Sunday October 22, 2017

What would a post-NAFTA Canada look like?

Canada's foreign minister, Chrystia Freeland, has said that that dissolving NAFTA would "turn back the clock on 23 years of predictability, openness and collaboration."

Canada's foreign minister, Chrystia Freeland, has said that that dissolving NAFTA would "turn back the clock on 23 years of predictability, openness and collaboration." (ANDREW CABALLERO-REYNOLDS/AFP/Getty Images)

Listen 40:24
Gordon Ritchie's book

(Macfarlane Walter & Ross)

In 1988, when the Canadian government first proposed signing a trade deal with the United States, there was loud opposition to the idea. Many said a free trade agreement would harm Canadian businesses, Canadian jobs, even Canadian culture and social programs. 

Similar concerns were raised before a new treaty, the North American Free Trade Agreement, took effect in 1994. It's a trilateral pact which includes Mexico.

Now, NAFTA is being re-negotiated at the insistence of U.S. President Donald J. Trump, who has threatened to abandon the deal altogether.

Unlike the apprehension that preceded its signing, there are growing concerns in Canada about living without NAFTA. 

Gordon Ritchie is a former Canadian ambassador for trade negotiations, and the author of a memoir about his years in public service. It's called Wrestling with the Elephant: The Inside Story of Canada-U.S. Trade Wars.

He says the Americans are engaging in "bush-league tactics, the kind of tactics you'd expect from a low-level real estate developer from Queens."  

Trump NAFTA Dilemma 20170504

Canada-US bilateral relations have been under threat by an erratic U.S. president whose stated policy is “America first.” (Sean Kilpatrick/Canadian Press)

Mr. Ritchie predicts that ultimately the Americans will walk away from the NAFTA negotiations, and that Canada will end up in bilateral talks with the U.S. alone. The problem, he says, is that "the American demands would remain the same and those demands are outlandish. They're designed to blow up talks, instead of reach agreement."

Listen to Michael's full conversation with Gordon Ritchie:

The Minister of Foreign Affairs, Chrystia Freeland, leads Canada's negotiating team.

She says talks haven't yet reached a stalemate, but concedes that the latest round has been the most difficult. 

"Where we're running into difficulties," she says, "is in several proposals from the U.S. which Canada is not able to accept, which would degrade NAFTA and fundamentally alter the nature of the agreement."

She agrees with Mr. Ritchie's view that the U.S. has been imposing unfair and punitive tariffs on Canadian industry, notably on softwood lumber and Bombardier planes.

But she argues that NAFTA offers Canada an opportunity to push back on those measures, and says she refuses to give up on the possibility of reaching an agreement.

Freeland

(L-R) Mexico's Secretary of Economy Ildefonso Guajardo Villarreal, Canada's Minister of Foreign Affairs Chrystia Freeland, and U.S. Trade Representative Robert E. Lighthizer on the final day of the third round of the NAFTA re-negotiations in Ottawa in September, 2017. (LARS HAGBERG/AFP/Getty Images)

"NAFTA is the agreement we have right now. It works well for Canada and I think that we need to stick at it for a while... Our focus right now is, and needs to be, on getting an improved, modernized NAFTA out of these negotiations."

Freeland says she has no plans to walk away from the negotiating table.

"We believe strongly that we need to take clear and firm positions — always pragmatic, well reasoned and with goodwill."

"I call it saying no with a smile," she says.

Listen to Michael's full conversation with Chrystia Freeland:

To hear the full segment, click 'listen' above, at the top of the page.