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The Trump administration has toughened one of its most contentious demands in the renegotiation of the North American free-trade agreement, proposing that an even higher percentage of content in autos made in the NAFTA zone come from factories where workers are paid at least US$15 to $17 an hour, The Globe and Mail has learned.

The United States still wants a deal by the end of the month, threatening to hit Canada and Mexico with tariffs on steel and aluminium starting next Tuesday if they do not reach an agreement.

Other sticking points in the talks are effectively log-jammed, said sources with knowledge of the closed-door bargaining: Washington is holding firm on its demands for tougher Buy American procurement rules, to scrap NAFTA’s dispute-settlement process, a “sunset clause,” and the dismantling of Canada’s protectionist dairy and poultry system.

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Negotiators have been meeting continuously for the past month in the U.S. capital. Top officials from the three countries hunkered down on Thursday for the third straight day.

The centrepiece of the talks is a U.S. demand to increase the amount of NAFTA zone content that vehicles made in North America must contain to qualify for tariff-free shipping among the three countries. The Trump administration wants the percentage raised from the current 62.5 per cent to 75 per cent or 85 per cent, with a series of additional new rules added in.

The original U.S. proposal to tie some car parts to factory wages would require auto makers to source at least 30 per cent of their parts from plants that met the wage threshold. But two sources said Washington demanded a higher percentage this week; one of the sources said the new figure is 40 per cent.

The measure, which is designed to drive auto jobs away from Mexico – where the average pay in a car plant is the equivalent of US$3 an hour – has been heavily resisted by both Mexican negotiators and some elements of the continental auto industry.

In addition, the United States wants rules that lay out what percentage of which parts of a car must come from North America, a bid to ensure that as much high-value work – such as building transmissions – as possible is done in the NAFTA zone. It is also proposing that 70 per cent of all steel, glass and aluminium in autos come from North America.

Autos have dominated this week’s talks, with officials negotiating how NAFTA rules will apply to individual car parts.

“The car sector is both the core issue of this negotiation and an issue which is fiendishly complex,” Foreign Affairs Minister Chrystia Freeland said on Thursday as she walked into a meeting with U.S. Trade Representative Robert Lighthizer at his offices near the White House. “The devil really is in the detail.”

Ms. Freeland cancelled a trip to Brussels for a NATO meeting on Friday to keep negotiating.

Mexican Economy Minister Ildefonso Guajardo told reporters he was prepared to remain in Washington as long as it takes. “I’m available all the time that is required or necessary. I can be here as long as is needed, as we can keep on advancing,” he told reporters.

Prime Minister Justin Trudeau’s chief of staff, Katie Telford, and U.S. President Donald Trump’s son-in-law, Jared Kushner, were also seen entering Mr. Lighthizer’s offices, underscoring the seriousness of the deal-making. Asked about the prospects for an agreement, Mr. Kushner replied: “Still working on it.”

Mr. Lighthizer wants a deal that can be submitted to the current U.S. Congress for approval. Because of numerous hurdles in U.S. trade law, this means it must be ready by May. The trade chief leaves for a visit to China next week, and is said to want a deal before that.

International trade lawyer Daniel Ujczo said that, between the tough deal-making on autos and the lack of progress in other areas, the window for a deal that can pass Congress this year is rapidly closing.

“It doesn’t look like the U.S. came with the flexibility Mexico and Canada needed to get a deal done,” said Mr. Ujczo, who works in the Columbus, Ohio, offices of Dickinson Wright. “With each passing day, the prospects grow dimmer to get a full, substantial deal by the end of next week.”

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Jerry Dias, the head of Canada’s largest private-sector union, said Canadian negotiators told him on Thursday the United States is holding fast on its toughest demands.

“That’s why, when people say a deal is imminent, not it’s not − not unless the U.S. moves in a significant way in a very short period of time,” he said.

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