Three Amigos expected to make some real deals on energy, tout North American trade

by Lee Berthiaume (feat. Colin Robertson)

National Post
June 27, 2016

OTTAWA — Get ready for hard commitments on clean energy and a soft sell on North American trade.

Prime Minister Justin Trudeau hosts Mexican President Enrique Pena Nieto on a state visit this week, before U.S. President Barack Obama joins them for the Three Amigos summit on Wednesday. Climate change will figure prominently, but so will the importance of all three countries working together economically.

Here’s what to expect:

Climate change and clean energy

In his last year in the White House, Obama has been pushing for real action on climate change.

The three leaders will follow that up by committing to increase the amount of clean energy produced in North America from 37 per cent today to 50 per cent in 2025. The ambitious goal, revealed by the White House, includes producing more energy by renewables, nuclear and carbon capture technologies.

The commitment will form the foundation of a comprehensive North American clean energy action plan, said Obama’s senior adviser, Brian Deese. “We believe this is an aggressive goal, but for all three countries, one that we believe is achievable continent-wide.”

Liberal officials say growing the share of clean energy produced across North America goes hand-in-hand with advancing closer economic integration. “It’s about sustainable jobs and sustainable growth,” said one official.

Environment Minister Catherine McKenna said the three leaders will also talk about ways to integrate alternatives into continental energy grids and harmonize energy efficiency standards to make it easier for the clean energy sector to grow.

North American trade

Pena Nieto, meanwhile, began his visit to Canada in Quebec City on Monday, where he called for greater economic integration. Liberal sources say it’s a message that has taken on added importance amid NAFTA-bashing in the U.S. presidential race, and after last week’s Brexit vote.

“The rhetoric will only get hotter south of the border,” said one Liberal official. “And (Brexit) hit home for us that protectionist sentiments exist everywhere and have to be confronted.”

A poll by the Angus Reid Institute found about one quarter of Canadians felt the North American free trade deal was good for the country, and an equal number thought it was bad. However, the same number said they didn’t know. Officials say it’s those people the government plans to talk to over the coming days.

“I think it’s the same message you saw around immigration and welcoming Syrian refugees,” said another Liberal official. “That we’re stronger together than apart.”

Former Canadian ambassador to Washington Michael Kergin said the message of economic co-operation will be directed not just at North Americans, but also Europeans, in hopes of easing “cynicism” and “anxieties” about the concept of regional unity. 

Nevertheless, all three North American leaders are going to have to be careful about how they broadcast their message to make sure they don’t stir up the type of anti-free trade sentiments they are trying to fight, said Carlo Dade, an expert on North American trade and investment at the Canada West Foundation.

Trade disputes

The three leaders will be all smiles when talking trade, but some disputes have been bubbling beneath the surface. The main concerns for Canada are the softwood lumber dispute with the U.S., and Mexico’s continued ban on some Canadian beef.

The beef ban goes back to 2003, when bovine spongiform encephalopathy (BSE) was discovered in Canadian cattle, and the Canadian Cattlemen’s Association estimates it will cost Canada about $10 million this year. Officials, however, have indicated a deal will be announced during Pena Nieto’s visit.

A solution to the softwood lumber dispute is less likely. At stake is billions of dollars for Canada’s softwood lumber industry, and Canadian officials are terrified it could become an election issue down south.

Of the softwood lumber dispute, former Canadian diplomat Colin Robertson, now vice-president of the Canadian Global Affairs Institute, said: “In the past this has been a real friction point for Canada and the U.S. This is one you would prefer to put behind us.”

Mexican visas

The Liberals will start to make good on their election promise to lift visa requirements for Mexican travellers. Officials warn, however, that the visas won’t automatically disappear. Rather, Trudeau will announce an “ambitious” schedule for having them removed in the coming weeks. 

The Harper government introduced the visa requirement in 2009, after thousands of Mexicans flooded Canada’s refugee system. While the Conservatives said it was necessary to keep out “bogus” refugees, it quickly became a barrier to relations between Canada and Mexico.

Reinstating visa-free travel will remove that barrier, but officials say they will be watching closely to see whether there is a spike in refugee claims from Mexico.

U.S. election and human rights

Trudeau and Pena Nieto are expected to pick Obama’s brain about the upcoming U.S. presidential election, with an eye toward dealing with President Clinton or President Trump. Clinton previously served as Obama’s secretary of state.

Meanwhile, Alex Neve, secretary general of Amnesty International Canada, said refugees from Central American countries are regularly persecuted in Mexico and it’s “unconscionable” for leaders to talk about free-flowing borders without addressing this “dramatic human rights crisis.”