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Prime Minister Justin Trudeau will hold an in-person meeting with President Joe Biden on Thursday in which he will push back against rising U.S. protectionism, as three of North America’s largest business organizations urge greater international trade co-operation on the continent.
The Prime Minister told reporters Monday that he intends to use his one-on-one time with Mr. Biden in the Oval Office to stress the economic vitality of continental trade and the importance of integrated supply chains, especially because the President seems intent on forging ahead with a “Buy American” strategy for the auto sector and infrastructure projects.
“Since the election of Mr. Biden, we have talked about our concerns with respect to Buy American, which poses a particular challenge not only for companies and workers here in Canada, but also in the United States, because of the integration of our supply chains and our economies in general,” Mr. Trudeau said. “It is counterproductive for Americans to put in place even more barriers and limitations on trade between our two countries.”
After the bilateral meeting, the two leaders will hold talks with their Mexican counterpart, Andres Manuel Lopez Obrador. This will be the first get-together of the leaders of North America since 2016, because former president Donald Trump was not interested in these “Three Amigos” trilateral summits, which had no fixed frequency but had typically been held every year or two since 2005.
Mr. Biden’s protectionist moves are popular with Democrats in Congress and welcomed by American trade unions, but are opposed by U.S., Canadian and Mexican business leaders.
In a letter released Monday, Lance Fritz, CEO of Union Pacific Corporation and chair of the U.S. Business Roundtable and International Committee, urged the three political leaders to reject protectionism and build a stronger, more integrated North American economy so that all three countries can better compete globally.
The letter was also signed by Don Lindsay, president and CEO of Teck Resources and chair of the Business Council of Canada, and Juan Gallardo Thurlow, head of the Business Roundtable of Mexico.
“All three organizations urge the leaders to work together on a comprehensive economic partnership and trilateral North American agenda,” they wrote.
The business executives called on the three countries to fully implement the renegotiated United States-Mexico-Canada Agreement free trade pact (USMCA), and to build “resilient regional supply chains, enhance energy independence … and facilitate trade to benefit businesses, farmers and workers across all three countries.”
Goldy Hyder, president of the Business Council of Canada, said Mr. Trudeau needs to be forceful in the Oval Office meeting and express Canada’s disappointment with protectionist policies promoted by the Biden administration. These policies are counterproductive, since North America needs to compete against Europe and Asia, he said.
“We do better when we work together, is the message he needs to deliver,” Mr. Hyder said, pointing to the way Mr. Biden’s Buy American policies undermine the recently adopted USMCA. “Business relies on the stability and predictability of those trade frameworks to make investment decisions.”
Perrin Beatty, president of the Canadian Chamber of Commerce, said he expects the Prime Minister will also raise objections to an attempt by Michigan Governor Gretchen Whitmer, a Democrat and supporter of the President, to shut down the Line 5 pipeline, which carries Canadian oil and gas across the border into Michigan.
“The administration has simply been sitting it out and not dealing with an issue that would have very serious consequences both in the United States and in Canada in terms of energy security,” Mr. Beatty said.
Canada and the U.S. used to have a strategic partnership, but that has been replaced by U.S. protectionism, driven by domestic politics, Mr. Beatty said.
The Prime Minister needs to drive home to the Americans that protectionism can turn into a two-way street, he added, pointing out that Canada holds large reserves of critical minerals that are needed for U.S. defence industries, electric vehicle manufacturers and producers of consumer products, such as smartphones.
“The Western industrialized nations are heavily dependent upon China for the supply of critical minerals. Canada has fortunately a significant amount of the global supply, and we can be an important part of the solution to prevent American industry from having to be so dependent on the goodwill of China,” he said.
Mr. Beatty argued that Mr. Trudeau also needs to push for joint management of the border, to avoid what happened when Canada opened land crossings to fully vaccinated U.S. travellers in August. The U.S. didn’t reciprocate until Nov. 8, when it opened its borders to Canadians travelling by land and ferry.
In Washington, the Prime Minister will face U.S. congressional pressure to rescind Canada’s requirement that anyone travelling from the U.S. into Canada first submit to a costly polymerase chain reaction COVID-19 test. The U.S. allows air travellers to use less expensive rapid antigen tests, and it does not require vaccinated foreign visitors to present test results at its land borders.
On Friday, U.S. Senate Majority Leader Charles Schumer and three other senators – Democrat Amy Klobuchar and Republicans Susan Collins and Mike Crapo – wrote to Foreign Affairs Minister Mélanie Joly, urging Canada to do away with the PCR test requirement.
“We heard from constituents that the testing protocols required by the Canadian government to enter the country will make it very costly for individuals to travel between our two nations,” they wrote.
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