Prime Minister Justin Trudeau is defending Canada's actions on the Trans-Pacific Partnership, asserting the country simply was not ready to put pen to paper on a final agreement because of lingering concerns around culture and the automotive sector.
"We weren't ready to close it yesterday," Trudeau told reporters at the closing news conference for the APEC summit in Vietnam.
Trudeau said he didn't snub other TPP leaders when he skipped a planned meeting to discuss the deal, as there would have been little point in having such talks when there was still so much distance between the countries on certain chapters.
Trudeau and Japanese Prime Minister Shinzo Abe had bilateral talks immediately before that planned meeting. After some disagreements between the two during the tête-à-tête, Abe told the other waiting leaders that the meeting was off, and Trudeau went on to meet with Facebook executive Sheryl Sandberg.
"The scheduled meeting with Prime Minister Abe … went long, we obviously had a lot to talk about, and at the end of the meeting it became clear it was in everyone's interest to postpone the meeting on TPP11," Trudeau said as an explanation.
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While some countries might be eager for a deal, notably Australia, New Zealand and Japan — their respective national news outlets quoted government sources expressing disappointment at Trudeau supposedly "screwing" and "sabotaging" a final agreement by being a no-show — Trudeau said they should never have expected to leave Vietnam with an agreement in hand.
"I wasn't going to be rushed into a deal that was not yet in the best interest of Canadians. That is what I've been saying at least for a week, and I've been saying it around TPP12 for years now and that position continues to hold," he said of the original trade pact that was negotiated under the former Conservative government.
Indeed, since his arrival in Vietnam, Trudeau has said he wouldn't cave to "pressure" from others, telegraphing that Canada did not have its pen in hand heading into Danang, the site of the APEC conference.
The original agreement — the so-called TPP12 — is being renegotiated now after U.S. President Donald Trump withdrew America in January.
Still 'important work to be done': Trudeau
The 11 countries still party to the deal reached an agreement late Friday on a series of "core principles," importantly a pledge that each member would uphold strict environmental and labour standards, and that they would dump intellectual property provisions initially demanded by the former Obama administration.
International Trade Minister François-Philippe Champagne made an 11th hour visit to the hotel of Canadian reporters in Vietnam late Friday to tout the progress made on TPP despite the cancelled leaders meeting.
But Trudeau said there is still much "important work to be done," namely on the creation of a gender rights chapter, changes around rules of origin — a part of the deal with particular salience to the auto parts sector — and issues surrounding Canada's protection and promotion of culture.
On the issue of autos, Canada faces a particular challenge. Under the original TPP, in order for a car to enter Canada tariff-free, 45 per cent of it must have originated in a TPP member nation (auto parts themselves must have a regional content value of 35 to 45 per cent).
These numbers are a reduction from the 62.5 per cent regional value content called for in NAFTA.
It would be hard to resist Trump's demands for greater American content in autos when Canada (and Mexico, which was also a signatory of TPP12) has allowed Asia to maintain a lower bar.
Japan, a major exporter of autos, has sought to keep the terms of the original deal despite Canada's opposition.
Flavio Volpe, the president of the Auto Parts Manufacturing Association, said, "We can't be in two boats at once."
Volpe said Canada's insistence on changing rules around autos is in the country's best interest.
"TPP terms as they now exist are not positive to Canadian-based auto parts manufacturing — 100,000 people that work for hundreds of Canadian firms will be happy to read today that their government has chosen to do the difficult work of negotiating in their interests instead of against them," he said.