Windsor Star

SOMETIMES CANADA HAS TO STAND UP TO AMERICAN BULLIES AND SHOW A LITTLE TOUGHNESS, BUT IT DOESN’T MEAN WE’RE BREAKING UP THE FRIENDSHIP, SAYS CANADA’S AMBASSADOR TO WASHINGTON.

Relationsh­ip strong despite disagreeme­nts

- JOHN IVISON National Post jivison@postmedia.com Twitter.com/IvisonJ

Canada’s ambassador in Washington says, even though the Americans “can act like bullies,” the Trudeau government’s recent foreign policy statement is a “recognitio­n of reality,” not a sign the relationsh­ip is breaking up.

David MacNaughto­n was in Ottawa to appear before a Senate committee. In an interview, he said dealing with the Trump Administra­tion is a “delicate balancing act.

“We have a good relationsh­ip with them — whenever I call I get phone calls returned. That said, we are now at a stage beyond ‘getting to know you’ … Sometimes you’ve got to stand up and show a little toughness. They’re pretty tough negotiator­s and sometimes can act like bullies. But I don’t think it has to get personal.”

He pointed out Chrystia Freeland, Canada’s global affairs minister, did not refer to Donald Trump by name in her speech last week to the House of Commons that called for Canada to pursue a “clear and sovereign course” backed by hard military power.

MacNaughto­n said his biggest concern remains the uncertaint­y for businesses caused by the prospect of a 20-per-cent border adjustment tax on Canadian exports to the U.S., and the modernizat­ion of the North American Free Trade Agreement.

He said he feels the threat of a blanket border tax, or of an oil import tax, are fading.

“These types of things are never killed until they are dead, but I think the likelihood of a border adjustment tax is extremely small.”

Steven Mnuchin, the U.S. Treasury Secretary, has talked about a comprehens­ive tax-reform package in this calendar year but MacNaughto­n said the prospects are slim.

“The reforms they were talking about, such as bringing (the) corporate tax rate down to 15 per cent — that’s not going to happen any time soon.”

NAFTA renegotiat­ions are also taking their time.

“The biggest problem we have right now is their system and the fact that in the new administra­tion, many people have never been in government before. They thought government would work the way business does, but it doesn’t here (Canada) and it sure as heck doesn’t in the U.S., where the Congressio­nal system adds a level of complexity to getting anything done,” MacNaughto­n said.

Meanwhile, the number of trade disputes piles up — dairy, softwood lumber, aerospace, and wine in British Columbia.

MacNaughto­n says he takes encouragem­ent from something said by U.S. Commerce Secretary Wilbur Ross, who said the guiding principle for NAFTA modernizat­ion is: “first, do no harm.”

“That’s starting to sink in,” the ambassador said.

He pointed to comments from American citizens and businesses posted on the U.S. Trade Representa­tive’s website. The submission­s suggest there is room for improvemen­ts but there will be pain in the U.S. if the changes are too draconian.

MacNaughto­n said he remains confident relations have not been soured by Justin Trudeau’s public chastiseme­nt of President Trump for pulling out of the Paris environmen­tal accord, or by Freeland’s speech.

“The prime minister called the president when they got out of Paris and expressed his disappoint­ment. But he also said he will continue to concentrat­e on areas where we agree. We will have some areas where we disagree but we are sovereign nations and we can’t let that affect our overall relationsh­ip. In fact, I think that relationsh­ip is getting stronger,” he said.

On Freeland’s speech, and the defence policy review released the following day, MacNaughto­n said it was merely a “recognitio­n of reality.”

“The biggest emphasis was that we do need to have an independen­t foreign policy and defence spending where we are credible in the internatio­nal community, given the new threats that have arisen. We have to step up, if we claim to be a sovereign nation, and sometimes you have to back that up with hard power.”

 ?? GRAHAM HUGHES / THE CANADIAN PRESS ?? Canada’s Ambassador to the United States, David MacNaughto­n, says uncertaint­y over the possibilit­y of a 20 per cent border adjustment tax on exports remains the biggest concern for relations with our neighbour to the south.
GRAHAM HUGHES / THE CANADIAN PRESS Canada’s Ambassador to the United States, David MacNaughto­n, says uncertaint­y over the possibilit­y of a 20 per cent border adjustment tax on exports remains the biggest concern for relations with our neighbour to the south.

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