Trudeau urged to relaunch Team Canada approach to fight rising US protectionism

US President Joe Biden walks with Mexican President Andrés Manuel López Obrador and Prime Minister Justin Trudeau to a meeting in the East Room of the White House in Washington on November 18.Susan Walsh / The Associated Press

The Trudeau government is urged to re-launch a Team Canada approach to tackling the Biden administration’s US protectionist policies, a non-partisan strategy that worked effectively during the 2017 North American free trade negotiations.

Canadian business and labor leaders say pan-Canadian approach urgently needed as US Senate begins negotiations on Build Back Better legislation that includes significant tax breaks for Americans who buy electric vehicles built in the United States.

During the NAFTA negotiations, Deputy Prime Minister Chrystia Freeland enlisted business and labor leaders, prime ministers and even former Conservative ministers to make the American political system work.

They lobbied Congress, US state governors and lawmakers, and business groups south of the border.

“There is no doubt that this will take a Team Canada approach as we did in the NAFTA negotiations,” said Unifor President Jerry Dias, who represents Canadian workers in the United States. automobile. “We need to meet 33 governors for whom Canada is their major trading partner and say, ‘Look, we’re not going to destroy our number one manufacturing industry without you feeling pain as well. “

Prime Minister Justin Trudeau on Thursday failed in his direct appeal to President Joe Biden for concessions on incentives to buy American, including tax credits of US $ 12,500 to encourage Americans to buy electric vehicles (EVs) made in the United States.

Mr. Trudeau and senior ministers told the US president and lawmakers the incentive would bring the Canadian auto industry to its knees and violate the North American Free Trade Agreement, now known as the United States-Mexico Agreement -Canada (USMCA).

Mr Biden was unmoved, and his press secretary, Jen Psaki, later told reporters that the electric vehicle tax breaks did not violate the USMCA.

“We have a different view of the USMCA’s commitment to electric vehicles,” Brian Nichols, US Under Secretary for Western Hemisphere Affairs, said Friday.

Incentives for electric vehicles are included in Build Back Better legislation that the Democratic-controlled House of Representatives passed on Friday. The $ 1.75 trillion bill aims to strengthen social programs and tackle climate change.

The bill is sent to the equally divided Senate, and Canada will have to start intense lobbying to get the incentive for electric vehicles removed. Centrist Democratic Senator Joe Manchin of West Virginia has expressed doubts about the tax credit.

“We have a huge job ahead of us with both administration and Congress,” said Canadian Chamber of Commerce President Perrin Beatty. “We really need everyone – the private sector, the government, the provinces and others, to pull the oars in the same direction. “

David MacNaughton, who helped negotiate the USMCA as ambassador to Washington, concurred with this view.

“We’re going to have to be in that kind of Team Canada mode all the time if we’re going to be successful in continuing to have access to the US market,” he said.

Mr. MacNaughton said members of the Biden administration had protectionism in their DNA, and he was not surprised that Mr. Trudeau didn’t get any concessions.

“I didn’t think we would get a dramatic breakthrough on Thursday, but I think we’ll get some sort of accommodation on the electric vehicle issue, but it won’t be easy. It has to be a combination of cajoling and sometimes being tough, ”he said.

Mr MacNaughton said the Canadian government took a hard line when the United States was unwilling to send personal protective equipment during the height of COVID-19. The Americans gave in when Ottawa threatened to block exports of pulp, a key material for the manufacture of masks and protective gowns.

Trudeau reminded the president that Canada has a competitive advantage over critical minerals used in batteries for electric vehicles, computers, smartphones and other essential items.

“They want to develop their electric vehicle industry, but they’re going to need our nickel, our cobalt, our magnesium to do it,” Dias said. “And finally, we can tell them that you are the last country in the world that we will export all of this to unless you take this proposal off the table.”

Flavio Volpe, president of the Association of Auto Parts Manufacturers, said Canada should also partner with Europe, Japan, Korea and Italy, who say the tax credit for electric vehicles would violate international trade rules.

Goldy Hyder, president of the Business Council of Canada, said the country needed a “sustainable and collaborative” strategy from all sectors of the economy to “protect our interests” in the face of US protectionism.

“This is how we won in the USMCA negotiations,” he said.

For Subscribers Only: Get exclusive news and political analysis by subscribing to the Policy briefing.

Source link

About Robert Davis

Check Also

Italy targets unvaccinated with restrictions as cases rise | Government-and-politics

“We started to return to normality. We want to keep this normal, ”Draghi said at …