Don’t fear for NAFTA, says ex-U.S. diplomat
A former U.S. ambassador to Canada doesn’t think the election of Donald Trump means it’s time to sound the death knell on the North American Free Trade Agreement.
In fact, David Wilkins insists trade — particularly that tied to energy — will grow between Canada and the United States, despite Trump’s broadside attacks against the continental pact during the presidential election campaign.
While millions of groggy Canadians woke up Wednesday trying to make sense of Trump’s surprise victory, Wilkins remained confident the relationship between the two neighbouring countries will get better, not worse.
“I’m not one of these who think the sky will be falling in,” says Wilkins, a Republican member in the South Carolina House of Representatives for 25 years who later became U.S. ambassador to Canada under George W. Bush.
“This is a pro-business president-elect who will surround himself with pro-business folks … that will be a boost for the U.S. economy, which is always good news for Canada.”
During the campaign, Trump embraced a populist, antiglobalization stance, lashing the 22-year-old trade agreement between Mexico, Canada and the U.S.
Trilateral trade within the North American region, which sat at US$288 billion in 1993, exceeded US$1.12 trillion by 2014.
By 2015, Canada and the U.S. alone exchanged about $2.4 billion each day in an array of goods and services, from vehicles, fruits and vegetables to oil and gas.
Yet the real estate mogul called NAFTA “the worst trade deal in the history ... of this country,” pointing at a loss of manufacturing jobs in the U.S.
He spoke frequently of renegotiating the pact.
On Twitter, Roland Paris, Justin Trudeau’s former foreign policy adviser noted Canada’s merchandise exports to the U.S. account for one-fifth of Canada’s GDP.
“Uncertainty. On many important international issues. Get used to it,” he wrote.
Analysts expect the change at the White House will have implications for free trade between the U.S. and Mexico, but remain uncertain how this will shake out for Canada.
They do, however, expect a shift in focus from trilateral to bilateral affairs.
“I don’t think Canada is top of mind to him, but it’s not necessarily on his hit list either,” said Christopher Sands, director of the Centre for Canadian Studies at Johns Hopkins School of Advanced International Studies.
Sands, who will speak in Calgary on Thursday, doesn’t believe the U.S. will ultimately scrap NAFTA, but suspects Trump will begin with a tough opening position — a “shock and awe demand and then negotiate back from it.”
Speaking from Greenville, S.C., Wilkins insists NAFTA won’t be ditched by the incoming Republican administration because the benefits are so obvious to all sides.
He notes other presidential candidates, including Barack Obama, spoke out against NAFTA while campaigning years ago but didn’t scrap it, reflecting political rhetoric doesn’t always match policy intentions.
“It’d be one thing (for Trump) to try to renegotiate a specific part of it or have a conversation about expanding it, but as far as quote, tearing up NAFTA … I do not expect that to happen,” said Wilkins.
What does seems certain is a dramatic U-turn in American energy policies going forward in 2017.
Last May, Trump outlined a pro-fossil fuel agenda and repudiated Obama’s decisions on the climate file, including the outgoing president’s rejection of the Keystone XL pipeline.
Trump vowed to save the coal industry, lift moratoriums on energy production from federal lands and revoke policies restricting new drilling technologies.
“I think this new president will respect the natural resources, both in the United States and in Canada. He will not disparage your oilsands, he won’t refer to them as dirty oil,” Wilkins said.
For Alberta, the most prominent page in Trump’s energy playbook centres on the $8-billion Keystone XL pipeline, which would move oil from Western Canada to refineries on the U.S. Gulf Coast.
Trump noted Obama blocked TransCanada’s pipeline even though it would’ve created 42,000 jobs. The rookie politician said he’d ask TransCanada to renew its permit application, but suggested he will bargain for a better deal from the proponent.
“By the way, I might also be asking for a big piece of the profit from that, so that the American people can get some more money out of it. Does that make sense?” Trump said in his May speech.
TransCanada issued a short statement Wednesday, noting it remains committed to the project.
The long-running softwood lumber spat that looms between the United States and Canada must be dealt with in the coming months. Wilkins says the climate stances between Canada and the U.S. could also lead to policy differences between the countries.
But he’s not worried, even though many Canadians are today by the reality of President Trump.
“There are always myriad number of trade issues that must be dealt with between our two countries and we resolve the vast majority of them,” says Wilkins.
“And I have no reason to believe that won’t continue.”