Donald Trump as president of the United Stated certainly creates some unknowns in terms of trade and its impact on the Canadian economy.
That was the message from John Gormley, guest speaker at an agricultural producer appreciation night held in Yorkton in March. “The man takes unorthodox to levels most of us can’t understand,” said the long-time radio talk show host, and former Member of Parliament.
“… He turns every single assumption on its head. From beginning to end it will be a presidency without precedent. There is no playbook for him, no template for this.”
Gormley said whatever one thinks of Trump he is iconic to the current age. “Donald Trump is a man who I find fascinating,” he said, adding “I can’t remember a time in my life when there was not a Donald Trump.” Gormley said for decades Trump has made headlines, sometimes for hugely successful business deals, other times for massive business failures, and others simply for being flambouyant, but he has always been in the news.
“This man is a creation of the media,” he said, adding that does not mean he has not been manipulative of the message the media has put out. “His relationship with the media, to be polite, is peculiar,” said Gormley then suggested the relationship might more correctly be termed “bizarre.”
So heading into the presidential election Trump had notoriety as being outside the political elite system, and that became a key element of his success, offered Gormley. Trump also came with a message about not apologizing for being American, with the rallying cry of making the U.S. great again, things people were ready to embrace. In that regard Gormley said, “Donald Trump is a symbol, a canary in the coal mine.” All the uncertainty may have an effect on the economy of North America. And that is at least concerning to Canada as this country and the U.S. do $2 billion per day in trade. “Seventy-five per cent of Canadian exports go to the United States,” said Gormley, adding U.S. trade with Canada is second only to their trade with China. And, 35 US states have Canada as their largest trading partner.
Specific to Saskatchewan 60 per cent of the province’s exports head south, with an annual value of about $20 billion, and that includes about $2 billion in canola seed, oil and meal, with the US also a key market for wheat, oats and several other farm crops.
So how Trump addresses trade has to be monitored. “Are there challenges? You bet there are challenges,” said Gormley.
Canada and the US have had a trade deal since 1982, with Mexico brought into the North America Free Trade Agreement a few years later.
“Mr. Trump says he wants to tweak NAFTA in regards to Canada,” said Gormley, adding that there is no way of knowing what the US president means with the word tweak.
Trump has also said he wants to see more “drastic” changes to NAFTA in terms of trade with Mexico. But Gormley suggested a wait-and-see approach.
“My take away message is don’t freak out,” he said, adding much will hinge on what tweaking might mean. And of course there remains the question whether anyone will risk re-opening the NAFTA deal.
Gormley suggested to do so would be to open “a Pandora’s Box,” because many groups would be lined up to have significant changes made. He pointed to environmental groups as an example, noting their power and vision is quite different today from when NAFTA was inked.
Even without opening NAFTA there are trade issues at play, including tariff and non-tariff barriers that have always been a factor even with a trade deal. Country of Origin Labelling (COOL) has been one example, but at least with NAFTA there are dispute resolution mechanisms in place, said Gormley. But NAFTA, or not, Trump is certainly talking greater protectionism, even referencing Abraham Lincoln’s stand from 1865, noted Gormley.
“I worry about Mr. Trump and what he wants with protectionism,” he said. That worry is why Canada must be cautious in dealing with Trump.
“Advocacy has never been more important,” said Gormley noting that the US president has shown signs of being egocentric and that plays into relations with the president.
Gormley did add he feels Prime Minister Justin Trudeau did a good job in his first meeting with the new president. “The Prime Minister hit the right notes with his first meeting with Donald Trump,” he said.
But again Gormley suggested caution in any reaction to Trump, and “not to see in the Trump administration shadows, or fears, that don’t exist yet.” •
— By Calvin Daniels