How Canada can benefit from Trump\u2019s mad rush to wrap up NAFTA talks<\/a><\/li>\n<\/ul>\nMost Canadians and Americans don\u2019t realize that the founders of the Big Three automakers \u2013 General Motors, Ford and Chrysler \u2013 all had Canadian roots. (The parents of GM\u2019s Will Durant, Walter Chrysler and Henry Ford all immigrated from Canada.)<\/p>\n
They turned Detroit into the Silicon Valley of the automobile era and built giants with huge Canadian subsidiaries. They did so in Canada because they understood the country was a member of Britain\u2019s Commonwealth and enjoyed tariff-free trade with its 52 members. The U.S. didn\u2019t have the same advantage.<\/p>\n
This meant that their cars — if made and assembled in Canada by their subsidiaries \u2013 had access to and could tap into the biggest free trade market on earth.<\/p>\n
The result was that, by the 1920s, Canada was the second largest auto exporter in the world and Canadian-made cars, namely the McLaughlin Buick, were the choice globally, preferred by British royalty and tycoons everywhere.<\/p>\n
North America\u2019s automotive companies grew during the Depression, then retooled their factories for the Second World War effort. Then everything changed.<\/p>\n
America went on to bigger success as its highway system and middle class exploded. But Canada\u2019s auto industry sputtered because after the war, Britain ended the Commonwealth tariff-free privilege and instead turned its sights onto joining a booming Europe.<\/p>\n
Canadians proposed the Auto Pact to the Americans and they agreed. This \u201cfair trade\u201d agreement became the template for the 1989 Free Trade Agreement, then NAFTA. Now Trump is revising the deal because Mexico\u2019s excessively low wage levels have gutted the auto regions of Canada and the U.S.<\/p>\n
Mexico is the target, not Canada, and even if NAFTA is rescinded, the two northern Amigos will continue to integrate and get along trade-wise. This is based in part, as before, on the deep-seated socio-economic relationships between the two, but also because Canada will become more useful to the United States in terms of trade.<\/p>\n
Brexit proponents intend to resurrect the Commonwealth tariff-free agreement at upcoming meetings this summer.<\/p>\n
This is an obvious plus for Canada and — if even partially pulled off — would be beneficial for Canadians and for American subsidiaries operating in Canada, who would then have access to a gigantic Commonwealth market.<\/p>\n
This is no small matter. There are 52 nations in the Commonwealth, which comprise one-third of the world\u2019s population \u2013 or 2.3 billion people \u2013 and would represent the biggest market globally.<\/p>\n
Proponents of a reactivated Commonwealth strategy are suggesting a staged implementation. Initial members would be Australia, Canada, New Zealand, and the United Kingdom, followed by India and South Africa, then the rest.<\/p>\n
That would be enormously positive for Canada, especially in tandem with the fact that Canada has a free trade agreement with the European Union, which the United States does not.<\/p>\n
A Commonwealth deal and European Union deal make Canada a very desirable place for Americans to export tariff-free to almost half the world without inking a free trade deal themselves.<\/p>\n
This worked for Canada during the automobile century and now positions Canada to succeed in the 21st century, thanks to protectionism and populism in the U.S. and U.K.<\/p>\n","protected":false},"excerpt":{"rendered":"
Diane Francis: Canada may be about to become a lot more useful to the U.S. in terms of trading, and it’s thanks to Brexit proponents<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/4033"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=4033"}],"version-history":[{"count":1,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/4033\/revisions"}],"predecessor-version":[{"id":4034,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/4033\/revisions\/4034"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=4033"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=4033"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=4033"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}