Freeland calls Bombardier ruling 'a clear case of protectionism'

Power Play: Trade troubles? Foreign Affairs Minister Freeland talks about the duties imposed on Bombardier and renegotiating NAFTA with 'protectionist' U.S. government.

One day after the U.S. Department of Commerce proposed a staggering 219 per cent duty on CSeries jets made in Quebec by Bombardier, Canadian politicians from all levels of government came out in strong opposition to the idea.

Speaking in the House of Commons on Wednesday, Prime Minister Justin Trudeau called the proposal “completely unfounded and without merit” and vowed to push back.

“We continue to stand by Canadian aerospace industry and we will fight for it every step of the way.”

Quebec Premier Phillippe Couillard, whose government invested US$1 billion into the company’s CSeries program, said the proposal was clearly designed to boost the American aerospace giant Boeing.

“Boeing may have won a battle, but let me tell you, that the battle is far from over. And we shall win,” Couillard said.

The U.S. department released its preliminary findings on Tuesday, which suggested that the billion-dollar boost gave Bombardier an unfair advantage when selling CSeries jets in U.S. markets.

Minister of Foreign Affairs Chrystia Freeland, who has been following the trade spat closely amid ongoing NAFTA negotiations, spoke with CTV’s Power Play host Don Martin about her reaction to the news, concerns about U.S. protectionism and how the federal government plans to respond.

WHAT WAS YOUR REACTION LAST NIGHT WHEN YOU HEARD THE NUMBER 220 PER CENT?

From the outset, our government has taken a very firm and a very clear position on this. We think the actions of Boeing and of the Commerce Department are unjustified. We think this is all about keeping the CSeries out of the marketplace. And we are absolutely committed to defending our aerospace sector and our aerospace workers.

AS YOU’VE MENTIONED, YOU’RE DEALING WITH A PROTECTIONIST U.S. REGIME. HOW DO YOU FIT A FREE TRADE DEAL INTO THAT MENTALITY?

Well it’s an interesting challenge. And I think we need to be candid with each other as Canadians.

This is a U.S. administration which is openly, proudly protectionist -- a U.S. administration that believes in “America First.” And that’s just a political fact.

Having said that, it is also the case that we have a great trading relationship with the United States and, crucially, the Americans have a great trading relationship with us.

We are the single biggest customer of the United States. We are bigger than China, Japan and the U.K. combined. And let me assure you, instead of saying hello when I meet Americans, that’s what I say.

And that underlying economic reality, I think, is ultimately the reason that I’m optimistic we’re going to end up in a good place.

SO WHEN YOU WALK IN AND SEE U.S. SECRETARY OF COMMERCE WILBUR ROSS – HE’S YOUR COUNTERPART – ARE YOU GOING TO POINT OUT THAT BOEING HAS RECEIVED $73 BILLION IS SUBSIDIES SINCE 2000?

Of course that is a point we make, and I think it’s important for Canadians to understand this too. Boeing absolutely is a company that enjoys very, very generous government subsidies and we need to be clear about what’s going on.

And we need to be clear that this is a clear case of protectionism -- a clear case of a company trying to take out its competitor.

WAS THERE A CHILL IN THE ROOM TODAY WHEN YOU SAT DOWN TO TALK WITH YOUR AMERICAN AND MEXICAN COUNTERPARTS ABOUT FREE TRADE, IN LIGHT OF THE BOMBARDIER NEWS?

The reality is that the NAFTA talks are separate from these different Commerce Department cases. Commerce is run by Secretary Ross, Ambassador (Robert) Lighthizer is the chief U.S. negotiator on NAFTA. So they truly are separate processes.

Obviously it was an issue that I raised with Ambassador Lighthizer – the Boeing-Bombardier issue – because it’s an issue which I know matters a lot to Canadians. It matters a lot to our government. So we were clear about our position and our concerns.

But it is also important for Canadians to understand that these are very separate issues (and) separate processes.

And also when it comes to the Boeing-Bombardier case, we are all now pretty familiar with how the Commerce Department works and it has a sequencing and a pattern. This was just the first stage. It was something that was set in motion a long time ago. And we all knew the ruling was going to come this week.

It’s a coincidence that it happened at the same time that we were having our NAFTA talks.

But I want to be clear and unequivocal: We are strongly opposed to this, and we’re going to fight for Canadian workers.

I THINK THIS REALLY MAKES THE CASE IN FAVOUR OF AN INDEPENDENT DISPUTE MECHANISM SYSTEM, BECAUSE YOU DON’T WANT TO TRUST THIS APPEAL GOING THROUGH A U.S. COURT SYSTEM. DOESN’T THIS UNDERLINE THE IMPORTANCE OF MAINTAINING CHAPTER 19?

Certainly. One of the things that I think Canadians are well aware of, and certainly people close to the Bombardier case are, is preliminary decisions by the Commerce Department are almost always in favour of the U.S. And so to that extent, this was a process that was set in motion and that was going to happen.

And certainty something that Canada has been clear on from day one if that Chapter 19 is a very important part of NAFTA for us. It was one of the great accomplishments of the initial NAFTA negotiation.

I like to say, we know that good fences make good neighbours and a good dispute settlement mechanism is how you ensure that you have an amicable and an effective trading relationship.

YOU’RE GOING INTO NAFTA NEGOTIATIONS IN A COUPLE WEEKS IN WASHINGTON. CAN YOU MAKE A DEAL BY THE END OF 2017?

What we are focused on is working hard (and) doing our homework. And I want to take this opportunity to say to all Canadians, if you see a Canadian trade negotiator, give her or him a hug. We have the hardest working, best team. We’ve done our homework.

We have come with all of our texts and we’re working as fast as we can, provided that we have texts to respond to.

This interview has been edited for clarity.