US President Donald Trump, a frequent critic of the existing deal, announced the apparent breakthrough on Monday. Canada has been absent from the discussions since Trump began criticism of Canadian trade policy. Canadian leaders insist that they are in no hurry to renegotiate the pact or to agree to anything not in their favor. He called the agreement "a really good deal for both countries", and added that negotiations with Canada will start soon, or additional tariffs on Canadian imports will be applied.
Any revisions to NAFTA will also require congressional approval, and some Republican legislators have been critical of Trump's plans to reshape the agreement. A draft fact sheet specified the content would be made in the United States and Mexico. The U.S. plan calls for increased regional content for autos.
"While any news of progress on restoring Nafta certainty is reassuring for American farmers, there are questions that remain on the nature of a final deal", Brian Kuehl, the organisation's executive director, said in a statement.
The United States and Mexico have reached a preliminary agreement resolving key bilateral trade issues. As has been the case over a year of intense and sometimes fractious negotiations to update the decades-old Nafta, it's not the end of the road. Without Canada, America's No. 2 trading partner, it's unclear whether any new US trade agreement with Mexico would be possible.
The U.S. president says the deal has led to hundreds of thousands of lost American jobs, and he promised to either change it to be more favorable to the U.S., or withdraw. A senior US trade official said there are hopes that a final three-nation accord can be reached by Friday.
Survival expert held in Spain over 1998 murder of Dutch boy, 11
The prime suspect in the killing of a Dutch schoolboy who vanished from a campsite over 20 years ago has been arrested. His body was discovered near a Christmas tree plot just over half a mile (1km) from the campsite the following day.
He says, "We will only sign a new NAFTA that is good for Canada and good for the middle class", adding that, "Canada's signature is required".
USA and Mexican negotiators worked over the weekend to narrow their differences.
He also said he wanted to get rid of the name Nafta, which he said has "bad connotations". But Trump and other critics say it encouraged US manufacturers to move south of the border to exploit low-wage Mexican labor.
Talks to overhaul the agreement began a year ago and have proven contentious.The Trump administration wants a higher percentage of auto production to come from within the NAFTA bloc before qualifying for duty-free status.
Talks have also been stymied by the Trump administration's insistence on a "sunset clause" that would end NAFTA in five years unless all three countries agreed to continue it.