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“Tweaking” NAFTA only worsens the agreement

During a joint media conference with Prime Minister Justin Trudeau yesterday, US President Donald Trump stated, “We have a very outstanding trade relationship with Canada. We’ll be tweaking it. We’ll be doing certain things that will benefit both of our countries, Our relationship with Canada is outstanding. We are going to work together to make it even better.”

While the mainstream media and business groups largely appear relieved that Trump didn’t talk about tearing up NAFTA, there are worrisome implications emerging from yesterday’s meeting.

Regulatory convergence

The Joint Statement issued by Trudeau and Trump highlighted, “We will continue our dialogue on regulatory issues and pursue shared regulatory outcomes that are business-friendly, reduce costs, and increase economic efficiency without compromising health, safety, and environmental standards.”

A tweaking of NAFTA could mean a mechanism like the one in the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) that aims to “prevent and resolve” non-tariff barriers by establishing processes that allow corporate interests to degrade various public interest protections.

The Washington Post warns, “Trump has embarked on the most aggressive campaign against government regulation in a generation. The fallout [is] affecting how dentists dispose of mercury fillings, how schools meet the needs of poor and disabled students, and whether companies reject mineral purchases that fuel one of the world’s bloodiest conflicts. Two measures — which would loosen environmental restrictions on waste-mining companies and financial disclosure requirements on oil and gas firms — have cleared the Senate and are on their way to the White House for the president’s signature.”

Trump also intends to roll back rules in the Clean Water Act that protect streams, tributaries and wetlands from development, as well as terminate the Streams Protection Act which is seen as an obstacle to coal mining. This could put further pressure on Trudeau to abandon his promise to restore and enhance the Navigable Waters Protection Act in Canada. Trudeau and Trump’s commitment to a “shared focus on infrastructure investments” and Trudeau’s reported keenness to build electrical transmission links across the border could also mean that power lines could continue to be excluded from the Navigation Protection Act.

Energy proportionality

Their Joint Statement also notes, “As the process continues for the Keystone XL pipeline, we remain committed to moving forward on energy infrastructure projects that will create jobs while respecting the environment.” But there’s nothing climate-friendly about the energy proportionality provision in NAFTA.

That provision says that Canada must maintain at least the same level of oil and gas exports to the United States as it had supplied for the past thirty-six months. Only if Canadian consumption is cut proportionately, and then only in times of crisis, could the Canadian government claim jurisdiction over its own energy resources. Canada already exports 3.4 million barrels of oil a day to the US, approving Keystone XL and Line 3 only compound this issue.

Council of Canadians chairperson Maude Barlow has stated, “NAFTA renegotiation must end the proportionality clause of the energy sector to meet our Paris climate commitments.” But Trudeau gave no indication yesterday that he would act to remove this dangerous provision from NAFTA.

Local procurement

The Globe and Mail reports, “The President said the United States will be seeking more ‘reciprocity’ in trade with Canada, which could include demands that U.S. firms are able to bid on provincial and municipal projects.”

It then highlights, “Some Canadian provinces and municipalities have local content or ‘knowledge’ requirements written into their procurement policies, giving an edge to Canadian companies. Infrastructure Ontario, for instance, which oversees tens of billions of dollars’ worth of provincial transit, hospital and school construction, favours contractors with local knowledge as a way to boost Ontario-based firms.”

Border security

Trump also stated during their joint media conference, “We have some wonderful ideas on immigration. We have some, I think, very strong, very tough ideas on the tremendous problem that we have with terrorism. And I think when we put them all together, which will be very, very quickly — we have a group of very talented people — we will see some very, very obvious results. We’re also doing some cross-border things that will make it a lot easier for trade.”

While not explicitly part of NAFTA, border security measures can be about appeasing the United States so that NAFTA isn’t challenged. The Trudeau government is now moving forward with C-23, a pre-clearance border security bill that would give US border guards new powers to question, search and arrest Canadians at airports, bus stations and train terminals in Canada. C-23 would also allow US border guards in Canada to be armed and to conduct strip searches on Canadians. It would also mean that permanent residents of Canada seeking to re-enter Canada via the United States could be turned away at US airports.

This also suggests that Trudeau will not make any move to rescind the Safe Third Country agreement. Fearing Trump’s immigration policies, asylum seekers are now risking their lives in the cold and the snow by crossing the border at Manitoba, Quebec and British Columbia. As The Globe and Mail explains, “Migrants who cross at open fields or other unguarded areas are not covered by the Canada-U.S. Safe Third Country Agreement, and have the right to make a refugee claim in Canada.” Keeping that agreement in place puts the lives of migrants at risk.

The Council of Canadians continues to call for bold and progressive changes to NAFTA, for extensive public consultations, and for a transparent and accountable process during NAFTA negotiations.