A day after new President Donald J. Trump announced his intent to renegotiate NAFTA, Canada’s top diplomat in the Southeast warned the Georgia legislature not to be wooed by the siren song of protectionism.
Canada’s not opposed to improving the early-1990s free-trade agreement between the U.S., Canada and Mexico, which doesn’t deal with the skilled migration and couldn’t have foreseen today’s digital economy.
“But at the same time, let’s not throw the baby out with the bath water,” Louise Blais, Canada’s consul general for the Southeast U.S., told Global Atlanta after extolling the positives of the deal in a 10-minute speech to the Georgia House of Representatives Tuesday.
“Protectionism is not what got Georgia where it is today, with its enormous flows in foreign direct investment. Supply chains and your competitiveness is what got you there,” she told law makers, outlining ways her office is working to build ties across borders on issues like female entrepreneurship and the film sector.
She pointed out that Georgia benefits from investments by 250 Canadian companies like Magna and DIRTT, which were honored by the Georgia governor last year. And the $10 billion trade relationship between Georgia and the country supports about 330,000 jobs in one way or another, she said.
“Our joint success in recent years owes a great deal to NAFTA and the healthy supply chains that it has created, making us together more competitive globally,” she said in the speech. “We are confident that you, our American partners, especially from Georgia, understand the mutual benefit of that balanced relationship.”
Ms. Blais, who will speak at the upcoming Global Atlanta Consular Conversation on Feb. 24, said she opted for a bit more firm language given the urgency of the trade situation in the U.S. today and the complacency of some state officials.
Her prime minister, Justin Trudeau, has been invited to the White House to talk NAFTA with Mr. Trump within the next month or so. On the agenda could be dispute resolution mechanisms and country-of-origin rules, both of which were addressed in the Trans-Pacific Partnership, the 12-nation trade deal including Canada and Mexico from which Mr. Trump announced a formal U.S. withdrawal Monday.
Georgia Rep. Chuck Martin, a Republican from Alpharetta who organized Ms. Blais’s speech at the legislature, said he understands the new administration’s desire to focus on fairness in American trade deals, but from his view, Canada is more of a partner than a competitor.
“The U.S. has been put in some bad trading situations, and there’s some — I won’t call it rhetoric — discussion about that needing to be fixed. I’m not the expert down to the details, but from a high level and from my knowledge as a consumer, our trade with Canada has been very fair over the years,” he said.
What would he say if he were Canada during this time of uncertainty? “‘We’re your trading cousins, so if we need to retool this, let’s retool it but keeping our good relationships in mind.’”
Canada doesn’t see a renegotiation as necessarily spelling doom for the trading relationship.
NAFTA doesn’t deal with immigration, and the process of granting special visas for Canadian technicians, executives and engineers working across the border needs to be updated, said Peter Taylor, a consul for Canada in Atlanta.
“It’s very bureaucratic,” he said. “You basically have lists that were drawn up in the late ‘80s. There are huge number of jobs in the digital economy that were not contemplated in the late ‘80s, but the bureaucracy says, ‘You can enter, you can’t enter.’”
While trade is a federal matter, Ms. Blais outlined concrete ways state officials could make Georgia more welcoming to Canadian business, starting with recognizing driver’s licenses issued by their provinces back home, a possibility thanks to 2013 legislation championed by the Korean community that allows Georgia to recognize licenses from other countries.
“What we hear from Canadians moving here either to work at CNN or invest or start a business is that they have to spend days at the motor vehicle licensing office, and they have to start from scratch as if they’ve never driven before. For an executive, they tell us that that’s time wasted,” Ms. Blais said.
Not everyone is quaking in their boots about the prospect of a new deal. GIW Industries, which is based in Grovetown, Ga., and owned by Germany‘s KSB Inc., sees most of its exported centrifugal slurry pumps go to the oil sands in the Canadian province of Alberta.
But pump components are brought into the U.S. duty-free anyway, and the company has never had challenges moving people across the borders for maintenance.
Plus, it’s hard to be concerned about a yet unclear policy, and it wouldn’t hurt to take stock of where things are, said Gary Simpson, who handles export compliance for the company.
“It keeps the production in Georgia, but instead of that production going back to Hollywood at a high cost, it comes to Canada. The expertise is there, they get the tax credit and it makes their product more competitive.”
Editor’s note: This article has been updated with comments from GIW’s Gary Simpson.
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