New TPP will cut billions in imports from U.S., feds say

American imports into OTTAWA Canada could fall by $3.3 billion under the recently rebooted TransPacific Partnership, the federal government has concluded, sparking fears the new pact could hurt the ongoing NAFTA renegotiation.

The text of the 11-country Pacific Rim trade deal — a pact President Donald Trump pulled the U.S. out of last year — was released late Tuesday, but a Global Affairs Canada analysis of the deal also delves into the impact on the North American Free Trade Agreement talks, which are to resume in five days in Mexico City.

The Trump administration has blasted trade deficits with Canada as an underlying reason for wanting to renegotiate or tear up NAFTA. The Canadian government rejects that position, saying the statistics don’t back the U.S. deficit assertions.

But the most recent analysis of the new TPP — known by the acronym CPTPP — predicts lower U.S. imports into Canada. “Under the CPTPP, Canadian exports to the United States are not expected to change significantly as the United States is not party to the CPTPP. However, there would be a decline in imports by Canada from the United States, resulting from erosion of U.S.’s NAFTA preferences in the Canadian market,” the analysis says. “Total Canadian imports from the United States are projected to fall by $3.3 billion, led by a decline in automotive products imports.”

Flavio Volpe, president, of Canada’s Automotive Parts Manufacturers Association, says that will hurt Canada at the next NAFTA round, where auto remains a key obstacle.

Canadian auto workers and manufacturers have been critical of the new TPP, including the government’s assertion that it has gained more access to the protected Japanese market.