A massive Pacific Rim trade agreement that the Conservative government is determined to conclude – even during this election campaign – would threaten more than 26,000 Canadian auto jobs, the country's largest private-sector union is warning.
The proposed Trans-Pacific Partnership deal would unite 12 countries from Chile to Japan into a single free-trade zone and eclipse the North American free-trade agreement in importance.
Talks are coming down to the wire, with the United States and Japan making what they hope is a final push to wrap up the accord next week in Atlanta.
There's growing concern over measures in the TPP that would lower domestic content rules for vehicles and car parts, overriding rules in the NAFTA that have protected Canadian auto jobs for decades.
Unifor economist Jim Stanford estimates this could threaten as many as 26,400 Canadian auto jobs in both assembling and parts-making.
"Watering down the content thresholds amounts to opening a huge back door to our market for products made in China and other non-TPP countries," Jerry Dias, Unifor president, said.
"That is a direct threat to thousands of good Canadian manufacturing jobs – exactly the kinds of jobs we need more of." The union leader also called for measures to ensure reciprocal trade in finished vehicles.
Under the North American free-trade agreement, Canada, the U.S. and Mexico require more than 60 per cent of cars and auto parts to be made within the NAFTA zone in order to enter their markets tariff-free.
The Japan-U.S. formula says that in the TPP zone vehicles would be tariff-free even if only 45 per cent of their content is made within the TPP zone, and auto parts with as little as 30 per cent.
Stephen Harper is being accused of sacrificing Canada's 80,000-job auto-parts industry in his eagerness to sign on to the TPP.
The Conservative Leader made waves last Thursday when he signalled that he's committed to signing the TPP even over the objections of the auto sector, whose members fear it will lead to a flood of foreign parts, produced by cheaper labour, killing their industry.
"The auto sector has concerns, as do others.… I'm not suggesting they will necessarily like everything that is in [the agreement]," Mr. Harper said, adding he was confident TPP negotiations would "conclude successfully."
The chances of a deal even before Canadian voters go to the polls Oct. 19 have soared on news that the United States is playing host to what it hopes will be the final round of the TPP talks in Atlanta at the end of September. An agreement would cover 12 countries from Chile to Japan, where the big prize is access into the latter's heavily-protected domestic market.
Ontario's economic development minister sounded the alarm last Friday over what he called "unilateral federal decisions made in back rooms," saying it would be "reckless and shameful" for the Conservative government to proceed with the deal as envisioned.
"Suggesting that Canada will be entering into an agreement that may negatively impact the auto-parts sector here in Ontario is not only disrespectful, but shows a lack of true economic leadership," Brad Duguid said on Friday. The Liberal minister's provincial government has clashed with the Harper Conservatives before, but Mr. Duguid on Friday called for them to work together, asking the Tories to consult with Queen's Park on the TPP.
The Canadian auto-parts industry has been built up and sustained through a series of trade agreements, starting with the 1965 Canada-U.S. Auto Pact, which required that vehicle-makers produce $1 in value-added production in Canada for $1 worth of vehicles they sold here.