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What’s on the horizon as the 6th round of NAFTA talks begin in Montreal today?

NAFTA talks are taking place at the Hôtel Bonaventure (900 Rue de la Gauchetière O) in Montreal this week.

The sixth round of negotiations on the North American Free Trade Agreement (NAFTA) begin today in Montreal. News reports suggest that this penultimate round (that is scheduled to end on Monday January 29) could be pivotal – or not.

There is both speculation that US President Donald Trump could use these talks to announce his government’s triggering of the six-month withdrawal clause in NAFTA or that given his suggestion that the negotiations could extend past the July 1 election in Mexico (and by implication the December 1 swearing in of new Mexican president) that talks could continue to limp on for some time yet.

The CBC’s Don Pittis comments, “As delegates gather in Montreal this week for the sixth round of the NAFTA renegotiation demanded by Trump, no one is expecting a sudden resolution. Instead, success will be measured by whether Canadians can prevent the talks from collapsing.” Put more bluntly, Phil Levy of the Chicago Business Council on Global Affairs, says, “It’s far more likely that the president decides to blow it up than you get a conclusion. I think it’s extremely unlikely you get a positive outcome out of [Round 6].”

Notably, if the talks don’t collapse and extend past December 1 of this year and into 2019 – then we have the strong potential of NAFTA becoming a ballot box issue in the October 21, 2019 federal election in Canada.

Also significant is the news that the Trudeau government will be bringing some ‘new ideas’ to the negotiating table this round. It’s troubling and a failure of transparency and accountability to the public that we do not yet know what the government will be proposing to the United States and Mexico.

The Globe and Mail’s Robert Fife reports, “Foreign Affairs Minister Chrystia Freeland has said Canada will put forward ‘creative’ proposals in Montreal. One is a ‘compromise’ on U.S. demands for higher American content in cars. Canada is proposing counting more high-value items like software, and less low-value items like rubber parts – essentially trying to increase the content number by changing the way it is counted. That’s creative, but can it move Mr. Trump?”

It’s not clear what Freeland will propose this week in terms of the controversial Chapter 11 investor-state dispute settlement provision (but given the government’s long-standing defence of so-called ‘investment protection’ measures, it’s unlikely it will agree to Trump’s demand that the provision be eliminated).

That said, there is now the argument that Trump’s corporate tax cuts could have an even greater impact on Canada than the collapse of NAFTA.

Prime Minister Justin Trudeau is flying to Davos, Switzerland today for the annual World Economic Forum gathering of transnational corporations and members of the 1% economic elite. While there, Trudeau will have private meetings with executives from Coca-Cola, Royal Dutch Shell and other transnationals.

Commenting on this January 23-26 forum, Canadian Chamber of Commerce president Perrin Beatty says, “By all means he should be going out and promoting Canada in a very positive way but we have to get our house in order here in Canada. We need to make sure that the tax and regulatory environment that both domestic and foreign investors are looking at are attractive in Canada.”

Almost 23,000 people have now signed our online action alert calling for significant changes to NAFTA. It does not appear that removing Chapter 11, ending (rather than expanding) energy proportionality, or removing references to water as a tradable good are on the prime minister’s agenda. Now, even beyond that, we have a significant new push for tax cuts and deregulation to be concerned about.

Further reading
Is Trudeau preparing to make NAFTA concessions as Trump suggests extending talks past July? (January 15)
What’s happening with NAFTA as the 6th round of talks comes to Montreal? (January 12)