Advertisement

Wilbur Ross on NAFTA: 'We wouldn't be wasting all this time if we weren't hopeful'

Wilbur Ross on NAFTA: 'We wouldn't be wasting all this time if we weren't hopeful'
From CBC - October 12, 2017

U.S. Commerce Secretary Wilbur Ross departed slightly from his president Wednesday in choosing his words on the renogotiation of the North American Free Trade Agreement, saying he still hopes, and believes, a deal can be reached.

"As you have seen in the media, from time to time, [U.S. President Donald Trump has] expressed a total willingness to depart from NAFTA should that become necessary," said Ross during an interview with Canada's former Conservative industry minister, James Moore, during a trade event at the Washington offices of international law firm Dentons.

"We do not hope it will, we do not desire it that it will, we do not believe that it will, but it is at least a conceptual possibility as we go forward."

Had fun discussing NAFTA with Secretary of Commerce Wilbur Ross @SecretaryRoss at the @Dentons NAFTA 2.0 Summit in Washington DC today pic.twitter.com/t51SMHYcH3

@JamesMoore_org

"We would not be wasting all this time if we were not hopeful."

Moore, who now sits on the Liberal government's advisory NAFTA panel, is also a senior business adviser at Dentons.

The fourth round of NAFTA negotiations kicked off Wednesday and will wrap next Tuesday.

Here is a transcription of their conversation. It has been edited for length and clarity.

James Moore: Round four started today. Highly anticipated. How are the renegotiations going in your view?

Wilbur Ross: So far the talks have mainly done basic background things, kind of what I would call boilerplate things, or relatively easy issues. Some more contentious issues will be coming up very shortly, those would include things like rules of origin, sanitary and phytosanitary, probably medical and pharmaceutical, technical barriers to trade, and textiles, as well as trade remedies and dispute settlement. ...

In terms of timetable going forward, there is no precise deadline and those of you familiar with trade negotiations know these are progressing at lightning speed compared with the normal ones. It's not usual to have so many days of consecutive negotiations. Not usual to have small intervals between negotiation sessions.

There's a reason for that and the reason for it is the political calendar: the fast-track authority (the Bipartisan Congressional Trade Priorities and Accountability Act, or TPA) that we have in the U.S. expires in July of 2018. Given the nature of Congress nowadays, who knows whether we will get that extended or we wo not. So that could be one deadline. If we lose TPA I do not think you will ever see a deal done here because what TPA does do it's not so much that it's fast, we have actually found it painfully slow because of all the consultations but what it does do is the final deal gets put to a vote in Congress yes or no, no amendments possible.

Second, the Canadian provincial elections are around mid-year, the Mexican presidential elections are a little bit after mid-year and then in November we have our own mid-term elections here. So, in general terms, once you get into next year nobody's going to get as big and complicated a deal as this done. So more or less the end of this year is the realistic deadline.

It will be longer than the original deal. The original one had 22 chapters, this will probably have 28.

The tone so far has been pretty constructive, but we have not gotten to the hard part. Both Mexico and Canada, particularly Canada, have been lobbying very aggressively. Canada visited with me and the president today, they lobbied in the Congress as well. And obviously all parties have been trying to stir up trade groups in the U.S. to have U.S. go easy in the negotiations.

The president is determined that if we have a new NAFTA it has to be one that suits our interests better than the existing NAFTA. And as you have seen in the media, from time to time he's expressed a total willingness to depart from NAFTA should that become necessary. We do not hope it will, we do not desire it that it will, we do not believe that it will, but it is at least a conceptual possibility as we go forward.

There are a few issues specific to individual countries. Particularly to Canada, they undoubtedly will consider bringing up something about softwood lumber, they undoubtedly will consider bringing up something about Bombardier and Boeing, although they have yet to do so in the formal negotiating sessions. So that's sort of a thumbnail sketch of where we are at the moment.

JM: You said something there, towards the end, you said your expectation is that it will be successful?

WR: We would not be wasting all this time if we were not hopeful.

JM: I want to put a question to you that I think is on a lots of people's minds and that is the issue of trade deficits. Rhetorically, it's been gone to over and over by the president as the pre-eminent frustration with NAFTA. The United States has a trade surplus with Canada

WR: That's not correct if you include crude oil and everything else. We are talking goods. We have a goods deficit if you include crude oil.

JM: How do you plan to remedy trade deficits? How is that achievable in a trade agreement?

WR: It's several things. The first thing is through enforcement. Our feeling is that prior administrations were not as aggressive as they should have been with trade enforcement. We have brought, since I came on the scene, 48 per cent more cases so far this year than was true in the last year of the prior administration. So more cases and different cases.

We are very interested in self-initiation as an activity. We are interested in it for a couple of different reasons. First reason is now if you are a smallish industry or a highly fragmented industry or one that has a lot of foreign participants, it can be hard to meet the requirements for the industry itself to initiative the case. We have the power to self-initiate and if the facts justify we can, we will and we are going to do more.

The second factor is that, it costs millions of dollars to bring one of these cases. And again, if it's a smaller or more fractured industry, that is a little bit of a challenge for them.

Advertisement

Continue reading at CBC »