Bad Influence
Published in Le Devoir
(Canada) on 30 September 2017
by Éric Desrosiers (link to original)
(Canada) on 30 September 2017
by Éric Desrosiers (link to original)
Translated from
by Laura Napoli.
Edited by Aaron Drews.
Trade negotiations are usually the business of obscure, boring and needy technocrats. With Donald Trump, they’ve become confusing, muddled and acrimonious political games.
To believe the official version, the renegotiation of the North American Free Trade Agreement is proceeding smoothly. In a joint statement on Wednesday, September 27, the officials in charge of the proceedings from Canada, the United States and Mexico even described the third round of discussions, which had recently concluded in Ottawa, as a success, where, according to them, “significant progress” was accomplished, particularly for small and medium-sized enterprises. But once the cameras and microphones were turned off, a different story emerged.
What is being said, among other things, is that, although it was the United States who forced the reopening of the accord by threatening to purely and simply slam the door otherwise, their negotiation team is by far the least well-prepared of the three. At the beginning of the negotiation, there was a staffing problem, with many high-ranking positions in the U.S. Department of Commerce—like in the rest of the U.S. administration—still not having been filled, months after Donald Trump came to power.
Canadian and Mexican negotiators also complain of never knowing exactly what the Americans want. Although the official goal of the renegotiation is to “modernize” NAFTA, which is almost 25 years old, Donald Trump has made it clear that, for him, international trade is a zero-sum game and that he wants, first and foremost, for his country to import less than its neighbors and export more. Besides that, his negotiators were the first to list their demands this summer, but this list—the summary alone of which is composed of 13 pages—remains vague at best, notably on many of the most contentious issues, such as access to agricultural markets, dispute resolution mechanisms and the minimum North American content threshold for property to be free of tariffs.
“It’s difficult to negotiate when the substantive issues aren’t on the table,” noted a Canadian observer in Le Devoir on Thursday, September 28. It’s like trying to dance without a partner or music.
It is common, of course, to save the most delicate questions and the biggest compromises for the final sprint, but there are limits!
Improvisation, Contradiction and Provocation
It’s not always better when U.S. negotiators present more concrete proposals. Two weeks ago, they came up with the odd idea of adding to the treaty a time-limited clause (“twilight clause”) that would force member countries to renew their membership every five years, before qualifying it as a mere “concept” thrown in the air. Last week, they wanted to demonstrate that the American content of cars produced on the continent was in free fall, only to be told after a fact-check, that all of their numbers were wrong.
Aside from this, a large number of U.S. demands seem to be directly drawn from the Trans-Pacific Partnership treaty, signed in 2015 between 12 Asian countries and three American ones, including the parties to NAFTA. Ironically, Donald Trump abandoned this agreement as soon as he took office. Other demands, however, seem to be there only to push others onto the sidelines, like the demand, reported on Wednesday in the Globe and Mail, that Mexico increase its minimum wage eightfold.
It’s a question of where the United States wants to go, as Mexican and Canadian negotiators complained this week. When one speaks to America's leading trade policymakers, said one of the negotiators in the Globe and Mail on Sunday, it seems like the population that they’re trying to please consists of only one person: President Trump.
It’s difficult to see how this exercise could lead to a substantive agreement in the extremely short time period that they have been given (end of 2017 to beginning of 2018), or even any agreement at all. For the moment, we are officially optimistic and the tone remains courteous, but the pressure will be stronger as the hour of reckoning approaches. Canadian Minister of Foreign Affairs Chrystia Freeland warned at the outset that the process was going to experience some “theatrical” and “emotional” moments.
Citizens, To Arms!
Quebec and Canada had a taste of things this week, in the Boeing vs. Bombardier CSeries case. Threats of trade sanctions and counter-sanctions are as common in the aviation industry as governmental subsidies. It was the dizzying height of the punitive tax inflicted by the American authorities on Canadian aircraft (220 percent) that surprised everyone. Three times higher than what Boeing itself claimed, this tax demonstrates more of the protectionist and vindictive attitude of President Trump than of the calculations of an agency specializing in international trade, even an American one.
The news immediately unleashed cries of scandal and vengeance in Canada and Quebec. Normally fairly cautious and measured when it comes to their powerful and vital American trade partner, even in the darkest hours of the multiple softwood lumber disputes, our leaders this time are pounding the drums of trade war.
There is someone in the White House who must feel like a pig in mud!
To believe the official version, the renegotiation of the North American Free Trade Agreement is proceeding smoothly. In a joint statement on Wednesday, September 27, the officials in charge of the proceedings from Canada, the United States and Mexico even described the third round of discussions, which had recently concluded in Ottawa, as a success, where, according to them, “significant progress” was accomplished, particularly for small and medium-sized enterprises. But once the cameras and microphones were turned off, a different story emerged.
What is being said, among other things, is that, although it was the United States who forced the reopening of the accord by threatening to purely and simply slam the door otherwise, their negotiation team is by far the least well-prepared of the three. At the beginning of the negotiation, there was a staffing problem, with many high-ranking positions in the U.S. Department of Commerce—like in the rest of the U.S. administration—still not having been filled, months after Donald Trump came to power.
Canadian and Mexican negotiators also complain of never knowing exactly what the Americans want. Although the official goal of the renegotiation is to “modernize” NAFTA, which is almost 25 years old, Donald Trump has made it clear that, for him, international trade is a zero-sum game and that he wants, first and foremost, for his country to import less than its neighbors and export more. Besides that, his negotiators were the first to list their demands this summer, but this list—the summary alone of which is composed of 13 pages—remains vague at best, notably on many of the most contentious issues, such as access to agricultural markets, dispute resolution mechanisms and the minimum North American content threshold for property to be free of tariffs.
“It’s difficult to negotiate when the substantive issues aren’t on the table,” noted a Canadian observer in Le Devoir on Thursday, September 28. It’s like trying to dance without a partner or music.
It is common, of course, to save the most delicate questions and the biggest compromises for the final sprint, but there are limits!
Improvisation, Contradiction and Provocation
It’s not always better when U.S. negotiators present more concrete proposals. Two weeks ago, they came up with the odd idea of adding to the treaty a time-limited clause (“twilight clause”) that would force member countries to renew their membership every five years, before qualifying it as a mere “concept” thrown in the air. Last week, they wanted to demonstrate that the American content of cars produced on the continent was in free fall, only to be told after a fact-check, that all of their numbers were wrong.
Aside from this, a large number of U.S. demands seem to be directly drawn from the Trans-Pacific Partnership treaty, signed in 2015 between 12 Asian countries and three American ones, including the parties to NAFTA. Ironically, Donald Trump abandoned this agreement as soon as he took office. Other demands, however, seem to be there only to push others onto the sidelines, like the demand, reported on Wednesday in the Globe and Mail, that Mexico increase its minimum wage eightfold.
It’s a question of where the United States wants to go, as Mexican and Canadian negotiators complained this week. When one speaks to America's leading trade policymakers, said one of the negotiators in the Globe and Mail on Sunday, it seems like the population that they’re trying to please consists of only one person: President Trump.
It’s difficult to see how this exercise could lead to a substantive agreement in the extremely short time period that they have been given (end of 2017 to beginning of 2018), or even any agreement at all. For the moment, we are officially optimistic and the tone remains courteous, but the pressure will be stronger as the hour of reckoning approaches. Canadian Minister of Foreign Affairs Chrystia Freeland warned at the outset that the process was going to experience some “theatrical” and “emotional” moments.
Citizens, To Arms!
Quebec and Canada had a taste of things this week, in the Boeing vs. Bombardier CSeries case. Threats of trade sanctions and counter-sanctions are as common in the aviation industry as governmental subsidies. It was the dizzying height of the punitive tax inflicted by the American authorities on Canadian aircraft (220 percent) that surprised everyone. Three times higher than what Boeing itself claimed, this tax demonstrates more of the protectionist and vindictive attitude of President Trump than of the calculations of an agency specializing in international trade, even an American one.
The news immediately unleashed cries of scandal and vengeance in Canada and Quebec. Normally fairly cautious and measured when it comes to their powerful and vital American trade partner, even in the darkest hours of the multiple softwood lumber disputes, our leaders this time are pounding the drums of trade war.
There is someone in the White House who must feel like a pig in mud!
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