Canada has nothing to fear in NAFTA negotiations: experts

Farmers might be scared of what renegotiation of the North American Free Trade Agreement could mean, but it could be a chance for Canada to fix and improve some problems, say a number of analysts and economists.

“It’s an opportunity for us to become way more ambitious around trade, whether it’s domestic or international,” said Sylvain Charlebois, a Dalhousie university expert on Canada’s food industry.

“We can actually use NAFTA as an opportunity to make internal commerce much more effective than it is now.”

And for most farmers, it shouldn’t be a source of excessive fear, others said.

“I don’t see a lot of things to worry about,” said Kevin Grier, a livestock markets analyst.

However, supply management industries are clearly in the U.S. president’s crosshairs and will almost certainly face some additional shots, said economist Al Mussell of Agri-Food Economic Systems.

“We have to assume that the U.S. will probably want at least as much and probably more access … to Canadian dairy, poultry and egg markets than they had secured in (the Trans-Pacific Partnership,)” said Mussell.

Canada’s agricultural exports to the U.S. and Mexico have multiplied many times since NAFTA was signed in 1993.

For 23 years NAFTA seemed a permanent feature of an integrated North American economy, but then Donald Trump was elected U.S. president and began speaking about renegotiating or even ending the agreement.

Canada’s response has been to work quietly through diplomacy and to work with trade allies to build support for NAFTA.

While many Democrats in Congress dislike or feel neutral about NAFTA, most Republicans are trade supporters who are unlikely to support moves to kill NAFTA.

That was why Grier isn’t too fearful about a NAFTA renegotiation.

“There’s no real body in the United States (farm and food industry) that’s very protectionist, with the exception of R-CALF,” said Grier.

Brian Innes, president of the Canadian Agri-Food Trade Alliance, said the chance to renegotiate could be a good thing.

“Clearly there are opportunities to make it work better, even though it has been an incredible success.”

Innes told the House of Commons international trade committee that flaws and lingering irritations could be reduced in a re-formed NAFTA.

He identified issues to examine:

  • harmonization of pesticide maximum residue levels (MRLs)
  • harmonization of farm chemical regulatory approvals
  • removal of border disparities, such as the problems U.S. grain has being delivered to Canadian grain elevators and the extra inspection Canadian meat exports are subject to at the U.S. border

“There’s huge opportunity when it comes to regulatory alignment,” said Innes.

Mussell said he too hoped to see more regulatory standardization come out of a reworked NAFTA.

Charlebois said if Canada gets its act together it could clean up both NAFTA and internal trade by em-bracing a strategic commitment to improving trade flow.

The same goes for supply management industries, he said. Rather than defending supply management as it exists now, Canada should consider reforming the system so farmers are still stable but also allows for more industry growth.

“If you can actually think of it as an opportunity you can actually come up with a really strong strategic model which can make the sector even bigger and stronger,” said Charlebois.

“Right now it’s just shrinking.”

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