Local business express NAFTA concerns to federal finance minister

Monday, August 13, 2018

The Windsor Star/Dave Waddell




Windsor’s future prospects — entwined in the NAFTA negotiations and the threat of debilitating American auto tariffs — could hinge on the bilateral talks between U.S. and Mexican negotiators, federal Finance Minister Bill Morneau suggested Monday.

A breakthrough in those talks could provide the impetus to push the rest of the agreement over the finish line, said Morneau, who was in Windsor meeting with local business leaders and touring the Windsor Assembly Plant.

“That discussion is now the important focus,” Morneau said.

“If they’re able to make traction on getting to a conclusion, that will allow us to get back to the table and deal with the outstanding issues in a timely way.

“I’m cautiously optimistic.”

Though Canada hasn’t been invited to the negotiations for the past three weeks, Morneau said the government is comfortable with what’s going on in talks. Those talks are largely focused on the Mexican auto industry while Canada and the U.S. have largely ironed out most auto-related issues.

“There’s always details that are going to be important,” said Morneau, who was also having dinner with some Windsor relatives before departing Monday.

“From a high level, it’s important this discussion with the United States and Mexico gets to a conclusion.”

Morneau said the American desire for a “sunset clause” — ending the agreement every five years —  and coming up with a dispute resolution system remain the two major hurdles left in Canada’s eyes.

“I get the sense they understand there’s a path to the agreement,” Windsor Mayor Drew Dilkens said. “I felt reassured from the minister that things are in place to work through the process.”

Shelley Fellows, vice-president of operations for the software firm Radix Inc., joked she might even be able to get to sleep Monday night after a meeting she described as positive.

“I felt assured to certain extent that they’ve reached out to businesses,” Fellow said. “I relayed our anxiety in the manufacturing sector about NAFTA.”

Fellows said 60 per cent of Radix’s business is automotive related while its parent company (Active Industrial Solutions) does 95 per cent of its business with the industry. Radix works directly with Ford, Toyota, Honda, Hyundai and GM.

However, Fellows hopes the sides pick up the pace in negotiations.

“I was encouraged to hear the current (Mexican) government is negotiating with the intention of having something in place by Dec. 1 (when the newly elected government takes over),” Fellows said.

Janice Forsyth, the interim president of the Windsor-Essex Regional Chamber of Commerce that hosted the roundtable, said the group stressed to Morneau the border and free trade are the lifeblood of the local community.

“Our business leaders expressed concern over the uncertainty,” Forsyth said. “It doesn’t allow business to plan for the future.”

In addition to Radix, there were representatives from Investors Group, the Windsor-Essex Economic Development Corporation, the logistics firm Farrow, University of Windsor, Union Gas, FCA, the Ambassador Bridge and Green Shield.

Forsyth said there were questions about what the federal government was prepared to do should auto tariffs take effect. Ottawa is aiding the aluminum and steel industries since they were slapped with American tariffs in June.

However, the auto industry presents a scale that’s much more challenging. Morneau sidestepped the question of whether Ottawa was putting plans in place for that event or what support they might be able to offer.

“Any idea around automotive tariffs is not helpful in advancing the cause of improving our trading relationship,” Morneau said.

“Any response we’d have to American changes would be measured and proportional.”

Stephen MacKenzie, CEO of the Windsor-Essex Economic Development Corporation, said it was vital that Morneau came to Windsor to visit “ground zero” in the trade debate with the U.S.

“When it comes to NAFTA, local Windsor issues are national issues,” MacKenzie said.

“The local economy is doing well, but there’s a sword of Damocles overhead. Steel and aluminum tariffs are bad, but auto tariffs are a game-changer.”

MacKenzie said aside from trade issues, the discussions touched on updating Canada’s tax system in light of U.S. changes, broadening the visa programs furthering the ability of citizens of either country to fill skilled jobs and ensuring access to American markets for the local greenhouse industry.

“Some parts of NAFTA did need updating,” MacKenzie said.

“There are jobs that didn’t exist when it was signed. There are over 6,000 people going to work each day in Detroit and 600 coming from Detroit to here.

“We need that free flow of expertise and services.”