With each passing day that the new NAFTA deal isn’t ratified by the governments of the three participating countries, Canadian businesses grow more nervous — and with good reason.
Business doesn’t like uncertainty, and uncertainty hovers over this new deal.
Appearing on Global News’ The West Block this past weekend, Goldy Hyder, president of the Business Council of Canada, told host Mercedes Stephenson that because of the political partisanship that is sure to engulf Canada and the United States on the eve of elections in both countries, there is an ongoing concern the deal may not be ratified.
WATCH: If new NAFTA not ratified before 2020, all bets of ratification are off, says Hyder
Hyder’s concerns are well founded, but there are different scenarios at play on either side of the 49th parallel.
Here in Canada, it’s a pretty safe bet that the deal, called CUSMA on this side of the border, will be ratified.
The clock is ticking before the House rises for its summer break and the ensuing federal election, but even if the ratification vote doesn’t happen by the end of this month, both government and opposition MPs that I’ve talked to are fully expecting to be called back to Ottawa during the summer break to ratify the deal.
On the American side, things are a little more complicated.
Stateside, the deal is called the USMCA because U.S. President Donald Trump wanted his country’s initials at the forefront of the acronym.
But the contrasting acronyms are hardly the biggest concern.
Protectionist politicians from both the Democrat and Republican sides are expressing concerns that the deal doesn’t go far enough to protect American interests and that it is too soft on Mexican labour standards.
There is some talk about modifying the agreement, which could result in a precarious delay in moving forward.
More importantly, there is a presidential election in the U.S. in 2020 and some tight races in the Senate and the House of Representatives, which could shift the balance of power.
That’s significant because some Democrats are unwilling to ratify the trade deal and give Trump a victory to brag about in the upcoming campaign.
If the deal isn’t ratified by the Americans in the next few months, there’s no telling what a scorned Trump, who is prone to erratic behaviour, might do.
If this all sounds convoluted, it’s because it is: the trade deal is no longer about commerce, it’s about politics, and that makes it a very volatile and unpredictable game.
No wonder the business world is nervous!