Western Canada’s silence on Asia-Pacific trade deal could be costly
We can’t let Ottawa dawdle on signing crucial TPP2 pact, writes Carlo Dade.
There is a strong and painful case to be made that Western Canada has not been well-served by the country’s trade agenda under the previous and current governments. This is not just a criticism of governments in Ottawa; it’s more a damning critique of how little western interests seem to care themselves, or how ineffective they have been in shaping national trade policy and priorities.
The largest and most important opportunity for western exporters is at hand, yet it’s not generating attention, much less pressure on the government in Ottawa to act. The opportunity on the table is a resurrected Trans-Pacific Partnership (TPP) agreement without the U.S. — a TPP2.
A recent report by the Canada West Foundation, titled The Art of the Trade Deal: Quantifying a TPP without the U.S., shows that all remaining countries would still benefit from a TPP2, but Canada and Mexico would gain the most. Canadian agricultural and commodity exporters would actually do better in a TPP2 than under an agreement including the U.S.
This isn’t surprising. A TPP2 gives Canadian exporters advantages their American competitors will not have. It would also, finally, put Canadian exporters on the same terms as the Australians.
But the real gift here is that the better terms Canada would have under a TPP2 in markets like Vietnam and Japan are thanks to the Americans. Countries made concessions in the TPP that they never would have given Canada in bilateral negotiations. With the Americans at the table, countries were more open. The irony of the U.S. withdrawal is that, instead of killing the agreement, they have made it better for others, including Canada.
After having done the hard work, the Americans are walking away and handing us their market share.
We in the West should especially grasp the opportunity at hand. This is the opposite of what happened to us in South Korea, when Canada dawdled in negotiating, only to see the U.S. and Australia go past us to sign trade pacts. Canadian exports to Korea, most notably pork, plummeted and have not recovered, even after the Canadian government rushed to conclude its own agreement.
This time, the opportunity is larger. We can go from having one trade agreement in Asia to having seven. We can go from running behind the Americans in Asia to running ahead. And, given that it generally takes a decade to negotiate trade agreements, this would be long-term advantage.
Success in the North American Free Trade Agreement negotiations is critical, but it’s also about largely preserving what we already have, not adding anything new or growing. It also leaves us stuck worrying about U.S. President Donald Trump’s every tweet. The Comprehensive Economic and Trade Agreement has some importance because it further opens Europe, a rich, stable market, but one that’s not growing and produces most of what we produce.
A TPP2 is our one and only chance this decade to gain entry into Asia. The agreement is done, other countries are moving to ratify, but Canada is again dawdling, and the government is hiding behind consultations instead of leading the charge.
If the West wants in on Asia — and it should — it must act above and beyond what has been done before.
A TPP2 must become the most discussed topic in Western Canada. Every western MP at every summer barbecue and town hall must face as their first and last question what they’ll do to ensure that Canada ratifies a TPP2 and sees that other countries follow. Every MLA and premier needs to hear the same question and outline what they will do to push Ottawa.
If Western Canada is ever going to have the trade access it needs, then westerners across the board have to step up and go beyond what they’ve done in the past to ensure that we don’t lose this unbelievable opportunity.