Canadian Minister: Brexit and NAFTA Dispute Making Firms Wary

Photo by Alex Guibord from Flickr

On Monday, the finance minister of Canada said that there are parallels between the way companies that are located in Britain and North America are holding back on investment as they wait for clarity regarding the renegotiation of NAFTA and the result of the discussions regarding a deal on Brexit.

During a speech in London, Bill Morneau stated: “Certainly anecdotally in North America, there are some businesses that are being cautious about investments because there is an expectation that NAFTA could be slightly different tomorrow than it was yesterday.

“I just assume that is a similar situation here. Hopefully (that’s) one to be overcome as more clarity comes out.”

He reiterated that he hoped that Canada would have at least as good a trade arrangement with the United Kingdom after Brexit as now, it is taking its present CETA deal with the European Union as a model and said that close ties with the United Kingdom remained critically significant.

Mexico and Canada have won exemption from the planned tariffs on steel and aluminium imports of Donald Trump, the President of the United States of America, pending renegotiation of the 24-year-old Free Trade Agreement of North America.

Morneau said that he was “cautiously optimistic” that the three countries would be able to finalise agreement regarding changes to NAFTA as requested by the United States. He added that the ability of Canada to avoid the tariffs was positive for the future of the trade treaty.

After his speech, he informed reporters: “The demonstration of our relationship that came through this discussion bodes well for the future, in terms of any future discussion around tariffs or for that matter around NAFTA.”

Morneau said that heightening trade protectionism was a concern that Canada desired to raise in the G20 group of major economies.

The European Union has revealed a list of possible retaliatory tariffs on products of the United States, including blue jeans and bourbon, once it faces additional charges on the bloc’s exports of steel and aluminium to the United States.