[CTC] Trudeau says he's too busy to join Trump and Lopez Obrador for NAFTA celebration

[Arthur Stamoulis]

https://www.theglobeandmail.com/politics/article-trudeau-says-hes-too-busy-to-join-trump-and-lopez-obrador-for-usmca/ <https://www.theglobeandmail.com/politics/article-trudeau-says-hes-too-busy-to-join-trump-and-lopez-obrador-for-usmca/>

Trudeau says he's too busy to join Trump and Lopez Obrador for USMCA celebration


by Steven Chase and Adrian Morrow. July 6, 2020
Prime Minister Justin Trudeau will not be joining his American and Mexican counterparts this Wednesday in Washington to celebrate the coming-into-force of the renegotiated NAFTA agreement, his office says.

U.S. President Donald Trump and Mexican President Andres Manuel Lopez Obrador are meeting in the U.S. capital to mark the start of the United States-Mexico-Canada Agreement, which is a revised version of the North American Free Trade Agreement.

Mr. Trudeau’s no-show in Washington will take place as the United States threatens to hit Canada with tariffs on aluminum shipments – a matter casting a cloud over Canada-U.S. relations right now.

The Prime Minister says he’s too busy with a House of Commons sitting Wednesday and the economic snapshot of federal government finances being delivered that day as well.

“We wish the United States and Mexico well at Wednesday’s meeting. While there were recent discussions about the possible participation of Canada, the Prime Minister will be in Ottawa this week for scheduled Cabinet meetings and the long-planned sitting of Parliament,” Cameron Ahmad, director of communications for the Prime Minister’s Office said in a statement.

The Prime Minister has previously mentioned health concerns as one factor he was considering when mulling whether to make the trip to Washington, D.C. COVID-19 infection rates have been rising in a number of U.S. States. Under Canadian rules, Mr. Trudeau and his staff would have been required to quarantine themselves for 14 days upon return to Canada.

“The entry-into-force of the new NAFTA is good for Canada, the United States, and Mexico. It will help ensure that North America emerges stronger from the COVID-19 pandemic,” Mr. Ahmad said.”We continue to work with our NAFTA partners to ensure this new agreement becomes a success for all three countries.”

Mr. Lopez Obrador, who had publicly urged Mr. Trudeau to attend the Wednesday get-together, told reporters Monday that he would soon speak to the Canadian prime minister by telephone.

The Mexican president also said he would undergo a coronavirus test before leaving Mexico, and was prepared to do another in the United States if required.

A Canadian government official told the Globe and Mail that Canada regarded the Wednesday event as more of a Lopez Obrador-Trump meeting from its inception. The official was granted anonymity because they were not authorized to publicly discuss foreign relations.

In recent weeks, the Trump administration has threatened to reimpose a 10-per-cent tariff on Canadian aluminum if Ottawa doesn’t agree to quotas on exports of the metal to the U.S. The Globe and Mail reported last month that Mr. Trump’s trade officials told their Canadian counterparts that they would recommend tariffs to the President if Canada did not promptly cut back on aluminum exports.

Reimposing tariffs would also contravene the spirit of the USMCA which came into force on July 1. Like NAFTA, the USMCA allows tariff-free trade on nearly all goods between the three countries.

Mr. Trump has used section 232, an obscure provision of the Trade Expansion Act, which allows the President to get around free-trade agreements by imposing tariffs for “national security” purposes, even though Canada is an American ally and part of the U.S.‘s defense industrial base.

One Canadian government source said Monday that Deputy Prime Minister Chrystia Freeland, Mr. Trudeau’s point-person on the U.S. file, is in discussions with Robert Lighthizer, Mr. Trump’s trade chief. The official said it did not appear that Mr. Lighthizer had recommended tariffs to Mr. Trump so far, but it was still unclear whether such an outcome could be avoided.

One aluminum industry source said the Trump administration wants Canada to do what Australia did last year: In response to tariff threats from the White House, the Australian government told its industry to cut back on exports to the U.S. The Trudeau government, however, wants to do no such thing and Canadian officials have been holding their ground in talks with the Americans, the industry source said.

The Trump administration is also mulling reimposing a 25-per-cent tariff on Canadian steel, but those discussions are less advanced than the ones on aluminum, the government and industry sources said.

Mr. Trump imposed the tariffs on Canada and dozens of other countries in 2018 as part of a broad effort to protect the U.S. metals industry from foreign competition. Canada fired back with tariffs on a range of U.S. goods, including ketchup and bourbon.

In 2019, Mr. Lighthizer and Ms. Freeland reached a deal to lift the tariffs. Under the terms of that arrangement, if there is a “surge” of any steel or aluminum product from Canada, the U.S. has the right to reimpose tariffs on that specific product. Two U.S. aluminum companies say that there has been such a surge and have been lobbying the Trump administration to reimpose tariffs. The Canadian industry, as well as the main American aluminum industry group, say there has not been a surge.

The U.S. does not produce enough aluminum to meet its demand meaning that, even with a tariff, American manufacturers would likely have to keep importing Canadian metal and paying the tariff. The tariff would give an advantage to U.S. aluminum producers by making their goods less expensive than those of their Canadian competitors.

-With files from Reuters

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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