Carlo Dade
Published in Kelowna Daily Courier and Castanet

September 5, 2017

Other than a chance for a selfie with Prime Minister Justin Trudeau, one thing folks in the Central Okanagan should be looking for out of this week’s federal Liberal caucus meeting in Kelowna is whether the government has any concern for the trade agreement that will determine the region’s economic future.

Not the North American Free Trade Agreement (NAFTA). Rather, it’s the Trans-Pacific Partnership agreement (TPP), which is alive and well without the U.S. – and being ratified by other signatories that see a chance to get a leg up on the Americans in booming trade with Asia.

For a region like the Okanagan, in Pacific-facing British Columbia, a new agreement in Asia that lets us catch up with the Australians and surge past the Americans makes this agreement the most important trade development to date. Given that an agreement with China would likely take close to a decade to conclude, it’s also the only opportunity for the foreseeable future.

Japan, New Zealand and the Malaysian Congress have already ratified the TPP, with others planning to announce agreement to move ahead this November at the annual APEC summit.

Rather than killing the TPP, U.S. President Donald Trump’s withdrawal has strengthened the resolve of the remaining countries. It has also made the agreement better for Canada. Economic modelling in a Canada West Foundation report shows that Canada does better in a TPP without the U.S. in the agreement with huge tariff and other advantages over American exporters in timber, wine, seafood, fruits and vegetables and business services – all important to the Central Okanagan, B.C. and the West.

Beyond agriculture and commodities, Canada will gain advantages in trade in services. In Singapore alone, demand for business services would increase C$200 million by 2035. The TPP will give companies in countries that are part of the agreement a huge competitive advantage for this business.

U.S. companies that want in on these opportunities will have to either hope that Trump changes his mind about the TPP, or move production and operations to a TPP country. For U.S. service and high-tech companies that want to take advantage of the agreement and remain close to home, B.C. and places with operating costs lower than Silicon Valley and good air connections like Kelowna, suddenly become more attractive.

These advantages would continue for as long as it takes the Americans to catch up in signing trade agreements in Asia. Given the Trump administrations record so far, this is a window that is open but needs to be seized as soon as possible.

Even for companies worried only about North America, ratifying the TPP will give Canada new leverage in NAFTA. Since firms in Canada and Mexico would have TPP benefits, but U.S. companies would not, pressure would be on American negotiators to make concessions to enable U.S. firms to catch up.

With so much on the table, ratifying the agreement would seem a slam dunk. Except that for some reason for this government it is not. Other than announcing 18 months of consultations, the government and western MPs including those from ridings that would benefit like Kelowna-Lake Country, Cloverdale-Langley City, South Surrey-White Rock and Langley-Aldergrove, have been silent.

The government has done the bare minimum in attending TPP meetings. Its refusal to state clearly and publicly that it supports going ahead with the TPP is in stark contrast to other countries and should be worrying for business in B.C. and across the west. When the remaining TPP countries meet at the APEC summit in November, Canada needs to be ready to join them in moving ahead. Being ready means making the case to the Canadian public and stating clearly that doing so is in the national interest.

Hopefully this week in Kelowna, in a region and province that would benefit the most from opening Asia and getting a leg up on the Americans, we will see western MPs step up and get the government to commit to ratifying the TPP. In the rest of the West, we are watching and hoping.

Carlo Dade is the director of the Trade & Investment Centre at the Canada West Foundation