“Is America’s new stance on trade leaving Canada out in the cold?
The Irish eyes that once smiled on Canada-U.S. trade have been replaced by a scowl from south of the border. Unfortunately for Canadian businesses, it seems that no matter who wins this year’s U.S. presidential election, Washington will continue to frown upon trade relations with Canada.
Bilateral irritants, including softwood lumber and dairy, have piled up in recent years. This has been exacerbated by President Joe Biden’s penchant for protectionism, much like his predecessor. It appears that having a Democrat back in the White House has not led to fewer trade tensions for Canada.
America’s New Buy America Policies
As Biden gears up for the fight of his political life, he is doubling down on his Buy America policies. His trade chief, U.S. Trade Representative Katherine Tai, made it clear that “We are putting the ‘U.S.’ back into USTR.” This is coupled with Republican front-runner and former president Donald Trump turbo-charging his “America first” mantra, proposing a 10-percent tariff on all imported goods, no matter the country of origin.
Disdain for World Trade Organization
Both men appear to have disdain for the World Trade Organization, which makes globalization a dirty word in America. This shows that Canada cannot count on receiving special consideration from its largest trading partner no matter who prevails in November.
Looking Back on Canada-U.S. Relations
It’s enough to make Canadians nostalgic for the Shamrock Summit of 1985 when then-prime minister Brian Mulroney hosted U.S. president Ronald Reagan in Quebec City on St. Patrick’s Day. It was this moment that paved the way for the Canada-U.S. free-trade agreement in 1988, setting a positive precedent for the future.
Potential for Further Challenges
Nearer term, the Canada-U.S. relationship faces significant challenges. Plans to increase tariffs on Canadian softwood lumber producers and ongoing concerns about Canada’s implementation of the dairy market access commitments under the USMCA are continuing sources of contention.
Concluding Thoughts
Although trade tensions are likely to persist no matter the outcome of the U.S. election, Canada must continue to navigate these challenging waters. Canada’s role in U.S. jobs and prosperity needs to be communicated effectively to avoid becoming a controversial point in the election or a target for certain political agendas. The future of Canada-U.S. trade remains uncertain, but proactive and thoughtful engagement is key in managing these challenging times.”
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