Trudeau sets out to sell Canadians on trade pact

Canada's Prime Minister Justin Trudeau (left) and Minister of Foreign Affairs Chrystia Freeland speak at a press conference to announce the new USMCA trade pact between Canada, the United States, and Mexico in Ottawa, on Oct 1, 2018. PHOTO: AFP

OTTAWA (AFP) - Canada's Justin Trudeau on Monday (Oct 1) hailed a new continental trade pact with the United States and Mexico as "profoundly beneficial" for Canadians - but the prime minister must now sell the deal to skeptical dairy farmers, unions and voters.

The 11th-hour deal was reached late Sunday (Sept 30) after more than a year of tough negotiations to replace a 24-year-old trade pact that US President Donald Trump had labelled a "disaster."

Canadian dairy farmers immediately denounced the new US-Mexico-Canada Agreement for easing market protections, while steel workers complained that US tariffs on steel and aluminum were not dealt with.

But Unifor, Canada's largest union representing auto workers, praised it for safeguarding the nation's top export - cars.

Trudeau was quick to embrace the new deal, welcoming it in a late night call with Trump as "a new and modern trade agreement" and that would "bring the countries closer together."

Moving to patch up a relationship badly strained by the fractious trade talks, the two leaders predicted the accord would "create jobs and grow the middle class, enhance North American competitiveness, and provide stability, predictability, and prosperity to the region."

At a press conference Monday, Trudeau predicted the new pact would be "profoundly beneficial for our economy" and "the most important progressive reform for North American workers in a generation."

Flanked by Foreign Minister Chrystia Freeland who led the Canadian negotiating team, he welcomed Mexico's concessions on auto worker wages, an exemption for Canada's cultural industries, and the keeping of binational dispute resolution panels on which he'd staked his political future.

The latter had been used on several occasions to successfully challenge US anti-dumping and countervailing duties on its lumber and other key sectors.

Unhappy farmers, steel workers

The United Steelworker's Canadian branch president Ken Neuman, however, called the deal a "sell-out" for failing to eliminate 25 per cent steel and 10 per cent aluminum tariffs imposed in June by the Trump administration.

Trudeau said those were being negotiated on a separate track, and that the talks continue.

In Quebec, meanwhile, politicians lamented that its key dairy sector was paying the biggest price in order to get a deal.

"The worst-case scenario has been realized," said Parti Quebecois leader Jean-Francois Lisee.

Canada's supply-managed system controls the production and price of milk and poultry and ensures stable incomes for Canadian farmers.

Preserving the protections for dairy was politically important to Trudeau, whose Liberal party faces elections next year.

But Trump had threatened to leave Canada out of the trade deal altogether if an agreement could not be reached by midnight Sunday, confronting Trudeau with the prospect of broader disruptions to the Canadian economy.

The Dairy Farmers of Canada warned that giving US farmers an additional 3.59 per cent slice of the US$16 billion (S$22 billion) Canadian milk and cheese market would have a "dramatic impact" on the sector.

"This has happened, despite assurances that our government would not sign a bad deal for Canadians," it said. "We fail to see how this deal can be good for the 220,000 Canadian families that depend on dairy for their livelihood."

But pundits noted that this access is similar to what was offered in a free trade deal with Europe and in the Trans Pacific Partnership.

The darker alternative

Opposition Conservative leader Andrew Scheer was quick to swipe at Trudeau's government over the deal.

"Today the United States is measuring their success in terms of what they got and Canada is measuring their success by measuring what they didn't have to give up, so it's pretty clear which end of the stick we are on," Scheer told reporters.

But on the Canadian street, many bystanders interviewed by local media breathed a sigh of relief at the prospect of stability returning to Canada-US relations.

Despite the Canadian concessions, Professor Louis Belanger of the University of Laval in Quebec told AFP the alternative - no deal at all - would have been a much darker outcome.

"Since Prime Minister Trudeau did not give in on key issues, I don't think he'll pay a political price at the polls next year," Belanger said.

"Most Canadians blame the American administration for the mess we're in, and I think Justin Trudeau will be recognized for saving the furniture," he added.

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