The C.D. Howe Institute recently issued a report suggesting a number of improvements to NAFTA, including the removal of costly trade barriers. The COMPAS panel of 122 Canadian CEOs agrees with many of the recommendations, but differs on issues related to water exports and oil and gas policy.
The panel agreed most fervently with the suggestion that Canada and the U.S. adopt a common system for inspecting and tracking container traffic from point of origin, whether in North America or elsewhere. The respondents also felt Canada should implement new U.S. regulations in areas where the American standards are at least as high as ours, which could include food labeling and drug testing.
The CEOs were less inclined to agree with the suggestion that water exports should be prohibited, and one respondent said Canada should proceed with “extreme caution” when tinkering with NAFTA given the weakness of the American economy. “The U.S. economic situation will lead them down the path of protectionism and it will not be to the benefit of Canada,” according to the CEO. “We may need the bargaining power of oil, natural gas, commodities and water as their and our recession deepens.”
The panel also expressed disagreement over the statement that Canada should avoid being heavy-handed in oil and gas negotiations, and that an East-West energy pipeline is too costly to be justified.
In their comments, the CEOs emphasized the importance of forming beneficial trade arrangements. “The WTO failed to reach an agreement in the Doha round and opened the door to more bilateral or multilateral trade agreements. Canada should take advantage of this situation and negotiate a better deal on NAFTA,” wrote one.
“I hope that we are at least as serious when it comes to removing inter-provincial barriers to trade,” wrote another panelist. “It seems very odd that we are better able to negotiate trade agreements with foreign nations than we are cleaning up the domestic issue of inter-provincial barriers.”