G7 in Japan

Canada and Japan talk trade in lead up to G7 summit

JOHN IBBITSON

The Globe and Mail  Sunday, May 22, 2016 10:05PM EDT

Justin Trudeau arrives in Japan on Monday for a week of talks ending in a G7 summit that is darkened by stalled trade agreements, a rising tide of insurgent populism and the possibility that a President Donald J. Trump could attend next year.

The ambitious Trans-Pacific Partnership trade agreement may not make it through the U.S. Congress; both Hillary Clinton and Mr. Trump, the likely Democratic and Republican presidential nominees, spout protectionist rhetoric; Britain votes June 23 in a referendum on whether to leave the European Union (called “Brexit”); and political turmoil in Europe threatens the future of the EU itself.

“The returns on trade have not been translated onto the dining room table,” said Colin Robertson, a former Canadian diplomat and vice-president of the Canadian Global Affairs Institute. Coupled with the uncertain recovery from the financial crisis of 2008-09, this has led, he believes, to a growing mood in both the United States and Europe that’s “anti-trade, anti-immigration, anti-big business, anti-establishment.”

Despite this, both Canada and Japan would like to reinvigorate their flagging trading relationship. Japan, once Canada’s second-largest trading partner, is now fifth. The two countries began free-trade negotiations in 2012, but put those talks on hold when they joined the ambitious Trans-Pacific Partnership talks that included the United States and a raft of Pacific nations.

Now all parties are holding their breath to see whether the U.S. Congress will ratify the TPP, as it’s known, since both Ms. Clinton and Mr. Trump say they oppose it. At the same time, populist politicians in both the United States (Mr. Trump on the right and Democratic presidential candidate Bernie Sanders on the left) and in Europe threaten the existing order.

In Austria’s presidential election on Sunday, the candidate supported by the Greens and the candidate of the extreme right-wing Freedom Party each took half the vote, with no clear winner apparent. Nativist, nationalist, populist parties are on the rise from Poland to France.

“You’ve got an awful lot of unhappy, angry people out there,” noted John Manley, head of the Business Council of Canada. “All they know is that things haven’t gotten better for them and they’re not sure why, but trade is a pretty convenient target.”

Against this backdrop, Mr. Trudeau will be offering a message of hope at the G7: that sustained government spending, such as the Liberals’ 10-year, $120-billion infrastructure plan, can revive both growth and confidence. It’s a 180-degree turn from what Canada was saying under the austerity-minded leadership of former Conservative prime minister Stephen Harper.

“I don’t think anything has changed to make the Canadian voice any more or less powerful today,” said Rohinton Medhora, president of the Centre for International Governance Innovation in Waterloo, Ont. “What matters is what the Germans think in Europe, what the Americans think about these issues.”

But if Canada does not have much influence in the global debate over trade, it does have an enormous stake in the outcome. The Canadian economy depends on trade, so any reversal of the decades-old trend toward ever-freer trade puts Canadian jobs and Canadian prosperity at risk.

Mr. Manley said he believes there could also be opportunities. If the Trans-Pacific Partnership agreement fails to be ratified, he is urging Mr. Trudeau to renew trade talks with Japan. “Canada has a rather unique opportunity to be a hub, rather than just one of the spokes,” he said, able to market itself as a conduit to both American and European markets.

All the more reason, Mr. Robertson urges, for Mr. Trudeau and International Trade Minister Chrystia Freeland to hie themselves to Europe sooner rather than later to nail down ratification of the Canada-EU free-trade agreement.

G7 leaders are painfully aware that, should Donald Trump become U.S. president, the global order would be under enormous strain. Not only is Mr. Trump vehemently opposed to the TPP (and to the North American free-trade agreement), he is threatening to launch a trade war with China and has mooted withdrawing the American security umbrella protecting Japan and South Korea.

But Mr. Medhora remains hopeful. If the British vote to stay in Europe and the Americans elect Hillary Clinton, he observes, then the established order will remain largely intact. “A lot depends on what happens with Brexit and the U.S. elections.”

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Obama and Trudeau summit

What will Trudeau and Obama get done at their meeting in March?

John Ibbitson The Globe and Mail

Justin Trudeau’s state visit to Washington March 10 will be impressively ceremonial, with the Prime Minister and President Barack Obama walking side by side in black tie into a glittering room, accompanied by their wives. But whether anything actually gets done during the visit depends on how badly the new Liberal government wants action on the border question, and how willing Mr. Obama is to oblige.

By the time of the visit, the 44th President will be a pretty lame duck, with the election of his successor less than eight months away. There is little or nothing he will be able to get through the Republican-controlled Congress. But Colin Robertson, a former diplomat who specializes in international relations, believes there is one key area where Mr. Obama could act on his own. “A preclearance agreement is certainly within his grasp,” Mr. Robertson said Tuesday . “There’s a deal there to be fixed, and it would certainly be in our interest.”

“Preclearance” is an initiative that came out of the Beyond the Border agreement signed in 2011 between Mr. Obama and then-prime minister Stephen Harper. The accord was intended to improve continental security while easing congestion at the Canada-U.S. border. Under that accord, goods entering either Canada or the United States could be jointly inspected and cleared, and could then cross the Canada-U.S. border without further inspection.

But the Department of Homeland Security has been blocking implementation, Mr. Robertson said. If the Trudeau team really wanted to see action on this file, they could lay the groundwork over the coming months that could lead to a March 10 announcement on new plans to advance the agenda on implementing preclearance protocols. If, that is, Mr. Obama is willing.

“He could do that by simply giving the regulatory guidance to the Department of Homeland Security,” said Mr. Robertson. “We could move ahead on this.”

Adam Barratt, a spokesman for the Department of Global Affairs, said that the Liberal government is committed to making “substantial progress” in reducing impediments to trade and commerce. “To this end, we will be taking a close look at files, such as preclearance, that could facilitate the movement of people between our countries,” he said by e-mail. The effort will be led by Public Safety Minister Ralph Goodale.

The press release announcing the visit stated that the Prime Minister and the President planned to discuss “energy and climate change, security, and the economic relationship.” In the matter of security and the economy, action on preclearance, harmonizing regulations and making it easier for people to cross the border on business are all Beyond the Border initiatives that could be advanced in 2016, Mr. Robertson maintained.

Whether any movement is possible on energy and climate change could depend on another planned meeting of Mr. Obama and Mr. Trudeau. Though nothing has been confirmed, the two leaders and Mexican President Enrique Pena Nieto are expected to have a “three amigos” meeting in Canada in April or late March, preceded by meetings of the foreign and energy ministers. A common approach to safety and environmental standards for fracking oil and natural gas is one possible outcome, Mr. Robertson speculated, while the Americans might also push Canada for environmental action in the Arctic.

Mr. Trudeau will doubtless be tempted to meet with Hillary Clinton, should she be in Washington. By then, the former secretary of state is likely to have trounced Vermont Senator Bernie Sanders, thus becoming the presumptive Democratic presidential nominee. Liberals and Democrats generally get along, and Ms. Clinton, a former New York senator, knows Canada well. Should she win the presidential election in November, Mr. Trudeau and Ms. Clinton could be expected to work co-operatively on a number of files until at least 2019, when Mr. Trudeau’s first term will expire. But such a meeting would violate the unwritten code of neutrality that Canadian prime ministers must adhere to during American elections. At the least, Mr. Trudeau couldn’t meet with Ms. Clinton without also meeting with the presumptive Republican nominee. And it is far from clear whether we will know who that is by March 10.

A Liberal government in Ottawa could do business with a Republican administration led by Florida Senator Marco Rubio or former Florida governor Jeb Bush, both of whom are mainstream candidates. But both men are currently trailing in the polls. The thought of either businessman Donald Trump or Texas Senator Ted Cruz – even if he was born in Canada – as president would appall Mr. Trudeau as much as it would appall most Canadians. Mr. Trump and Mr. Cruz are currently first and second in the Republican race, even though Mr. Cruz is an extreme right-winger and Mr. Trump is, to put it gently, a xenophobe. No more state dinners for Mr. Trudeau if either of those two men becomes president.

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New Trudeau Cabinet

CTV News Channel: Dion minister of foreign affairs

Former Canadian diplomat Colin Robertson says Stephane Dion ‘has a well-developed sense about what the world is about.’
Screen Shot 2015-11-04 at 6.07.56 PM

Trudeau’s foreign cabinet picks signal climate and trade priorities

By choosing Stéphane Dion as Foreign Minister, the new Prime Minister sends three messages. First, as a veteran of the Chrétien era and as a Quebecker, Mr. Dion’s appointment signals a return to a more pacific strain in Canadian foreign policy and a reluctance to become involved in foreign military entanglements. Mr. Dion will, with conviction, withdraw Canadian forces from the fight against the Islamic State. Future American presidents should expect a skeptical response when asking whether Canada is ready to join in the next military venture.Globe and Mail Update Nov. 04 2015, 1:23 PM EST

Video: Maryam Monsef: Minister of Democratic Institutions and Canada’s first Afghan-born MP

Unless, of course, that venture has been approved by the United Nations Security Council. Supporting the UN will once again be a priority of Canadian foreign policy, along with other multilateral forums such as the Commonwealth and la Francophonie. As well, expect a gradual rebalancing over time between the equal right of Israel to a secure existence and the Palestinian people to their own state.

Above all, combatting climate change is now a top foreign as well as domestic priority. In Paris next month, Mr. Dion will negotiate Canada’s renewed commitment to combat global warming. He, not Environment Minister Catherine McKenna, will head the cabinet committee on climate change. Fighting global warming has gone from last priority to first, as the federal government transitions from Conservative to Liberal.

Colin Robertson, a former diplomatic and current foreign-affairs analyst, observes that Canadian foreign policy has always balanced national interest with constructive internationalism. Under Mr. Harper, national interest held sway. “Stéphane Dion represents constructive internationalism,” said Mr. Robertson: a broad commitment to multilateral engagement, foreign aid (though little is known about the Minister of International Development, Marie-Claude Bibeau) and collective security.

But Canada’s stance won’t be entirely Pearsonian—far from it. Mr. Trudeau has signalled in the past his strong support for the new government in Ukraine, a position strongly buttressed by Chrystia Freeland, the new Minister of International Trade, whose background is partly Ukrainian. Canada under the Liberals will remain firmly committed to confronting Russian aggression and defending NATO’s eastern flank, a key priority under Stephen Harper.

(And by the way, Defence Minister Harjit Singh Sajjan has four tours of duty under his belt as a member of the Canadian Forces – three in Afghanistan and one in Bosnia – and will hardly be an isolationist voice in cabinet.)

Ms. Freeland can also be expected to aggressively pursue and expand upon the trade priorities of the Harper government. Her first order of business will be to ratify the trade agreements the Conservatives negotiated with the European Union and the 11 nations of the Trans Pacific Partnership. She will seek to improve trade relations with China, while also pursuing other Asian and Pacific opportunities.

“He’s picked a very high-profile trade minister, who is articulate, savvy, with an international reputation,” observes Fen Hampson, director of the Global Security and Politics program at the Centre for International Governance Innovation.

Many diplomats privately complained that, under the Conservatives, trade issues overwhelmed foreign policy. They hoped that with the Liberals back in charge trade would be returned to the back burner, Mr. Hampson observed. But by combining the veteran Mr. Dion with the aggressive newcomer Mr. Freeland, Mr. Trudeau is choosing not to choose between the Chrétien and Harper legacies.

“I think it’s going to be a bit of both,” said Mr. Hampson. “It’s going to be salt and pepper.”

Along with substance, expect also a change of style, an urbane cosmopolitanism that had gone missing in the Harper years and that will emphatically be back under this new team. Everyone who is anyone will be visiting Ottawa for an earnest discussion with (or lecture from) Mr. Dion, a scintillating debate with Ms. Freeland, and a quiet but elegant dinner with Mr. Trudeau.

If style matters as much as substance in foreign affairs, then that could be the biggest change of all.

TPP Deal would reignite North Amierican integration

TPP trade deal would reignite North American co-operation: Mexican minister

“There are very few issues that would not benefit from a more North American perspective,” Jose Antonio Meade told The Globe and Mail in an interview.

“More and more we are coming to realize that there is benefit to trilateralizing the issues.”

But analysts warn that it will take more political will than U.S. President Barack Obama has displayed thus far to get the Three Amigos working together again.

Efforts to conclude the Trans-Pacific Partnership negotiation – an ambitious trade agreement that would involve 12 Pacific nations – foundered last month in Maui in part because Canada and Mexico rejected a deal that the United States and Japan had reached on automobiles and auto parts.

Canada and Mexico want a higher threshold of production within the trade zone before cars and car parts are exempt from tariffs than the United States and Japan are proposing.

And feathers were ruffled when Ottawa and Mexico City learned that the United States and Japan had negotiated the lower threshold without consulting them.

“I think it was safe to say it was a surprise,” Mr. Meade acknowledged.

To get the talks back on track, trade officials from Canada, the United States and Mexico met in Washington on Thursday in an effort to reach a compromise. In an e-mail, the Canadian Department of Foreign Affairs, Trade and Development described the talks as “constructive,” but had no further comment.

The TPP, as it is known, is facing major headwinds, and time is running out to reach an agreement. The U.S. Congress must ratify whatever agreement is reached, the American presidential election could hijack congressional approval and attention in Canada is distracted by the federal election.

But Mr. Meade remained confident that an agreement will be reached, although he would not predict by when.

And he said he believes that agreement would revive a continental approach to tackling major issues affecting the three countries.

Such co-operation has been on the decline, with Canada and Mexico negotiating bilaterally with the United States during the Obama administration, especially on border issues.

The trilateral relationship is “stalled for lack of political ambition and leadership,” said Colin Robertson, an analyst in Canada-U.S. relations.

Mr. Obama has shown little interest throughout his presidency in taking a continental approach to issues, preferring to talk with Canada and with Mexico separately – to the extent he talks to them at all.

“There’s not that grand vision, which we’ve had under previous presidents and which I think you have to have,” Mr. Robertson observed.

Canada-Mexico relations are also strained as a result of the Stephen Harper government’s decision to impose visa requirements on Mexicans visiting Canada.

But a successfully concluded Trans-Pacific Partnership would not only strengthen ties among the 12 Pacific nations that are part of the talks, Mr. Meade predicted, it would also update the two-decade-old North American Free Trade Agreement involving Canada, Mexico and the United States.

And that, in turn, could lead to a continental approach to other pressing issues, especially energy security. “The more we integrate our energy markets the more security we will have, the better prices we will have, the more competitive we will be,” Mr. Meade predicted.

Similarly, it makes sense to pursue a continental approach to reducing carbon emissions, he added.

But others are skeptical. Len Edwards, a distinguished fellow at the Centre for International Governance Innovation in Waterloo, Ont., and a former deputy minister of foreign affairs, agreed that a successful conclusion to the TPP talks would rejuvenate NAFTA.

But grappling with challenges in energy, the environment, agriculture, mobility and the like “will require renewed energy, co-operation and commitment,” he added. And at the moment, all three are lacking.

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Canada-Europe Trade Deal and the US

Excerpted from A Canada-Europe trade deal represents a great opportunity. Can we seize it? by John Ibbitson Globe and Mail February 13, 2013

…Now the Americans also want a free trade agreement with Europe. Canada is already ahead of them. An agreement on CETA was due in December. The new deadline is March or April.

With the United States about to take centre stage, Canada risks being pushed off the stage entirely, unless it can wrap up the talks by April at the very latest.

“We’d better get our act together and conclude these negotiations quickly,” said Colin Robertson, the former diplomat who now writes and advises on trade issues, “because all of the oomph and energy on the part of the Europeans is going to immediately shift to what they see as the bigger game: the US-EU negotiations.”

As Mr. Robertson pointed out, in the last decade Canadian dithering froze this country out of a free-trade agreement with South Korea, once the Americans stepped in to do their own deal.

The reason for the delay on the Canada-European agreement is that CETA would be a very 21st-century deal. Rather than simply lowering tariffs on manufactured goods, it aims to open up government procurement to foreign bidders, to lower agricultural tariffs and to enhance patent protection, especially in pharmaceuticals…

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On Border Update

Excerpted from Border deal just part of agenda in ‘make or break’ year by JOHN IBBITSON

OTTAWA — The Globe and Mail Monday, Dec. 17 2012

Few paid any attention on Friday to the one-year report card on the new Canada-U.S. border agreement. The terrible shootings at Newtown understandably shoved everything else aside.

That report shows the Harper government and the Obama administration still struggling to fulfill the promise of the Beyond the Border agreement on travel, trade and security.

Trade is the issue on which the Conservatives want to be judged. (They certainly prefer it to military procurement.) And 2013 is shaping up as the pivotal year in casting that judgment.

The Harper government will either open Canada more fully to the world, or we’ll simply muddle along. In this economic environment, muddling along simply won’t do.

Among other things, rules are now in place so that passengers with cross-border connections no longer have to check their baggage twice, and there is the pilot project that permits imports bound for the U.S. market to be examined in Prince Rupert, B.C., and then shipped south with no further inspections on the principle of “cleared once, accepted twice.”

But John Manley, the former foreign minister who now heads the Canadian Council of Chief Executives, observed that “the two governments are still negotiating the terms of a comprehensive preclearance system for land, rail and marine cargo even though that plan was supposed to be finalized,” by this month.

He wants both sides to put their back into accelerating and expanding a continental inspection regime.

Not fair, responded David Jacobson, the U.S. ambassador to Canada.

“The overwhelming majority of what we said we were going to do, we did, and for the ones that aren’t on schedule, there were good and valid reasons why they didn’t get done,” Mr. Jacobson told The Globe’s Paul Koring.

But making progress on thinning the Canada-U.S. border is only one aspect of an agenda that will make 2013 a “make or break year,” said Colin Robertson, the former diplomat who now studies and writes on trade issues.

The Harper government is also supposed to be in the very last stages of concluding a comprehensive trade agreement with the European Union. The final issues – on agriculture exports and intellectual property protections – are proving to be the most difficult. If a deal is to be done, ’twere well it were done quickly, for the Europeans and Americans are now looking to negotiate an agreement, and once those talks are started, the Europeans will focus on nothing else.

Canada is finally part of the even more ambitious Trans Pacific Partnership talks, which would create a new free-trade sphere that would link nations in North and South America, the Pacific and Asia. An accord will be reached in 2013, or not at all. And Canada and India have committed to concluding a free-trade agreement in 2013.

The Conservatives face plenty of resistance to their trade agenda. For every action to make it easier and cheaper to sends goods across the Canada-U.S. border, there’s the reaction of a Congress or an administration looking for new fees and charges to help offset the chronic budget deficit.

Powerful lobbies continue to press for agricultural, pharmaceutical and other protections, which complicate trade agreements.

Still, the Conservatives are trying. As Mr. Robertson observes, the report card can point to an increased willingness on the part of Canadian and U.S. officials to harmonize safety and other regulations, so that products manufactured in one country can be sold in both.

If the Harper government can continue to make progress on the Canada-U.S. border, conclude a trade deal with Europe, another with India, and maybe be part of a Trans Pacific agreement, that will make 2013 a good year.

Excerpted from  New border security deal has made Canadians, Americans safer and better off: U.S. ambassador by John Ivison National Post Dec 14, 2012

OTTAWA — Canadians and Americans are safer and better off as a result of the perimeter security deal signed last December by Prime Minister Stephen Harper and President Barack Obama, says the U.S. ambassador to Canada.

David Jacobson pointed to two initiatives he said have increased efficiency at the border – reduction in wait times at airports because of the NEXUS trusted traveller program and mutual recognition of air cargo that means less missing baggage on connecting flights.

He said the choice is not between security or efficiency. “They tend to be the same thing.”

Mr. Jacobson was speaking as the two governments reported “significant progress” on their plan that aims to “thin” their border.

In the first annual report on the “Beyond the Border” and regulatory co-operation programs, they said there has been improved coordination on border management, cyber-security, the NEXUS plan and air cargo security.

“This puts real meat on the bones of what the President and the Prime Minister promised. And we aren’t done yet,” Mr. Jacobson said.

John Manley, president of the Canadian Council of Chief Executives, was less glowing in his assessment.

“To be perfectly honest, it’s more promising than actual results. There are signs that good things are happening but it will require more work,” he said.

He said it remains a difficult challenge to get sovereign nations to think about fluidity at the border as if it were an inter-state or inter-provincial boundary.

Free trade has reduced tariff barriers, but both sides still charge fees for some services, like product inspections.

The council pointed out the goal of pre-clearing goods on the factory floor remains unfulfilled. At the launch last year, both sides touted a pilot project in Prince Rupert, B.C., where goods landed were checked and loaded at the port, then shipped by rail to Chicago, without being re-inspected at the border in Minnesota.

Mr. Jacobson said the need for legislation on both sides of the border has slowed down the rollout of that initiative.

Colin Robertson, a former diplomat and close observer of the Canada-U.S. relationship, said there was nothing new in the progress report but it was a useful taking stock exercise. He said it was significant “Beyond the Borders” still bears the imprimateur of the U.S. President, which sends the message down the chain of command it is a priority.

The target when the deal was struck was to reduce border costs by $16-billion a year – or 1% of gross domestic product.

Mr. Jacobson said the focus on the border highlights a trading relationship that is going from strength to strength. Two-way trade between Canada and the U.S. rose by 38% — or $181-billion — in the last two years.

“Last year alone, Canadian exports to the U.S. increased by $41-billion,” he said.

“Canadian exports to China increased by $4-billion. I think it was Mark Twain who said ‘rumours of my demise are greatly exaggerated.’ ”

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