Sunday, 24 September 2017

Canada's goals for 'progressive' NAFTA include labour and environmental standards, gender equality

Canada, the U.S.A., and Mexico are in talks to renegotiate NAFTA, an agreement President Trump reportedly considers “fundamentally flawed”. You’d be hard-pressed to find anyone in Canada who doesn’t agree that NAFTA is flawed, but Chrystia Freeland, the Canadian Minister of Foreign Affairs, is said to be optimistic about the negotiations.  

Though the three countries have entered a confidentiality agreement to protect offers made during the negotiations, we can still get a sense of what Canada will be aiming to achieve. Before leaving for Washington, Freeland set out Canada’s core objectives in the negotiations: 

1.    Address technological changes. Freeland states that one of Canada’s aims is to modernize NAFTA to reflect the technological changes since it was first negotiated 23 years ago.

2,     Make NAFTA more “progressive.” According to Freeland, Canada hopes to accomplish a more progressive agreement by:
  • Incorporating strong labour safeguards in the core of the agreement. In this regard, Freeland states:

    One reason that these progressive elements, particularly on the  environment and labour, are so important is that they are how we guarantee that the modernized NAFTA will not only be an exemplary free trade deal, it will also be a fair trade deal. Canadians broadly support free trade. But their enthusiasm wavers when trade agreements put our workers at an unfair disadvantage because of the high standards that we rightly demand. Instead, we must pursue progressive trade agreements that are win-win, helping workers both at home and abroad to enjoy higher wages and better conditions.

  • Integrating enhanced environmental provisions to ensure no NAFTA country weakens environmental protection to attract investment, and that supports efforts to address climate change;
  • Adding a new chapter on gender rights, in keeping with Canada’s commitment to gender equality.
  • Improving Canada’s relationship with Indigenous peoples, by adding an Indigenous chapter; and
  • Reforming the Investor-State Dispute Settlement process, to ensure that governments have an unassailable right to regulate in the public interest.
3. Cut red tape for the business community. According to Freeland, Canada will seek to bring regulations into harmony to make it easier for business people on either side of the border.

4. Liberalize government procurement. This prerogative is sure to be a sticking point in the negotiations, as it will push back against the Trump administration’s buy-American rhetoric. Freeland has stated:

Local-content provisions for major government contracts are political junk-food, superficially appetizing, but unhealthy in the long run.

5. Freer movement of professionals. This would be accomplished by extending the temporary entry provisions in Chapter 16 of NAFTA to reflect the needs of businesses. 

6. Limit protectionism. Freeland states that Canada will seek to preserve a fair process of anti-dumping and duties.

Final Thoughts

The Good

Many of Canada’s goals in entering these negotiations could have a positive impact on workers.

At present labour standards under NAFTA are contained in side agreements, which provide inadequate protections to workers. Bringing strengthened labour standards into the core of the agreement could mean more protections for workers’ safety, the right to bargain collectively, and the right to strike. These improvements would give labour a chance to have more input and control over working conditions.

Also, seeking to reduce the attractiveness of foreign labour by advocating for fair wages for all workers, no matter which country is involved, could limit unfair wage competition and keep jobs in Canada.

In theory, anti-dumping provisions could protect the local economies of all parties to the agreement. Under anti-dumping provisions, any of the three nations involved could impose duties on imports if it believes they are priced below fair market value.

The Bad
While it’s laudable that Canada is open to reforms to the ISDS provisions, and that it will seek to protect its right to make environmental regulations, it must go further. Canada has been the most commonly sued country under the ISDS provisions of NAFTA, being penalized, in part, because of a desire to protect our environment and industries. ISDS provisions give corporations too much control over sovereign entities and it would be best to seek an elimination of the ISDS provisions entirely.

Further, there’s good reason to be skeptical of any renegotiated NAFTA, given the negative impact the initial NAFTA agreement has had on labour generally and organized labour particularly. If nothing else, NAFTA represents a facet of the ongoing shift to a global economy, and for that reason alone must be regarded with suspicion. The agreement has facilitated the ongoing offshoring/outsourcing of jobs and has had a devastating impact on the labour movement and workers’ rights. If Canada hopes to create a truly positive agreement for workers, it must remain mindful of the agreement’s dangerous potential to damage labour. If Canada is serious about defending labour and workers’ rights, it could argue for a provision that prevents work from being outsourced to right-to-work regions or states. That, at least, would help to ensure workers are not being exploited. Freeland’s objectives say nothing about right-to-work.

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While Canada’s objectives could be improved, they are largely positive. According to a report, Trump has said both Mexico and Canada were being “very difficult” in talks to renegotiate NAFTA. With the trouble NAFTA has brought to Canadian workers, Canada has every reason to be difficult in the renegotiations, and we can only hope the President is being sincere on this point.

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