Washington, Sep 27 (AP/UNB) — President Donald Trump said Wednesday that he rejected a one-on-one meeting with Canadian Prime Minister Justin Trudeau over the trade dispute involving the North American neighbors and renewed his threat to slap tariffs on cars imported from Canada as negotiations drag on.
Trudeau spokeswoman Eleanore Catenaro said in response: "No meeting was requested. We don't have any comment beyond that."
In an extraordinary rebuke of America's northern neighbor, Trump vented his frustration with Canada during a news conference along the sidelines of the United Nations General Assembly, the latest sign of deteriorating relations between two allies who share a border.
"His tariffs are too high and he doesn't seem to want to move and I've told him forget about it," Trump said of Trudeau. "And frankly, we're thinking about just taxing cars coming in from Canada. That's the mother lode. That's the big one."
"We've very unhappy with the negotiations and the negotiating style of Canada. We don't like their representative very much," Trump said in an apparent reference to Canada's Minister of Foreign Affairs Chrystia Freeland, who has been negotiating with U.S. Trade Representative Robert Lighthizer.
Canada, the United States' No. 2 trading partner, was left out when the U.S. and Mexico reached an agreement last month to revamp the North American Free Trade Agreement. The U.S. and Canada are under pressure to reach a deal by the end of the month, when Lighthizer must make public the full text of the agreement with Mexico.
But Trump suggested he may go forward with a revamped NAFTA without Canada. The president said it would be called "USM," for the U.S. and Mexico, instead of "USMC," and offered blunt criticism of the Canadian team engaged in the talks.
"Canada has a long way to go. I must be honest with you, we're not getting along at all with their negotiators. We think their negotiators have taken advantage of our country for a long time," he said.
Any push by Trump to slap a 25 percent tariff on imported autos and auto parts from Canada might help American workers but could also inflate car prices, make U.S. manufacturers less competitive and generate retaliation.
Roughly four in five cars assembled in Canada are exported. The Canadian Automobile Dealers Association has warned that the auto tariffs could affect billions of dollars' worth of exports and lead to the loss of more than 100,000 jobs across the country.
Relations between the two neighbors have been strained since Trump assailed Trudeau at the G-7 meeting in June, calling him a "weak" and "dishonest" back-stabber. Canadian leaders have objected to Trump's decision to impose tariffs on Canadian steel, citing national security.
The trade talks have been deadlocked over issues such as Canada's high dairy tariffs and U.S. efforts to shield drug companies from generic competition. Trump, during the news conference, reiterated his longstanding grievances against NAFTA and job losses, saying the trade pact had been "great for Canada, great for Mexico, very bad for us."
The trade agreement, which took effect in 1994, removed most trade barriers between the U.S., Canada and Mexico, leading to a boost in trade, but it encouraged U.S. automakers and other manufacturers to move south of the border to take advantage of low-wage Mexican labor.
United Nations, Sep 27 (AP/UNB) — The United States and Japan announced Wednesday they will open negotiations on a bilateral trade agreement between the world's first- and third-largest economies.
It's a significant shift by Tokyo which has been a strong advocate of a multi-nation trans-Pacific trade pact that President Donald Trump withdrew from soon after taking office. The move won Japan relief from the immediate threat of punitive tariffs on its auto exports to the U.S.
Trump made the announcement after meeting with Japanese Prime Minister Shinzo Abe in New York on the sidelines of the U.N. General Assembly.
He said that Japan had been unwilling in the past to enter into such talks, but now is and such a deal "will be something very exciting."
Abe has cultivated close ties with Trump since after his 2016 election but trade relations have been difficult, since the Republican president withdrew from the 12-nation Trans-Pacific Partnership, or TPP, that had been negotiated by the Obama administration and championed by Abe despite considerable domestic political opposition in Japan.
The Trump administration, pushing to narrow the U.S. trade imbalance with Japan, has since imposed steel and aluminum tariffs on its ally. Imposing higher tariffs on auto imports that would have escalated trade tensions significantly.
A joint statement said that the United States is seeking more access to the Japanese auto market and that the Japanese won't go beyond any previous commitments to open their protected agriculture market. "It's a line in the sand" from Japan, said Ted Murphy, a partner at the law firm Baker McKenzie. "You guys think auto are important. We think agriculture is important."
Abe said the United States will hold off on threatened tariffs on Japanese autos while the negotiations are underway. The statement also adds that the two sides will make efforts" to resolve differences over U.S. tariffs on imported steel and aluminum.
Murphy said he suspects that Japan dropped its objections to bilateral trade talks with the United States after seeing Mexico agree to a trade deal with Washington last month.
"We've agreed today to start trade negotiations between the United States and Japan," Trump told reporters, alongside Abe before their meeting.
"This was something that for various reasons over the years Japan was unwilling to do. And now they are willing to do. So we're very happy about that. And I'm sure they will come to a satisfactory conclusion," he said.
Abe, who could face criticism at home that he's caved in to U.S. pressure, insisted the negotiations would lead to a trade agreement on goods that would be different to comprehensive free trade agreements that Japan has entered into before.
Japanese officials said that was because past agreements also covered services and trade rules, and focusing on goods would make it easier to reach quick results.
The joint statement said negotiations will begin after completion of necessary domestic procedures in each country.
U.S. Trade Representative Robert Lighthizer told reporters that he would be talking to Congress on Thursday about seeking trade promotion authority for the president to negotiate the agreement.
The statement said the proposed agreement will cover goods, and other key areas including services, that can produce "early achievements." The U.S. and Japan would then negotiate on other trade and investment items.
Senior Japanese trade official Atsuyuki Oike, who helped negotiate the TPP, said the two sides have yet to identify where those "early achievements" might be. "We are at the entrance of any negotiations so we don't know what the outcomes will be," he said.
The TPP has proceeded without the U.S., and in his speech to the U.N. on Tuesday, Abe described himself as a "flag-bearer for free trade," and said "there has been no greater joy for me" than when it was approved by Japan's parliament. He also pointedly noted that Japanese investment supports 850,000 jobs in the U.S. and that 3.8 million Japanese cars are manufactured annually in the U.S., more than double the number it exports to the U.S.
the other major topic at Wednesday's meeting with Trump was North Korea. Abe credited the U.S. president with a "major transformational change" in relations with North Korea after his June summit with Kim Jong Un.
Abe later told reporters, "next it's my turn," saying he wants to "break the shell of mutual mistrust" with North Korea and meet with Kim himself. But he added that no meeting has been decided on yet, and any meeting that takes place would have to contribute to the resolution of the cases of Japanese nationals who were abducted by North Korea in the 1970s and 1980s.
Abe is the odd man out among the major powers in Northeast Asia in not having met with Kim this year. The leaders of South Korea and China have done so multiple times. Trump is planning a second summit and his top diplomat Mike Pompeo is traveling to Pyongyang again next month.
Singapore, Sep 26 (AP/UNB) — Asian markets rose on Wednesday as traders awaited a third interest rate hike by the U.S. Federal Reserve for this year.
KEEPING SCORE: Japan's Nikkei 225 rose 0.4 percent to 24,033.79. Hong Kong's Hang Seng index, which reopened after a holiday, jumped 1.7 percent to 27,968.13. The Shanghai Composite Index added 0.9 percent to 2,805.73. Australia's S&P ASX 200 gained less than 0.1 percent to 6,187.00. Shares fell in Taiwan but rose in Singapore and Indonesia. Markets were closed in South Korea for a national holiday.
WALL STREET: U.S. benchmarks finished mixed on Tuesday as rising interest rates hurt stocks that pay big dividends. Higher oil prices pulled transportation and shipping companies lower. The S&P 500 index lost 0.1 percent to 2,915.56, and the Dow Jones Industrial Average shed 0.3 percent to 26,492.21. The Nasdaq composite was 0.2 percent higher at 8,007.47. The Russell 2000 index of smaller-company stocks gained 0.2 percent to 1,708.80.
U.S. INTEREST RATES: On Wednesday, the Federal Reserve is expected raise its benchmark interest rate to between 2-2.25 percent in its ninth increase since late 2015. Another increase is expected later this year, with more to come in 2019. Traders will also be keeping an eye on the Fed's economic projections and Chairman Jerome Powell's news conference afterward. Stocks usually do well when the Fed starts to raise interest rates because the higher rates reflect solid economic growth, which is associated with strong company profits. But as the rate increases continue, in line with the Fed's goal of keeping inflation in check, the effect on stocks can become negative as economic growth slows.
ANALYST'S TAKE: "The market has already priced in a 25 basis points lift to the Fed funds rate. The economic projections and the speech by Chair Fed Powell will be dissected for insights into what the central bank sees in 2019," Alfonso Esparza of OANDA said in a commentary.
ASIAN OUTLOOK: Closer to home, the Asian Development Bank, a Philippines-based regional lender said Wednesday that trade conflicts, rising debt and rising interest rates in the U.S. will likely dampen Asia's growth in the coming year. The bank expects economic growth in Asia to remain at a robust 6.0 percent in 2018 but to slip to 5.8 percent next year. China's economy is expected to expand at a 6.6 percent annual pace this year but slow to 6.3 percent in 2019.
ENERGY: Oil futures fell after rallying on news that a weekend meeting of OPEC and its allies ended without an increase in production. Benchmark U.S. crude dropped 13 cents to $72.15 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 0.3 percent on Tuesday to close at $72.28. Brent crude, used to price international oils, fell 4 cents to $81.22 per barrel. It settled at $81.26 after climbing to $81.87 per barrel in London, its highest price since November 2014.
CURRENCIES: The dollar eased to 112.84 yen from 112.97 yen. The euro weakened to $1.1765 from $1.1766.
Buenos Aires, Sep 26 (AP/UNB) — Argentina's central bank chief resigned Tuesday amid negotiations with the International Monetary Fund.
The surprise resignation of Luis Caputo was announced in a bank statement that said he was leaving for personal reasons. But it came as the government was pushing for a new financing deal with the IMF aimed at helping Argentina's struggling economy.
Later in the day, President Mauricio Macri said a new agreement with the IMF would be announced Wednesday providing advances of new funds that should ease worries about a possible government default.
"We hope that it will definitely clear up other doubts about our financing capacity and the stability of monetary policy," Macri told reporters in New York, where he is attending the U.N. General Assembly session.
Caputo had only been in the job since June and will be replaced by former economic policy secretary Guido Sandleris.
Argentina has been hit by a severe drought, one of the world's highest inflation rates and a sharp depreciation of its currency, which has lost more than half its value against the dollar so far this year. That has forced the government to reach out to the IMF for help.
The peso had been recovering in recent days but the currency began to tumble after the resignation and was trading midday Tuesday at 39.7 pesos per U.S. dollar.
"This resignation is due to personal reasons, with the conviction that a new deal with the IMF will re-establish trust in the fiscal, financial, monetary and exchange rate situation," the bank said.
Macri asked the IMF for an early release of funds from a $50 billion deal agreed earlier this year to ease concerns that Argentina will not be able to meet its debt obligations next year.
Most Argentines have bad memories of the IMF and blame the international lending institution for encouraging policies that led to the country's worst economic crisis in 2001-2002, when banks froze deposits and put up sheet-metal barricades as thousands of protesters unsuccessfully tried to withdraw their savings.
Just as the resignation was being announced, Argentine labor unions were staging a nationwide strike to protest the economic turmoil and austerity measures announced by Macri, who is currently in New York where he will address the UN's General Assembly.
Caputo's resignation increases the probability of a disorder in the markets, economist Gabriel Rubinstein told local TN television channel.
"The dollar can strengthen (versus the peso), people get nervous, some withdraw deposits, others will change prices and in the midst of this it can lead to social conflicts that will further stoke the fire," he said.
Beijing, Sep 25 (AP/UNB) — A Chinese trade envoy says talks with Washington are impossible while the United States "holds a knife" to Beijing's neck by imposing tariff hikes.
The deputy commerce minister's warning Tuesday followed Beijing's release of a report accusing President Donald Trump of bullying other countries and disrupting the global economy.
The report dampened hopes for progress toward settling the dispute over Beijing's technology policy. Both sides have raised tariffs on billions of dollars of each other's goods.
Wang Shouwen said Beijing is open to talks but said, "now that the United States has adopted such large-scale restrictive measures and holds a knife to another's neck, how can negotiations proceed? It would not be negotiations of equality."