Trade and Gender

U.S. unlikely to accept NAFTA gender chapter with teeth: trade experts

Saturday, September 23rd, 2017
THE CANADIAN PRESS/AP/Judi Bottoni
OTTAWA –  The Liberals want a feminist North American Free Trade Agreement, but trade experts say that will depend on reassuring the United States no one could use it to hold their feet to the fire.

“I think U.S. support for such a chapter (on gender equality) would hinge upon the soft or hard nature of the commitments in any proposal with respect to gender,” said Wendy Cutler, a former trade negotiator for the U.S. government.

“If it’s largely aspirational and has soft commitments, with no dispute settlement and no obligation to accede to other agreements, then I think it’s something the administration would consider favourably,” said Cutler, vice-president of the Asia Society Policy Institute in Washington, D.C.

In other words – no real consequences for failure.

The U.S. and Mexico have already been asking high-level questions about the scope and impact of the proposed chapter on gender equality, according to Angella MacEwen, a senior economist with the Canadian Labour Congress.

“They were looking at the language the Canadians had proposed and were saying, ‘Why would we do this?”’ said MacEwen, who is familiar with that aspect of the talks.

“Would this change anything?”

The answer could be a matter of perspective.

The Canadian Press has not seen the proposed text, but several sources both in and outside of government said it is modelled after the gender chapter the Liberal government added to its free trade deal with Chile.

That pact – the second in the world – had both countries agree that working to include women and girls is key to long-term economic development and reaffirm their commitment to international agreements on gender rights.

They also set up a committee to oversee that work.

It also made clear, however, that nothing in the gender chapter could be subject to the dispute resolution mechanism that applies to the rest of the trade deal.

“The Chile chapter is really weak,” said MacEwen.

It is this kind of symbolism that had the Conservatives pushing back against the idea of wrapping gender equality into the new NAFTA, calling it a distraction from the goals of creating jobs and securing market access for Canadians.

International Trade Minister Francois-Philippe Champagne said the fact that gender rights are on the table at all – and codified in the Canada-Chile deal – is an important step.

“It’s a journey,” he said in an interview.

“The fact that we even have a discussion around what should be the content, how far it should go, what will be the process to review the clause from time to time, for me is already a step forward,” said Champagne.

“The gold standard now needs to include a gender chapter.”

Colin Robertson, a former Canadian diplomat, said he thinks the progressive trade agenda the Liberals have been championing is getting noticed because of the recognition that the many benefits of trade have not been shared equally.

“Gender specifically is really about equal treatment and empowerment, especially of women, and this crosses the North-South-East-West divide,” said Robertson, vice-president and fellow at the Canadian Global Affairs Institute.

“Even Trump recognizes its salience.”

The Liberal government might be bringing gender issues into other areas too.

MacEwen said Canada has proposed language on things like pay equity, child care and women in trades in the preamble to the labour chapter, although they are not hard obligations.

“Canada doesn’t have pay equity, so we wouldn’t be in compliance with the chapter, but it does talk about the importance of moving towards it,” she said.

David MacNaughton, the Canadian ambassador to the U.S., said he expects gender equality to come up during the third round of NAFTA negotiations beginning Saturday in Ottawa.

He also suggested previous talks revealed the Americans are not yet convinced.

“They didn’t immediately sign on,” he said.

Dan Ujczo, an international trade lawyer specializing in Canada-U.S. matters, said there is some concern a chapter on gender could have unintended consequences.

“Can these virtues turn into venom?” said Ujczo.

The concern is that language on parental leave, for example, be used to challenge labour and employment laws in the U.S. that do not grant a year of paid parental leave, which is available in Canada.

“Could some of these broadly worded provisions then be used to attack otherwise legitimate federal and state laws in the U.S.?” said Ujczo, who is with the cross-border firm Dickinson Wright, in Columbus, Ohio.

That is why Ujczo said he thinks Canada will need to put significant effort into reassuring the U.S. administration of President Donald Trump the gender chapter will not be enforceable.

That raises another question.

“An agreement without enforcement is just an agreement to agree and so really, what’s the point?” he asked.

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Liberal Internationalism for the 21st century

How to keep the Western consensus from falling apart

CETA’s just a symptom. Is it too late to get back on track?

Colin Robertson IPOLITICS October 21, 2016

The liberal international order, based on free trade and open markets, is under severe strain. Reform and renewal must begin within the trans-Atlantic alliance of democracies.

These were some of the conclusions of a group of serving and former policy-makers and thinkers, from both sides of the Atlantic, recently brought together by the Ditchley Foundation for a weekend retreat at the Greentree Estate on New York’s Long Island.

Change — economic and social, demographic and environmental — goes beyond shifts in the balance of powers. A host of challenges — nativism, isolationism and protectionism — threaten liberal democracies. Brexit defied conventional wisdom and in the United States Donald Trump channels the angry populism of a vast number of Americans who think the system is not working for them.

The fix to this democratic discontent begins at home, through policies that address inequality while also rethinking how governments can better interact with their citizens.

In a practical sense, this means tax fairness designed to promote inclusiveness and investments in infrastructure that promote sustainable growth. The United States could learn from Europeans’ traditional focus on fairness while the Europeans could take lessons from American innovation and resiliency.

The next step: repair the western alliance. The habits of cooperation have deteriorated and old mistrusts have resurfaced. The U.S. is fed up with carrying the burden of defence, while the Europeans see American standards for the new economy as neo-imperialist.

We need a 21st century version of liberal internationalism that re-endorses free trade and open markets — but makes inclusion and fair distribution dominant themes.

open quote 761b1bThere’s a risk that we’re headed into a period of ‘beggar-thy-neighbour’ mercantilism.

Elected leaders need to explain why we are democracies. We deal with complexity but it is just as important to communicate it — and this requires the support of business, labour and civil society. Current and new mechanisms need to be developed to deal with issues like climate and cyber-security.

Trade has become a particular flashpoint. There’s a risk that we’re headed into a period of ‘beggar-thy-neighbour’ mercantilism. We have moved to a post-tariff world where the barriers are now increasingly regulatory. Fiscal policies will vary — but can we figure out agreed boundaries around currency, taxation and trade adjustment to avoid a race to the bottom? How do we bring to heel global corporations that have perfected tax and regulatory avoidance?

While great powers have weight and capacity, especially in military might, middle powers like Canada are often better at coalition-building and working at the diplomatic seams.

Middle powers are more nimble and they can make a difference when they find their niche. At the United Nations last month, Justin Trudeau promised that Canada is “here to help”.

Specifically, Canada can help bring a focus on gender equality, offer up our experience in the integration of refugees and demonstrate a renewed commitment to peace operations. Can we also figure out a way to export our successful experiment in pluralism?

If the first year of the Trudeau government was about telling the world that ‘Canada is back’, then the years to come must be about visibly demonstrating how, where and what Canada is doing to ‘help’. Words are fine but dollars are better — and we are a long way from our NATO pledge of 2 per cent of GDP for defence and the Pearsonian benchmark of 0.7 per cent of GDP for international development.

The bigger challenge for Mr. Trudeau, as for all democratic leaders, is sustaining commitments for longer than the life of one government. This means creating consensus, across partisan lines and with the public, that will endure changes of government.

Democratic governance today is increasingly about transactions, accountabilities and meeting operational objectives. But good public policy — especially now that the boundaries between what is foreign and what is domestic have effectively merged — depends on finding time to think and reflect.

The Ditchley approach — rigorous policy discussions during a long country weekend — is a throwback to an age before 24-7 news cycles and constant connectivity. Next month’s annual Halifax International Security Forum, with the backdrop of our principal Atlantic port, is a very useful variation on this approach. These kinds of forums may not provide all the answers — but they raise many of the right questions.

In a complicated world, we need more constructive thinking on the practical application of democracy and the liberal international order that sustains it.

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On Stephane Dion

What’s going on with Stéphane Dion?

Is he chopping logic on China, or is he contradicting Trudeau?

Tasha Kheiriddin IPOLITICS September 26 2016

Prime Minister Justin Trudeau was turning heads at the United Nations last week. His chief diplomat, Stéphane Dion, gets mostly eye-rolls these days.

Late last week, the foreign affairs minister appeared to directly contradict the prime minister on the state of discussions with China on a possible extradition treaty that would see Chinese fugitives returned to the mainland — and to China’s highly politicized justice system.

A day after Trudeau stood beside visiting Chinese Premier Li Keqiang and defended the decision to pursue talks, Dion snapped at a Globe and Mail reporter who had called for comment on the story: “Your paper should check the facts. There is no negotiation. To write like pretending it is, it is wrong. Stop that please.”

Retired diplomat Gar Pardy described the exchange in one word: “Bewildering.”

“I doubt ‘negotiations’ in the narrow sense of the word are on,” he told me. “It’s more like the two governments agreed to sit down and discuss (the parameters). But why we have this confusion doesn’t make any sense.”

Pardy wonders if language is the issue — specifically the word “negotiations”.

“Language is a bit of a problem for Dion … There’s no reason why he needs to speak in English — he can say what he wants to say in French — but I was surprised at the snappiness to the Globe and Mail. I have not seen something like this ever before.

“If you can’t get your act together on something, then you kind of wonder what else is going on.”

Other observers are a bit more charitable. Retired diplomat Colin Robertson, now a senior strategic advisor for McKenna, Long and Aldridge LLP, suggested that Dion’s comments may be a natural side effect of Trudeau’s commitment to a more cabinet-driven approach to government.

“Mr. Trudeau has sought to restore cabinet government and this will mean ministers take the lead in their portfolios. This is always complicated in foreign affairs where there is inevitable overlap between prime ministers and foreign ministers.”

open quote 761b1bThis is a diplomatic dance of the highest order. The last thing anyone needs is a minister who keeps stepping on his partner’s toes.

Robertson went on to add that the episode might actually have a silver lining for Canada: “In dealing with the Chinese, who are often opaque, a bit of ambiguity on our part may not be a bad thing in advancing Canadian interests, especially when the game is long, as it usually is with the Chinese.”

But this isn’t the first time Dion has undermined the official government line as foreign affairs minister. When the Trudeau government decided to stick with a controversial arms deal with Saudi Arabia negotiated by the Stephen Harper government, both Dion and the PM said that the deal was done and Canada had no choice but to follow through. “We have said during the campaign — the prime minister has been very clear — that we will not cancel this contract or contracts that have been done under the previous government in general,” Dion told the CBC’s Power and Politics in January 2016.

As it turned out, this assertion was false: The deal had not been finalized, because doing so required the signing of export permits — by none other than the foreign minister. Months later, Dion quietly OK’d these in April 2016 — without Trudeau’s input. Dion saw nothing wrong with this: “It’s not a cabinet decision. It’s a minister’s decision,” he said during an editorial board meeting with The Globe and Mail.

In defence of that choice, Dion cited the example of Sweden, which had reneged on a military contract with the Saudi regime over human rights concerns. “Sweden did a bit the same about a contract and the reaction has been very harsh. Saudi Arabia reacted in a way that cut many things … They cancelled a contract and the reaction has been very harsh.”

That wasn’t entirely accurate, either. When contacted by the Globe, a spokeswoman for the Swedish Foreign Ministry insisted that “we have not experienced any economic effects due to the issue that you mention and our bilateral relations with Saudi Arabia are good.” While it is true that Saudi Arabia recalled its ambassador and temporarily suspended business visas for Swedes after the incident, the paper reported that the two countries began normalizing relations just a few weeks later, and that there were no lasting consequences “other than a decline in military trade.”

The minister of foreign affairs is Canada’s chief diplomat. The job requires both the careful use of language and the maintenance of a unified front with the prime minister. Projecting an image of organization and strength is critical, especially on such a sensitive issue as the negotiation of an extradition treaty with China.

“An extradition treaty a fairly complex affair,” Pardy said. “It’s all based on issues of dual criminality — the Chinese cannot ask to extradite persons for a crime that is not a crime in Canada, and vice versa.”

In other words, this is a diplomatic dance of the highest order. The last thing anyone needs is a minister who keeps stepping on his partner’s toes. Dion needs to rein in his pedantic impulse to be uber-correct, and get better in sync with the PMO. If not, Trudeau would be wise to assign him a different dance card in the next cabinet shuffle.

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Obama’s State of the Union and Canada

 

Obama’s final year — and what comes after

IPOLITICS

By | Jan 11, 2016 8:57 pm |
Canadian Prime Minister Justin Trudeau, left, takes part in a bilateral meeting with U.S. President Barack Obama at the APEC Summit in Manila, Philippines, on Thursday, November 19, 2015. THE CANADIAN PRESS/Sean Kilpatrick

Canadian Prime Minister Justin Trudeau, left, takes part in a bilateral meeting with U.S. President Barack Obama at the APEC Summit in Manila, Philippines, on Thursday, November 19, 2015. THE CANADIAN PRESS/Sean Kilpatrick

On Tuesday night, President Barack Obama goes to Capitol Hill to deliver his seventh State of the Union (SOTU) address. It’s going to be an important speech, because it’ll give us insight into the president’s thinking, his priorities and his plans for his final year in office.

Look for him to defend his emphasis on diplomacy and multilateralism in dealing with ISIS and hot spots in the Middle East, as well as American relationships with China and Russia. Expect him to again reassure Americans on their domestic security in the aftermath of the Paris and San Bernardino terror attacks, and to press home the argument he made in his recent Town Hall — that his use of executive authority to strengthen background checks on gun purchases will make Americans safer.

President Obama can look back on a year of major foreign policy achievements: the Iran nuclear deal; curbing the Ebola epidemic in Africa; renewed relations with Cuba; achieving congressional ‘fast-track’ and a negotiated Trans Pacific Partnership to complement the security ‘pivot’ to Asia; and the multi-nation climate deal out of Paris.

Imperfect as it may be, the Affordable Care Act (or ‘Obamacare’) is in place and is working. Despite continuing Republican efforts to scuttle it, it will be part of the Obama legacy and eventually it might bring down health costs. The OECD says the U.S. currently spends 16.4 per cent of GDP on health care, compared to 10.2 per cent in Canada.

President Obama will point to economic conditions that are now the best they’ve been since he took office; he can argue, in other words, that the first term stimulus intervention worked. The U.S. unemployment rate has dropped to 5 per cent (versus 7 per cent in Canada). Applications for unemployment benefits are at a four-decade low.

The U.S. also is expected to lead the G7 in growth next year (2.8 per cent, compared to 1.7 per cent in Canada). Supply chain integration should boost Canadian production as long as our goods and people can easily cross the border. This means Prime Minister Trudeau’s main ask of President Obama should be more efficient border access, including for business travel.

While the U.S. economic picture is good, the distribution of rewards continues to be skewed to the top of the ladder. Those with only a high school education are the worst-off, while university-educated millienials, with more debt, are also making less compared with their parents and older siblings.

A growing sense of inequality is exacerbating political discontent. Here the divide between those on one side of the 49th parallel and those on the other is profound.

Over 60 per cent of Canadians think the country is heading in the right direction and support the Trudeau government. In the United States, meanwhile, the mood is gloomy: 65 per cent of Americans think their country is headed in the wrong direction and only 44.5 per cent say they approve of President Obama’s performance. It’s even worse for Congress, which has only a 13.4 per cent approval rating.

open quote 761b1bOne-time GOP presidential aspirant Scott Walker wanted to build a wall across the Canada-U.S. border. There will be more dumb ideas coming — ideas that we’ll need to monitor and address.

These numbers go some distance in explaining the appeal of Bernie Sanders on the left and Donald Trump and Ted Cruz on the right. The Feb. 1 Iowa caucus and Feb. 9 New Hampshire primary will give hard evidence of how far Americans will go in expressing their frustration.

To explain what’s happening in American politics, The Atlantic recently featured essays by conservative David Frum and liberal Peter Beinart. The Canadian-born Frum writes that the “angriest and most pessimistic people in America are the people we used to call Middle Americans.” Their economic insecurity and economic nationalism sets them apart from traditional Republicans. The GOP, says Frum, is split between its base and its elite. Where Mitt Romney ran on “tax cuts, budget cuts, deregulation, free trade”, this time the Republican base wants its social security entitlements, opposes free trade and would tax the rich more.

The Trump phenomenon, writes Peter Beinart, is partly a backlash against the Occupy Movement’s left-wing militancy and the racial strife symbolized by the ‘Black Lives Matter’ movement. But the Trump noise, says Mr. Beinart, “is louder than it is strong. Instead of turning right, the country” — and the Democratic party — “is still moving to the left.” The Democratic elite has moved leftwards, notably on climate change and sexual rights, and he notes presumptive nominee Hillary Clinton’s criticism of the Trans-Pacific Partnership and her promise of tougher financial industry regulation.

This year’s unconventional U.S. presidential race is entertaining — but it should not divert our attention from what are likely to be some significant policy shifts with the next administration, whether it’s Democrat or Republican.

Different approaches on trade, security, immigration and financial regulation will affect Canadian interests. Wisconsin Governor and one-time GOP presidential aspirant Scott Walker wanted to build a wall across the Canada-U.S. border. There will be more dumb ideas coming — ideas that we’ll need to monitor and address.

We also need to pay attention to those contesting Congress and states’ gubernatorial and legislative contests. A third of the Senate is up for re-election, along with the 435 members of the House of the Representatives.

We should meet regularly with Mexico (they have over 50 offices in the U.S., compared to our 15) to share intelligence and planning. U.S. politicians have a tendency to take a ‘one-size-fits-all’ approach to both borders and we need to work with Mexico to combat silly and ill-conceived policy ideas. Strengthening North American competitiveness should be a trilateral ambition.

Meanwhile, we need to carefully listen what Obama has to say in the SOTU. There are opportunities — notably around the March State dinner and the North American Leaders’ summit — to advance our interests. We have many shared interests on issues like trade and climate. Now we need to develop harmonized or compatible policy regimes. President Obama is not taking his foot off the gas and there’s still much we can accomplish together before he leaves office next January.

 

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Canada and Iran-Saudi Tensions: You need to be there to be useful

Harper government’s break with Iran leaves Canada without influence in Saudi spat: experts

Iranian demonstrators chant slogans and hold anti-Saudi placards and flags during a rally to protest the execution by Saudi Arabia last week of Sheikh Nimr al-Nimr, a prominent opposition Saudi Shiite cleric, by Saudi Arabia, in Tehran, Iran, Monday, Jan. 4, 2016. (AP Photo/Vahid Salemi)

Iranian demonstrators chant slogans and hold anti-Saudi placards and flags during a rally to protest the execution by Saudi Arabia last week of Sheikh Nimr al-Nimr, a prominent opposition Saudi Shiite cleric, by Saudi Arabia, in Tehran, Iran, Monday, Jan. 4, 2016. (AP Photo/Vahid Salemi)

The Harper government’s closing of Canada’s embassy in Tehran in 2012 leaves Ottawa virtually impotent to exercise any kind of influence to reduce the inflamed tensions between Saudi Arabia and Iran, former diplomats and foreign affairs experts suggest.

“If we’re not in one of the two critical capitals, it’s hard to bring analysis and on the site expertise. We just don’t have that,” said Colin Robertson, vice president of the Canadian Global Affairs Institute and a former Canadian diplomat.  “Until we have people on the ground in Tehran, we’re handicapped.”

Tension between Saudi Arabia, the major Sunni Muslim power in the region and Iran, the major Shiite player, has sharpened over the past several days following the execution by Saudi Arabia of a prominent Shiite cleric, Nimr al-Nimr along with 46 others accused of terrorism.

Iranian protestors attacked the Saudi embassy in Tehran, the capital of Iran, following the news, causing Saudi Arabia to announce it was cutting diplomatic ties with Iran — and prompting multiple Middle Eastern Sunni countries, including Bahrain and the United Arab Emirates, to follow suit and restrict their own relations with the Islamic Republic.

The Harper government cut off diplomatic relations with Iran in 2012 and formally listed it a state sponsor of terrorism. All Canadian diplomats were pulled out of the country, leaving Canada powerless to act even as a back-channel between the two rivals in the current conflict.

“Iran would not be willing to even consider, let alone accept, a conciliatory role for Canada,” said Thomas Juneau, former strategic analyst on the Middle East for the Department of National Defence and an associate professor with the University of Ottawa.

Prime Minister Justin Trudeau said during the election campaign that he would restore diplomatic relations with Iran if elected but has not yet said when that will happen.

Conservative foreign affairs critic Tony Clement said Monday on CBC News’ Power & Politics that Canada should hold off restoring relations with Iran until it shows it is willing to behave better.

But any changes to Trudeau’s plans are unlikely, experts say, because the conflict is throwing the need for accurate intelligence into sharp relief.

“I think the pressure is just to get a more informed view of what’s happening in the region by having diplomatic representation on the ground,” said Scott Heatherington, former director of then-Department of Foreign Affairs, Trade and Development’s foreign intelligence division. “I would expect that to continue, notwithstanding what’s happening this week.”

Adam Chapnick, a professor at the Royal Military College specializing in Canadian foreign policy, agreed, saying the conflict emphasizes the need for Canada to get people on the ground in Tehran if it wants to have any role in influencing or even mediating outcomes in the Middle East.

Canada’s long-term economic and security interests also mean that Iran is too important a player to simply ignore, as the Conservatives did, Chapnick said.

“If you want to have influence in a region, you need to have eyes and ears on the ground,” he said.

Foreign Affairs Minister Stephane Dion issued a statement Monday morning expressing concern at the executions and the potential they have for further inflaming sectarian tensions between Sunnis and Shias.

Global Affairs Canada also declined a request from iPolitics to speak with Canada’s ambassador to Saudi Arabia, offering instead a brief emailed statement.

“Canada regrets the incidents which have led to Saudi Arabia’s decision to sever its diplomatic relations with Iran,” departmental spokesman Francois Lasalle said. “We urge countries of the region to work with all communities to defuse these tensions and promote reconciliation. We also call on Iran to protect diplomatic premises on its territory as per the Vienna Convention.”

The government also said Monday the strife will not impact the $15-billion deal it has with the Saudi government for the sale of light armoured vehicles.

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Canada in the World

 

It’s time for Canada to stop sleepwalking across the global stage

By | Sep 27, 2015 8:58 pm |

THE CANADIAN PRESS/Adrian Wyld

THE CANADIAN PRESS/Adrian Wyld

Canada’s international brand needs a make-over. It starts with a strategic plan, focused priorities and specific initiatives for international re-engagement.

In preparing for Monday’s foreign policy debate, our party leaders should read Roland Paris’ letter to the next prime minister, Ian Brodie’s After America and a recent study by Robert Greenhill and Meg McQuillan assessing Canada’s global engagement.

Greenhill and McQuillan observe that spending on defence and development assistance has fallen by half since 1990. The drift downwards — from 2.4 per cent to 1.2 per cent of GDP — began in 2000. Canada, they argue, has become an international “free rider”.

Earning our way back into good global citizenship requires money and time. Budgets, especially for defence and development, require sustained commitments. The next prime minister must devote time to building relationships with his counterparts, most importantly with the U.S. president.

Our first priority must be developing a plan for Canada’s international re-engagement. Start with three questions:

  • Where do we want to play a role in the world and why?
  • What do we want to achieve?
  • How much will we spend?

Any international re-engagement strategy needs to keep in mind the following:

  • One in five Canadian jobs depends on trade. Trade — both exports and imports — accounts for more than 60 per cent of our GDP. Despite expanding our trade agreements, our share of global exports has fallen in recent years.
  • Shielded by the U.S. security umbrella, we do defence on the cheap — spending just one percent of GDP. Our continental and collective security obligations, especially maritime, need attention. When it comes to military procurement, especially for our navy, we need to put defence readiness ahead of the jiggery-pokery of industrial and regional benefits.
  • Our birth rate is below replacement level, so we need a vigorous immigration program to attract talent with commensurate programs to help newcomers settle into Canada. Half of the people living in our largest city, Toronto, were born outside of Canada.

Good international citizenship means a re-commitment to multilateralism and a healthy development assistance program. Creating economic and political stability depends on democratic governance, something Canada does better than others, so we should make better use of institutions like the Parliamentary Centre and International Development Research Centre.

Our leverage in foreign capitals, especially Washington, depends on the intelligence and insights gathered by our diplomats. The Foreign Service needs to be revived and resourced, with more overseas offices. Let our ambassadors experiment with different forms of public diplomacy.

open quote 761b1bIn life’s lottery, being Canadian is the top prize. We are a comfortable country in an increasingly uncomfortable world. But with privilege comes responsibility.

To signal that Canada is back in the multilateral arena, we should consider the following initiatives:

  • Expanding our resettlement of refugees and asking the United Nations High Commissioner for Refugees what more Canada can do to help.
  • Putting a battalion into blue berets in response to UN Secretary General Ban Ki-Moon’s plea for more peacekeepers.
  • Re-joining the UN Convention to Combat Desertification in advance of the Paris Climate conference.
  • Declaring that we will soon seek election to the UN Security Council, running as a voice for the middle powers.

Our second priority should be rebuilding and expanding the North American relationship. McKinsey estimates that, by 2035 — through improving trilateral economic integration — North America could achieve cumulative productivity gains yielding another $10 trillion in trade flows and $1.5-$2.2 trillion in cumulative GDP growth. How can the three of us work together to promote our collective prosperity?

We should challenge the U.S. and Mexico to help us take North American integration to the next level — unifying our approach on economic, social and global issues. Getting the North American platform right — a different model than that of the EU — will help us grow supply chains and diversify our markets overseas.

We can lead in developing a new view for North American integration through the following initiatives:

  • A North American competitiveness agreement that addresses continental labour mobility, regulatory harmonization, and infrastructure priorities. For financing we should join and broaden the scope of the North American Development Bank.
  • A North American approach to the Paris climate conference that shares, for example, the best practices in tailings, water, land and greenhouse gas developed by our oilsands industry, or the regulatory excellence of the Alberta Energy Regulator.
  • Strategic engagement with Mexico, starting with the lifting of the visa. Make Central America the priority for our development assistance.

Our third priority should be to make the changes at home necessary to implement our expanded global role.

While the United States will always be our main market, we need to diversify. Disputes on softwood lumber, Keystone XL and country-of-origin labeling should have taught us that dependence on one market dooms us to be price-takers. If we want a global price we need to get our goods to global markets. This means building the infrastructure — coast-to coast pipelines, LNG terminals, ports, rail and road.

Projects of national scope require national consensus. All levels of government need to collaborate with business, environmental groups and First Nations. Look to the Boreal Forest Agreement as a good example of public-spirited cooperation.

We need new ideas on managing our market economy against the changing international landscape. The Macdonald Royal Commission on Canada’s Economic Union (1982-85) is the model for developing new thinking on our national and international development prospects. The Macdonald Commission generated the intellectual capital behind free trade, the GST, balanced budgets and pension security. Completing its work in less than three years, the Commission cost just $21 million.

In life’s lottery, being Canadian is the top prize. We have an abundance of land and resources and a friendly neighbour. We are a comfortable country in an increasingly uncomfortable world.

But with privilege comes responsibility. We can’t do everything — but what we do should advance our interests and promote our values. International engagement — bilateral and multilateral — accomplishes both objectives. It is with this principle in mind that the next government needs to reset Canadian foreign policy.

Colin Robertson is vice president and a Fellow with the Canadian Global Affairs Institute

The case for Ballistic Missile Defence

Time to join the missile shield, Canada iPolitics Insight

By | Feb 10, 2014

    The Israeli Iron Dome defense system in action in the port town of Ashdod, Nov. 15, 2012. (AP Photo /Tsafrir Abayov, File)

    This article is based on a presentation made by the author to the Senate National Security and Defence Committee.

    When stormy weather threatens, prudent people carry an umbrella. It is time for Canada to find shelter under the umbrella of ballistic missile defence (BMD).

    The threats to Canadians are real. North Korea has developed a road-mobile ballistic missile capability that’s intended to target the U.S. but — given its wonky aim — could just as easily hit Canada. Iran has an arsenal of ballistic missiles. And what if Pakistan, with its missiles and nuclear weapons, were to go rogue?

    Risk assessments conclude that in the coming years we will see more bad actors with access to warheads, intercontinental missiles and weapons of mass destruction — nuclear, chemical and biological.

    Missile defence has been embraced already by our 27 partners in NATO and our friends and allies in the Indo-Pacific: Australia, Japan and South Korea.

    We share information in early warning and attack assessment with the United States through our participation in NORAD. But when it comes time to make the critical launch decisions, our officials literally have to leave the room.

    The algorithms developed by U.S. Northern Command to protect the American homeland do not include Canadian cities like Calgary, Edmonton, Toronto or Montreal.

    The core principle of our Canada First Defence Strategy is the protection of Canadians. Membership in BMD means we are full partners in the conversation on defending North America, including Canada. This is why we need to join BMD.

    Critics of BMD say it doesn’t work. They describe it as a latter-day Maginot Line: unreliable, costly and provocative. NORAD, they argue, provides sufficient defence — but they’re forgetting that, at the critical moment, we must leave the room.

    BMD is not Ronald Reagan’s ‘Star Wars’ initiative, with its improbable futuristic weapons and enormous cost. The current system has no space-based weapons. Instead, it uses kinetic energy to stop warheads.

    New technology, research and constant testing have made BMD a reasonable shield. The Israelis’ Iron Dome demonstrates the worth of anti-missile technology.

    Shouldn’t Canada have a say in the development of the North American BMD architecture before the emergence of a combined ICBM/nuclear threat?

    With the system essentially in place, participation does not come with an admission charge. Any future costs can be scaled and shared within the alliance.

    Foes of BMD also claim that it makes us too reliant on the United States. It’s the same, tiresome old argument typically applied to questions of trade and commerce — but who would argue that free trade has not been good for Canada?

    The whole point of collective security is to contribute according to our capacity for our mutual security and protection. Protecting Canadians (and Americans) was the logic of the original DEW line and NORAD, the bi-national aerospace defence agreement which has served us since 1958 and now includes aspects of maritime warning. Shouldn’t Canada have a say in the development of the North American BMD architecture before the emergence of a combined ICBM/nuclear threat?

    During the cruise missile debate, Prime Minister Pierre Trudeau remarked that some Canadians “are eager to take refuge under the U.S. umbrella — but don’t want to help hold it.” The other NATO partners have signed on to missile defence. So have Australia, Japan and South Korea.

    Some critics suggest BMD is somehow morally wrong. But we’re living in the world, not Elysium. We can’t be sure that a missile aimed at the United States isn’t going to strike Canada. Reframe the moral argument and ask yourself: Why doesn’t the Government of Canada have a voice in how BMD may be used? One could argue that it is a moral imperative for the government to have such a say when the target could a Canadian city.

    BMD is part of the continuum of capabilities that contributes to the Alliance and protects Canadians. Taking part in BMD surveillance could save Canadian lives in the event of a missile attack, and provide early warning to the rest of the Alliance.

    By being part of the defensive shield, we strengthen the deterrent effect of BMD. This could include missile defence capacity in our new warship, or using our submarines to track potentially hostile attack subs.

    Participation in BMD is both an insurance policy for our homeland and a renewed commitment to contemporary collective defence. Canada has benefitted greatly from that collective defence, with marginal premiums. Collective defence means preparation and commitment. “Only when our arms are sufficient beyond doubt,” observed John F. Kennedy, “can we be certain beyond doubt that they will never be employed.”

    Changed circumstances, Alliance solidarity, and self-preservation oblige us to revise our policy. BMD must now be incorporated within our ‘Canada First’ defence strategy.

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    Primer to the G20 in St. Petersburg

    The Rumble in Russia: A G20 primer iPolitics Insight

    By | Sep 5, 2013 2:02 pm | iPolitics Subscription Required | 0 Comments

    A general view of the round table meeting at the G-20 summit in St. Petersburg, Russia on Thursday, Sept. 5, 2013. The threat of missiles over the Mediterranean is weighing on world leaders meeting on the shores of the Baltic this week, and eclipsing economic battles that usually dominate when the G-20 world economies meet. (AP Photo/Sergei Karpukhin, Pool)

    Today and tomorrow, the leaders of the major economic nations, their finance ministers and central bankers will meet to discuss global economic and financial issues in St. Petersburg’s Constantine Palace.

    The summit takes place against the backdrop of the Syrian crisis and the recent coup in Egypt; these issues inevitably will spill over into informal discussions. On the economic front leaders face the challenges of joblessness, especially youth unemployment in Europe, the relative slowdown in the Chinese economy with its attendant effects on other developing economies, and the sluggish recovery in developing nations. We are also witnessing competitive devaluations and the creeping rise of protection.

    Meet the G20

    The G20, originally a meeting of finance ministers, their deputies and central bankers, was formed in 1999 in the wake of the Asian and Russian financial crisis with then-Finance Minister Paul Martin playing a lead role. It was raised to the leaders level in the wake of the 2007-2008 financial crisis when President George W. Bush convened a summit in Washington in November, 2008 to address the economic crisis.

    G20 leaders reconvened in London (April, 2009) in Pittsburgh (October, 2009) in Toronto (August, 2010) in Seoul (November, 2010), in Cannes (November, 2011) and in Los Cabos, Mexico (June, 2012). Next year’s G20 will be hosted by Australia.

    The leaders’ summit is the culmination of a year-long process of meetings which — in addition to the discussions of central bankers, finance ministers (whose meetings under Russian leadership also included labour ministers) and sherpas — includes sessions involving representatives of labour, business, think-tanks, youth, girls (Belinda Stronach was a driving force behind the Girls 20 summit) and civil society.

    The member countries include the G8 nations — Canada, United States, Japan, France, Germany, Italy, the United Kingdom and Russia — as well as Argentina, Brazil, Mexico, Australia, China, India, Indonesia, Korea, Turkey, Saudi Arabia and South Africa. Their economies cover two-thirds of the world’s population and account for over 80 per cent for world trade and global production.

    The heads of the International Monetary Fund and World Bank participate, as do the heads of the European Union and European Commission and the head of the European central bank. Other national leaders also have been invited to discuss specific topics, such as development.

    The G20’s ‘standing’ agenda

    The G20 has developed a de facto standing agenda. First item on that agenda is the restoration of a multitlateral trading system. Expect leaders to address the topic, but there is no sense the WTO Doha Round will be concluded soon. Today, movement on multilateral trade rests with the Trans-Pacific Partnership and a series of smaller regional groupings.

    Another item on that agenda is protectionism. The 2013 Global Trade Alert observes that over 3,330 new government protectionist measures — trade remedies, local content requirements, discriminatory regulatory practices — have been reported since 2008. A record 431 measures were imposed in the last year in what the GTA calls “a quiet, artful, wide-ranging assault on free trade”.

    The G20 nations account for 65 per cent of protectionist measures, notwithstanding their pledge for a ‘standstill’ at the London 2010 summit.

    The agenda also includes international investment. Barriers to investment continue to plague G20 economies. Governments need to further open their economies.

    Another agenda item: fiscal policy. This means saving in good times so you can spend in recession and then get back to balance as quickly as possible.

    Finally, there is sustainable development. It is easy to look at the Millenium Development goals as a glass half-empty. However, significant progress has been made in increasing the resources of international financial institutions, building infrastructure, improving food security, financial inclusion and reducing the cost of remittances.

    Developing countries now account for more than half of the world’s economic activity and more than half of global exports. China is now the number one world exporter. A recent report from the Lowy Institute argues that development and global economic issues must be ‘mainstreamed’ into the G20’s core agenda.

    What does the St. Petersburg summit want to achieve?

    On the website created for St. Petersubug, Russian President Vladimir Putin said that he had two objectives for the summit: achieving balanced growth and job creation. The ‘watchwords’ of the meeting will be:

    • Growth through quality jobs and investment;
    • Growth through trust and transparency;
    • Growth through effective regulations.

    Eight priority areas have been identified:

    1. A framework for strong, sustainable and balanced growth;
    2. Jobs and employment;
    3. International financial architecture reform;
    4. Strengthening financial regulation;
    5. Energy sustainability;
    6. Development for all;
    7. Enhancing multilateral trade;
    8. Fighting corruption.

    What is it likely to achieve?

    Don’t expect a lot. Watch for action on the following:

    Implementation of the IMF’s 2010 Quota and Governance Reform. IMF Executive Director Christine Lagarde says that “completing the 2010 quota and governance reform is essential to the Fund’s legitimacy and effectiveness.” It requires a doubling of the IMF quota resources and reviewing the IMF quota formula in order to adequately reflect the current weights of its members.

    Resurrecting the Doha Round. Currently on life support, a global agreement could result in GDP increases of approximately $960 billion and create over 18 million jobs worldwide, according to a study by the Peterson Institute’s Gary Huffbauer and Jeff Schott prepared for the International Chamber of Commerce. At their April meeting in Doha, the ICC argued for progress in five areas:

    • Concluding a trade facilitation agreement;
    • Implementing duty-free and quota-free market access for exports from least-developed countries;
    • Phasing out agricultural export subsidies;
    • Renouncing food export restrictions;
    • Expanding trade in IT products and encourage growth of e-commerce worldwide.

    Exchange rate and incentives competition. The number of governments competing for foreign investment by lowering their tax rates has increased. As Martin Wolf recently observed, “policies aimed at export-led growth impose contractionary pressure on trading partners, particularly in times of deficient aggregate demand and ultra-low interest rates. In the last decade, we have seen the largest and most persistent exchange rate interventions ever.”

    Structural reform. The OECD has encouraged the G20 to embrace structural reforms and a switch in emphasis from politically-charged current account rebalancing to labour product market reforms for medium-term growth and a growing consensus on fiscal frameworks.

    The division over how to deal with debt-to-GDP. The U.S. and others favour a more flexible stance. They are not likely to agree on specific quantitative fiscal targets but likely will concentrate instead on reducing debt-to-GDP over the medium term.

    What does Canada want?

    Prime Minister Harper wants the summit to result “in commitments for further action on key issues such as financial regulation and trade liberalization.”

    Our main objectives include commitments toward:

    • Greater transparency: Canada and Russia have co-chaired the G-20 Anti-Corruption Working Group.
    • Accountability: In tracking progress on commitments made at previous G-20 Summits and especially on the Development Working Group commitments established at the Toronto G-20 Summit.
    • Financial sector reform: G20 members have agreed to implement the regulatory requirements of Basel III, the international standard for stronger regulation of the banking sector.

    Beyond the summit agenda, a great deal of other business gets done at these meetings. Mr. Harper can be expected to discuss the Canada-Europe trade agreement with European leaders, progress on the Trans Pacific Partnership and the always-important Canada-U.S. agenda with President Obama.

    So do we really need a G20?

    Yes. The G20 filled a gap in the architecture of top-table meetings.

    The permanent members of the Security Council — Russia, China, France, Britain and the United States — represent the world of 1945 and the early Cold War. As we have seen over Syria and other crises, getting the Security Council to act constructively is very difficult. Reforming the Security Council to make it more representative of today’s geo-political situation has been an exercise in futility.

    The G-8 group is Eurocentric and does not include China, India or Brazil. So the G-20 made sense.

    Like the G8, much of the value of the G20 is in its process. More people will work on the draft of the final communiqué than will actually read it but the process of getting there is what really matters. The ongoing meetings between central bankers and finance ministers (the original G20) now include separate discussions with business, civil society and think-tanks.

    What matters at these summits is not the prepared statements at the main table but the frank discussions and informal meetings that take place in the corridors and meeting rooms around the main conference. Winston Churchill, who popularized the word ‘summitry’, observed that ‘jaw-jaw’ between leaders is better than ‘war-war’.

    Further reading

    The best Canadian sources for G20 documentation with a chronology of past summits is at the University of Toronto’s G20 Information Centre, managed for years by John Kirton. The Center for International Governance Innovation (CIGI) in Waterloo has done excellent work on the G20, especially its priorities for the G20 published for the St. Petersburg summit. This primer owes much to the session recently held at the Rideau Club, moderated by CIGI’s Fen Hampson, with Canadian Council of Chief Executives CEO John Manley, Russian Ambassador Georgiy Mamedov and CIGI’s Domenico Lombardi and Rohinton Medhora.

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    Defence and diplomacy in an age of austerity

    As part of their background series on the Canadian budget ipolitics published ‘Defence and Diplomacy in an Age of Austerity’ and in The Mark as Defence in an Age of Austerity: ‘Projecting Canadian ‘soft power’ means developing ‘hard power’ first’

    Posted on Mon, Jun 6, 2011, 12:22 am by iPolitics special report

    To slay the deficit and at the same time create jobs and sustain growth is now the abiding leitmotif of western governments living in an age of austerity. It is a tall order, especially given globalization and the competition from India, China and Brazil, and, in most western nations, the challenges of an aging population.

    Approaches vary. The British are applying a latter day version of Thatcheromics. In France, Sarkozy has rolled back benefits and the retirement age. The Greeks, Irish and Portuguese are enduring IMF-imposed restraint; they are likely to have more company in their misery. For now the grumbling German taxpayers keeps afloat the idea of Europe. A divided America is debating all options but eventually they’ll have to settle for a combination of less services and more tax.

    In this slough of western despair, the Canadian situation is comparatively better, but the Harper Government’s deficit commitments means hard choices.

    The only federal program with some immunity will be the First Nations, for whom most Canadians, including the prime minister, acknowledge an abiding obligation. The burden will be shared with the provinces and municipalities, but the effective counterweight lobby of teachers, nurses and the public on their local MPs will mitigate some of pain on the biggest spending programs.

    Foreign and defence policy lack natural constituencies, although both the development assistance and, especially, defence procurement, spend billions in contracting for goods and services.

    Yet surveys regularly tell us that Canadians care about the wider world. More so than most other countries we derive our sense of national identity from our internationalism. In part, this is a reflection of the fact we are increasingly a people with roots in every corner of the world.

    Once the tide of settlers flowed across the Atlantic, since 1980 newcomers have crossed the Pacific and we now have a strong representation from the Indian and Chinese Diasporas. Our pluralism is a source of pride and envy – if the Canadian experiment in federalism and diversity can work so can others.

    A strong defence and activist diplomacy should enjoy non-partisan interest and support. But the case has to be made. 
Joe Nye once lamented that while we had demonstrated an abundance of ‘soft power’ we had forgotten that its successful application first required sufficient ‘hard power.’ Comparatively, we do defence on the cheap, spending a little over one per cent of our GDP. The Americans, by contrast, spend about 5 per cent and the British about 2 per cent.

    As Gen. Walt Natynczyk has observed, we have the best ‘little’ Navy, Army, Air and Special Forces in the world. The Canadian Forces have performed marvelously abroad – fighting on the ground in Afghanistan, providing relief in Haiti and now in the air and sea Libyan campaign – and at home, as demonstrated most recently in flood relief on the Richelieu and Assiniboine.

    The creation of Canada Command and the correct priority we put on the home front also underlines the importance of our putting resources and attention toward our Reserves – Canada’s ‘citizen soldiers.’

    Ours is the longest coastline in the world – enough to circle the equator six times. Always a sea-trading nation, we have become a nation of traders, with a record number of discussions underway to further trading opportunities with, for example, the European Union, China and India.

    There have been more changes to the ocean’s regulatory regime in the last 30 years as coastal states extend their jurisdiction than in the last three centuries.  The oceans carry 90 per cent of global traffic including over half of Canadian trade. The maritime estate on which we claim jurisdiction is about 70 per cent of our land mass and the developments in the Arctic are a parable for what is taking place around the world.

    We need to make the investments and break the keels on our promised icebreakers and the new destroyers that will put muscle into our eloquent words about how much the North means to Canadians. 

The Government’s re-election should mean a re-affirmation of the Canada First Defence Strategy, including meeting the new recruitment levels. These are good jobs that directly contribute to the national interest.

    Building supply ships and new fighter jets is expensive but necessary because no one knows either the nature of the next threat but when it comes we need to be ‘ready, aye, ready.’

    We still need a sensible industrial defence policy to complement the Strategy and a first priority for both Peter MacKay and Julian Fantino must be to address the impenetrable and opaque procurement process because it is neither transparent nor cost-efficient.

    And delay in defence puts lives at risk. 
In his elegant farewell remarks to the Department of Foreign Affairs and International Trade, former Foreign Minister Lawrence Cannon re-enunciated the Harper governments’ foreign policy priorities: the United States, the Americas, global economic opportunities and Afghanistan with special attention to the Arctic.

    The most important of these priorities is the United States. Mr. Harper recognizes the wisdom of Brian Mulroney’s rule about good relations with the U.S. – it starts with a friendly and constructive relationship with the president. The Mulroney corollary is equally important: our influence in the world is measured to a significant degree by the extent to which we are perceived as having real influence in Washington.

    The Harper-Obama initiative to re-create a continental security perimeter to unplug the border and to take a machete to the tyranny of small regulatory differences that hobble business, especially SMEs, must proceed.

    The imposition of drones, guards and passports at the border has disrupted the benefits of the FTA and NAFTA. American tourism has fallen back to levels not since the 1970s. More dangerous to jobs and growth has been the disruption the flow of goods and services from the once rapidly developing North American supply chains.

    If President Obama is to export his way out of recession, he must recognize that the place to start is with his two biggest trading partners, Canada and Mexico. 
The trade agenda remains the same:  the Canada-EU Free Trade Agreement by 2012, and creating a formal framework with India by 2013.

    We need a deal with China and, in the wake of the abortive BHP potash takeover, clarity around foreign ownership of resources and the role of the provinces and federal government.

    The test for Ed Fast and the government will be their willingness to re-engage Canada as a leader, rather than a follower, in trade policy.

    The Doha Round is on life support and its failure will have implications for us. We are a trading nation – nearly half of our GDP derives from what we buy and sell across our borders. Its time we put supply management on the table. It will cost us billions to pay off the favoured few but it is necessary.

    During the lead up to the FTA I heard the same squawking from the wine industry. Today our wine industry is competitive and world class. Both the Australian and New Zealand diary industries went through a similar exercise; today, both export their produce to the world.

    The Harper commitment to re-engage with Latin America has been strong on rhetoric. Our relevance in the region will depend on our ability to participate in the broader social, political and economic agenda. Americas Minister Diane Ablonczy has made a good start with the promise in Vancouver (May 26) to help with training for police, justice and border management and to strengthen security cooperation.

    Embracing the Americas should start with Mexico. Its growth rate, improving literacy and location make it a prime market that Canadian companies are embracing, notwithstanding the drug cartels. We need, as a recent study for the Department of Foreign Affairs reaffirmed, “more concrete evidence on the ground of Canada’s interest.”

    Start with Mexico and move south. Aid to Latin America should become the new priority as we draw down in Afghanistan. The cabinet needs to revise our development assistance criteria to ensure that we can lend a helping hand to Mexico.

    Unlike our Armed Forces, our Foreign Service has suffered from neglect and a management that has preferred process to policy. In its zeal for bean counting and ‘accountabilities’ it has forgotten that foreign policy is about … foreign policy.

    ‘Whole-of-government’ should not mean a thousand miniature foreign services in every government department. The conduct of foreign policy requires coherence and consistency with the foreign ministry empowered as a central agency of government in the same fashion as the Department of Finance, Treasury Board and the Privy Council Office.

    While a National Security Council may make sense for the United States with its checks and balances and separation of powers, for reasons of efficiency, economy as well as the exigencies of Westminster-style executive government argue against a similar experiment in Canada. 
But this does not mean a Fort Pearson with its back against the town reflecting on a golden age that has become more romantic than reality. Happily, there is considerable talent in the Foreign Service.

    The challenge for Mr. Baird will be to cultivate it, encourage it and then lead it on those issues that matter for Canadians and on those initiatives where Canada can make a difference.

    Getting our way in a difficult world requires a coherent foreign and defence policy. It means investment in our Forces and our Foreign Service. As a regional power we should play off our geography. This means first and constant attention to the United States. But we also need to invest and intervene in our other regions of interest – the Americas, in the Arctic and those on the other side of our Pacific and the Atlantic oceans.

    In an age of austerity, everything becomes sharper in definition because the margins for error are too costly. It means looking through the right end of the telescope – that of the national interest. It requires recognition that foreign and defence policy is about power and the projection of power in the places that count.

    Get this right and the rest will fall into place.

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