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The likely manifestation of that creative thinking is flexibility on the rules of origin proposals put forward by the Americans. Trump would like to see up to 85 per cent of all components in autos being sourced from within the NAFTA region, with 50 per cent of the content coming from the U.S.

The U.S. content requirement would decimate the Canadian car industry, according to Jerry Dias, president of the Unifor trade union.

But he said raising the amount of NAFTA region content to around 75 per cent from the current 65 per cent is “quite do-able.”

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Officials say discussions are now taking place about raising the NAFTA region content requirement.

Progress is also possible on the sunset clause proposal, if it is watered down into an agreement to hold periodic reviews of the new deal.

The U.S. demand to scrap the Chapter 19 dispute resolution mechanism remains non-negotiable for the Canadian side, but there is the possibility for reform of the Chapter 11 investor-state settlement terms.

The trickiest subjects on which no progress has been made are supply management and government procurement.

The question now is whether the president will decide to blow up NAFTA (or at least try — the legal mechanisms for withdrawal are uncertain and Congress may block a U.S. exit).

Market reaction to the reports that an exit is imminent will have given Trump pause for thought.

U.S. stocks fell slightly after the Reuters report and the chief investment strategist at Charles Schwab was quoted as saying the U.S. pulling out of NAFTA would represent a risk to the markets.