Alberta and Ontario go rogue on trade
Over the weekend, a couple of messages came down from Canada. First, it was Premier Doug Ford of Ontario and then Premiere Danielle Smith of Alberta. Here is the story:
Alberta Premier Danielle Smith is echoing concerns about Mexico that were expressed earlier this week by Ontario's premier, saying she hopes Canada can get a "carve-out" from import tariffs that president-elect Donald Trump is promising.
Smith told her provincewide radio call-in program Saturday that advice she received from Robert Lighthizer, Trump's former trade chief, was that governments north of the border should take a "Canada first" approach, noting Mexico was inviting investment from China.
She said that was undercutting the manufacturing sector in both the U.S. and Canada.
Ford on Tuesday issued a statement saying that since signing on to the United States-Mexico-Canada Agreement, Mexico has allowed itself to become a back door for Chinese cars, auto parts and other products into Canadian and American markets.
Canada first? Wonder what inspired that? Both would consider an agreement with Mexico directly but want out of this current deal. No word yet from PM Justin Trudeau or the other provinces.
What is driving all this is the growing relationship between China and Mexico -- the fear that Chinese products will have a "Made in Mexico" label slapped on them and brought to the U.S. and Canada. You may recall that Trump mentioned this during the campaign in the context of electric cars.
The larger picture here is interesting. The U.S. has clearly moved to the right. By all accounts, a conservative prime minister will soon replace PM Trudeau. Down in Mexico, a very leftist "presidenta" is running things now.
The word from Ontario and Alberta will strengthen Trump's hand when he negotiates with Mexico. It may get Mexico to reconsider its relationship with China to save the more reliable economic partners to the north. Well, I don't know, but time will tell.

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Image: Cohen.Canada
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