By Carlo Dade
Published in the Financial Post
September 26, 2018
The news for Canada on renegotiation of the North American Trade Agreement (NAFTA) has been bleak, but there is one aspect that bodes well for future and potentially more difficult, trade negotiations: the quiet death of the Trudeau government’s so-called progressive trade strategy.
At the start of the NAFTA renegotiation, Prime Minister Justin Trudeau insisted that the inclusion of progressive elements such as new chapters on Indigenous and gender issues was essential to the agreement, going so far as to say that it was not a frill but a practical necessity.
Yet, in the closing act of the NAFTA negotiations, reality has overtaken rhetoric. The progressive agenda has disappeared from the negotiations as well as the public debate around it — with, it appears, no discernible impact on Canadians’ feelings toward the pact or negotiations. Practical dollars-and-cents, saving-or-losing-jobs issues have crowded out non-critical issues. Progressive trade obviously has not made that cut.
While the prime minister and his government were concerned about some public backlash against liberalized trade, inserting what have been purely symbolic chapters in its revised agreements with countries like Chile does nothing to address to the problems the government and others claimed are consequences of such liberalized trade.
The gender chapter in the revised Canada-Chile trade agreement is essentially a statement that both parties think gender is important, they will collect and exchange data, they will meet to discuss potentially co-operating on gender programs and they will issue a report on all of this. None of this is actionable using the agreement’s dispute settlement procedures, meaning there is no accountability.
Given that this gender chapter had nothing of substance, it appears a press release was itself the end game: red meat for the government’s progressive base and ticking off a campaign promise with an eye to the next election. This worked for an agreement with a country like Chile with similar domestic debates on trade as Canada and a left-of-centre government that also needed the same incentive for its base.
This was far from the case with U.S. President Donald Trump and the NAFTA negotiations. But the Americans are not the only objectors to bringing what they felt were extraneous issues at the NAFTA table. The deathblow to the Trudeau government’s attempt to push its progressive agenda in NAFTA arguably came, from of all places, the incoming populist, left-of-centre Mexican administration.
In one of his first English language interviews after being named to lead the incoming Mexican government’s NAFTA negotiating team, Jesus Seade gave an expansive view of the thinking of the new government on trade and made it clear that social — or in Trudeau’s language, “progressive” — issues have no place in trade negotiations and that dealing with these issues is a subject for domestic policy. Period.
The Mexicans may not have thrown Canada under the NAFTA negotiating bus, but on the identity trade issue, they have certainly yanked whatever was left of that rug out from under Trudeau.
In a touch of irony, what progress has been made in actually doing something concrete and tangible to help women in business in NAFTA has been done quietly by the bi-national female CEO group set up by Trudeau and Ivanka Trump. This shows a more constructive path forward on these issues. Domestic policy, as identified by the incoming Mexican administration, is the proper start. Going beyond this means bringing those who actually trade, hire, promote and buy to the table to put forward solutions.
In all of this there is a silver lining. If this is indeed the end of the government’s progressive trade agenda — and the lack of any mention of it in the mandate letter from the prime minister to his new trade minister indicates that it is — then the issue should be off the table for negotiations with China. This removes a contentious issue that would do nothing to advance hard Canadian interests and will allow our negotiators to instead focus time and attention on areas where trade agreements actually have impact: protecting jobs, promoting investment and dealing with non-tariff barriers.
At the very least, should our government try to raise the issue, China now has the perfect response: We’ll take the same progressive trade elements that you have in NAFTA.
Carlo Dade is the director of the Trade and Investment Centre at the Canada West Foundation.