Canada’s goals for ‘progressive’ NAFTA include labour and environmental standards, gender equality

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Sounding optimistic, but warning that negotiations could be difficult, Foreign Affairs Minister Chrystia Freeland used a series of appearances on Monday to explain that Canada will seek to modernize North America’s 23-year-old trade deal to update its labour standards, ease cross-border movements of professionals, cut red tape and open up government procurement.

Talks to renegotiate the North American Free Trade Agreement begin on Wednesday in Washington, D.C.

Canada, the United States and Mexico are embarking on a “historic project,” Freeland said, adding she was optimistic about the talks, but that there would likely be moments of drama and conflict.

In a speech at the University of Ottawa, the minister pointed to Canada’s free-trade deal with the European Union as an example of the kind of “progressive” trade pact Canada wants to see in a new NAFTA.

Specifically, she pointed to strong labour safeguards, integrated environmental protections, a new chapter on gender rights to promote gender equality, a chapter dedicated to Indigenous people and reforming the investor-state dispute settlement process to ensure governments can pass regulations in the public interest without facing corporate legal action.

The Canada-EU deal, known as CETA, comes into effect Sept. 21.

Freeland said those “progressive elements,” including labour standards, were important to maintaining popular support for free markets.

“Canadians broadly support free trade. But their enthusiasm wavers when trade agreements put our workers at an unfair disadvantage because of the high standards that we rightly demand. Instead, we must pursue progressive trade agreements that are win-win, helping workers both at home and abroad to enjoy higher wages and better conditions.”

Freeland said the renegotiations are an opportunity to cut red tape and harmonize regulations to “make life easier for business people on both sides of the border.”

Chrystia Freeland outlines Canada’s NAFTA goals2:25

Also among the six goals Freeland set out in her speech Monday:

  • Creating a freer market for government procurement by pushing back against “local-content provisions” for major government contracts, a swipe at “Buy American” laws in the United States.
  • Easier cross-border movement of business professionals by expanding NAFTA’s Chapter 16 provisions for temporary entry for businesspeople.
  • Maintaining Canada’s traditional protections under NAFTA, including a dispute resolution system to ensure anti-dumping and countervailing duties are applied fairly, as well as an exception to preserve Canadian culture and Canada’s system of supply management.

Perhaps attempting to prepare Canadians for difficult times ahead, Freeland explained things could get messy, likening the process to remodelling one’s kitchen. She recalled that the late Simon Reisman, Canada’s chief negotiator during free-trade talks with the United States in 1987, dramatically walked away from the bargaining table at one point.

Freeland herself walked away last year from negotiations on CETA.

Freeland testifies at trade committee

Appearing before the international trade committee after her speech at the Ottawa school, Freeland was asked to account for specific elements of business between Canada and the United States.

NDP Tracey Ramsey argued that CETA had “eroded” Canada’s system of supply management in the dairy sector, and noted that the American administration takes issue with the arrangement. Conservative MP Dave Van Kesteren similarly wondered if Freeland would change the rules around dairy access.

Canada ‘fully committed’ to defending supply management5:55

Freeland said her government is “fully committed” to defending supply management and argued that American producers are currently exporting more dairy products into Canada than vice versa.

Conservative MP Gerry Ritz asked whether the outstanding dispute on softwood lumber would continue to be pursued or whether it would be set aside until NAFTA was renegotiated. Freeland said she thinks negotiations on softwood lumber will continue in parallel.

Freeland was accompanied by several officials from the Department of Foreign Affairs, including Steve Verheul, Canada’s chief negotiator.

“We’ve been doing a lot of research on what the U.S. will be looking for, not looking just at their stated negotiating objectives, but well beyond that,” Verheul assured MPs. “We have a good sense of what they’re going to bring to the table and what the value of it is. And I think we’re certainly well positioned to respond to whatever might come.”

Conservative MP Randy Hoback nonetheless said not enough was presented to give the business community confidence that the government had a “game plan.” Both Hoback and Ritz questioned whether the Liberal government had done enough to prepare for the talks.

Softwood negotiations to continue during NAFTA talks1:52

Freeland heads to Washington

Freeland will travel to Washington on Tuesday for a dinner with her U.S. and Mexican counterparts the night before the first round of formal negotiations is set to take place.

In the run-up to NAFTA renegotiations, the Liberal government waged a massive outreach to U.S. officials to send a message about the mutual importance of NAFTA to jobs and prosperity on both sides of the border.

Since Trump’s inauguration on Jan. 20, Prime Minister Justin Trudeau, cabinet ministers, parliamentary secretaries, premiers and provincial/territorial ministers, parliamentary committees and other parliamentarians have made more than 175 visits to the U.S. or engaged with senior officials in Canada, according to data provided by Global Affairs Canada.

Chrystia Freeland says NAFTA is important to auto sector3:19

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Canada’s goals for ‘progressive’ NAFTA include labour and environmental standards, gender equality

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