If NAFTA deal is harmful, Canada should walk away

Can any good come from such a one-sided agreement?

This month, the thorny issue of NAFTA has resurfaced again. As part of its overall trade plan to strong-arm other countries in smaller agreements rather than working through multilateral structures, Donald Trump’s U.S. administration released a lengthy and onerous list of demands for renegotiations.

The U.S. is looking to turn major aspects of NAFTA into one-way protections favouring only its own interests. It wants to impose its own draconian intellectual property rules and negligible privacy standards; to prohibit Canada and Mexico from applying local preferences in procurement while insisting on the ability to do so itself; to attack Canadian policies and institutions, including supply management, Crown corporations, and Canadian content requirements; and to provide U.S businesses with the ability to block new regulations.

In response, Justin Trudeau at first attempted to avoid any public position at all other than to try to find a way to appease Trump, then limited his criticism of the U.S. objectives to a mealy mouthed attempt to preserve a single dispute resolution mechanism. And it doesn’t look like Canada plans to bring any proposed improvements to the table.

In other words, the main effect of any NAFTA renegotiation looks be to allow the U.S. to rewrite the current agreement for the sole benefit of its corporate interests. And this when Canada has already borne the brunt of the agreement’s past effects.

With that in mind, it’s worth asking whether

… It doesn’t look like Canada plans to bring any proposed improvements to the table.

any good can be expected to come of another round of business-run trade negotiations — and whether Trudeau has the sense and the guts to walk away from the table if not.

To be fair, the U.S. does mention adding labour and environmental protections to NAFTA’s main text (rather than in side agreements). But a recent decision under a trade agreement between the U.S. and Central American countries has confirmed those planned provisions don’t amount to much.

The U.S. had complained about Guatemala’s neglect of workers’ rights. Guatemalan employers had summarily terminated workers trying to unionize — and the government had in turn failed to enforce fines or court orders in response to the violations.

The CAFTA panel found a “significant shortfall” in Guatemala’s enforcement of worker protections, and concluded that some employers exploited that for competitive advantage. But the panel ultimately held there wasn’t enough of a pattern of abuse to treat the violations as affecting trade — and decided it couldn’t do anything in response. Needless to say, that’s a radically different standard than the one applied to corporations, which are able to sue to protect trade and investment.

And the U.S. plans for NAFTA include the same wording that limited the CAFTA panel’s authority. Labour or environmental protections would be enforceable only to the extent they “(affect) trade or investment between the parties” — meaning Trump’s plan is for business to come first even in a renegotiated deal’s theoretical social provisions.

If there’s some prospect of setting a more fair standard to protect workers and the environment, that might represent something worth negotiating. But Trudeau’s reticence makes it doubtful he has any appetite to push the issue.

In sum, Trump’s plans for NAFTA mostly figure to make a bad deal worse for Canada. And we’re best off pushing Trudeau to walk away from the table if necessary, rather than handing Trump a win at the expense of the public interest.

Greg Fingas is a Regina lawyer, blogger and freelance political commentator who has written about provincial and national issues from a progressive NDP perspective since 2005. His column appears every week.