Yesterday, the Atlantic Council, an international affairs think tank based in Washington, D.C., held a discussion with experts and former government officials regarding the future direction of trade ties between the United States, Canada, and Mexico.
Moderated by Jason Marczak, deputy director of the Atlantic Council’s Adrienne Arsht Latin America Center, the panel included Rafael Fernández de Castro, a professor at Syracuse University who served as an adviser to former Mexican President Felipe Calderon; Paula Stern, founder and chairwoman of The Stern Group and Atlantic Council board member who served as Chairwoman of the U.S. International Trade Commission in the Reagan administration; and Peter MacKay, a former Minister of Justice and Attorney General under the Harper government.
“To make America great again, you have to make NAFTA great again,” said MacKay, who is currently a partner at the law firm Baker McKenzie. He said the visit to Mexico this week by U.S. Secretary of State Rex Tillerson and Department of Homeland Security Secretary John Kelly was “an opportunity to recast a wrong-footed approach and go back to the basics… not retrench or double-down on rhetoric, but hone in on just how important NAFTA is.”
“Changing the rules of the game significantly at this point is where we’ll get bogged down,” said MacKay. However, he added that “tweaking specifics” to modernize the deal can be worked out.
With regards to the upcoming NAFTA negotiations, MacKay speculated that Canada’s access to procurement contracts in the massive infrastructure initiative promised by the U.S. president could be a top demand from Ottawa. As a businessman, MacKay said he believes that Trump will surely realize that “you can’t go it alone in the enormity of the type of infrastructure he is speaking of.”
“This has yet to be unpacked in terms how that will impact the American economy, but there seems to be a lot of indications there will be restrictions placed on Mexican and Canadian participation in infrastructure building,” MacKay said. “They’re going to need labour, they’re going to need Canadian softwood lumber, other products that will be part of building the infrastructure.”
Ultimately, it is in the best interests of the United States to not only update NAFTA, but also to uphold the foundation of the agreement and maintain a strong North American partnership, said MacKay, who indicated this was the position Prime Minister Justin Trudeau took when he visited Washington earlier this month.
“A world without NAFTA is a much more difficult world for all three countries,” said MacKay. However, he warned, “on some things we may have to part company.”
MacKay said that while none of the three countries in NAFTA could be successfully independent, there may be a need to diversify trade relationships. “TPP may be dead for the United States, but it’s not dead for Canada,” he said.