I disagree with most media and political pundits that believe Trump is unpredictable. He campaigned on America first which includes being tough on illegal immigration and ripping up NAFTA. His voting base believes that these two issues are responsible for low wages and poor job opportunities in the United States.
It was obvious to me that the U.S. government shutdown was caused by Trump who set the March 5th deadline for DACA (Deferred Action for Childhood Arrivals). He is using Dreamers as a bargaining chip to get funding for more border security and for his idiotic wall. Eighty per cent of Americans don’t want Dreamers to be deported. If Trump really cared, he would have informed the House of Representatives to draft a by partisan bill to solely deal with DACA.
In my humble opinion, Trump is just looking for an excuse to rip up NAFTA. Donald Trump’s protectionist leanings have been obvious since before the U.S. presidential election. U.S. negotiators are showing few signs of backing down from unrealistic demands on automotive content rules, the chapter 19 dispute mechanism and a five-year sunset clause that have left NAFTA teetering on the brink.
Canada and Mexico have rejected most of the U.S. proposals for NAFTA reforms, leaving officials with a big job if they are to bridge the large differences in Montreal. Negotiations are due to wrap up at the end of March.
Protectionist moves as U.S. imposes tariffs on the following imports
- Softwood lumber (Canada)
- C-series planes (Canada)
- Pulp & Paper (Canada)
- Washing machines (South Korea)
- Solar cells & modules (China)
Canada is firing back by bringing a trade complaint to the World Trade Organization (WTO) despite the fact that the president has been particularly critical of the WTO and its system for dispute settlement.
A former U.S. trade representative says he’s hoping that a recent wide-ranging trade complaint launched by the Canadian government against the United States won’t “end up blowing up in their face” at the NAFTA negotiating table.
Adding more fuel to the fire, Canada has agreed to a resurrected a version of the Trans-Pacific Partnership (TPP) and will sign on to the deal. The deal, renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, comes after talks in Japan this week with the 11 countries (including Mexico) that are still committed to the deal.
“We are happy to confirm the achievement of a significant outcome on culture as well as an improved arrangement on autos with Japan, along with the suspension of many intellectual property provisions of concern to Canadian stakeholders,” said International Trade Minister Francois-Philippe Champagne in a statement.
Will these moves strengthen Canada’s position at the negotiation table with the United States or will it force Trump to play his withdrawal card?
My bet is that picking a fight with Trump will result in him sending a NAFTA withdrawal letter to both Canada & Mexico which will cause a stock market correction. In my humble opinion, it is only a question of when!
Smart Money 
Ciao Rico,
Nice piece, made me think of an aspect that I was not considering, Trump starting to ramp up protectionism to many other fields, countries and products… This could prove to be a negative trigger for world’s economy. Here in Europe we did not hear about the Canadian part of the story, only Korea and China. I know that Canada recently signed all sorts of free trade agreements with Europe, I remember my canadian clients being quite happy about it.
Not sure what to make of Trump economic policies, I look at them with skepticism, but in a “boom period” even bad choices might seem right. What is the opinion of Canadian people on this tariff story?
Ciao ciao
Stal
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The NAFTA trade talks are getting a lot of attention in the Canadian media but not in the United States. The biggest concern is that more tariffs will be imposed on our automotive sector. Plus the U.S. tax cuts will encourage Canadian companies to expand in the U.S. instead of Canada.
Unfortunately, most Canadians are more concern regarding the standings of their home town hockey team!
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Unforntuantely we (the romans) invented “panem et circensens” (bread and gladiators), to distract the population from more pressing problems… We have the same story in Italy, with elections that are going to tear apart the country (politically), but people are stressing about the fact that we didn’t qualify for the World Cup!! 😦
Anyhow I will look for more news, I would be worried about the tax cut, but is it so easy to relocate a business in the US from Canada?
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Many companies in Canada are owned by foreign multi-nationals so they can expand anywhere in the world.
Many auto parts and car assembly plants have moved to Mexico for example. Two U.S. retail giants have closed their stores in Canada. (Target and Sears) Many Canadian oil companies have expanded into shale oil production in the U.S. because of lack of pipelines in Canada.
Foreign investment in Canada will dry up if Trump rips up NAFTA. I may live in Canada but my money lives in the U.S., Europe and Asia.
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