Brexit prompts new agenda for North American Leaders’ Summit

theglobeandmail.com
June 27, 2016
By Robert Fife

The three leaders of North America will trumpet the benefits of liberalized free trade and the necessity of countries to work in unison when they gather in Ottawa for a summit that had been set up largely to focus on the environment but has been turned upside down by the stunning British vote to exit the European Union.

Senior Canadian and Mexican officials told The Globe and Mail last week that there would be little focus on free trade at the summit to avoid causing any political damage to Hillary Clinton, the presumptive Democratic nominee, who is battling anti-free trade Republican contender Donald Trump in the U.S. presidential election.

But the shocking British vote to secede from the EU has forced the leaders of Canada, the United States and Mexico to reassess the game plan for Wednesday’s North American Leaders’ Summit, to be held at the National Gallery of Canada in Ottawa, officials say.

“Obviously it is going to be a much bigger issue than had there been a Remain vote,” a senior Canadian official said on Sunday. “All three leaders, who have spoken on the phone, are all keen to express the sentiment that there is a part of the world that believes in openness and trade, and free exchange of people and goods.”

Officials say Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto, who arrives in Canada on Monday for a state visit, will remind North Americans “how lucky we are to be where we are...and we are a lot more successful when we tackle shared problems together rather than put up walls.”

When the summit gets under way on Wednesday with the arrival of U.S. President Barack Obama, Environment Minister Catherine McKenna said, the world will hear a strong message about the advantages of free trade.

“These three leaders are aligned in believing we need trade relations and we are very lucky to have a continental approach,” Ms. McKenna said in an interview. “When you look at the North American market, it is a very significant market. It is a great message to the world that we are working together and we believe in trade.”

When Mr. Trudeau and Mr. Pena Nieto meet over the next two days, sources say their focus will be on forging a new partnership to act as a counterweight against rising U.S. protectionism.

The Mexican leader arrives in Quebec City, where he will be greeted by Governor-General David Johnston. He later flies to Toronto to speak to a business group and dine with Mr. Trudeau and Ontario Premier Kathleen Wynne.

Mr. Trudeau will also rescind visa restrictions on Mexican travellers, a major irritant since 2009, when they were imposed by the former Conservative government to curb the flow of bogus refugees.

“We are a progressive government. The visas are being lifted. That is a campaign commitment to Mexicans,” Ms. McKenna said.

Sources say the two leaders will sign agreements on educational exchanges, and share “best practices” on ending the social isolation and exploitation of indigenous people in both countries. Canada will also offer intelligence and training to combat Mexico’s drug violence.

“We are going to have a wide-ranging discussion on security, and for Mexico, it truly has very significant security issues,” a Canadian official said. “We have world-class talent on that part on all of our institutions, from the RCMP, CSIS [Canadian Security Intelligent Service] and CSE [Communications Security Establishment]. We have world-class assets that countries like Mexico could really learn from.”

However, Canadian and Mexican officials say the real aim of the discussions is to set up a partnership to combat what both leaders see as rising protectionist sentiment in the U.S., their biggest trading partner.

A Mexican official noted that both countries teamed up to fight U.S. action, through the World Trade Organization, on country-of-origin labelling for meat products, as well as an attempt by the United States during the Trans-Pacific Partnership negotiations to allow Japanese vehicles to be imported tariff-free to North America, with just 30-per-cent content. Canada and Mexico forced the cap up to 45 per cent. It is currently 62.5 per cent.

“The protectionist fires are starting to blow, whether we are talking about Hillary Clinton and her opposition to TPP or Donald Trump, who is anti-everything and wants to build a wall between Mexico. We are going to need allies to try and fend off these protectionist winds,” Colin Robertson, vice-president of the Canadian Global Affairs Institute, said in an interview. “Working with Mexico on country of origin and the TPP, we were able to push back – but especially on country of origin, which is basically a protectionist measure. By both threatening retaliatory action, Congress folded. On our own, we would not have been successful.”

About 40 per cent of what the United States buys from Mexico starts out in the United States, while 25 per cent of what Americans buy from Canada comes from the United States.

Former prime minister Brian Mulroney said on Friday that continental free trade created almost five million jobs in Canada and doubled the country’s GDP to $1.8-trillion since 1994, when the North American Free Trade Agreement took effect.

Measures to tackle climate change, including a commitment from Mexico to join Canada and the United States to reduce methane gases by 40 per cent, will be announced on Wednesday, as well as harmonization of environmental regulations.

“This is a real opportunity - it doesn’t come that often where you have governments who are extremely aligned on a clean-energy, clean-growth strategy,” Ms. McKenna said. “There is an economic opportunity when we have standards that are similar, so when it comes to vehicles and trucks, there are things we can do there.”

Canada and Mexico will sign a memorandum of understanding to work together on sharing information on how to foster native languages, protect indigenous art and help women facing domestic and street violence, as well as look at ways to engage indigenous people as partners in resource development.