Ontario lobbies U.S. governors against protectionist trade measures

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Ontario Premier Kathleen Wynne has been making a lot of long-distance phone calls lately, ringing up U.S. governors from Colorado to South Carolina.

Earlier this month, she chatted with the governor of Wyoming, a western state with a population of less than 600,000. It isn’t exactly a vital trading partner, but Wynne is intent on building bridges with governors wherever they may be.

She’s been writing them, calling them and meeting them, and in July she will attend their annual conference in Rhode Island.

While President Donald Trump pursues “Buy American” policies and warns of withdrawing from the North American Free Trade Agreement if he doesn’t get what he wants at the renegotiation table, states are considering protectionist trade policies of their own.

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Wynne, Prime Minister Justin Trudeau and Quebec Premier Philippe Couillard meet in Ottawa in 2015. Their governments worked together to lobby lawmakers in New York state this spring to drop a proposed “Buy American” policy. (Chris Wattie/Reuters)

Ontario is deeply reliant on trade with the U.S., and it’s a top customer for exports from 27 states.

It exchanges more than $1 billion in trade every day with the U.S., according to the province, so Ontario could be severely impacted if trade restrictions are imposed. With Canada’s biggest economy, Ontario’s success in keeping its borders open matters to the rest of the country.

On-the-ground lobbying

“We believe that there is nothing inevitable about any of these proposals, and so we are going to continue to be on the ground, working with governors, with legislators in states across the country to make the case that open trade, open borders, are in the best interest of the people of the United States and in the best interests of the people of Canada,” Wynne told reporters Monday.

Being on the ground in Albany, N.Y., as that state considered including a “Buy American” provision in its budget in March was crucial to Ontario’s lobbying, government officials say.

Cabinet ministers travelled there to talk one-on-one with lawmakers. Ontario’s representative in Washington, Monique Smith, was a frequent visitor and key player in the full-court press to get the measure dropped.

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A worker walks past stacks of lumber at the Partap Forest Products mill in Maple Ridge, B.C., in April. The federal government, British Columbia, Ontario, Alberta and Quebec are fighting a new softwood lumber tariff imposed by the U.S. (Darryl Dyck/Canadian Press)

“We were present, we were on the scene, they knew that Canada was there,” Smith, a former cabinet minister in Ontario, said in an interview.

Ontario worked with Phyllis Yaffe, Canada’s consul general in New York, and with the Quebec government, which also has strong economic ties to New York.

Ontario hired a government relations firm to help navigate the state’s budget process. The firm is on a retainer for $16,900 a month for up to six months. Quebec is expected to share the cost.

Ontario emphasized to New York lawmakers that about 680,000 jobs in their state depend on trade and investment with Canada.

That narrative, backed by statistics, complemented the physical presence at the legislature and amounted to a winning formula, officials said.

Ontario prepared to retaliate

“We were successful,” Smith said. In the end, the “Buy American” measure was dropped, much to the relief of Ontario and Quebec. Smith said they were worried including the provision would have set a dangerous precedent.

But Texas is considering a policy that would affect steel and iron industries, and Illinois is looking at an even broader one.

Wynne went to Chicago in early April to meet Governor Bruce Rauner and push the open-trade message.

Should a state impose trade restrictions that impact Ontario, the province is prepared to retaliate with measures of its own, but Wynne said Monday that’s “not where we want to go.”

The federal and provincial governments are straddling the line of advocating for open trade while standing up for Canadian industries that could be threatened, including automotive, lumber, dairy and manufacturing.

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David MacNaughton, Canada’s ambassador to the U.S., met Wynne in Toronto in February, with Smith, right. Wynne announced a new committee to focus on U.S. economic issues. (Queen’s Printer for Ontario)

Now that the Trump administration has imposed new tariffs on Canadian softwood lumber, the narrowly re-elected British Columbia Premier Christy Clark wants Prime Minister Justin Trudeau to ban thermal coal exports from the U.S., and he indicated he would consider it. Ottawa is also considering duties on goods from Oregon, which has a senator who has been a hardliner on the softwood lumber dispute.

Ontario hiring advocates, advisers

Ontario hired former federal trade minister Jim Peterson to work on the softwood lumber file. Alberta has hired Canada’s former ambassador to the U.S. and former Manitoba premier Gary Doer, British Columbia has former federal cabinet minister David Emerson and Quebec has Raymond Chrétien, another former ambassador to the U.S.

Ontario also brought on John Gero, Canada’s former ambassador to the World Trade Organization, to advise the government on trade issues.

Dennis Darby, president and CEO of Canadian Manufacturers and Exporters, said in an interview that it’s crucial the federal and provincial governments work closely together and that so far, they seem to be doing that. Darby said his group is part of the planning for the NAFTA talks.

He says Ontario’s personal approach in New York was the right one. “I think that had a lot to do with the New York decision.”

An Ontario government official who worked on the file but was not authorized to be quoted by name said the same strategy will be used with other states, and Queen’s Park is building a “library of information … to deploy at a moment’s notice.”

Ontario also plans to add staff to Smith’s office in Washington.

Talk louder, PC leader says

Progressive Conservative Leader Patrick Brown said in an interview that Ontario needs to “amplify our voice.”

“I don’t think Ontario’s advocacy has been noticed. I certainly don’t think they’ve made any splash in Washington,” he said.

Canada’s ambassador in Washington, David MacNaughton, met Wynne in Toronto in February when she announced a new committee on Ontario-U.S. economic and trade relations.

Smith is co-chairing the committee, which meets monthly. Civil servants who work on U.S. files, some 200 of them, were also brought together for a meeting in February.

Targeting Capitol Hill

In addition to lobbying at state levels, Ontario is carefully choosing whom to target on Capitol Hill. It’s requesting meetings with members of Congress who sit on committees that deal with trade issues.

“We want to make sure that they understand as they go into negotiations on NAFTA how important their relationship is with Canada and Ontario,” said Smith.

“There are always going to be bumps in the road,” Smith said, but “I think Ontario is well-positioned, given all the work that we’ve been doing.”

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Ontario lobbies U.S. governors against protectionist trade measures

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