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"Afghanistan: meeting the development challenge" by John Manley The author first visited Afghanistan as Canada’s foreign minister following the ouster of the Taliban regime in 2002. Five years later, John Manley returned to Kabul and its environs as a private citizen and a director of CARE Canada, one of the leading NGOs working to rebuild that shattered country. In this view from the ground, as part of our continuing Mission Afghanistan series, Manley writes that security remains “the major issue, including for NGOs.” But while the “promise of 2002 has thus far been unrealized in the establishment of a true system of rule of law and sustainable Afghan institutions,” he also found measurable progress, including “programs in housing, micro-credit, infrastructure and community development.” "SES-Policy Options exclusive poll: Canadians, Americans agree both better off with free trade" by Nik Nanos On the 20th anniversary of the negotiation of the Canada-US Free Trade Agreement, Policy Options asked SES Research to measure support for free trade in both Canada and the United States. In this exclusive poll, Canadians and Americans not only agree free trade has been good, but they agree it is important to our two countries’ competitiveness in the global economy, and are confident about the prospects of deepening economic integration. The FTA is seen as a success and the level of confidence runs high across the board — in all regions of both countries, in all age groups and in all educational demographics. “What is most striking about the results,” writes pollster Nik Nanos, “was that in both Canada and the United States the intensity of support for free trade in many instances was ten times stronger than the intensity against it on a number of elements.” "Canada's free trade lessons for the world" by Craig Wright and Derek Holt In this economic impact study conducted for Policy Options on the 20th anniversary of the negotiation of the Canada-US Free Trade Agreement, Royal Bank Chief Economist Craig Wright and Assistant Chief Economist Derek Holt examine eight negative myths regarding the FTA and conclude they have all been debunked by events. Remember? Production and jobs would migrate south. Investment would evaporate. Canada would be for sale. And so on. All those fears have been dispelled. But there are areas of mixed evidence such as large firm productivity and others, where “much work remains to be done,” they warn, for the momentum of free trade to be regained. Policy complacency at home and protectionism abroad are among the risks facing Canada today. "How free trade came to Canada: lessons in policy analysis" by Charles McMillan It is 20 years since the negotiation of the Canada-US Free Trade Agreement, but before the two sides even came to the table, the political stars had to be aligned in the right direction. In Canada, the aggregation of political and economic forces began with the election of the Mulroney government in September 1984, and the recommendation of the Macdonald Commission for a “leap of faith” on free trade in 1985. In the US, the Reagan administration thought it could leverage trade talks in the multilateral arena by undertaking bilateral trade talks with Canada, its largest trading partner. And Brian Mulroney, who had opposed unfettered free trade during the Conservative leadership campaign in 1983, became its proponent in 1985. Charles McMillan, who was Senior Policy Adviser to the Prime Minister at the time, provides this revealing policy backgrounder on the origins of the deal. "The impossible deal" by Robin V. Sears Based on historical evidence, political prospects for free trade between Canada and the United States were not very promising. In the nineteenth century, Macdonald’s protectionist National Policy won him four consecutive elections from 1878 to 1891. In the twentieth century, Laurier’s Reciprocity Accord with the US cost him the 1911 election. In the 1940s, Mackenzie King negotiated with the US, but only in secret. But then in the 1980s, along came the Macdonald Commission, recommending a “leap of faith” and Brian Mulroney willing to make it. Robin Sears, who was a senior adviser to Ed Broadbent in the NDP’s campaign against free trade, recalls the powerful emotions and the political undercurrents, shaping the tumultuous events that began with the FTA in October 1987, on into the historic free trade election campaign of 1988. "Twenty years on, the Cassandras are still wrong" by Derek H. Burney As chief of staff to the prime minister in 1987, Derek Burney headed the Canadian team at the meeting that literally at five minutes to midnight, resulted in the Canada- United States Free Trade Agreement. At the signing of the FTA on October 3, 1987, and in the subsequent free trade election of 1988, various Cassandras forecast dire scenarios of doom for Canada’s economy, social programs and political sovereignty. Twenty years on, the Cassandras couldn’t have been proven more wrong, though that doesn’t mean they’re out of business. Here is a look back and a look ahead, by a top official who was present at the creation of the FTA. "Free trade and dispute settlement: time to declare victory" by Michael Hart and Bill Dymond A key goal in negotiating the Canada-US Free Trade Agreement (FTA) was to replace US antidumping and countervailing duties on Canadian exports with a new set of rules on subsidies and unfair competitive practices. The result was enhanced dispute settlement but not the new rules Canada sought. Did the FTA fail to solve the problem? Antidumping and countervailing duties have virtually disappeared from use. Softwood lumber is the exception that proves the point. The record of the past 20 years suggests that the FTA largely solved the problem, but on a different basis that few could have foreseen. "Financial services in the FTA: almost an afterthought" by Stanley H. Hartt On October 3, 1987, an “elements agreement” in principle was achieved on free trade between Canada and the United States, and achieved as the hands of the clock ticked toward midnight and the expiration of President Reagan’s fast-track authority for an “up or down” vote by Congress, but without amendment. One of the elements was financial services and one of the eight Canadians in Treasury Secretary Jim Baker’s Washington boardroom was Stanley Hartt, then Canada’s deputy minister of finance. Here, he recalls that historic day and the making of a momentous deal. "The loonie and the FTA" by Thomas J. Courchene Despite the fact that the floating loonie and the FTA go back only a score of years, their relationship easily qualifies as among the most interactive and important in Canada’s post-war economic policy history. The major undervaluation of the loonie with respect to the greenback prior to 2002 led to a three-fold increase in exports and served to reorient Canada’s traditional east-west trade in a north-south direction. The ongoing overvaluation of the loonie embodies economic, fiscal and environmental issues that are creating inter-provincial, federal-provincial and inter-industry tensions. This overshooting on both sides of the purchasing-power-parity exchange rate raises the issue of whether the Canadian currency area is large enough to embrace both a world-class energy sector and a world-class manufacturing/business-service sector. "What the West wanted and what it got" by Todd Hirsch No region of the country was more supportive of free trade than the West, and no province more supportive than Alberta. We asked our Calgary-based columnist Todd Hirsh for his thoughts on what the West expected from the Free Trade Agreement, and what it got. “Access for natural resources was expected by western Canada and was delivered,” he writes. But apart from what it delivered on the economic side, he observes that for the West, “the FTA was seen as a way of finally breaking out from under the economic thumb of Ottawa.” While there have been disappointments, he concludes, “with the FTA, the West wanted economic gains and it got them.” "Gateways, global value chains and trade corridors" by Russ Kuykendall Canada’s international trade policy prioritizes the Gateways model with a view to increasing trade with Asia, especially China. Meanwhile, Industry Canada pursues research on global value chains, looking at how trade occurs inside binational and multinational companies. Russ Kuykendall raises questions about the net benefit to Canada from the China-focused gateways trade. He affirms the strengths of the global value chains model, but asks whether it provides an adequate explanation of trade. Instead, Kuykendall proposes that the Trade corridors model best explains Canada-US trade — Canada’s most important trading relationship — and that the model suggests where Canada should pursue development of trade. "The long road to free trade" by Earl H. Fry After an interval of 120 years, Canada and the United States finally concluded the Free Trade Agreement, negotiated in October 1987 and implemented at the beginning of 1989. “In the aggregate,” writes Earl Fry, a leading authority on bilateral commercial relations, “20 years of free trade have actually been very good for both Canada and the United States.” “Total Canadian exports to the United States have increased almost 350 percent in nominal terms from US$88 billion in 1989…to US$303 billion in 2006. For most Canadians, their national economy has never been better during their lifetimes has been over the past several years.” "NAFTA revisited" by Jeffrey Schott and Gary Hufbauer From the Peterson Institute in Washington, leading American trade policy authorities Jeffrey Schott and Gary Hufbauer consider the results under the North American Free Trade Agreement among Canada, the US and Mexico since 1994. “NAFTA was and is foremost a commercial agreement and in commercial terms the pact is a great success,” they write. “Between 1993 and 2006, trilateral merchandise trade rose almost three-fold, now exceeding $800 billion annually.” On the jobs front, “US employment rose from 110 million in 1993 to 144 million in 2006 and in Canada from 13 to 16 million,” although “NAFTA is no more than a blip on the US employment picture.” They conclude: “NAFTA succeeded in advancing economic integration and the goals agreed to in the pact — though not in reaching the inflated promises of politicians when the agreement entered into force.” "Free trade in Washington: all politics, all the time" by David T. Jones If all politics are local, then in Washington, all trade is politics. Twenty years after the FTA and 15 years after the NAFTA, former US diplomat David Jones looks at the results and prospects for free trade from Washington, where lobbyists and special interests are deeply entrenched, where Congress is rarely out of campaign mode, and where the President of the United States, even when he enjoys fast track authority from Congress to pass trade agreements “up or down” without amendment, has great difficulty in securing agreement for bilateral and regional FTAs. "Portrait des exportations du Mexique, du Canada et du Québec après vingt ans de libre-échange" by Dorval Brunelle The Free-Trade Agreement between Canada and the United States, like its North- American counterpart NAFTA, has had a significant integrating effect on its signatories. Dorval Brunelle, director of UQAM’s Observatoire des Amériques, notes that among the 23 major regional economic agreements listed by the United Nations Conference on Trade and Development, it is in North America that the greatest volume of internal trade between the partners has occurred. In this brief overview he observes, however, that after 20 years of free trade, the repercussions have differed considerably among the three countries involved. Between 1990 and 2003, Mexico’s share of bilateral trade increased from 7 to 24 percent of GNP, Canada’s went from 16 to 27 percent, but the United States’ only went from 2 to 2.5 percent. "Has North American integration resulted in Canada becoming too dependent on the United States?" by Eugene Beaulieu The Canada-US Free Trade Agreement (FTA) dramatically increased trade and investment between Canada and the United States, and this deeper economic integration resulted in Canada becoming more specialized in production and more dependent on the United States as an export market. The benefits of increased specialization in production and trade flows have been higher Canadian productivity and income. However, some argue that Canada is now too economically dependent on the United States and that trade and investment policy must be employed to diversify the destination of Canadian export markets. The University of Calgary’s Eugene Beaulieu argues that concerns about the economic risks of depending on exporting to a single country are overstated. Further, even if there were a compelling argument for export-diversification programs, these policies would likely be ineffective. Given the extent of economic integration, the trade-policy priority should be to lower the costs of doing business across the Canada-US border. "Un partenariat sans les peuples" by Alain Noël [summary not available] "Interpreting the constitution: the living tree vs. original meaning" by Ian Binnie Continuing our year-long series The Charter @ 25, Justice Ian Binnie of the Supreme Court of Canada argues for “the living tree” interpretation of the Constitution, as opposed to “original meaning.” This article is adapted from his debate with Justice Antonin Scalia of the United States Supreme Court at the McGill Institute for the Study of Canada’s landmark Charter @ 25 conference, in Montreal last February 16. Binnie vs. Scalia, as the debate was dubbed, was a riveting performance by both judges. "Une charte du fédéralisme : une idée attrayante qu'il faut mieux défendre" by Éric Montpetit [summary not available] Book excerpt: Memoirs by Brian Mulroney In this exclusive excerpt from his book, Memoirs, the former prime minister recounts the tense month of negotiations and stalemated talks with the United States before the dramatic agreement at the 11th hour of the last day — October 3, 1987. Book review: Anthony Wilson-Smith reviews Memoirs by Brian Mulroney [summary not available] Book Review: Gil Troy reviews The Reagan Diaries, edited by Douglas Brinkley [summary not available] "Économie québécoise - le virage est bien amorcé" by Monique Jérôme-Forget [summary not available] |
