Political posturing casts sour tone over Montreal NAFTA talks

by Katie Simpson (feat. Sarah Goldfeder)

CBC News
January 23, 2018

The sixth round of NAFTA talks has barely started in Montreal, and yet the political posturing behind the scenes is already casting a sour tone over the meeting.

The Canadian Press reported that the Americans are not only frustrated with Canada over the lack of progress, but also the recent complaint made against the U.S. at the World Trade Organization. 

A source with direct knowledge of the talks is fighting back against those claims, saying it is "nonsense" to suggest Canada is being obstructionist.

"Obviously, the unconventional proposals from the U.S. have been the core issues since round four, but it is clearly in their tactical interest to paint a different picture," the source said, speaking on background.

"We've been first to the table from the start, and we continue to be very constructive, looking for ways to bridge gaps."

The back-channel back-and-forth appears to be a sign of stress at the table. 

"I think it's contentious," said former U.S. diplomat Sarah Goldfeder. "But it is something that is par for the course in trade negotiations, especially when so much is on the line," she added. 

If the tensions don't ease, it could lead to another public political meltdown — the last time political leaders overseeing NAFTA spoke following a round of talks all three delivered blunt criticism over the lack of progress. 

"Frankly, I am surprised and disappointed by the resistance to change from our negotiating partners on both fronts," U.S. Trade Representative Robert Lighthizer said at the closing news conference for the fourth round of talks, in October.

Foreign Affairs Minister Chrystia Freeland accused the U.S. of making "troubling" proposals and embracing a "winner takes all mindset."

For professional diplomats, the comments were not exactly diplomatic.

Since that round in Washington talks have been spaced out in the hopes of turning down the temperature at the bargaining table. 

Political leaders also took a step back, and did not meet at the end of the fifth round of talks. 

Creative solutions

Freeland says Canadian negotiators are entering this round of talks with a slate of "creative proposals" to counter some of the demands made by the U.S.

The Americans have put forward five so-called "poison pills", which neither Canada nor Mexico will support.

Demands include dramatically altering the auto sector, implementing a sunset clause, changes to government procurement, the dairy industry, and the dispute management system.

A second source with direct knowledge of the talks said Canadian officials will try to get the Americans to explain the true objectives of their proposals. The source used the sunset clause as an example. Canadian negotiators will try and flesh out what the U.S. is trying to get with its proposals. Does it actually want a forced exit every five years? Or does it really want a performance review over that time period?  If the true objective is some type of regular review or analysis, the source said there would be space to talk about the idea.

Trump softens

Goldfeder said there is an easy way to tell if talks are progressing. 

"The longer the negotiators stay at the table, if the sessions are being used to their complete timetable, that's a good sign," she said. "If sessions run short...that makes me nervous, because that means there's not a whole lot of negotiating and discussing going on."

There is an added layer of uncertainty given the inconsistent statements about NAFTA from the White House.

Trump has repeatedly threatened to tear up the deal, but recently, he appears to have softened that position. Earlier this month, he told the Wall Street Journal he may wait until after the Mexican federal election this summer before making a decision about the agreement.

The tone change came when all three countries got a glimpse of what a withdrawal would look like. The day before Trump made those comments, an inaccurate report suggested the White House had imminent plans to kill NAFTA.

In the immediate aftermath, multiple stocks took a hit, while the loonie and peso also dipped. All three rebounded after the White House confirmed it had not changed its position on the agreement.

Trump has repeatedly pointed to the stock market, and its record highs, as a success of his presidency.

The official tone remained the same yesterday, when spokeswoman Sarah Sanders told reporters "we actually feel like things are moving forward," at the negotiating table.