Image Credit – Census Bureau By The New York Times
OTTAWA — While the Trans-Pacific Partnership trade pact may well be the subject of future political battles in the United States and elsewhere, its arrival amid an election campaign in Canada ignited debate here instantly.
The announcement of the deal came exactly two weeks before Canadians vote in a national election that has shifted among several issues, including expense account fiddling by Conservative senators and the wearing of face coverings by some Muslim women at citizenship ceremonies. With Canada’s economy dragged down by the collapse of oil prices, the trade pact was simultaneously portrayed as a potent force for economic revival by Prime Minister Stephen Harper, a Conservative, and a job destroyer by Tom Mulcair, the leader of the New Democratic Party.
While the agreement was unlikely to completely dominate the campaign as debate over free trade with the United States did in 1988, its political effect could be enough to tip the balance in a contest where the Conservatives, New Democrats and Liberals, under Justin Trudeau, have been locked in a near three-way tie in polling since the campaign began in August.
Yet as in 1988, both opponents and proponents pledged to add their voices to the debate.
“Absolutely, it’s going to be an issue in the election,” said Jerry Dias, national president of Unifor, a union that counts 41,000 autoworkers among its 310,000 members. “This should destroy the Conservatives in manufacturing Ontario.”
Mr. Dias’s prediction may largely reflect organized labor’s general antipathy toward Mr. Harper’s government. Yet most analysts agree that Ontario, Canada’s most populous province, is likely to be decisive in determining who forms the next government. And while the Trans-Pacific deal creates opportunities for many Canadian industries, including forestry and fisheries, there are many who predict that may accelerate the gradual decline of Canada’s auto and auto-parts industry, which is almost entirely based in Ontario and accounts for about 20 percent of the province’s industrial activity.
Several polls have suggested that the Conservatives could lose their current hold on several constituencies surrounding Toronto. Many of those places have auto assembly or parts plants.
While campaigning on Tuesday in Whitby, an Ontario city adjacent to the General Motors of Canada headquarters in Oshawa, Mr. Harper offered the auto industry a billion Canadian dollars spread over 10 years to encourage construction of auto assembly plants. As autoworkers held a protest against the agreement outside the factory hosting his campaign stop, Mr. Harper insisted the pact would expand the industry. “We believe that this deal offers enormous benefits for the automobile sector,” he said.
Canada’s auto industry is almost entirely based on exports to the United States, with about 85 percent of car and trucks being sent there. The North American Free Trade Agreement has gradually shifted the focus of Canada’s auto industry away from assembling cars to making parts, said Bill Anderson, director of the Cross Border Institute at the University of Windsor, located in the Ontario city where FCA Canada, maker of Chrysler and Dodge cars, has its headquarters.
Compared with Nafta, the Trans-Pacific agreement would allow duty-free entry for automobiles with a lower percentage of parts that manufacturers must obtain from within the free trade area. That, some experts say, could leave Canadian parts makers, which employ 81,000 people, vulnerable to backdoor competition from, among others, China, which was not part of the pact.
“It’s a very complicated picture,” Mr. Anderson said. “But it’s an election issue where people feel automotive jobs are threatened.”
Mr. Mulcair has repeatedly pledged not to be bound by the agreement if his party forms the next government largely because of what he believes will be its effect on automotive employment.
“If elected, Canada will not be part of an agreement that loses 20,000 jobs,” he declared at a campaign rally in Toronto.
While the Liberal Party led the unsuccessful fight against free trade with the United States in 1988, Mr. Trudeau now describes his party as a champion of trade pacts. Yet he has said that he cannot endorse the Trans-Pacific deal until its full text is available.
Flavio Volpe, the president of the Auto Parts Manufacturers’ Association, said that he welcomed the attention to his generally overlooked industry. But, he added diplomatically, it may be that neither Mr. Harper nor Mr. Mulcair is correct. Ten large parts makers that employ half of the industry’s workers, he said, might benefit from the deal. But, he added, many of the other 300 small operators “are really going to be under pressure.”
He predicted that it would take at least five years to see if the gains by the big companies, like Magna International, offset the small players’ losses. “Anybody who is championing gains or who is forecasting losses is way ahead of themselves,” he said.
-By IAN AUSTEN