Sign the TPP, Mr. Trudeau
RATIFICATION OF THE TPP IS WHAT CANADIAN BUSINESS OWNERS WANT. — MERRIFIELD
The challenge of Canada’s i nternational trade file is a complex one: diversifying our trade so we are not so beholden to the U. S. market (worth more than 70 per cent of our exports and more than $ 1 billion a day), while simultaneously fighting the protectionism within that one market to which we are so beholden. The protectionist talk coming from both the Trump and Clinton camps during this U. S. presidential campaign should concern the Canadian government and simply ignoring it and hoping it goes away is foolhardy.
The single best t hing Prime Minister Justin Trudeau can do right now to ensure that Canada’s trade portfolio is as varied as possible before the November presidential election is to ratify, or at the very least to signal his government’s support for, the Trans- Pacific Partnership ( TPP). While the debate around this deal has been highly charged, if you pull out the voice of businesses from the noise of zealously anti- trade interest groups, you will find that ratification of the TPP is what Canadian business owners want. They want preferential access to 800 million customers in the fastest growing part of the world and they want the precedent and safeguards that the TPP provides before Canada inevitably increases its formal trading relationship with China.
If the fact that Japan is a TPP partner is overlooked by the Trudeau government, it would be a severe oversight. Japan is the third- largest economy in the world and Canada doesn’t currently enjoy free trade access to its market. Think whatever you will about the TPP, but Japan is the big fish we can catch by signing on. It is an economy that will buy a variety of Canadian resources — energy, seafood, beef, among other things — and Japan is ready to sign on. In fact, Japanese Prime Minister Shinzo Abe has publicly said Canada should seek early ratification of the TPP along with his own government. Both U. S. President Barack Obama and Prime Minister Abe’s buy- in to the TPP should resonate with Trudeau.
However, the TPP will not become reality without ratification by the United States (which requires congressional approval for the deal) and the entire TPP cohort is waiting with trepidation to see what the United States Congress will do with it this fall. Canada is unwisely equating waiting with sitting idle, while a coalition of TPP partners, including Japan, and business groups are actively urging America to ratify the TPP. Just this month, Obama assured Australian Prime Minister Malcolm Turnbull of his commitment to securing congressional approval for the deal, in addition to doing the same during a visit to Vietnam this week. Obama may well be grateful for a show of support from a popular and charismatic progressive world leader to help him sell the TPP at home. Trudeau should not underestimate his influence in this regard.
The challenge of fighting protectionism within the United States is directly linked to the challenge of building support for the TPP because it is American protectionism that is killing this trade deal. Fighting this kind of protectionism is a high- stakes game of whacka- mole that involves all levels of American government and requires vigilance and consistency. The biggest protectionist battle that Canada is fighting right now is over softwood lumber, which is part of an industry that supports 370,000 Canadian jobs and contributes $ 20 billion to our GDP. Again, the perils Canadian exporters may face under a Trump or Clinton presidency should spur the prime minister into action to get a new Softwood Lumber Agreement signed before October when the Canadian industry will find itself unprotected against countervailing and anti- dumping duties.
There are things the Canadian government can do now to insulate our country against the protectionist threat that is coming, but they require action and making decisions. Trudeau has the world hanging off of every selfie and tweet that he makes. Canadian farmers, oil and gas workers, loggers, sawmill workers and small business owners — the middle class the Liberals have talked so much about — is hoping he’ll start using that power for their benefit rather than his own.