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On NAFTA, Canada preparing for ‘every eventuality’

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OTTAWA – With senior Canadian officials acknowledging there is an increasing chance that U.S. President Donald Trump is preparing to pull the U.S. out of NAFTA, Canada’s main minister on the file, Chrystia Freeland says Canada is ready.

Freeland, Canada’s foreign affairs minister and point-person on Canada-U.S. relations said that it’s been well known since before the renegotiations got underway that the U.S. was mulling withdrawing, but the federal government is still holding out hope that Trump’s rhetoric on the trilateral trade deal remains just that.

“Our approach from the start has been to hope for the best, but prepare for the worst, so Canada is prepared for every eventuality,” Freeland told reporters at the start of the two-day Liberal cabinet retreat in London, Ont. Thursday morning.

“I think we need to take our neighbours at their word, take them seriously,” Freeland said.

Canada hosting round six in Montreal

Senior government officials tell CTV News that there is an increasing chance that the Americans will walk away from the North American Free Trade Agreement.

The U.S. administration could do so by using a clause within the deal which sets in motion a six-month withdrawal notice. That notice would have to happen by March, adding pressure to the next round of NAFTA talks scheduled to start January 23 in Montreal.

There, Freeland said she still hopes that “goodwill on all sides” when Canadian, U.S. and Mexican negotiators reconvene in a few weeks. Canada is close to closing some “bread-and-butter” business chapters of the trade deal.

“When it comes to the more unconventional U.S. proposals, we have been doing some creative thinking. We’ve been talking with Canadian stakeholders, and we have some new ideas that we look forward to talking with our U.S. and Mexican counterparts about in Montreal,” Freeland said.

Potential pullout moved markets

Reports of the U.S.A.’s potential pullout moved the markets yesterday and the Canadian dollar took a hit.

Finance Minister Bill Morneau, speaking to reporters Thursday morning, said he knows people are closely watching the negotiations and that the government has “carefully looked at all scenarios in order to consider what the ramifications are.”

The ministers have offered no details yet on what the preparations for a U.S. withdrawal look like.

“What we’re trying to do is make sure that we get to a situation where we have a strong agreement that will ensure our economic security,” Morneau said.

Over the last year there has been a concerted approach from Canada to meet with U.S. counterparts at various levels of government to discuss the benefits of staying in the trilateral trade deal. This lobbying has included members of the Opposition.

Impact on Canada-U.S. relations

Former U.S. ambassador to Canada Bruce Heyman tweeted that Trump “has demonstrated internationally when the tough gets going-the going gives up.” He called a potential NAFTA withdrawal “reckless and irresponsible.”

In an interview with CTV News Channel, Heyman said he thinks Canada has taken “the absolute right approach,” in working to improve NAFTA while also preparing for the possibility the deal might be dismantled.

Heyman cautioned his fellow Americans that leaving the table would cause “significant harm” to Canada-U.S. relations.

Prime Minister Justin Trudeau was also asked about the fate of NAFTA on his way into the cabinet meeting, and he said he looked forward to discussions with his cabinet colleagues today.

NDP call for transparency in talks

New Democrat Trade critic Tracey Ramsey said, given the latest news that a Trump withdrawal could be imminent, she wants the Liberals to be more “upfront” about the status of the talks.

“From the very beginning of NAFTA renegotiations, we have urged the Liberals to be open and clear about their plans and priorities with this trade deal. Yet, despite the Liberals’ campaign promises to be open and transparent, they have left Canadians completely in the dark,” said Ramsey. She noted the number of sectors and Canadian jobs that would be impacted by NAFTA falling apart.

“It is time the minister reveal what those plans are, to provide leadership and stability for Canadian workers…. and all affected Canadians deserve to know what supports will be in place,” she said.

With files from CTV News’ Ottawa Bureau Chief Joyce Napier

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On NAFTA, Canada preparing for ‘every eventuality’

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