Participant in the Global Business Forum, Perrin Beatty the transition from an open and free market to protectionism dates back several years

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The growth of a protectionist mindset and policy south of the border is a major concern for Perrin Beatty, President and CEO of the Canadian Chamber of Commerce, as the United States prepares in the midterm elections in early November.

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Beatty said from the Global Business Forum in Banff on Friday that the shift from an open and free market to protectionism goes back many years. It was accelerated under the presidency of Donald Trump and was doubled by US President Joe Biden.

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With about 75% of what Canada exports to the United States and 60% of what we import from there, things have been difficult in recent years.

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“The difficulty, on a broader level, is that the relationship between Canada and the United States has moved from a strategic relationship where we see ourselves as essential partners to each other to a transactional relationship,” Beatty said. .

He explained that this meant that both sides saw the importance of the symbiotic relationship by the two countries, now that the United States weighs its decisions on how it affects itself, first and foremost. , especially at the polls, “and Canadians don’t vote”.

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Midterm elections will be held on November 8 and the 435 seats in the House of Representatives and 35 of the 100 seats in the Senate will be contested. Democrats hold control of both branches, but it’s a slim hold. Earlier this spring, it was shaping up to be an almost certain move to Republican control, but due to recent Supreme Court rulings on abortion and gun control, the race is expected to be much tighter.

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Martin Durbin, president of the U.S. Chamber of Commerce’s Global Energy Institute, said via video feed, however, that he expects Republicans to still get a narrow majority. He noted that this would mean the president is likely to exercise his executive powers more often.

“And certainly with Republicans in control of either house or both, you’ll see a lot more congressional scrutiny of what the administration does,” he said. “That can in some ways slow things down, and depending on your perspective, that could be a good thing or a bad thing.”

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  1. An American flag on the home of a nearby resident waves in the breeze near a U.S. Border Patrol truck blocking the road northwest of Nogales, Arizona December 15, 2010. With a new continental trade deal almost over, it might be tempting for the average Canadian to think that cross-border business anxiety will soon be a thing of the past, at least for a while.

    Fear of age-old protectionist sentiment returns in post-NAFTA era

  2. The “new NAFTA deal” should be good for Alberta's agriculture industry as long as governments continue to fight protectionist sentiments in our biggest markets, experts say.

    New NAFTA is a win for agriculture, but protectionist sentiment still threatens industry: expert

  3. Democratic presidential candidate Joe Biden's

    Biden presidency could be ‘more protectionist’ than Trump, says former US ambassador

Biden used his executive power upon taking office to reverse the expansion of the Keystone XL pipeline, which was to provide increased access for Canadian oil to the Gulf of Mexico.

Energy is a key source of trade between the two countries, especially with the global market disruption due to the Russian invasion of Ukraine, as well as the push towards renewable energy. Beatty noted how Biden has traveled to other countries like Saudi Arabia to increase oil and natural gas production to meet US needs and help offset shortages by cutting off Russian energy. .

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“The sensible thing to do would be to have a bilateral agreement in terms of energy security, which would allow our two countries to work together to ensure that we are able to obtain the energy that we need in North America. North from North American supplies,” he said. “The world has changed since the Keystone XL was killed by the President and the policies have to change too.”

The price of carbon also remains a major issue. While Canada’s carbon tax is expected to increase to $170 per tonne by 2030, the United States has no tax. Durbin said there was little political appetite on either side to push forward a carbon tax, especially in the face of soaring inflation.

Inflation and energy shortages have also led to the establishment of a European Carbon Border Adjustment Mechanism, which would see a leveling of the playing field between EU nations, put on ice.

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US President Joe Biden addresses his supporters at a Democratic National Committee event in Washington on Friday.
US President Joe Biden addresses his supporters at a Democratic National Committee event in Washington on Friday. Samuel Corum/Getty Images

There has been talk of imposing a similar tariff on products entering Canada from the United States to help level the playing field, but Meridith Lilly, associate professor at Carleton University’s Norman Paterson School of International Affairs , said that was not the answer.

“I think a carbon border adjustment would be terrible,” she said. “It’s a tax, it’s a trade tariff. And when you introduce a tariff, it automatically creates disruptions at the border.

She said there are better options to solve the problem of the competitiveness of Canadian products.

Lilly said signs of protectionism really showed during the pandemic when the United States prioritized face masks and other American-made personal protective equipment to stay in the United States. Canada responded with 3M opening factories in Ontario to produce masks here.

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In recovery, Biden was also set to put in place measures through his Build Back Better legislation that would have badly affected the Canadian auto sector, but was rejected.

Lilly noted that doing everything here shouldn’t be the answer every time and that free trade has been and will continue to be beneficial for both parties.

“International trade and globalization keep prices low for Canadians, and so we are, overall, net beneficiaries of globalization,” she said. “I think it requires long-term thinking about what the essential sectors are, how are we going to support them in the moment and are we willing to pay more?”

Beatty said the relationship between Canada and the United States as trading partners remains strong, however, there must be a plan from Ottawa on how to combat growing protectionism.

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Friday ended the 23rd annual forum, the first without the late Doug Mitchell, co-founder and co-chair. His wife, Lois Mitchell, said the conference will continue to play an important role in discussing the impact of global issues like trade, energy and world orders on Albertans.

“It’s so important to have that perspective on what’s really going on in the world, but really more than anything, to create empathy,” Lois said. “That’s why I finally realized how important debate is, because it’s also understanding another person’s point of view. That doesn’t mean you agree with it, but at least listen to it.

[email protected]

Twitter: @JoshAldrich03

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