Trudeau talks trade with Mexican president ahead of meeting with Pence in Peru

Two of the three political leaders with the most at stake at the NAFTA table huddled Friday behind closed doors, their most senior trade lieutenants alongside, in hopes of unlocking a mutually beneficial solution to the cross-border conundrum posed by U.S. President Donald Trump.

Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto gathered on the sidelines of a major international summit in Peru's capital, along with Foreign Affairs Minister Chrystia Freeland and Mexican Economy Secretary Ildefonso Guajardo.

U.S. Trade Representative Robert Lighthizer pulled out of the summit at the last minute, sending his deputy, C. J. Mahoney, in his place.

The sit-down, the first face-to-face between the two leaders since November, comes at a critical time, with Canada, Mexico and the U.S. all looking for a breakthrough in the ongoing effort to update the North American Free Trade Agreement — and Trump's wild-card trade strategies doing little to clear the air.

It was also a chance for Trudeau to take stock of Mexico's position — and perhaps share strategies — before the prime minister heads into a meeting Saturday with U.S. Vice-President Mike Pence.

Pence is in Peru instead of Trump, who was originally scheduled to attend but decided against it at the last minute, ostensibly to deal with the American response to a chemical attack in Syria.

Freeland described the conversation between Trudeau and Pena Nieto as "a good one," even as she expressed optimism about the state of NAFTA negotiations, which are continuing in Washington this weekend.

"Canada and Mexico found that we're very much on the same page in believing that now is the moment to very, very intensely engage and to really enter a new stage, a new rhythm, a new level of negotiations," she told reporters after the sitdown.

The meeting between the Canadian and Mexican leaders came one day after U.S. officials indicated they were willing to soften their demands on autos, which Trump followed by warning that he was willing to renegotiate "forever."

Freeland refused to speculate on these apparently competing messages, even as she said all trade negotiations are subject to "moments of drama."

"There certainly have been moments of drama in the past," she said of the NAFTA talks. "And I will make a prediction … there are more dramatic moments (coming) in the days to come. And we should not be distracted by those."

Trudeau's meetings with Pena Nieto and Pence come as the three are attending the Summit of the Americas, which is held every four years and brings together leaders from across the Western Hemisphere.

The prime minister started his day Friday by meeting Peruvian President Martin Vizcarra, who served as Peru's ambassador to Canada before the previous president was forced to resign over a scandal last month.

Trudeau delivered a 10-minute address to business leaders from across the Americas encouraging them to invest in Canada, noting that the country has free trade agreements with dozens of countries around the world.

Even as his government struggles to deal with a pipeline crisis at home, one that has forced him to return to Canada on Sunday before resuming his travels to Europe, Trudeau pitched his country as a great place to invest, telling hundreds of business leaders "that big things can get done in Canada."

More than half the countries with which Canada has free trade agreements are in the Americas, Trudeau said, and the hope is to add a deal with Latin America's largest trading bloc, Mercosur, to that tally.

"Even in this age where the value of trade is being questioned by some, we have successfully negotiated landmark agreements with Europe and with Asia," Trudeau added - a not-so subtle dig at protectionists like Trump.

The prime minister went on to emphasize Canada's skilled labour force, low unemployment and debt-to-GDP ratio, recent federal investments in infrastructure and a new investment agency as proof that Canada is open for business.

The message appeared well received, and Kenneth Frankel, president of the Canadian Council for the Americas, said the region offers a natural opportunity for Canada - particularly as it looks for a northern partner who isn't Trump.

Yet Siegfried Kiefer, president of Calgary-based engineering firm Atco Ltd., said Latin American leaders have told him they need massive new investments in infrastructure to grow their economies first.

On that front, Canada's own record on infrastructure and "national-interest projects" has room for improvement, Kiefer said, including Kinder Morgan's Trans Mountain pipeline, which is at the centre of a fierce battle between the Alberta and B.C. governments.

"The business community is generally looking for proof in the pudding," he said.

"The public unrest relative to some of these projects is really what you're trying to deal with. And that in my mind deals with how do you gain the trust of the people of the country that you have looked at the merits of the project objectively."

Trudeau's day also included hosting a lunch with representatives from the 15-country Caribbean Community, where he announced $25 million in new funding to help the region deal with natural disasters such as hurricanes.

The prime minister also met with Chilean President Sebastien Pinera, who took office in March and whose country is an important political and trade partner with Canada.