Saturday April 29, 2017

Trump's first trade punch and what it could mean for NAFTA renegotiations

A worker walks past stacks of lumber at the Partap Forest Products mill in Maple Ridge, B.C., on Tuesday April 25, 2017.

A worker walks past stacks of lumber at the Partap Forest Products mill in Maple Ridge, B.C., on Tuesday April 25, 2017. (Darryl Dyck/The Canadian Press)

Listen to Full Episode 49:59

Canada remains confident a deal can be reached with the United States on softwood lumber without repeating the drawn-out trade litigation of the past.

The U.S. Commerce Department announced this week it would levy countervailing duties of between three and 24 per cent on Canadian imports.

President Donald Trump has also mentioned dairy and energy as sectors of the Canadian economy he was worried about, without outlining exactly what his concerns were, but raising fears on this side of the border about what actions that may lead to.

Softwood Lumber 20170425

Minister of Natural Resources Jim Carr speaks during a press conference in response to newly-levied U.S. tariffs on Canadian softwood lumber, in Ottawa on Tuesday. (Adrian Wyld/The Canadian Press)

Natural Resources Minister Jim Carr says reaching a new, long-term deal is the best option, even as he repeated his warning that jobs will be lost in the forest industry, and that the US lumber industry continues its lobbying for new duties on Canadian imports.

"The complications are that you have lobbies at work, lots of political pressures. But our experience is in all of these conversations at every level of the United States government and beyond is that people see the common interest."

The U.S. Commerce Department imposed preliminary duties of between three and 24 per cent on Canadian softwood imports this week. More anti-dumping duties are expected in the future.

Trump's Commerce Secretary Wilbur Ross said that the White House had hoped to get this dispute out of the way before NAFTA negotiations begin. Michael Froman, who served as Barack Obama's top trade negotiation, told CBC that a deal was in reach but the Canadian side felt they could get better terms with Trump.

In an interview with CBC Radio's The House, Carr said there was "no good deal possible from the Canadian perspective" with the previous government.

"We weren't prepared to sign a bad deal. We won't sign a bad deal. If we have to wait it out we will. And we'll use all the options available to us but I don't think that's in the interests of either Canada or the United States."

Rhetoric vs. reality 

Laura Dawson, director of Canada Institute at the Wilson Centre in Washington, D.C., says Trump's rhetoric this week, claiming NAFTA has been horrible for the United States and a disaster, doesn't match the reality that the trade deal "has been pretty darn good" for the US.

"When Donald Trump's announcement were coming out this week the U.S. agriculture sector pushed back really hard. U.S. farms depend on exports to Canada and Mexico and they were having none of this. So he's gotten a lot of pushback."

Dawson says it's clear the Trump administration is trying to reignite American opponents of free trade in the aftermath of failures to bring in a number of setbacks in his efforts to get rid of Obamacare and congressional opposition to his budget plan.

It's why Dawson thinks Trudeau's approach, reminding Trump in one of their phone calls this week of the negative impact scrapping NAFTA would have on jobs and businesses on both sides of the border, is the right one.

She adds Canada should also work with Mexico as both countries prepare to discuss changes to NAFTA.

"Mexico has really strong retaliatory power in the United State. Every bit of corn the U.S. exports is bought by Mexico. If they stop buying U.S. corn that would be a big deal for US agriculture. Similarly the security front, if they stop cooperating on the U.S. southern border… that's a big deal for the United States."

"So I think Canada needs to be a partner for Mexico."

Window of opportunity?

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Quebec negotiator Raymond Chretien speaks at a news conference on softwood lumber as Quebec Economy, Science and Innovation Minister Dominique Anglade left, looks on, Tuesday, April 25, 2017 at the legislature in Quebec City. (Jacques Boissinot/Canadian Press)

According to former Canadian ambassador to the U.S. Raymond Chrétien, the Trudeau government has a small window to settle the softwood lumber dispute out of court before U.S. President Donald Trump kicks off his renegotiation of the ​North America Free Trade Agreement.

The two countries' dispute over softwood lumber goes back years, and in the most recent flare-up the U.S. Department of Commerce has imposed countervailing duties of between three and 24 per cent on Canadian imports.

Natural Resources Minister Jim Carr responded to the tariffs by saying Canada is exploring its legal options.

But Chrétien told CBC Radio's The House host Chris Hall it might not get that far.

"I'm confident that there's a window perhaps for a negotiated settlement for the following reason: Mr. Trump has indicated that he wanted a quick, now renegotiation of NAFTA but this is not possible in my view. So why not solve the lumber dispute before you tackle the more comprehensive, complicated NAFTA negotiations?" Chrétien said.

"So hopefully there's a small window there and I'm sure that in Ottawa they would welcome a softwood lumber deal."

Chrétien, who served as ambassador from 1994 to 2000 and watched NAFTA come into effect, says between Trump's health care trip up earlier this year and potential difficulties implementing tax reforms, he'll be looking for a victory on lumber quickly.

Chrétien says there's a consumer case Trudeau's government can make a consumer case to both Ross and Trump, two business men.

"Our case relates more to the consumers. I mean the fact that Mr. Trump wants to help the middle class, and of course our lumber is necessary to keep the housing costs low, so very much try to make our case in line with his overall desire to help the middle class there," Chrétien said.


'Jordan was sort of the wake up call'

Andrew Parsons driving law changes

Newfoundland's Attorney General Andrew Parsons was in Ottawa this week to meet with federal Justice Minister Jody Wilson-Raybould. (CBC)

Newfoundland and Labrador's attorney general says adding money isn't the only way to fix court delays across the country.

"I don't feel this is completely a federal issue or completely a Jordan issue. Jordan was sort of the wake up call to 'hey look, our court systems can change,'" Andrew Parsons said. 

"There is a burden on all of us to make sure we do things timely."

He and other provincial and territorial justice ministers met in Gatineau, Que., on Friday for an emergency meeting with their federal counterpart, Jody Wilson-Raybould.

Top of mind: how to tackle delays in the criminal courts especially after the Supreme Court of Canada issued a groundbreaking decision, R. v. Jordan, last summer that set out a new timeline for determining whether a criminal trial has been unreasonably delayed, citing a "culture of complacency" for contributing to the problem.

"I think a lot of it can be procedural and this is where we talk about perhaps changes to the Criminal Code.  In our province for example we're doing more direct indictments," Parsons said, adding getting rid of mandatory minimums could also free up courts.


In House: O'Leary is out, so what's next in the Conservative leadership race?

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Kevin O'Leary is dropping out of the Conservative leadership race and is endorsing his opponent Quebec MP Maxime Bernier. (Nathan Denette/Canadian Press)

What happens to a leadership race when one of the perceived front-runners drops out?

That's what we're in the process of figuring out following Kevin O'Leary surprise announcement that he was no longer seeking to become the next leader of the Conservative party.

O'Leary said Wednesday he was confident he could win the Conservative race, but raised doubts he could defeat Prime Minister Justin Trudeau in the next election. He cited his failure to gain traction in Quebec and his poor French-language skills as reasons for dropping out of the leadership race.

"Maxime Bernier is now a target for all the others," said Susan Delacourt from the Toronto Star and iPolitics.

"It's going to be a very different race for him now. There's going the before O'Leary and the after O'Leary part," she added. 

"Maxime Bernier may be the front runner right now, but it's not a done deal for him," said Joel-Denis Bellavance of La Presse.

"There are some candidates who can still surprise," he said, pointing to Andrew Scheer as an example of somebody else who could do well when the votes are counted.