Expect amplified U.S. protectionism in Round 3 of NAFTA talks: Ambrose
Published Saturday, September 23, 2017 7:00AM EDT
OTTAWA -- Across the NAFTA negotiating table, Canada is facing a protectionist “political master” in Donald Trump and as a result, Canadians should expect increased conflict in the third round of trade talks in Ottawa, says Rona Ambrose, a member of Canada’s NAFTA Advisory Council.
“This is a political negotiation and Trump is in charge, so yes we have to be very wary of that,” said Ambrose in an interview with Evan Solomon, host of CTV’s Question Period. “He is the political master.”
U.S. President Donald Trump triggered the renegotiation of the North American Free Trade Agreement, and has threatened to pull the U.S. out of it if he isn’t able to renegotiate improved terms for his country.
“The starting point is ‘we don’t like NAFTA and we think it’s not working.’ That’s a pretty tough place to start from,” said the former interim leader of the Conservative Party.
With negotiators meeting in Ottawa this weekend and into next week for round three of the renegotiations of the 23-year-old trade deal, Ambrose said to expect escalating conflict and contrast between the nations, but no knockout punches, yet.
“I think we can’t be too naive to think that this is going to go really easily, and will be wrapped up really quickly, and that the Americans are going to be easy to deal with because they’ve got a Trump agenda,” Ambrose said.
After round two of NAFTA talks saw the U.S. target Mexican labour standards and now reports of anxiety within the Canadian auto sector over the Americans seeking more U.S. content, Trump’s team has made it clear they aren’t angling for all three countries to get their fair share, it’s about seeing more being made in America, she said.
“This is a free trade negotiation, but we’re sitting across the table from someone who isn’t necessarily talking free trade. They’re talking about America first, they’re talking in a very protectionist way about the American economy. They’re talking almost in language of economic nationalism,” Ambrose said.
Canada’s plan to handle U.S. stance
To counter this push from Canada’s neighbour to the south, Ambrose said Canadian negotiations have to hold their ground on wanting to see the deal improved in areas like digital and clean technology, things she says is needed for the current and future success of the Canadian economy.
She said unlike the Americans, Canada won’t be looking to get more of everything, but rather want to see increased trade liberalization across North America.
Ahead of NAFTA renegotiations, Foreign Affairs Minister Chrystia Freeland spelled out that Canada’s priorities would include making the deal “more progressive,” by adding new chapters on indigenous rights and gender, and strengthening labour and environmental protections.
Canada’s ‘red line’
Another potential source of conflict between Canada and the U.S. in these talks is Canada’s “real red line”: Chapter 19, the dispute resolution mechanism.
Ambrose said she’s heard firsthand from the American administration that they want to do away with it because they feel it often doesn’t rule in their favour.
Under Chapter 19, a panel of representatives from all three countries gets activated if one party isn’t playing by the trade rules, bypassing the court system for what Ambrose classified as a more impartial arbiter.
If the Americans are successful in removing it, it could mean disputes between Canada and the U.S would have to go through a U.S. court, something Ambrose said Canadians should be rightly suspicious of.
Deal by 2018 an ‘optimistic’ timeline
Ambrose said considering all this, the aim to have the deal finalized by the end of this year or early 2018 is “really optimistic,” but the further into next year talks go, the more likely the negotiations will get caught up by political agendas.
The impetus for getting it done by then stems largely from the timing of the U.S. midterm elections in November of next year, and Mexico’s general election in July 2018.
“There’s so many scenarios here and I don’t think count on wrapping this up quickly and cleanly by the end of December,” Ambrose said.
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