Farm states have warned him that triggering the NAFTA withdrawal clause to scare Canada and Mexico into concessions would backfire - they say it would also scare foreign buyers of American goods, leading them to seek new suppliers.
Mexico, Trump said, "can pay for it indirectly through NAFTA".
She made her remarks amid signs that Canada and Mexico might be prepared to reverse their steadfast opposition to several US hard line demands for changes to NAFTA. 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.
Ryan said Friday that NAFTA needs to be "updated", but the USA should work within the framework of the deal that took effect in 1994, rather than pulling out.
A top unnamed government official from Canada told Reuters: "The government is increasingly sure about this...it is now planning for Trump to announce a withdrawal".
In the newspaper interview, Trump also renewed a threat made during his 2016 presidential run: "If we don't make the right deal, I will terminate NAFTA". The White House later said its policy hasn't changed. Trucks built there could be subject to a 25 percent tariff if the USA exits NAFTA.
Michael Sabia of Caisse de dépôt et placement du Québec and Bruce Flatt of Brookfield Asset Management Inc., speaking Wednesday in a panel discussion in Toronto, responded to news that Canadian government officials see an increasing chance the USA president will give six months notice to withdraw.
That means Mexico will essentially have paid for the wall, he said.
That report seems to have been a false alarm for now, but the response it provoked revealed another possibility: Is Trump less likely to leave NAFTA now than he was several months ago?
The U.S. dollar fell against a basket of major currencies but made a partial recovery after the Labor Department said its consumer price index, excluding the volatile food and energy components, rose 0.3 percent last month, the biggest advance since January 2017.
Freeland said on Thursday that Canada had come up with some creative ideas in a bid to unblock the talks.
The parties are hoping to wrap up the talks in the first quarter of 2018.
The news broke as the cabinet of Prime Minister Justin Trudeau began gathering in the southwestern Ontario town of London ahead of a scheduled two-day meeting where NAFTA is one of the items on the agenda. But proponents from the Canadian and Mexican governments and NAFTA-supporting stakeholders in the USA all see this as positive.
Separately, Canada launched a wide-ranging trade complaint against the United States, the World Trade Organization said on Wednesday, in a dispute that Washington said would damage Canada's own interests and play into China's hands.
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