By Carlo Dade
In the The Province, Calgary Herald, Medicine Hat News, Business in Vancouver
June 29, 2017
There is a strong and painful case to be made that western Canada has not been well-served by the country’s trade agenda under the previous and current governments. That this has occurred is not just a criticism of governments in Ottawa; it is more a damning critique of how little western interests seem to care themselves – or how ineffective they have been in shaping national trade policy and priorities.
What we have done to date has gotten us three times as many trade agreements in Central America as we have in Asia. If you’re happy with Honduras, stop reading, if not it gets worse.
The largest and most important opportunity for western exporters is at hand, yet it is not generating attention, much less pressure on the government in Ottawa to act.
The opportunity on the table is a resurrected Trans-Pacific Partnership (TPP) agreement without the U.S. – a TPP11.
A recent report by the Canada West Foundation “The Art of the Trade Deal: Quantifying a TPP without the U.S.” shows that all remaining countries would still benefit from a TPP11, but Canada and Mexico would gain the most. Canadian agricultural and commodity exporters would actually do better in a TPP11 than under an agreement with the U.S.
This is not surprising. A TPP11 gives Canadian exporters advantages that their American competitors will not have. It would also, finally, put Canadian exporters on the same terms as the Australians.
But the real gift here is that the “better” terms that Canada has under a TPP11 in markets like Vietnam and Japan is thanks to the Americans. Countries made concessions in the TPP that they never would give Canada in bilateral negotiations; with the Americans at the table, countries were more open. The irony of the U.S. withdrawal is that instead of killing the agreement, they have made it better for others including Canada.
After having done the hard work the Americans are walking away and handing us their market share.
We in the West should especially grasp the opportunity at hand. This is the opposite of what happened to us in Korea when Canada dawdled in negotiating only to see the U.S. and Australia rush past us to sign trade pacts. We essentially handed the Aussies and American our market share. Canadian exports to Korea, most notably pork, plummeted and have not recovered even after the Canadian government, with a belated sense of urgency, rushed to conclude its own agreement.
Yet, here we are again. But this time the opportunity is larger. We can go from having one trade agreement in Asia to having seven. We can go from running behind the Americans in Asia to running ahead. And, given that it generally takes a decade to negotiate trade agreements, this would be long-term advantage.
Success in the NAFTA negotiations is critical but it is also about largely preserving what we already have, not adding anything new or growing. It also leaves us stuck worrying about Donald Trump’s every tweet. CETA is of some importance because it further opens Europe, a rich, stable market but one that is not growing and it produces most of what we produce. A TPP11 is our one and only chance this decade to gain entry into Asia.
The agreement is done, other countries are moving to ratify, but Canada is again dawdling and the government is hiding behind consultations instead of leading the charge.
If the west wants in on Asia – and it should – it must act above and beyond what has been done, and what has failed it, before.
A TPP11 must become the most discussed topic in western Canada. Every western MP at every summer bbq and town hall must face as first and last question what they will do to assure that Canada ratifies a TPP11 and sees that other countries follow. Every MLA and premier needs to hear the same question and answer what they will do to push Ottawa.
If western Canada is ever going to have the trade access it needs, then westerners across the board have to step up and go beyond what they’ve done in the past to ensure that we do not lose this unbelievable opportunity.
It’s time to stop trying and start winning. That begins with getting a TPP11.
Carlo Dade is the director of the Trade & Investment Centre at the Canada West Foundation