(Ottawa) Finance Minister Chrystia Freeland is quietly preparing the ground for the mandatory review of the Canada-United States-Mexico Agreement (CUSMA), the trade agreement that replaced the North American Free Trade Agreement (NAFTA) on July 1, 2020.
The first revision of the CUSMA must take place in 2026, on the occasion of the sixth anniversary of its entry into force. All three trading partners must conduct the review and confirm their desire to renew it for another six years.
Last September, Ms. Freeland called a meeting on this subject bringing together a select group of business and labor allies who supported her in the long and difficult negotiations she led with the United States and Mexico in order to modernize NAFTA while she was Minister of Foreign Affairs, La Presse learned.
“We must take the time to prepare well for the talks that must take place,” confirmed a source present at the meeting with Minister Freeland, who is also Deputy Prime Minister.
Flavio Volpe, President of the Automotive Parts Manufacturers Association, Goldy Hyder, President and CEO of the Business Council of Canada, Victor Dodig, President and CEO of CIBC, and Blake Hutcheson, President and CEO of the OMERS firm, were part of the group of people who were invited to the informal meeting on CUSMA in Ottawa on September 11.
Documents obtained by La Presse under the Access to Information Act show that the purpose of this meeting was to discuss the best course of action “in anticipation of the first review of the agreement which is scheduled for 2026 “.
“It may be appropriate to discuss the CUSMA review mechanism. The agreement has a duration of 16 years, and is subject to renewal every six years following a joint review and confirmation by each party. The first joint review will take place on the sixth anniversary of the agreement (July 1, 2026),” the documents also read.
Ms. Freeland’s office did not want to comment on Tuesday about this meeting or about the strategy that the Trudeau government intends to deploy in this matter.
The obligation to review and confirm the terms of CUSMA every six years is raising some concerns in the Canadian business community. Especially since the first review could come after the November presidential election in the United States.
A rematch between Democratic President Joe Biden and former Republican President Donald Trump is on the horizon. Currently, polls suggest a tough battle between the two leaders, and a victory for Donald Trump is not impossible, despite his legal setbacks.
Remember that Canada and Mexico were forced to renegotiate entire parts of NAFTA at the request of former President Trump. The latter came within a hair’s breadth of tearing up the agreement to mark the hundredth day of his coming to power, in 2017, before changing his mind at the eleventh hour when certain members of his administration reminded him of the devastating impact that could have such a decision on states which had voted overwhelmingly for him in the presidential election.
Contacted by La Presse, Goldy Hyder indicated that the meeting was “confidential”, but that it aimed to establish “the route to take which will lead us towards a smooth transition”.
“We must learn lessons from history. No matter who is in power, we know that we must have a “Team Canada” approach, which worked well last time, in order to protect our national interests. It was a good meeting, and I appreciated the tone of the discussions,” said Mr. Hyder.
“We believe that our status in the rest of the world depends a lot on the relationship we have with the United States. We also know that our economy is heavily dependent on the trade agreement with the United States. It is therefore crucial at this time that interested groups, political parties, business people, unions all work together to defend the economic interests of the country. We have time, but a year can pass very quickly. »
The President and CEO of Manufacturiers et Exportateurs du Québec (MEQ), Véronique Proulx, is delighted to see that Ottawa is preparing for the revision of the CUSMA.
“The US elections can be a real game-changer. We have had this file on our radar for some time. We need to start thinking about it now. We have not yet been approached by Minister Freeland, but I find it positive and encouraging to see that they have started the process because it will come quickly,” explained Ms. Proulx.
“When you look at what’s happening on the geopolitical scene, there are a lot of countries that are closing themselves off. The dynamics are changing, but at the same time, the G7 countries are trying to work together. So, the time is right for Canada to position itself even more as an ally, a partner of choice to strengthen competitiveness in the North American market. Canada’s challenge is to maintain access to the American market. »