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First Trump Now The EU Deal

Corporate Canada is shifting its focus to Prime Minister Justin Trudeau’s trip across the Atlantic later this week.

Trudeau’s visit is expected to coincide with the European Union’s ratification vote on its free-trade deal with Canada, an agreement nearly scuttled last fall due to opposition from a small region in Belgium.

“The prime minister is now off to hopefully put (the Canada-EU free trade deal) in his pocket and bring it home from Europe, which would also be good news,” John Manley, the president of the Business Council of Canada, said in an interview.

Canada is expected to ratify the deal after the European Parliament gives its OK.

The deal will still need the approval of the EU’s 28 national parliaments as well as some regional governments. But 90 per cent of the deal is expected to come into force under what is known as provisional application.


“It’s important for the federal government to finalize the deal with the EU”

Perrin Beatty, head of the Canadian Chamber of Commerce, agreed that it’s important for the federal government to finalize the deal with the EU.

Business leaders in Canada said they were somewhat comforted by Trump’s comments Monday after his first face-to-face meeting with Trudeau.

In particular, they highlighted the president’s remark that the U.S. was in favour of “tweaking” the North American Free Trade Agreement, rather than ripping up or dramatically changing the deal, as Trump had vowed to do during the election campaign.

“We’ll be doing certain things that are going to benefit both of our countries,” Trump told reporters at a joint news conference in Washington with Trudeau.

“We will co-ordinate closely to protect jobs in our hemisphere and keep wealth on our continent.”

There are expectations in Canada that the president’s words will help lift business confidence after weeks of companies wondering what the future will hold.

But while Manley expected Canadian firms to be “somewhat placated” with regard to their concerns about the unknowns of Canada-U.S. trade, he said many key economic questions remain unanswered.

“There still has to be meat put on the bones – we don’t know what tweaking NAFTA really means,” said Manley, a former Liberal cabinet minister.

He said firms are still looking for clarity on the future of the congressional Republicans’ proposed border-adjustment tax, which could have serious negative effects on Canadian exports to the U.S.

Manley, whose group represents around 150 chief executives, also pointed to the possibility that Trump’s promised infrastructure program could be fraught with Buy America provisions, which could force Canada to respond with similar measures.

However, the joint statement from Trudeau and Trump after Monday’s meeting suggests vaguely that both leaders might be envisaging an open border when it comes to government infrastructure.

“Given our shared focus on infrastructure investments, we will encourage opportunities for companies in both countries to create jobs through those investments,” the statement reads.

Beatty said the uncertainty has created a “chilling effect” among his members, who have been telling him that they want to know the rules of the game before they make any multimillion-dollar investments in Canada.

Some of those fears have eased, he noted.

“I think that people, as of today, have confidence that the relationship is fundamentally sound,” said Beatty, who, however, expects firms to seek more clarity going forward.

“Again, I think everybody recognizes that there are contentious issues that we have to deal with between the two countries and it won’t always be easy.”

Source: Meatbusiness


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