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David Bond, Former Chief Economist for HSBC Canada: Time for Canada to fundamentally rethink its rel

Just in case there was any doubt, the recent behaviour of US President Trump in dealing with the renegotiation of NAFTA makes it obvious that this narcissistic, unthinking, bombastic bully really is only concerned about his “ratings” with his base of supporters. Freed of any real constraint by the legislative or judicial arms of government, he is causing major long-term damage to the capacity of the United States to influence the world’s future as well as weakening the structure of constitutional government in the US.

Not only has he, in effect, declared economic warfare on Canada; he continues to denigrate our Prime Minister and treat Canada, a long-time friend and ally, in a shameful fashion. And he treats virtually all nations, except perhaps Russia, in a similar fashion, at least from time to time – oblivious to his country’s nose-diving influence on the international stage.  China’s leadership must be pinching themselves daily, unable to believe Mr. Trump’s continuing stupidity in allowing China to essentially eclipse the US throughout Asia and Africa.

So I argue that Canada has to fundamentally rethink our approach towards the US and how we will conduct relations with the Trump administration in future. Our two countries have a myriad of interactions on a practically endless list of files. National defence, including NORAD (The North American Aerospace Defense Command), intelligence sharing, and interchange of military personnel, is just the most obvious examples. Sharing of information on border crossings and potential terrorist threats is also a key contribution to US security.

Because we share the northern part of the continent, we are also forced to work co-operatively on weather forecasting, the regulation of trans-border river flows, joint shipping facilities such as the St. Lawrence Waterway, the treatment of migratory bird life, shared ocean resources, air spaces and trans-border aircraft movement. All this cooperation facilitates and improves the lives of Americans and Canadians, so why is Trump acting as if we are just trying to exploit the US in some dastardly fashion with unfair trading practices?

I think it’s obvious that he wants to appear to “win”, obtaining results that appear to the obvious advantage of the USA at a “cost” or “loss” to Canada. That is the central and may be the only strategic objective: make Trump look good. What we will have to do from now on, as long as Mr. Trump and whomever is his successor, if they support this approach to resolving trans-border issues, is to assume that will be their objective.

Whatever they propose, we need to consider that their opening position will be framed in such a way as to portray Canada as acting in an aggressive and uncooperative fashion. While the US Administration may use Twitter to chastise Canada, our public reaction should be neutral and minimal. Certainly our diplomats in Washington should confidentially set the record straight with members of the legislative bodies. And that should be it. Informing the media should be tightly controlled with one unique spokesperson on each issue. We should be responsive but not overly anxious or expeditious in reacting to American moves on trans-border issues.

Such an approach may produce a prolonged period of stress that could lead to negative impacts upon our economy and future prospects. Assuming that things will change once Trump is gone would be unwise.

To minimize negative impacts, Canada needs to implement a long-run strategy of market diversification both with Europe and Asia. We need to develop language capacities in these areas, promote Canadian trade fairs in these regions and invite students from these regions (though not from Saudi Arabia) to come and study here. Our international aid should be strategically focused on these regions. If we could shift 15% of our trade away from the USA in the next 5 to 7 years then we would gain a significant amount of breathing rooming in our relations with our southern neighbour. 

This article also appears in the Kelowna Courier. 

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