Be patient. And don’t worry too much just yet.
That’s the advice of former prime minister Brian Mulroney for those wondering what Donald Trump’s presidency will mean for this country.
“I know you’re wondering how Canada will fare under the Trump administration,” Mulroney said at FarmTech. “I’ve had the privilege of knowing both Hillary (Clinton) and Donald for 25 years, and the unpredictability he is showing is a side of his personality that I have not seen before.
“But I am convinced that if we play this wisely, there are more opportunities for constructive partnerships between us than for difference or concern.”
Mulroney helmed the Canada-U.S. Free Trade Agreement three decades ago and negotiated the North American Free Trade Agreement with Mexico five years later.
“The theory was that if we compete fairly and effectively on our own continent, we would be much better able to compete globally,” said Mulroney, prime minister from 1984 to 1993. “That promise is even more compelling today, especially as we see increasing signs of protectionism on many, many fronts.”
But Canada also needs to be vigilant in safeguarding access to the U.S. market, he said.
“I don’t have to remind anyone with a television today of the damage of protectionism and the growing threat that protectionism has on the prosperity of anyone in this room today,” he said. “You will see it on your television tonight and every night thereafter for a long period of time.”
Trade agreements have become easy targets for Americans frustrated by the slow recovery of their economy. That ire isn’t directed at Canada, but “we should do everything to make sure we don’t become a target accidentally,” he said.
He likened the reaction to the early days of Trump’s tenure to the initial negative attitudes towards president Ronald Reagan.
“Don’t take in all the stuff you see in the news at night and conclude that those people know what they are talking about. Give him the benefit of the doubt,” he said.
Mulroney said he used that approach when negotiating trade deals with both Reagan and president George Bush Sr.
“The key is to find avenues of common ground and common purpose while managing differences — in a relationship this complex, there are bound to be differences,” he said.
Mulroney spoke of the positive benefits of the free trade deals, including a 300 per cent increase in trade between Canada and the U.S., and increased job creation in both countries. The two countries’ acid rain treaty was also a landmark agreement and set the stage for future ones, he said.
But he urged a go-slow approach to environmental measures, such as the carbon tax, that would undermine Canada’s competitiveness.
Instead, Ottawa should be persistent and rigorous about defending access to the U.S., and in reminding American leaders that two-way trade flow benefits both countries.
“What we cannot do is stick our heads in the sand ostrich style and hope that the protectionist measures down in Washington will abate on their own,” he said. “Forget it. It’s not going to happen.”
The agreement with the European Union, once ratified, will offer significant promise to Canadian agriculture. Canadian exporters face high tariffs on agricultural products, but there is duty-free access for beef, pork, and bison along with preferential access for processed food products and beverages.
“It is estimated conservatively that our agri-food exports to the EU will increase by a minimum of a billion dollars annually,” Mulroney said. “The agreement has been signed and is ready for ratification… but it will not be a slam dunk because of the nationalist protectionist pressures we saw in Brexit that are now present across Europe.”
Along with planning for a post-Brexit agreement with the U.K., Canada should be a “leader instead of a laggard” in seeking out trade deals.
China is now Canada’s second-largest market for agricultural goods, and now comprises 16 per cent of Canada’s total exports versus five per cent in 2008.
“I strongly encourage the Trudeau government to move coherently and sensibly evaluate China. Because of our rich commodity base, Canada is better positioned to take advantage of emerging opportunities for economic expansion, not only in China, but throughout the Asia Pacific region.”
Don’t “wait for customers to come calling at our door,” he warned.
“We have to demonstrate convincingly that we want their business; that we will invest and innovate to ensure high quality; and that we will be able to provide them with an efficient source of supply, which is something that our railroads have to understand as well.”
With the Trans-Pacific Partnership dead in the water, Canada should strike trade agreements with countries such as Japan, Malaysia, and Vietnam, he said.
“Above all, we need to broaden the vision on trade and the audacity to pursue, but not to replace, to complement what would be our most likely market — the United States, for decades to come. The more balance, the better.”
Mulroney also said Canada should consider dismantling its supply management systems for dairy and poultry in order to facilitate trade deals. The former prime minister fought to preserve supply management during NAFTA negotiations but in recent years has called for it to be phased out.