Canada US Relations after Charlevoix

After the diplomatic disaster of the Group of Seven summit in Charlevoix, Que., it is now clear that for Mr. Trump it is not about leading – the traditional role of the U.S. President – but about winning at any cost. Relationships are not for cultivating, but only for using to Trumpian advantage.

Canada and like-minded countries need to stick together, act in tandem and push back against Trumpist protectionism. It means taking it to him where it hurts and targeting his base: in particular the farm community. At the same time, we need to tell Americans, who will suffer job loss and higher prices, that they have only their president to blame.

For more than 500 days now, Justin Trudeau has made nice to Mr. Trump. The advice from former prime minister Brian Mulroney was correct – that the relationship with the president is the most important relationship for a prime minister and that Canada-U.S. relations, alongside national unity and national security, are the files that require a prime minister’s constant attention.

Among liberal democratic leaders, Mr. Trudeau was seen as the one who had the best relationship with Mr. Trump. He was the Trump whisperer. But Mr. Trump’s behaviour at Charlevoix, Que., was abominable.

The tweets before Charlevoix, Que., took personal shots at both Mr. Trudeau and French President Emmanuel Macron, the other leader who has cultivated Mr. Trump. The tweets afterward, insulting Mr. Trudeau, are beyond the pale. As Mr. Trudeau said, we are a polite people but we are not pushovers.

Canadians are justly outraged, but we have deep interests at stake, so we need to proceed with care and planning.

First, we need to get our act together domestically. Mr. Trudeau needs to consult with the premiers and business to get their advice on our retaliation list. What is their assessment of increased protectionism on their province and industries? What about life after the North American free-trade agreement? We will be hurt. We will need to provide adjustment assistance for the afflicted. But how would Americans like it if Canadians began to spontaneously boycott American goods, especially U.S. farm produce, and stopped travelling south for holidays?

Second, we need to take advantage of the free-trade deals that we already have in place and put real effort into matchmaking; business with business. As a matter of our national security (two can play this game), we should quickly pass the implementing legislation to bring the new Comprehensive and Progressive Trans-Pacific Partnership into effect. With Canada’s implementation, the agreement would immediately come into force.

If this means keeping parliamentarians at work into July so be it. Provincial legislatures may also have to be recalled. While they are at it they should pass their enabling legislation for the Canada-Europe Comprehensive Economic and Trade Agreement. This is a matter of grave national economic urgency. Canadians need to see that their legislators are acting in the national interest.

Third, we need to act in tandem with our G7 partners and like-minded countries, such as Mexico, as we collectively retaliate to the recently imposed steel and aluminium tariffs. Canada and Mexico learned the value of acting collectively when they worked together to persuade the U.S. Congress to rescind its protectionist country-of-origin labelling requirement in 2015.

American legislators respond to local pressure. They need to feel the heat of retaliation. Canada has a lot of allies, especially in the Republican congressional caucus. They don’t like Mr. Trump’s direction and are already moving to curb the trade powers that were ceded to the executive branch during Franklin Roosevelt’s administration. Hopefully, we will see then the beauty of the checks and balances at work. The U.S. founding fathers designed their system to prevent a president from becoming a king.

The more Mr. Trump attacks his fellow G7 and fellow democratically elected leaders the more difficult it makes it for them to go along with him when it counts. That includes, however unlikely, a deal with North Korea.

The road that Mr. Trump is going down makes no economic sense. George W. Bush reluctantly imposed limited steel tariffs in 2002 (Canada was exempt) and lifted them a year later because it was costing American jobs, not creating them.

Canadians are used to compromise and consensus, especially in how we handle the relationship with Uncle Sam. Manage it well and we can tell them when their breath is bad. Mr. Trump has a bad case of halitosis. We need to tell him so and serve him the bitter medicine he has brought on himself.

CPAC Prime Time Politics Monday, June 11, 2018

Colin Robertson and Christopher Sands on Canada–U.S. Relations00:10:34Quick View

PRIMETIME POLITICS

Colin Robertson and Christopher Sands on Canada–U.S. Relations

 The G7 Summit in Charlevoix ended in dramatic fashion on Saturday with U.S. President Donald Trump directing strong criticism at Prime Minister Justin Trudeau over Canada’s response to U.S. tariffs. CPAC’s Martin Stringer is joined by two experts in foreign affairs and diplomacy to assess the current state of the Canada–U.S. relationship. Colin Robertson is vice-president and fellow at the Canadian Global Affairs Institute and a former Canadian diplomat. Christopher Sands is director of the Center for Canadian Studies at the Johns Hopkins University School of Advanced International Studies. (June 11, 2018) (no interpretation)

 

Prepare for the Worst

US officials back Trump’s outraged G7 remarks as Canada struggles to mend relationship with its largest trading partner

Chrystia Freeland will travel to Washington this week for a visit which will focus on trade talks – but also attempt to reset US-Canada relations.
 Chrystia Freeland will travel to Washington this week for a visit which will focus on trade talks – but also attempt to reset US-Canada relations. Photograph: Yves Herman/Reuters

Canadian diplomats are scrambling to mend a deteriorating relationship with its largest trading partner after senior US officials maintained the rhetorical barrage first unleashed by Donald Trump at the G7 meeting in Quebec.

Foreign affairs minister Chrystia Freeland will travel to Washington this week for a visit which will focus on trade talks – but also attempt to reset relations between the two countries, which have been pushed to their lowest point in recent memory amid an increasingly bitter row over trade.

In television appearances over the weekend, two senior Trump advisors said that Justin Trudeau “stabbed the US in the back” after the prime minister spoke out against the US president’s aggressive trade policies.

In an appearance on Fox News on Sunday, White House trade advisor Peter Navarro said: “There’s a special place in hell for any foreign leader that engages in bad faith diplomacy with President Donald J Trump and then tries to stab him in the back on the way out the door.”

The sharp escalation has shocked experts and fuelled worries of a devastating trade war, one which Canada, a middling economic power, would likely lose.

“There have been moments of tension in various times in the history of Canada-US relations, but I’ve never seen or heard of anything like the type of language the US administration has used towards Canada,” said Roland Paris, an international affairs scholar and former advisor to Trudeau.

Canadian officials hoped the G7 summit in Quebec over the weekend would be an opportunity to reset discussions around trade after Trump imposed punitive tariffs on the EU and Canada.

But the gathering concluded on a sour note after Trudeau told reporters Canada “will not be pushed around”. Trump responded via social media calling the prime minister “very dishonest and weak”.

“We have to prepare for the worst now,” said Colin Robertson, a former diplomat and head of the Canadian Global Affairs Institute. “There’s a lot of damage control going on today and for the next few days,” he said.

The US remains Canada’s largest trading partner, a relationship valued at $673.9bn, but Trump has claimed Canada has a trade surplus with the US, a statement not backed up by any evidence.

A recent report from the CD Howe Institute finds that the tariffs will cause significant economic pain in both countries: Canada could lose as many as 6,000 jobs and a 0.33% GDP reduction, whereas the US would lose 22,700 jobs, but only a 0.02% disruption to the GDP.

Last week, Canada introduced more than $16bn in retaliatory tariffs against the United States, meant to inflict targeted pain on politically vulnerable industries, such as whisky, orange juice, frozen pizzas and soy beans.

“There are plenty of people in the United States, including in positions of influence, who were just as outraged at those remarks as Canadians were,” said Paris.

Although there is little to suggest that his aggressive trade policy has spirited support within his party, analysts say Trump has seized on the duties as a weapon he can wield without needing congressional approval.

“He’s discovered these weapons and he’s using them for maximum effect to further his ‘American First’ bellicose trade and political agenda,” said Lawrence Herman, a former diplomat and international trade lawyer. “I think the lesson has come home that as a strategic objective: be less dependent on the unreliability of the United States … What Trump is showing is that the United States is an unreliable treaty partner.”

The recent spat has backed Canada into an uncomfortable position: while attempting to remain steadfast against a belligerent trade partner, it must also reckon with the fact that much of its economic productivity is tied to seamless free trade with its southern neighbour.

Trudeau’s father, Pierre Trudeau, famously likened the relationship with the United States to a mouse next to a sleeping elephant. “No matter how friendly and even-tempered is the beast, one is affected by every twitch and grunt,” the former prime minister said.

Justin Trudeau, Donald Trump, Angela Merkel and other world leaders at the G7 summit.
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 Justin Trudeau, Donald Trump, Angela Merkel and other world leaders at the G7 summit. Photograph: Justin Trudeau/JT

Justin Trudeau amended his father’s metaphor at a gathering of American governors last year. “While you, my American friends, may be an elephant, Canada is no mouse. More like a moose: strong and peaceable – but still massively outweighed.”

Trudeau’s firm stance towards the US administration has resulted in a rare unified front amongst current and former political leaders.

Over the weekend, his conservative predecessor Stephen Harper appeared on Fox News to appeal for calm. Conservative leader Andrew Scheer tweeted his support for the prime minister.

Even Doug Ford, the newly-elected populist premier of Ontario – who has pledged to fight Trudeau on a number of policy initiatives – backed the prime minister’s position.

That support reflects a cold economic reality: Ontario is particularly vulnerable to America’s protectionist policies as more than 80% of the province’s exports are sent south of the border, said Robertson.

More recently, Trump has reiterated his threat to impose a 25% tariff on Canadian-made automobiles – a move that would devastate the $80bn industry.

Experts say that as discussions enter uncharted territory, it’s critical that the issues of trade remain the central of focus.

“Trudeau will not personalize this with Trump – and he will not let any of his cabinet or caucus do so. He’ll let public opinion do that for him,” added Robertson.

Meanwhile, Canada should push to ensure two large trade deals – the Trans Pacific Partnership and the Comprehensive Economic Trade Agreement – are finalized in the coming months to hedge against further uncertainty.

“We’ve got these open doors to Europe and the Trans Pacific Partnership. We’ve some housekeeping to do to show we’re serious,” said Robertson.

G7 Communique?

G-7 Leaders Race to Salvage Consensus

 Updated on 
  • Trump facing a backlash from leaders in Canada over tariffs
  • Meeting could instead end with less-formal chair’s statement
U.S. President Donald Trump, center left, shakes hands with Emmanuel Macron, France’s president, center right, after standing for a family photograph during the G7 Leaders Summit in La Malbaie, Quebec, Canada, on June 8, 2018.

Photographer: Cole Burston/Bloomberg

Leaders from the world’s richest industrialized nations downplayed expectations they will agree on a formal statement at the end of their meeting, as a brewing trade dispute threatens to upend relations between the traditional allies.

Speaking to reporters on the sidelines of the two-day Group of Seven summit in La Malbaie, Quebec, German Chancellor Angela Merkel said it remains uncertain whether the talks will produce a joint communique. Instead, the host, Canadian Prime Minister Justin Trudeau, could issue a less-formal chair’s statement.

Theresa May, from left, Angela Merkel, Donald Trump, and Justin Trudeau during G7 Leaders Summit in Canada.

Photographer: Cole Burston/Bloomberg

“I cannot say whether there will be a common statement or just a summary,” Merkel said on Friday.

It would mark a rare break in protocol for the group. The consensus documents typically outline a shared vision of global affairs, where the seven countries also undertake commitments on everything from currencies, development aid and international security.Donald Trump, for his part, told reporters at his bilateral meeting with Trudeau that he thought there would be a joint statement coming out of the summit, though he didn’t specify whether he was referring to a final joint communique or to separate side agreements.

A Guide to the G-7 Communique, How It’s Done and Why It Matters

The U.S. president is facing a backlash from leaders in Canada and Europe over tariffs he imposed last week on steel and aluminum, as well as his decisions to walk away from international deals to address Iran’s nuclear program and climate change. Leaders have struggled to find ways of getting through to Trump and persuading him to budge from his pre-established positions.

“This should not come as a surprise to anyone,” said Colin Robertson, vice president at the Canadian Global Affairs Institute and a former Canadian diplomat, but “I wouldn’t say the walls have come down if we don’t have a communique.”

Robertson said there are other issues on which there will be agreement and the primary significance of these meetings anyhow is that “leaders get together and have those frank discussions.”

Sharp disagreements on trade are making it difficult for nations to come up with the traditional concluding statement from the agreement. French President Emmanuel Macron has said he’ll refuse to sign a formal communique if there’s no progress on U.S. tariffs and other sticking points.

One solution, Merkel said, might be for Trump to withhold his signature from a final document.

“In a culture of open discussion, it’s possible that we don’t agree on all points,”’ Merkel said. “It would be more honest to address the different viewpoints and to continue the work of overcoming these differences, rather than pretending that everything is in order.”

Canadian Foreign Minister Chrystia Freeland, speaking to reporters at the summit, said officials are still in talks and “we’ll see where we land.” The G-7 is also working on side agreements for issues such as gender and supporting democracy.

“What we want to see is getting the substance right and in the past that has been done in a number of ways — a chairman’s statement, for example,” James Slack, a spokesman for U.K. Prime Minister Theresa May told reporters.

A senior government official meanwhile said May would warn that countermeasures from the EU would be unavoidable unless tensions were eased quickly. She would also tell other leaders that rather than imposing tariffs on each other, pressure should be increased on China to reduce its excess steel capacity, the person said.

Tariff forum

Concerned about Trump’s approach to tariffs, Merkel on Friday proposed the creation of a “shared evaluation mechanism” on U.S. trade, a forum aimed at defusing tensions between the U.S. administration and the European Union. It’s an idea that has the support of Macron and European Commission President Jean-Claude Juncker, a French official said.

The other six nations are pushing for the G-7 to affirm “collective trade rules” in the communique, the French official said. Trump brought his hawkish trade czar, U.S. Trade Representative Robert Lighthizer, along for the trip.

The tariff standoff is a complicated issue for the EU — each country is exposed to different sectors, and could be impacted differently in the event of an escalation. Trump, for instance, is considering imposing tariffs on auto imports on national security grounds, a move that would hurt major foreign auto producers like Germany.

Merkel has repeatedly called for a strengthening of the World Trade Organization and for the establishment of mechanisms aimed at preventing future trade disputes. It wasn’t clear how her proposed trade forum at the G-7 would differ from the WTO’s dispute resolution functions.

“We need again a multilateral trade agreement,” Merkel said at a business summit last month. “As we all see right now, something has become unstable and the situation is quite difficult. It is therefore important to create a reliable common legal framework and mechanisms for settling trade disputes, which are accepted by everybody.”

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G7 and Rules Based Order

Testy Trump to ditch G7 summit early, White House says

QUEBEC — U.S. President Donald Trump is cutting short his first presidential trip to Canada this weekend, as trade and foreign policy disputes appear set to mar his planned summit with the leaders of the Group of Seven wealthy democracies.

The U.S. president’s reception in the picturesque town of La Malbaie along the St. Lawrence River is set to be a far cry from when Ronald Reagan visited Quebec three decades ago, when he was so friendly with Prime Minister Brian Mulroney they sang a song together.

Quarrelling with Trump over his protectionist tariffs on steel and aluminum imports, decision to exit the Iran nuclear accord and retreat from global efforts to combat climate change, erstwhile American allies are turning the summit into something of an intervention, challenging the U.S. president in the most direct terms to date.

The summit threatens to mark the outer limit of international patience for the avowed nationalistic Trump, as leaders who had sought to cajole and “bromance’’ the president are embracing more hard-nosed tactics.

Before shortening his planned participation on the eve of his departure, Trump found himself publicly feuding with summit host, Canadian Prime Minister Justin Trudeau, and with French President Emmanuel Macron — two leaders who previously banked on flattery to win concessions with the American.

Trudeau has grown increasingly direct with his fury with Trump for imposing the tariffs on Canada’s metals industries — and for justifying the protectionist move by calling those imports a threat to U.S. national security.

Under Trump, the United States has abandoned its traditional role in the G-7. American presidents from Reagan to Barack Obama pressed for freer global trade. And they championed a trading system that required countries to follow World Trade Organization rules.

Trump’s policies, by contrast, are unapologetically protectionist and confrontational. To hear the president, poorly conceived trade deals and unfair practices by America’s trading partners have widened America’s trade deficit with the rest of the world — $566 billion last year — and contributed to a loss of millions of factory jobs.

Nelson Wiseman, a professor at the University of Toronto, said he can’t recall relations between U.S. and Canada being worse. He said the G-7 meeting will appear to be six lined up against one. Indeed, on Thursday, French President Emmanuel Macron suggested in a tweet that Trump might not sign the final summit statement on G-7 priorities.

“The American president may not mind being isolated,‘’ Macron tweeted, “but neither do we mind signing a six-country agreement if need be. Because these six countries represent values, they represent an economic market which has the weight of history behind it and which is now a true international force.‘’

Trump offered his own digs the evening before his departure.

“Please tell Prime Minister Trudeau and President Macron that they are charging the U.S. massive tariffs and create non-monetary barriers. The EU trade surplus with the U.S. is $151 Billion, and Canada keeps our farmers and others out,‘’ he tweeted, adding, “Look forward to seeing them tomorrow.‘’

Later, Trump tweeted, “Take down your tariffs & barriers or we will more than match you!‘’

White House officials said Trump in recent days had bristled at attending the summit, where he is set to be challenged face-to-face on his policy decisions. Among allies, there was even been speculation that Trump might walk out of the meetings — or even decide not to show up. Late Thursday, the White House announced he would leave the summit Saturday morning, after a session on women’s empowerment but well before it wraps up.

“The President will travel directly to Singapore from Canada in anticipation of his upcoming meeting with North Korea’s leader Kim Jong Un Tuesday,‘’ press secretary Sarah Sanders said. “G7 Sherpa and Deputy Assistant to the President for International Economic Affairs Everett Eissenstat will represent the United States for the remaining G7 sessions.‘’

Trudeau has charged that he found the tariffs “insulting’’ and said such tactics are hardly how two close allies and trading partners that fought side-by-side in the Second World War, Korea and Afghanistan should treat one another. The Trump administration has also clashed with Canada over his insistence that the 24-year-old North American Free Trade Agreement involving the United States, Canada and Mexico be written to better serve the U.S.

The prime minister had at first refrained from criticizing Trump, apparently in the hope that he could forge a personal relationship that might help preserve the landmark free trade deal, a forerunner of which Reagan and Mulroney negotiated. Those two leaders became fast friends and famously sang When Irish Eyes Are Smiling together in Quebec City in 1985.

Trudeau’s courting of Trump appeared to work for a time. The president had initially exempted Canada from the steel and aluminum tariffs in March. But Trudeau became exasperated and took a shot after Trump let the exemption expire last week.

“We’ll continue to make arguments based on logic and common sense,‘’ he said, “and hope that eventually they will prevail against an administration that doesn’t always align itself around those principles.‘’

The United States has experienced tense relations with its allies before — over the Vietnam War, for example, over Reagan’s decision to deploy Pershing II missiles in Europe and over President George W. Bush’s invasion of Iraq. But Trump’s moves — the tariffs and his decisions to pull out of the Paris climate agreement and the Iran nuclear deal, among other actions — have taken the hostility to new heights.

“This is the first time the U.S. government is seen as truly acting in bad faith, in treating allies as a threat, in treating trade as negative and fundamentally undermining the system that it built,‘’ said Adam Posen, president of the Peterson Institute for International Economics. “This U.S. administration feels unbound by previous U.S. commitments in a way that no other administration has ever felt.‘’

“Prime ministers are people, and he’s insulted them,‘’ Reinsch said. “They’re just not going to easily roll over when he punches them in the nose like that.‘’

Canada and other U.S. allies are retaliating with tariffs on U.S. exports. Canada is waiting until the end of the month to apply them with the hope the Trump administration will reconsider. The Canadian tariffs would apply to goods ranging from yogurt to whiskey.

Robert Bothwell, a professor at the University of Toronto, said Trump’s actions appear intended to break Canada at the negotiating table.

“They are relying on the overwhelming strength of the U.S. to compel a much weaker neighbour to give in to whatever they demand,‘’ Bothwell said. “That brings in the real possibility of lasting damage to Canadian-American relations.‘’

Bothwell expects this to be Trump’s only visit to Canada. He even wonders if it could be the last G-7 meeting for the president.

“We’ve not had an American president or administration like this in the post-war period,‘’ said Colin Robertson, a former Canadian diplomat. “I am worried because it is destructive to the rules-based international system that the Americans have been the guardian of.‘’

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Trump at Charlevoix

From Vanity Fair

Trump can expect a warm welcome at this weekend’s G7 summit

Just kidding! Everyone there hates his guts more than ever thanks to last week’s decision to slap our closest allies with steel and aluminum tariffs. “What this G7 is going to show is that the United States are alone against everyone and especially alone against their allies,” French Finance Minister Bruno Le Maire told reporters on Friday. “Mr. Trump will be like the proverbial skunk at the garden party given the protectionism,” Colin Robertson, vice president of the Canadian Global Affairs Institute, told Politico. “He is the outlier anyway, but this is simply going to make those two days of discussions more tense.” Canada, which is hosting this year’s summit, called the tariffs “an affront” to Canadian soldiers who have died fighting alongside Americans, counterattacking with levies that could hit $16.6 billion on steel, aluminum, beer kegs, whisky, maple syrup, and other goods.

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Canada USA Relations

‘It’s a very dangerous political place to be for the Conservative Party,’ Ambrose warns Tories not to attack Liberals on NAFTA

By JOLSON LIM      
NAFTA advisory council member Rona Ambrose and other panelists also paint a gloomy picture of future Canada-U.S. trade relations and of U.S. President Donald Trump’s impact on the free trade consensus.
Moderator Colin Robertson, former Quebec premier Jean Charest, former interim Conservative leader Rona Ambrose, and former Chrétien-era communications director Peter Donolo, pictured May 8 on a panel at the Canadian Global Affairs Institute conference at the Rideau Club. The Hill Times photograph by Andrew Meade

OTTAWA—Former interim Conservative leader Rona Ambrose is warning the federal Tories to watch their attacks on the Liberals over the crucial NAFTA renegotiations because it could make them look “anti-Canada” which is not a big “vote-getter.”

“It’s a very dangerous political place to be for the Conservative Party of Canada to attack the Liberal government, which is working hard to come to a deal that’s in the best interest of Canada,” she told a packed room Monday at the Canadian Global Affairs Institute conference at the Rideau Club. “That would mean almost like you’re having to look like you’re taking the other side, which is Donald Trump’s side. That is not a politically smart place to be.”

Ms. Ambrose, who is now a Liberal-government-tapped member of the NAFTA Advisory Council and is based in Washington, D.C., with the Wilson Centre, said the NAFTA issue doesn’t garner a lot of votes and it isn’t a No. 1 issue for constituents or even the No. 10 issue. Ms. Ambrose was speaking at a panel discussion called ‘Positioning Canada in the Shifting International Oder.’ The panel focused on managing Mr. Trump’s ‘America First’ approach to foreign affairs and international trade, moderated by former diplomat Colin Robertson.

Ms. Ambrose was responding to Peter Donolo, former longtime communications director to former prime minister Jean Chrétien, who told the same audience that he believed the political consensus on NAFTA will eventually disappear and that Canada-U.S. relations will become a “live issue” again.

He said U.S. President Donald Trump’s approach to politics, often based on demonstrating “his opponent’s face has been grounded into the dirt” and humiliated, will not go over well with Canadian politicians.

“The term win-win is not in Mr. Trump’s lexicon,” said Mr. Donolo, now vice-chairman of Hill and Knowlton in Toronto. “I don’t think Mr. Scheer or Mr. Singh, who have been part of this elite consensus on NAFTA negotiations, are then going to congratulate Prime Minister Trudeau and his government for a great deal on the NAFTA renegotiation when that’s not the way politics works.”

Mr. Donolo predicted the political atmosphere is going to look like how it was when the United States invaded Iraq in 2003, when political parties were split on whether to participate in the conflict.

He pointed to how Mr. Trump’s rhetoric and actions have swayed Mexican politics, where leftist leader Andrés Manuel López Obrador is now leading in polls and is running on challenging Mr. Trump.

“There will be firm sides drawn and there won’t be a national consensus issue; where it will end, I don’t know. It’s not a healthy development.”

Ms. Ambrose, Mr. Donolo, and Jean Charest, former Quebec premier and Progressive Conservative leader, all spoke in Ottawa while Foreign Affairs Minister Chrystia Freeland (University-Rosedale, Ont.) and trade officials are in Washington for another critical round of talks, the last such discussions before renegotiations are halted to accommodate for presidential elections in Mexico in July and the midterm congressional race in the U.S. in November.

The negotiations fall under a global political backdrop of right-wing, populist, and trade-skeptic movements rising in many western democracies, including the United States, the United Kingdom, and France.

But in Canada, conservative politicians haven’t swung to the hard right and remain enthusiastically supportive of free trade, despite the belief, including from Ms. Ambrose, that movements in other countries have influenced some Canadians.

While Ms. Ambrose said she remains optimistic that a trade deal can be reached, she also painted a gloomy picture of Canada-U.S. relations, even if Mr. Trump doesn’t receive a second term in 2020.

“This romantic notion that the Americans are our best friends and biggest allies; that’s not the reality anymore,” she said.

“That’s not how they’re treating us in the trade arena. It’s how they’re treating us in other arenas. And it speaks to the fact we have to recognize their agenda, when it comes to ‘America First,’ is Canada is not just second, Canada’s maybe third, fourth, or maybe fifth down the line.”

Ms. Ambrose also said she doesn’t believe that Mr. Trump’s politics will be confined to one-term or that he’s a one-off politician the country won’t ever see again.

“I think the people who support him are alive and well and in fact growing, the type of politician that he is. We see some of these elements right in our own country. We see it in a number of western democratic countries,” she said.

But she also noted that a recent deal between the U.S. and South Korea was celebrated as a victory by both governments, possibly signalling that the Trump administration won’t take as hardline of an approach to trade deals in the future.

Ms. Ambrose said striking a deal on auto parts in the ongoing round of negotiations would mark a major breakthrough because it would give Mr. Trump a major political victory and a win for his political base, located in the country’s industrial heartland.

“If we can get something around autos, which is the absolutely sweet spot for Donald Trump…I think that is a win-win for Canada and the U.S.,” Ms. Ambrose said. “And I don’t think we’ll see him rub our faces in the dirt over that.”

Ms. Ambrose said Trump voters don’t care about wonkier issues such as the Chapter 19 dispute resolution mechanism, but striking a deal on auto parts will leave negotiations in better shape heading into election season.

“I’m a little more optimistic if those are the last things on the table,” she said. “As a politician, you’re looking at these things and going ‘Okay, we really want to get rid of Chapter 19, but what is that going to gain me in the states where I need votes.’ Not much because they don’t even understand it.”

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Summit of the Americas

Summit of the Americas presents opportunities for Canada

IPOLITICS by Colin Robertson
April 13, 2018

Success at this week’s Summit of the Americas in Lima, Peru should be measured by a re-commitment to liberal democratic institutions and freer trade. For Justin Trudeau the test will be to advance our trade objectives beyond NAFTA and actively support hemispheric democratization.

‘Democratic Governance against Corruption’ is the theme of this summit. The rule of law is a basic structural challenge across Latin America. Brazil’s Oderbrecht bribery scandal – Operation Car Wash- has toppled several leaders and it has regional scope.

Democratisation is the great achievement within Latin and Central America but is must be sustained. Presidential elections are scheduled this year in nine of the members, including the three biggest Latin America countries – Brazil, Colombia and Mexico, There is already Russian meddling in the Mexican election. President Vladimir Putin wants to discredit liberal democracy and create wedges in the US alliance system.

Working through the Organization of American States (OAS), Justin Trudeau should offer Canadian expertise on conducting and monitoring elections. When it comes to governance, Canada’s Parliamentary Centre, helping legislatures and legislators better serve their citizens should be enlisted. With fifty years experience, it has established its global credentials as a go-to center for governance expertise.

Hemispheric free trade remains elusive. US backing is essential but not with Donald Trump and ‘America First’.

The Lima summit, the eighth in a regular series, will bring together most of the 35 hemispheric leaders. President Bill Clinton hosted the first summit, in Miami (1994) to boost a hemispheric free trade area stretching from Alaska to Terra del Fuego. Negotiations began but the divides proved too big. There were subsequent summits in Santiago, Chile (1998) and Quebec City (2001) and then Mar del Plato, Argentina (2005) but with the discrediting of market fundamentalism – ‘the Washington consensus’ – the appetite for closer economic integration was gone.

Populist leaders led by Venezuela’s Hugo Chavez, Brazil’s Lula da Silva, Bolivia’s Evo Morales and Argentina’s Hector Kirchner derided the FTAA, labelling it Yankee neo-imperialism. Instead, they embraced ‘Bolivarianism’, creating their own regional trade part – Mercosur –  and development bank – Banco del Sur.

But if the Washington consensus was bitter medicine, especially for Argentina and Ecuador, ‘Bolivarianism’ was toxic. Banco del Sur was never capitalised and populist policies resulted in corruption, impeachments and economic catastrophe.

Venezuela, once the richest country in Latin America, is in economic free-fall. According to the IMF, the Venezuelan GDP has shrunk by 50 percent  in the last 5 years.  This economic collapse has caused untold human suffering and massive migration of Venezuelans to neighbouring countries (especially Colombia) in search of food, medicine and a future.

Venezuelan president, Nicolas Maduro is ‘disinvited’ to Lima. He fails the ‘democracy clause’ established by then Canadian prime minister Jean Chretien and other leaders at their Quebec summit. Managing a post-Maduro Venezuela will be on the agenda.  Canada is invested in this effort through the imposition of Magnitsky-style sanctions against Maduro associates and involvement in the Lima Group.

The looming Sino-American trade war will also be discussed. For most of the hemisphere, the US and China are thir biggest trading partners. These protectionist spiral and growing geo-political tensions, spelled out in a recent speech by former US Secretary Rex Tillerson,  risk significant collateral damage for the region.

Justin Trudeau can use the summit to advance Canada’s trade agenda. With its rapidly growing middle class and younger demographics, marketing Canadian schools should be part of every conversation.

Mr. Trudeau should establish a date for our associate membership in the Pacific Alliance with presidents Pena Nieto, Sebastien Pinera (Chile), Juan Manual Santos (Colombia) and Martin Vizcarra (Peru).

Freer trade with Mercosur is also a Trudeau objective. If Canada can help Mercosur put its protectionist past behind it then the recent initiative should include progressive trade provisions. Advancing the environment, labour, gender, and small business is a better way to address populist discontent.

Canada is a country of the Americas. Since NAFTA, especially with its re-negotiation, we have come to appreciate Mexico as our friend and partner.  Mexico and USA aside, there are 32 other nations whose votes we will need in our quest for a UN Security Council seat.

We now also have a growing hemispheric web of trade agreements buttressing our commercial interests – banking and mining but now including manufacturing and infrastructure. Migration has created growing Latin diasporas, especially in our cities. Tourism and student study will bring more. Devoting sustained attention to the Americas makes sense for Canada.

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NAFTA… and behind this door

Donald Trump has decided it’s “Let’s Make a Deal” time for NAFTA. Like in the long-running game show co-created and hosted by the late Canadian Monty Hall, there are three doors with different prizes: the big, the modest and the booby.

After deliberations last week in Washington by the key ministers − Chrystia Freeland, Ildefonso Guajardo and Robert Lighthizer − three doors lie before their leaders:

  • Pursuing a big deal with negotiations suspended until next year, after the Mexican inauguration and new U.S. Congress convenes.
  • Agreement now on a modest deal, such as the recent remake of the Korea-U.S. FTA.
  • The booby prize — Mr. Trump rescinds the NAFTA.

Calling NAFTA “the worst trade deal ever,” Mr. Trump has come close to scrapping it on several occasions. Farmers, auto workers and business, key components in the Trump base, now say “do no harm“ to NAFTA.

Congress is responding to their pressure by telling the U.S. President to reform NAFTA. After enduring 23 years as one of the scapegoats for job loss and illegal migrants, its threatened demise has rehabilitated NAFTA with half of Americans saying they want to keep it.

As Sino-American trade tensions continue to escalate, China requires sustained attention from the Trump administration.

If Mr. Trump wants to build international support to persuade China to curb its overcapacity in steel production and to follow international norms on intellectual property, then repairing neighbourhood relations makes good geopolitical sense. With the midterms approaching, it is also good politics.

So what would a revised NAFTA, even in a modest deal, look like?

Dispute settlement is the red line for Canada and Mexico. The Trump administration is applying trade retaliation as never before. Canada has felt the U.S. sting on softwood lumber, Bombardier jets and newsprint. We also face tariffs on steel and aluminium – exemption depends on the NAFTA talks. Canada and Mexico must have redress, beyond the U.S. court system, from unilateral U.S. trade actions.

A new content formula for North American autos appears within grasp, although Mexico will need to bend on the minimum-wage component.

Access to government procurement could be resolved by letting governors and premiers figure this out through regional reciprocity agreements. We did this in 2010. States and provinces handle most spending on infrastructure. Having a variety of vendors ensures better value and checks local gouging.

The Mexican idea of having a thorough review of the agreement after five years should satisfy the U.S. demand for a sunset clause.

If these pieces fall into place, resolution of other items should follow.

Canada would keep supply management of its dairy and poultry industry. In return, the United States will get increased quota access — what they would have got if they had stayed in the Trans-Pacific Partnership. The threshold after which duties apply on cross-border imports would be revised upwards from Canada’s $20 rate to that approaching the Mexican rate – $50 – but nowhere near the $800 U.S. rate.

The negotiators and ministers have gone as far as they can go. If Mr. Trump is set on a “quick“ deal, then the three leaders must weigh in.

With new auto-content rules and slight improvements on agricultural access, President Trump would claim victory for auto workers and farmers. Canada and Mexico would retain dispute settlement. There would be provisions on energy as well as environment, labour and gender – reflecting elements of the Trudeau progressive trade agenda.

For Mexico, the stakes are high. How will a deal affect campaigning for its July 1 presidential and congressional elections? President Enrique Pena Nieto’s chosen successor, Jose Antonio Meade, is currently running well behind the leftist former mayor of Mexico City, Andres Manuel Lopez Obrador.

And what about Congress? A modest deal won’t meet every local interest.

With effort, an agreement could be voted on during the lame-duck session after the Nov. 6 mid-term elections, but it would be tough. Mr. Trump may well decide to double down by introducing the new NAFTA and rescinding the current version, telling Congress to take it or leave it.

A modest NAFTA agreement would still be a win-win-win. North America would retain its top spot as a competitive trading platform. In time, there will be more improvements, whether through future NAFTA updates or when a future U.S. administration joins the Trans-Pacific partnership.

Monty Hall said that there were “some strange moments” on Let’s Make a Deal, like the time that there was an elephant behind one of the doors. Living in Trump times, we understand what he meant.

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Round Six

Round seven of NAFTA renegotiation creates room for optimism

  • Corwyn Friesen, mySteinbach
  • Posted on 01/30/2018 at 9:31 am

The Vice President of the Canadian Global Affairs Institute says the fact that the renegotiation of the North American Free Trade Agreement will continue is cause for renewed optimism.

With round six of the renegotiation of the North American Free Trade Agreement having concluded in Montreal negotiators are now preparing for round 7 next month in Mexico.

Colin Robertson, Vice President and a Fellow of Canadian Global Affairs Institute. says what is significant coming out of the Montreal Round is that they’re still standing and there will still be negotiations.

There was much concern going into this round that because we were going to taken on those provision relating to importantly dispute settlement, government procurement, rules of origin as it relates to autos, the sunset clause so called, if we were not able to make progress then President Trump or United States Trade Representative Robert Lighthizer might pull the plug.

The fact is we’re still negotiating and there’s going to be another round, this is all good news. I would say that going into this round there was fair bit of pessimism about whether this might be the end. But in fact we’re still standing and going forward.

One of the more significant things was that, in Montreal ten members of Congress led by the Chair of the Trade Committee within the House of Representatives was present and they acted, I think, as a kind of a positive force saying we who represent our constituents would like to see the NAFTA reformed but we would like to see the NAFTA continue.

~ Colin Robertson, Canadian Global Affairs Institute

Robertson notes last week President Trump was in Davos, Switzerland where he delivered, by Trump standards, a fairly moderate speech where he stated, “Yes, America first but not America alone” and he made no reference to the North American Free Trade Agreement. Round seven of the NAFTA renegotiation is set for late next month in Mexico before heading back to Washington in March for what is currently scheduled as the final round of negotiations.

Round 7 of NAFTA Renegotiation Creates Room for Optimism
Colin Robertson – Canadian Global Affairs Institute
Farmscape for January 30, 2018

The Vice President of the Canadian Global Affairs Institute says the fact that the renegotiation of the North American Free Trade Agreement will continue is cause for renewed optimism.
With Round 6 of the renegotiation of the North American Free Trade Agreement having concluded in Montreal negotiators are now preparing for round 7 next month in Mexico.
Colin Robertson, Vice President and a Fellow of Canadian Global Affairs Institute. says what is significant coming out of the Montreal Round is that they’re still standing and there will still be negotiations.

Clip-Colin Robertson-Canadian Global Affairs Institute:
There was much concern going into this round that because we were going to taken on those provision relating to importantly dispute settlement, government procurement, rules of origin as it relates to autos, the sunset clause so called, if we were not able to make progress then President Trump or United States Trade Representative Robert Lighthizer might pull the plug.
The fact is we’re still negotiating and there’s going to be another round, this is all good news.
I would say that going into this round there was fair bit of pessimism about whether this might be the end.
But in fact we’re still standing and going forward.
One of the more significant things was that, in Montreal ten members of Congress led by the Chair of the Trade Committee within the House of Representatives was present and they acted, I think, as a kind of a positive force saying we who represent our constituents would like to see the NAFTA reformed but we would like to see the NAFTA continue.

Robertson notes last week President Trump was in Davos, Switzerland where he delivered, by Trump standards, a fairly moderate speech where he stated, “Yes, America first but not America alone” and he made no reference to the North American Free Trade Agreement.
Round 7 of the NAFTA renegotiation is set for late next month in Mexico before heading back to Washington in March for what is currently scheduled as the final round of negotiations.
For Farmscape.Ca, I’m Bruce Cochrane.

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NAFTA: Round Six

Canada faces angry Americans in pivotal sixth round of NAFTA talks

The Canadian Press
January 21, 2018

Canada will be hosting an annoyed and angry United States as the sixth round of talks in the North American Free Trade Agreement renegotiation unfold over the coming week.

The Trump administration is making known its displeasure about Canada’s contributions to date and demanding progress over the marathon 10-day session.

Multiple sources aware of the U.S. administration’s views say the acrimony has a variety of causes, including Canada’s recent decision to file a sweeping complaint about U.S. trade practices at the World Trade Organization and its pursuit of a progressive trade agenda that includes Indigenous and labour provisions.

The rhetoric around its implacable rejection of the most controversial U.S. positions — raising continental content provisions on automobiles, scrapping a dispute resolution mechanism, limiting Canadian access to U.S. procurement, and instituting a five-year sunset clause — as well as bitterness over apparent leaks are all fuelling the U.S. animosity towards Canada, say sources.

Sources familiar with the Canadian position dismiss all that and say the tone at the negotiating table is professional and cordial, and that Canada is prepared to table counter-proposals in order to make progress.

They say Canadian negotiators are making constructive proposals to find common ground with the Americans on what some have called poison pills designed to kill the deal.

Indeed, Canada, the U.S. and Mexico are showing signs they all want to see tangible progress in this round in order keep the negotiations on track, and discourage U.S. President Donald Trump from announcing his intent to withdraw from NAFTA.

It will be another week before Foreign Affairs Minister Chrystia Freeland, American counterpart Robert Lighthizer and Mexico’s Ildefonso Guajardo arrive in Montreal on Jan. 29 to close the extended round that gets underway earlier than planned on Sunday.

The way some see it, Lighthizer is in no hurry to come back to Canada.

“The feeling of ill will between Bob Lighthizer’s office and the Canadians — I don’t think you can underestimate it,” said Sarah Goldfeder, a former U.S. diplomat who now represents American clients in an Ottawa consultancy.

“He’s extremely frustrated with China and Canada,” added Goldfeder.

“Those are the two countries he thinks are being most unfair to the United States … Those are the ones taking up a good chunk of his time, and not in positive ways.”

Goldfeder noted that when Freeland went to Washington two weeks ago she met Commerce Secretary Wilbur Ross and members of Congress — but not Lighthizer.

When Guajardo visited later in the month, Lighthizer’s door was open to him, she said.

Colin Robertson, a retired diplomat with extensive experience in the U.S., said the body language between Lighthizer and Freeland is “terrible,” which is telling.

“He’s a bully and she gets under his skin,” said Robertson. “She and Guajardo are amigos. No one would say that about Freeland and Lighthizer.”

Canadian officials say Freeland and Lighthizer intend to meet this week while the two are in Davos, Switzerland for the annual meeting of the World Economic Forum.

Lighthizer isn’t willing to blow up NAFTA over the WTO challenge, but Canada should brace for some bilateral retaliation. Meanwhile, his office isn’t interested in the Canadian progressive trade agenda — entrenching Indigenous, gender and workers’ rights issues in the pact — because it has the whiff of Canada dictating social policy to the U.S., Goldfeder said.

Lori Wallach, the director of Public Citizen’s Global Trade Watch, a group normally at odds with the Republicans, was also critical of the Canadian posture.

“Canada is 100 per cent not engaged. Mexico started engaging in the last month or so,” said Wallach, who knows Lighthizer.

”Probably after the Montreal round, that increases the prospect that there could be a notice of withdrawal.”

Ottawa is defensive. The characterization of Canada as obstructionist is nonsense, and the product of strategic leaking of information, according to another official familiar with the content of talks, and who agreed to speak anonymously citing the sensitivity of the ongoing negotiations.

The official said Canadian and American negotiators, as well as their Mexican counterparts, know each other well and are working methodically in the 30 separate negotiating rooms to make incremental progress.

The official pointed to Freeland’s Jan. 11 comments at the Liberal cabinet retreat in London, Ont. as evidence Canada is doing some “creative thinking” about how to deal with “unconventional” U.S. proposals.

The complaints about Canada’s progressive trade agenda are also a bit rich, the official said, because the real obstacles are more fundamental — the American poison pill proposals that wouldn’t fly in any trade negotiation.

In particular, the official cited the U.S. proposal to ditch the dispute resolution mechanism, saying Americans remember full well that former Progressive Conservative prime minister Brian Mulroney considered that idea a deal breaker during the original Canada-U.S. free trade talks in 1988.

Freeland told CTV’s Question Period on Sunday that the progressive chapters on labour, gender, environment and Indigenous issues are not a problem. She said the Indigenous chapter would be discussed for the first time in Montreal.

Assembly of First Nations Grand Chief Perry Bellegarde said it’s about time — he has pushed Freeland hard on the issue in recent months as part of her NAFTA advisory committee. Bellegarde told The Canadian Press he hopes the Americans and Mexicans support a chapter affirming Indigenous Peoples’ inclusion in the economy.

“Canada is supporting that,” he said.

“Tuesday will be the first formal response by U.S.A., Mexico to that new chapter, and so it’s very important.”

Today’s NAFTA talks are unusual because Canada is being told it needs to give up benefits or lose access to its fundamental trading partner, said Eric Miller, head of the Rideau Potomac Strategy Group in Washington.

“Canada’s economic livelihood is on the line,” said Miller, a former Canadian official who worked on the auto bailout.

“One should expect Canada to be very focused on it, and to react very strongly.”

Mike Blanchfield and Alexander Panetta, The Canadian Press

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