OTTAWA Oct 4 Canada, fearful of talk by the
U.S. presidential candidates to reopen the North American Free
Trade Agreement, could use the opportunity to push for a better
deal on worker mobility, dispute resolutions and other issues,
Canadian negotiators of the original pact said.
Republican Donald Trump calls NAFTA the worst trade deal
signed by the United States and Democrat Hillary Clinton has
signaled a change of position on the 1994 pact she supported
when it became law under her husband, former president Bill
The agreement between the United States, Canada and Mexico
is often used for political grist in U.S. election campaigns but
altering it is a major concern for export-oriented Canada.
In 2008, Barack Obama campaigned on renegotiating the treaty
with tougher labor and environmental standards, a pledge that
fell to the wayside when he became president in January 2009.
But the idea has taken hold more strongly in 2016 and Mexico
has said it is ready to update the treaty. Canada has said NAFTA
is in the best interest of all three countries.
If Canada were forced to renegotiate, one issue it could
target is the pact's investor-state dispute settlement
The United States wanted it included in the original deal to
protect U.S. investments in Mexico. It has since been used by
American companies to sue Canadian federal and provincial
governments. TransCanada Corp is using the provision to
seek billions from the U.S. government for rejecting the
Keystone XL pipeline.
That would probably be an area of mutual concern for Canada
and the United States given those unintended consequences, said
Derek Burney, Canada's former U.S. ambassador, who was involved
in the original negotiations.
Labor mobility, a concern for Canadian technology companies,
could be improved by updating the list of professions that
allows workers to relocate between countries.
"We fell short in terms of what we wanted to achieve on
labor mobility in the NAFTA," said John Weekes, Canada's chief
negotiator, who added Canada should also push for improved
access to the U.S. government procurement market.
Reopening NAFTA could give the Canadian government cover to
phase out a domestic supply management system for the
politically powerful dairy industry that has come under
international criticism, negotiators said.
"I'd be secretly delighted if they came hard at us on supply
management," said Burney. "Given the dairy industry and its
weight in the United States, it's not easy to dismiss."
The system controls dairy prices and production, which
critics say drives up consumers prices. The industry says it
allows farmers to get stable prices, and noted Canada has
preserved the system while negotiating several trade agreements.
Still, former negotiators warned Canada would not be working
from a position of strength as it sought concessions.
"Ignoring everything else, yes, there could be an
opportunity there," said Michael Hart, who advised on the
original negotiations. "But in the real world, I'd be very
While Clinton has said she would rework the trade pact,
Trump's threat to withdraw is a bigger concern in
"If we're in a situation where people are threatening
they're going to walk out of trade agreements unless they can be
renegotiated, then I think we're in a situation where it would
be very difficult," said Weekes.
(Additional reporting by David Ljunggren; editing by Grant