CAUTIOUSLY OPTIMISTIC:

Canada’s am­bas­sador to U.S. says good things could come out of NAFTA talks

The Hamilton Spectator - - FRONT PAGE - ALEXAN­DER PANETTA

WASHINGTON — Canada’s am­bas­sador to Washington, who sat in on the Don­ald Trump-Justin Trudeau sum­mit this week, says he’s now cautiously optimistic about any forth­com­ing changes to the North Amer­i­can Free Trade Agree­ment.

Those con­ver­sa­tions fo­cused on changes that would be ben­e­fi­cial to both Canada and the United States, as they have done for months in talks with the White House and, be­fore that, the Trump tran­si­tion team, David MacNaughton said Wed­nes­day.

“If we’re go­ing to change it, we’re go­ing to do things that are good for both Canada and the United States. That was the spirit of the meet­ing,” MacNaughton said in Toronto.

“I’m cautiously optimistic. I mean, you never know in these things, but I’m quite optimistic that it’s go­ing to be good for us.”

The U.S. pres­i­dent con­cluded his meet­ing with Trudeau with a pub­lic dec­la­ra­tion that the trade re­la­tion­ship with Canada is out­stand­ing, and sug­gested he only wants a few tweaks in an up­graded NAFTA.

Some ex­perts warn that mak­ing such a prom­ise is not en­tirely in the pres­i­dent’s purview, and that once ma­jor trade ne­go­ti­a­tions open, nu­mer­ous stake­hold­ers, in­dus­try groups and politi­cians will try forc­ing their is­sues to the ta­ble.

MacNaughton him­self added a word of caution: It’s hard to know ex­actly what the new ad­min­is­tra­tion will ask for, be­cause the Trump cab­i­net has yet to have its com­merce and trade sec­re­taries con­firmed by Congress.

The con­fir­ma­tion process has been held up by the en­trenched par­ti­san war­fare in Washington. The dis­ar­ray mounted this week amid calls for an in­ves­ti­ga­tion into con­nec­tions be­tween Rus­sian in­tel­li­gence and the Trump cam­paign.

One cab­i­net nom­i­na­tion — Andy Puzder — was ac­tu­ally tor­pe­doed Wed­nes­day. He dropped out amid con­tro­versy.

The key play­ers on the NAFTA file, mean­while, are still cool­ing their heels. Com­merce pick Wil­bur Ross and United States Trade Rep­re­sen­ta­tive nom­i­nee Robert Lighthizer are both await­ing news on their con­fir­ma­tion.

MacNaughton used a sports metaphor to de­scribe the one-sided na­ture of the cur­rent trade con­ver­sa­tion, be­tween a full Cana­dian gov­ern­ment and a partly staffed ad­min­is­tra­tion: “It’s a bit of shad­ow­box­ing right now.”

He ex­pressed op­ti­mism in an­other area. He hopes there will be a ben­e­fi­cial res­o­lu­tion to dif­fer­ences over so-called “Buy Amer­i­can” re­stric­tions on for­eign com­pa­nies com­pet­ing for U.S. in­fra­struc­ture projects; the coun­tries is­sued a state­ment af­ter the Trudeau-Trump meet­ing that in­cluded a vague ref­er­ence to work­ing to­gether on con­struc­tion.

But some ob­servers say it’s way too early to cel­e­brate.

“I think the ini­tial Cana­dian re­ac­tion on Mon­day was a bit too ex­u­ber­ant,” said Toronto trade lawyer Mark Warner. “The bot­tom line is that it all de­pends on what (Trump) means by ‘tweak’ ... I think it was just a place­holder. Canada wants an­swers faster than he can give.”

If Trump wants sig­nif­i­cant changes to NAFTA, he needs to go through Congress. And that process in­cludes a pub­lic con­sul­ta­tion where the U.S. gov­ern­ment re­ceives in­put from Amer­i­can com­pa­nies on ideal ne­go­ti­at­ing po­si­tions.

A num­ber of U.S. com­pa­nies have al­ready voiced gripes about Cana­dian trade prac­tices. An­nual U.S. gov­ern­ment re­ports reg­u­larly list griev­ances re­lated to things like re­stric­tions on milk, cheese and poul­try im­ports; con­trols of what liquor gets sold and where; Canada’s tighter duty-free rules; lim­its on for­eign com­pe­ti­tion in the telecom­mu­ni­ca­tions and broad­cast sec­tor.

It’s hard for any­one — in­clud­ing Trump — to pre-emp­tively prom­ise just mi­nor tweaks, Warner said.

If NAFTA un­der­goes sig­nif­i­cant changes, that will force Trump to send the al­tered agree­ment back to Congress for a vote un­der the fast­track rules, and, Warner said, “I think that means open­ing Pan­dora’s box.”

GRA­HAM HUGHES, THE CANA­DIAN PRESS FILE PHOTO

David MacNaughton, Canada’s am­bas­sador to the U.S. who sat in on Mon­day’s meet­ing be­tween Justin Trudeau and Don­ald Trump, says talk of changes to NAFTA have fo­cused on en­sur­ing they are mu­tu­ally ben­e­fi­cial.

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