Print Friendly and PDF

Prosperity Partner: Building the Canadian Relationship

Ambassador David MacNaughton leverages entrepreneurial, business and political expertise to nurture Canada’s vital partnership with Michigan and the United States

By: Daniel Lai

Canada’s ambassador to the United States, David MacNaughton, is perhaps his country’s most important envoy on the world stage. In a time that is critical to the economic growth of both countries, MacNaughton’s political and business-savvy expertise bodes well as the chief voice for Prime Minister Justin Trudeau in Washington, D.C. The Detroiter recently interviewed MacNaughton, who will attend the 2018 Mackinac Policy Conference, on how the prime minister and his administration are  working to protect and grow businesses and jobs on both sides of the border, particularly in Michigan — Canada’s top trade partner — and the implications for Michigan and Canada under a revised North American Free Trade Agreement.

Maintaining the bilateral relationship with the United States has been a stated goal for Prime Minister Trudeau. What are the administration’s current priorities? Where do you see challenges and opportunities and How can the two countries work together?

Canada and the United States have the longest, most peaceful and mutually beneficial relationship of any two countries in the history of the world. What I find striking is the personal connections between Canadians and Americans. I meet Americans from all walks of life who tell me about their links to Canada. They come to Canada to hunt or fish, they have a child at a university, or they work with a Canadian.

With 400,000 people crossing the border every day, and $2 billion worth of goods and services traded daily, that is a lot of relationships. These bonds are the cement in the foundation of our binational relationship. It is a source of optimism for me that we have so many opportunities to build together.

Things have worked so well for so long that we are all guilty of taking our bilateral relationship for granted. That is partly why there has been such extensive outreach from all levels of the Canadian government during this past year. Virtually every member of the cabinet and Prime Minister Trudeau has had meetings in the states. In just the past half year, the Detroit region has received visits from Navdeep Bains, Canada’s Minister of Innovation, Science and Economic Development; Marc Garneau, Minister of Transport; and Amarjeet Sohi, Minister of Infrastructure and Communities.

Canadian and U.S. prosperity is inextricably linked. Canada is committed to moving forward with the United States on initiatives that keep our borders open to the flow of legitimate people and goods, while securing borders from shared threats. Neither country needs slower, more cumbersome trade at the border.

Another area of progress concerns preclearance. Canada and the United States are seeking to strengthen our relationship and enhance our mutual security, prosperity and economic competitiveness across all transportation modes.

Regarding security, our two countries share a robust partnership. Terrorism remains a global problem. Our defense relations are longstanding and well entrenched. 2018 marks the 60th anniversary of NORAD, the North American Aerospace Defense Command. It is worth noting that no terrorist attack has ever been carried out by individuals entering the United States from Canada. Canadian and American law enforcement and intelligence agencies engage and cooperate with one another daily to ensure that our citizens are secure.

Have you seen an influx of skilled talent immigrating to Canada following the United States’ tough stance on immigration regulations? What lessons can we learn from Canada regarding protecting our borders while also remaining a welcoming nation?

Like the United States, Canada is a country of immigrants. Diversity is our strength and has played a key role in driving our economic prosperity and our success as a nation. There are many opportunities for foreign nationals to come to Canada with legal status to study, work or even immigrate on a permanent basis. So much of our economy is now dependent on services, so it is critical that we modernize the rules for temporary entry of professionals under NAFTA for business people moving across our border. There are jobs that exist today that weren’t known back in 1994.

Canada’s system of immigration has been recognized internationally as a thoughtful, responsible approach that takes into consideration the need for more immigrants while balancing our fiscal and global responsibilities. Canada’s new Global Skills Strategy provides employers with a faster and more predictable process for attracting top talent and new skills to Canada. The Government of Canada recognizes that by improving access to top global talent, it will support Canadian innovative companies to grow and flourish, as well as create jobs for Canadians.

Canada remains an open, welcoming country to people seeking refuge, whatever their ethnicity, background or religion. Entering Canada must be done through the proper channels. We are confident in our programs and will continue to ensure that our immigration system balances compassion, efficiency and economic opportunity, while protecting the health, safety and security of Canadians.

Michigan and Canada share a unique relationship. Not only is Michigan the largest exporter of goods to Canada, its border crossings allow thousands of engineers, nurses and highly educated professionals from both the United States and Canada access to jobs. What would a world without NAFTA look like for Canada and Michigan?

Canada’s message heading into the original creation of the 1988 Canada-U.S. Free Trade Agreement, and then of NAFTA, a quarter century ago, was the same as our message today: America has no better friend or partner than Canada. Any increase of trade barriers between our countries, such as canceling NAFTA, would significantly impact jobs in the United States and Michigan, as well as in Canada. Canada is prepared for all possible scenarios. However, having met with U.S. stakeholders and members of Congress, it is clear they understand that a withdrawal from the agreement would harm U.S. workers and industry.

Rather than focusing on what a post-NAFTA world would look like, Canada is focused on finding solutions. No one wants the U.S. economy to succeed more than Canada. When Michigan and the United States succeed, so does Canada. NAFTA is part of that success. Our relationship supports millions of middleclass jobs on both sides of the border. We need to work towards the same goal — that is, a more competitive North America, achieved by give and take on all sides.

Canada’s goal is to reach a good deal, not any deal. A win-win-win deal is both possible and necessary. We all need to approach negotiations in good faith with this goal in mind. If we don’t all win, we all lose. Any effort to roll back trade would be bad for all three economies.

A study by the Center for Automotive Research reveals that any plan to undo a free trade agreement with Canada could result in automotive companies offshoring assembly to non-NAFTA countries, which would economically devastate Michigan suppliers. How is Canada working through the negotiation process to protect the automotive supply chain?

Canada will continue to advocate against any new proposals that would negatively affect jobs and our cross-border supply chains. The U.S. automotive proposal would not only be damaging to the Canadian and Mexican automotive sectors, but to the U.S. automotive sector as well.

From the beginning, Canada’s approach to negotiations has been to present ideas and solutions that benefit all three NAFTA partners and contribute to North American competitiveness. Canada has presented several creative ideas to help advance discussion in some of the more difficult areas of the negotiations, including on automotive rules of origin. Our ideas would reduce red tape, improve enforcement, as well as incentivize investment in manufacturing and research and development in North America. Canada will continue to consult with the automotive industry and other stakeholders on these ideas.

Our overriding objective is to build on the many valuable components of an already good agreement. We want to make updates that better align NAFTA to new realities in trade and investment.

What would you say to those who propose that trade agreements like NAFTA are bad for business and job creation?

NAFTA, while not perfect, has been a good agreement for the United States, broadly speaking, just as it has been good for Canada and Mexico. Trilateral trade has increased three-fold since 1994. Since NAFTA went into effect, the U.S. economy has added 33 million net new jobs. To put this in perspective, the entire population of Canada is 36 million.

However, we can and should do more to help the people who have been left behind by global trade. We can and must build bridges to new opportunities for the middle class, and those working hard to join the middle class. We can and must work tirelessly to find a pathway to prosperity for all.

This is among the greatest challenges of our time. NAFTA needs an update. Canada believes that a modernized NAFTA should include elements such as stronger labor and environmental provisions. Our negotiators have already closed several chapters, including on competition and small and medium-sized enterprises, with the aim to help support the middle class.

We’ve reached out to companies in Michigan and across the United States to tell their stories about their ties to Canada. This is part of doing our homework and getting to a deal that creates a North America that is the most competitive economy in the world.

The Gordie Howe International Bridge is critical for the long-term economic growth of both Detroit and Windsor, with both sides working together on its completion. Additionally, leaders from both governments partnered on the recent Amazon HQ2 bid. How can the collaboration between Detroit and Windsor translate into the broader U.S.Canada relationship?

The Government of Canada is firmly committed to the Gordie Howe International Bridge. Nearly 30 percent of surface trade between Canada and the United States goes through Windsor-Detroit so this new bridge is vital to accommodate future traffic growth for this strategic trade and transportation corridor. This border crossing is vitally important to the economic well-being of the local community, particularly to the automotive industry and for daily commuter traffic between Windsor and Detroit.

Once complete, the bridge will feature six lanes, associated ports of entry, and direct connections to the highway systems in Ontario and Michigan. It will support the anticipated growth in traffic over the years to come and will also provide for redundancy at the busiest trade corridor between Detroit and Windsor in case of emergencies or unforeseen events.

The Windsor-Detroit Bridge Authority (WDBA) is working with the cities of Windsor and Detroit and with many partners on both sides of the border including Infrastructure Canada, the Michigan Department of Transportation, U.S. Federal Highway Administration, Canadian and U.S. border services, and others. This project is expected to create thousands of jobs in Ontario and Michigan.

You will be attending the Detroit Regional Chamber’s 2018 Mackinac Policy Conference in May. What are you most looking forward to?

I am very much looking forward to exchanging views on NAFTA with participants at the Mackinac Policy Conference. This will be a significant opportunity to engage with decision-makers on all aspects of the Canada-U.S. relationship.