Automotive supply chain, F-35 procurement among issues for which the two countries must search for common ground
November 10, 2016
OTTAWA—Experts say Donald Trump’s stunning election win has thrown the cornerstones of Canadian foreign and defence policy into question.
They say Canada needs to prepare for a U.S. president who is open to dismantling the North American Free Trade Agreement, wants to throw up protectionist walls along the 49th parallel and has challenged how NATO works.
Trump floated all of those ideas during the campaign, but his victory speech sought to play them down.
Instead, he stressed that his administration would “deal fairly” with other countries and look for common ground rather than hostility.
Fen Hampson, the head of the global security program at the Centre for International Governance Innovation in Waterloo, Ont., says Canada should now focus on preserving its trade agreement with Europe and expanding its reach into Asia.
Hampson says an end to NAFTA could eventually mean new tariffs on goods and services that the trade agreement kept at bay, as well as an end to bilateral dispute resolution.
“We should expect a wrecking ball on NAFTA that will also force us to renegotiate the terms of the Canada-US 1988 free trade agreement,” Hampson said in an interview.
“It’s time to double down on our own bilateral trade agreements not only with the European Union but with new markets in Asia. That will give us leverage with Washington. The more we can diversify the more leverage we will have.”
Trade lawyer Lawrence Herman said Trump’s signals that he would reopen NAFTA would force Canada to the bargaining table for some tough discussions.
“As a practical matter, if the Americans insist on re-negotiation, I don’t see how we can refuse to sit down and talk.”
Herman said there are serious implications for the auto industry, which has developed an intertwined supply chain that now crosses North American borders.
“He won Michigan and Ohio and will do what’s needed to protect the auto workers in that part of the country. If that means reducing Canadian benefits, Trump won’t care.”
Hampson said Trudeau was wise to avoid criticizing Trump during the campaign and he should immediately try to meet the president-elect to forge a personal relationship with a leader driven more by personality than policy.
But the Trudeau government may face more calls to increase defence spending.
“When it comes to NATO allies and his rhetoric about free riders, he’s going to be looking very hard at what we spend on defence, and he’ll look very hard and what kind of fighter we’re going to purchase.”
Hampson predicted Trump will play “hardball” if the Liberals turn their backs on purchasing the F-35 stealth fighter from American firm Lockheed Martin when it finally chooses its replacement for CF-18 fleet.
Canada’s support of the Paris climate change agreement puts the two countries on “a collision course” on climate change, he added.