The Canadian government is signalling the approach it intends to take should U.S. president-elect Donald Trump make good on his promise to renegotiate the North American Free Trade Agreement.
In a lengthy interview, Canada’s ambassador to the U.S. expressed his desire to see the countries propose common-ground, common-sense ideas that improve the old agreement instead of flinging out hardball demands that could produce drama-filled bargaining.
“We have done an extensive amount of work (to prepare for this),” David MacNaughton said. “We have a good sense of what would be in Canada’s interest. …
“(But) the areas we need to focus on — and I think we are focusing on — is where is it not just in Canada’s interest, but in Canada and the United States’ interest …”
MacNaughton declined to elaborate on specific treaty improvements he has in mind, saying he wants to avoid negotiating in public. But he did say improvements to an out-of-date visa system that creates unnecessary red tape when employees travel across the border for work could be one of them.
In addition to NAFTA, potential trade tussles with the incoming Trump administration include the president-elect’s vow to fight certain tax policies of other countries; his preference for Buy American restrictions on infrastructure projects; the ongoing softwood lumber dispute; and increasing anger among U.S. dairy producers over Canadian import restrictions.
It’s also unclear what the incoming administration actually wants from Canada —Trump almost never mentioned America’s northern neighbour during the campaign, even as he railed against NAFTA.
However, MacNaughton said he’s had positive conversations with people close to president-elect, and the Trump team’s complaints about trade tend to involve currency manipulation, dumping of steel, cheap labour, trade imbalances and low environmental standards that make it hard for U.S. companies to compete.
“None of those things apply to Canada,” MacNaughton said.
“I think they see us as pretty much the good guys, rather than the bad guys in terms of trade.”
This raises a question about the other North American amigo: Mexico, which has been a frequent target of Trump’s. That question is, would Canada seek to renegotiate NAFTA as a trilateral block, or cut Mexico loose and try to get a better result by dealing one-on-one with the Americans?
MacNaughton said he couldn’t rule out either possibility: “The reality is that we will do what is in Canada’s interest,” he said.
On Buy American, MacNaughton says his team has been talking to the United Steelworkers union, which has members in both countries, and whose president is Canadian Leo Gerard, in the hope of getting an exemption for Canadian steel — like the one eventually worked out between Stephen Harper and Barack Obama following the 2009 U.S. stimulus bill.