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Canadian Businesses Concerned Over NAFTA

by Mike Godfrey,, Washington Thursday, May 11, 2017

The head of the Business Council of Canada has written to the Prime Minister to express concern over the future of Canada's trading partnership with the US and Mexico.

In his letter, President and CEO John Manley said that the prospect of a new round of North American Free Trade Agreement (NAFTA) negotiations "represents both a risk and an opportunity for Canada."

According to Manley, at a minimum, the Canadian Government must seek to "protect the framework of rights, benefits, and privileges that our companies and citizens currently enjoy under NAFTA." He stressed that any agreement "must be based upon reciprocal access and treatment."

Manley said that while the Council supports the modernization of outdated NAFTA provisions and the application of dispute resolution provisions, it does not support country-specific rules of origin. He added that the Council is concerned that the US could seek to revive or develop new trade enforcement tools "that would authorize the unilateral imposition of duties or trade remedies without resorting to dispute settlement under NAFTA or through the World Trade Organization."

Manley believes that any new trade enforcement measures under consideration by a member of NAFTA should be discussed during the negotiations, and that any new mechanism established must ensure "coordination, consultation, and resolution prior to the imposition of unilateral remedies."

In spite of his reservations, Manley also claimed that there are opportunities in a number of areas to update NAFTA. He said its provisions on labor mobility and customs procedures are outdated and should be amended to reflect current business practices and anticipate future needs.

Moreover, Manley said that progress on regulatory cooperation could result in substantive savings for Canadian and US consumers. He recommended that Canada and the US make the existing Regulatory Cooperation Council a permanent body, which would work closely with industry to identify areas for harmonization.

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