand times out of a thousand.''