Trade deal an opportunity for NDP
Trans-Pacific Partnership comes with potential downsides for the Liberals
MONTREAL — Prime Minister Justin Trudeau’s decision to sign on to a new Pacific trade deal that does not include the United States has reassured those who feared his government was fiddling with the trade file while NAFTA was on the verge of unravelling.
But the announcement that Canada will join 10 other nations in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (formerly the TPP) comes with potential downsides for the Liberals.
It stands to make holding together the fragile pro-NAFTA coalition Trudeau has built more difficult.
Cracks in that coalition were in evidence minutes after Tuesday’s TPP announcement. Speaking for Canada’s auto parts manufacturers, the president of their association, Flavio Volpe said there “could not be a dumber move at a more important time.”
The president of Unifor, Canada’s largest private-sector union, Jerry Diaz accused the federal government of having “thrown NAFTA negotiators under the bus.” There was similar pushback from the steel industry.
Lobbyists for Canada’s dairy farmers questioned the logic of forcing concessions on their industry that would no longer be matched by reciprocal gains in the shape of improved access to the U.S. market.
Ontario Premier Kathleen Wynne — Trudeau’s main provincial ally among the larger provinces — said she was concerned about the impact of the trade deal on key sectors of her province’s economy.
Quebec would readily join the ranks of the discontented if the exemption for cultural industries that Canada says it has wrestled from its partners turns out not to be bulletproof.
Expect the definitive text of the rewritten TPP deal to be parsed with a fine-tooth comb.
In public, Canada’s NAFTA negotiators maintain that the decision to join Mexico in embracing a Pacific trade deal will have no real impact on the ongoing NAFTA talks.
But in private there were questions as to whether Trudeau’s government concluded that, the risks of signing on to a revised TPP now were offset by the positive optics of looking like Canada was succeeding in finding alternative trade avenues.
The sixth round of tripartite NAFTA negotiations opened this week in Montreal in a climate of pessimism with most Canadian trade insiders bracing for the worst.
In a CTV interview last weekend former Conservative interim leader Rona Ambrose who sits on Trudeau’s NAFTA advisory council said there seemed to be a consensus that it was probably only a matter a time before the Trump administration pulls the plug on NAFTA.
Talk of a Canadian Plan B has percolated to the surface over the past few weeks.
In any event if Trudeau was looking for a taste of the acrimony that may be to come if Canada — to salvage NAFTA — ends up making significant concessions at the negotiating table, he got it this week with the announcement of the Pacific trade deal.
The NAFTA talks are essentially about mitigating losses. Canada’s bottom line revolves around how much it can afford to give up before it decides it is not worth pursuing the current North American trade arrangements.
No amount of federal rhetoric can change the fact that the dominant thread in that narrative is one of damage control.
As an insurance policy against a NAFTA failure, the revised TPP offers Canada minimum coverage. It is not a remedy for the realities of geography. But it could be described as a consolation prize.
By comparison to the NAFTA dynamics, the Pacific trade deal stands to make at least some industry winners in Canada. The country’s pork and beef producers are among those.
On the political side, Trudeau’s move could also give a bit of a breath of life to the flagging NDP.
The initial TPP was negotiated under Stephen Harper in the dying days of the 2015 federal election. At the time, NDP leader Tom Mulcair latched on it in an attempt to re-energize his losing campaign.
In the last stretch he pivoted away from his platform to campaign hard against the Trans-Pacific Partnership. The strategy is credited with having helped the NDP save some Ontario and Quebec seats.
Back then though Trudeau dodged the battle. The Liberals reserved judgment on the merits of the deal until after the election. The chapter of the TPP saga that opened this week will find the Liberals more squarely in the sights of the NDP and some of its activist and union allies.