Tear Down That (Trade) Wall

(Globe & Mail)

Former trade minister David Emerson on what Stephen Harper was negotiating in Europe this week, why it might only be the start and whether the seal hunt is more trouble than it's worth

Adam Radwanski, globeandmail.com: Mr. Emerson, thanks for taking the time to help shed a little light on what the Prime Minister has been doing this week in Europe. It strikes me, given the potentially massive changes to our trade policy that could ultimately result from Mr. Harper's talks with the EU, that there's been surprisingly little focus on what's being discussed (other than the seal hunt). Should Canadians be paying more attention to what's going on there?

David Emerson: There is no doubt that Canadians should be paying close attention to the government's attempts to move trade policy forward more aggressively. Canada has always been, and always will be, a trading economy. Today 80 per cent of our exports go to the U.S., and with protectionism on the rise we absolutely must build deeper relationships across both the Atlantic and Pacific.

The EU is a market of roughly three quarters of a billion people, with 27 countries' markets at various stages of development and with enormous potential for trade and investment linkages to Canada. With Europe, we are also dealing with relatively stable and advanced democracies. If we can strike a comprehensive trade deal expeditiously, it strengthens Canada's position relative to the U.S. and builds on a market where we have begun to see significant growth and success.

Adam Radwanski: There have been rumblings about knocking down trade barriers between Canada and the EU for years, but rarely have they amounted to much. What's changed?

David Emerson: Probably the biggest change has been the willingness of provinces to consider being bound by the obligations such a deal may involve.

Procurement practices of sub-national governments have been major barriers to the success of past negotiations. Policies limiting mobility of skilled and educated people are another example.

Quebec, for example, has moved from a historically reluctant jurisdiction to a strong advocate of a deeper economic relationship with Europe.

We still are likely to have problems dealing with agriculture to any substantial degree; both the EU and Canada are strongly protectionist and timid with respect to certain agricultural interests. Canada will also have to show increased flexibility when it comes to protectionist limits on foreign ownership and investment in certain sectors.

I do think, perhaps wishfully so, that Canadians are more informed than ever about the economic perils of protectionism. Let us hope our leaders continue to lead and take advantage of the opportunity.

Read the complete interview here.

Foreign Affairs Issues to Watch this Session

(Embassy – Jeff Davis & Lee Berthiaume)

Since becoming the government in 2006, the Conservatives have pushed an aggressive free trade agenda, which is expected to increase with the death of Doha a few months ago. However, there have been questions about the government’s choice of partners for talks.

Over the past two-and-a-half years, negotiations with Jordan, Peru, Colombia, Panama, the Caribbean Community and the Dominican Republic were launched or are waiting to be started. The majority of these, including Jordan and Colombia, were widely regarded as more politically motivated then being of great economic benefit to Canada. Colombia in particular prompted sharp criticism from opposition parties and civil society groups.

The government did manage to conclude talks with Jordan, Peru, the European Free Trade Association – composed of Iceland, Norway, Switzerland, and Liechtenstein – and Colombia before Parliament broke for the summer and election.

However, only the EFTA deal has made its way through Parliament, and even then, implementing legislation will have to be introduced and passed before the agreement comes into effect.

While the majority of these deals will pass uncontested, parliamentarians will likely try to throw some stumbling blocks at the government to stop the Colombia deal. And if the government doesn’t act to start making the EFTA agreement law soon, there could be grumbling coming from the Europeans.

Also on the trade front is the new Canada-European Union Trade and Investment Enhancement Agreement, launched just weeks ago at the Canada-EU Summit in Quebec city. This new deal, certainly still in its infancy and years from completion, has not yet been debated in the House and could come up for a great deal of discussion this session.


Also on the books are several negotiations that have stretched on for years. Canada and South Korea are still far apart because of auto and beef industry concerns, while the Canada-Singapore and Canada-Central America Four deals are stalled.


In terms of new deals, the government has not yet signalled its next target, though it has pledged to move forcefully. It will also be a strong advocate for increased trade liberalization at a time when the world is looking to hunker down. Still, Canada seems to have an easier time talking trade deals than finishing talks, especially when it comes to difficult negotiations.


One question mark is Canada’s new trade minister. While David Emerson had a solid background in business and was said to be the main influence behind shaping Canada’s trade and investment policies, Stockwell Day is a relatively unknown quantity on the file. With a new administration south of the border, Mr. Day has perhaps been put in this position for the solid American connections he made during his time as minister of public safety.


But under Mr. Emerson, Canada identified India, China and other emerging economies as major priorities and moved its resources away from Europe and Africa in favour of Latin America and Asia. Will this trend continue? Read the complete article.

B.C. Premier, Emerson Slam NDP for Promise to Negotiate New Softwood Deal

(Globe & Mail)

NDP Leader Jack Layton was roundly criticized Friday for proposing to tear up the Canada-U.S. softwood lumber agreement, with both B.C. Premier Gordon Campbell and former international trade minister David Emerson saying the idea is preposterous.

The B.C. Premier waded into the federal election campaign for the first time Friday, denouncing Mr. Layton’s stance on softwood. The deal, Mr. Campbell said, has been a lifeline for the hard-hit B.C. forest sector.

“You want to rip up the softwood lumber agreement? Give your head a shake,” Mr. Campbell said in a speech to municipal leaders in Penticton.

Mr. Campbell later acknowledged to reporters that Mr. Layton was the target of his comments

“I think Mr. Layton has shown a profound ignorance, both of the agreement and the impact his statements will have on British Columbia,” Mr. Campbell told reporters. “It would be significantly damaging to British Columbians ... that’s going to cause huge job losses at a time when forestry can’t afford any more challenges.”

Mr. Layton this week promised he would scrap the “sellout” deal, negotiate new lumber deals with the U.S., and restrict raw log exports to encourage local development. He says the deal needs to be reassessed because of mill closures and job losses in the industry despite the deal.

In an interview Friday, Mr. Emerson forecast permanent mill closures and job cuts if Mr. Layton was ever able to act on that idea, adding Canada would “get creamed in a negotiation today on softwood lumber.”

“What is [Mr. Layton] going to put on the table that is going to force the Americans, incent the Americans to come up with a better deal than we have today?” asked Mr. Emerson.

“What is it he’s going to give them? He may have some brilliant idea that has passed me by.”

Mr. Emerson said he expected Canada would end up with an inferior agreement if it took another shot at negotiating one. Read more here.

Emerson and Provincial and Territorial Representatives United on Canada’s Trade Priorities

(DFAIT)

The Honourable David Emerson, Minister of International Trade and Minister for the Pacific Gateway and the Vancouver-Whistler Olympics, recently met with provincial and territorial representatives to discuss Canada’s current trade agenda and the status of the World Trade Organization (WTO) negotiations.

“Canada is recognized as a world-class trading nation, but we need to keep up with global competition,” said Minister Emerson. “Today, we agreed to continue working together to build new commercial relationships, improve conditions for business and investors, and increase market access for Canadian goods, services and talent around the world.”

Minister Emerson outlined key elements of the Global Commerce Strategy, the federal government’s blueprint for strengthening Canada’s competitiveness in global markets. Canada has one of the most successful and prosperous economies in the world. The Strategy lays the foundations for a stronger, more competitive position in global markets by providing tools to help Canadian business tap into global value chains and adapt to today’s ever-changing international markets.

Canada benefits greatly from its strong commercial links with the United States and the many advantages that the North American Free Trade Agreement affords. Being part of the largest free trade zone in the world puts Canada on a unique footing with its competitors. The North American partnership remains central to the federal government’s strategy for ensuring a strong and prosperous Canadian economy.

At the meeting, ministers benefited from a valuable exchange with Michael Wilson, Canada’s Ambassador to Washington, on the subject of a strategic approach to addressing common objectives with the United States. They also had the opportunity to consider ways to maximize the advantages of the North American platform and deliver results for business and citizens.

Ministers discussed Canada’s relationship with the European Union and a study under way that examines the benefits of strengthening our economic ties. Launched by leaders at the June 2007 Canada-EU Summit, the study covers a wide range of bilateral trade and investment issues. Ministers expressed optimism that Canada and the EU can achieve a more extensive commercial partnership.

Minister Emerson provided an update on the current Doha Development Round of WTO negotiations and led a frank discussion about Canada’s position in the negotiations. Ministers reaffirmed their unanimous support for a successful outcome.

“Canada will continue to nurture its existing relationships and promote its ambitious trade agenda to increase prosperity for Canadians across the country,” added Minister Emerson. “I am pleased that my provincial and territorial counterparts expressed support for our bilateral and regional trade agenda, and for developing stronger commercial partnerships in the Americas, Asia and Europe.”

Emerson Announces Legislative Review of Export Development Canada

(Foreign Affairs and International Trade Canada)

The Honourable David Emerson, Minister of International Trade and Minister for the Pacific Gateway and the Vancouver-Whistler Olympics, today announced that International Financial Consulting Ltd. has been selected to conduct the 2008 legislative review of the Export Development Act.

The Act requires that the Minister undertake a review of Export Development Canada (EDC) every 10 years in order to provide advice and recommendations to the government and to Parliament on how EDC can best assist Canadian exporters and investors in international commerce.

“EDC plays an important role in supporting Canadian competitiveness in the global marketplace,” said Minister Emerson. “This review provides an opportunity to examine how EDC is evolving, and should continue to evolve, in order to best support Canadian companies that operate internationally.”

International Financial Consulting Ltd. will conduct research and analysis, as well as consult with a broad range of stakeholders, for example, through town hall meetings in major Canadian cities. The final report will be submitted directly to the Minister of International Trade and will inform the Minister’s subsequent advice to the government and to Parliament, expected in the fall of 2008.

International Financial Consulting Ltd. is a leading international consulting firm. Based in Ottawa, the firm specializes in financial services in support of trade, investment and development, with a focus on strategic planning, institutional development and the interface between the public and private financial sectors. The contract for this legislative review was awarded following a competitive bidding process.

For further information on the review, to make a submission, or to participate in the consultations, please visit http://www.EDCReview2008.ca.