Hit the ground running on international trade
Justin Trudeau is building his new cabinet at a time when global uncertainty is threatening growth, trade, investment and Canada’s place in the world. As he puts together mandate letters to define expectations for his ministers, here is our own letter-writing attempt, with a few suggestions for the international trade portfolio.
Dear Minister,
With our two biggest trade partners fully engaged in a fight for global supremacy, Canada is in a precarious spot right now when it comes to international trade — the lifeblood of our private sector and our economic prosperity. I am so pleased you have agreed to take on the job of navigating our country through such disruptive times.
While the recent election campaign and our party platform were essentially silent on how Canada should position itself as China and the United States upset global trading patterns and indulge in bruising protectionism, Canadians expect their federal government to do what it takes to ensure the free flow of goods, money and people in and out of their country with an eye to fairness and prosperity for everyone.
Here are the top four priorities you need to undertake to preserve our trading system.
United States Our best customer and our best friend is no longer reliable and is occasionally vindictive. To inoculate ourselves, we need to have all three NAFTA partners sign and seal the renegotiated continental trade agreement as quickly as possible so that it won’t unravel under pressure from American domestic politics.
The naming of a new U.S. ambassador who can intensify top-level diplomacy is the first, urgent step. Lobbying Democrats, businesspeople, state governors and members of Congress should be ratcheted up.
The Conservatives’ co-operation in that regard would be helpful, as would the engagement of organized labour and industry groups from Canada.
In particular, key Canadians need to work together to ensure the automotive sector is not lured by U.S. demands to invest in the United States at the expense of Canada.
China Our second-best customer is most certainly not in the bestfriend camp, having blocked our canola and meat and detained two Canadians to punish us for detaining Huawei executive Meng Wanzhou on behalf of the United States.
The recent naming of Dominic Barton as our new ambassador to Beijing could ease tensions and has already helped bring about the lifting of the meat ban. As a newly named minister, you must capitalize on this momentum immediately to end the other sanctions and negotiate a more neutral stance with China. The patience of the Canadian business community is running out.
That means you should work with the foreign affairs minister to pressure Washington to take legal action against Huawei as a company and not Meng as a person, opening the door to her release from Canadian custody.
In exchange, you could consider giving ground to the United States on its Huawei ban.
At the same time, you need to secure the release of our prisoners in China and the lifting of the ban on canola in return for Meng’s departure from Canada.
Friendships Without the U.S. reliably by our side in trade or in support of global institutions, we need our other allies and international organizations more than ever.
You need to actively take common stands with France, Germany and the United Kingdom on free trade, investment and multilateral taxation initiatives. You need to be prepared to do a quick trade agreement with the U.K. if it leaves the European Union, and preliminary talks are appropriate.
You should ramp up Canada’s profile and leadership, not just at the World Trade Organization, but also at the G7 and G20, the Organization for Economic Cooperation and Development, the United Nations, the Five Eyes and any other network involved in setting standards for the digital economy. Canada has an opportunity to speak up here, in an area of the global economy that will only grow in importance and complexity.
Diversification and investment Be mindful that while Canada benefits from open markets, not every Canadian shares equally in the benefits. Promotion of Canada’s small businesses in new export markets helps, as does attracting international investment into Canada.
Companies say lack of advice is their No. 1 barrier to expanding their exports, so trade commissioners need to be fully resourced, both to help companies and entrepreneurs enter new markets and also act as conduits for foreign companies that want to invest in Canada.
You should make a priority of fully implementing the trade diversification strategy that was introduced last year, targeting key new markets and concentrating your resources on making Canadian firms more competitive in those countries.
Best wishes!