United States-mexico trade talks progressing but no breakthrough with China

US officials holding a two-front battle in President Donald Trump's bid to revise major trade ties made progress with Mexican negotiators but found no breakthroughs with a Chinese delegation this week.

The North American Free Trade Agreement and China have been two key targets of Trump's aggressive trade strategy and he has largely brushed off concerns from the business community about the harm done to the US economy.

With NAFTA at least, there has apparently been progress. The negotiations "are well advanced," Mexican Economy Minister Ildefonso Guajardo told reporters on Thursday, but "we are not there yet."

Canada needs to re-engage in the talks before the NAFTA rewrite can be completed and "the only way that can happen is if we continue through the weekend and into next week," he added.

Guajardo and Mexico's Foreign Minister Luis Videgaray have been shuttling back and forth to Washington for more than a month for meetings with US Trade Representative Robert Lighthizer to try to iron out the bilateral issues, such as rules for the auto market, before the end of August.

Officials last week indicated they expected a breakthrough this week but "negotiations are highly complex," Guajardo said on his way into yet another meeting.

He has cautioned that some of the hardest issues were still on the table, including the US demand for a fiveyear "sunset clause," which would oblige the three countries to renew the pact regularly.

"There's been no indication of flexibility from the US on this issue," a senior Canadian official told AFP.

Nevertheless, Canadian Prime Minister Justin Trudeau said Thursday that he was "encouraged by the optimism expressed by the US and Mexico."

"We're ready to sit down and continue the hard work of modernizing and negotiating a better deal for all of us," he said, but stressed Canada would "only sign a good deal for Canadians."

Canada's top diplomat and chief NAFTA negotiator, Chrystia Freeland, said Wednesday she would rejoin the talks once Washington and Mexico City finish their bilateral discussions.

The three countries have been negotiating for a year to salvage the trade pact Trump says has been a "disaster" for the United States.