Monday, August 11, 2014

Canada and Mexico Relations in NAFTA

CANADA and Mexico share the fortune, or misfortune, of a border with the world’s most powerful country, which looks down on both of them. For 20 years, as privileged trading partners of the United States, they have had the opportunity to influence it by creating a shared vision for North America. Instead the two have bickered like rivals in a tawdry ménage a trois.

Canada plays the part of the wronged partner. It has jealously sought to protect the relationship with its neighbour, fearing that Mexico may steal its thunder. “Canada is quick to give offence and Mexico is quick to take it,” says Laura Dawson, author of a report on the bilateral relations for the Canadian Council of Chief Executives, a business group. That could be shrugged off as irrelevant in a region where the only bond that matters is with the United States. But there are economic costs for North America as a whole, including the United States, because more could be done to link supply chains and energy markets trilaterally rather than just bilaterally.

Canada was a reluctant participant in the negotiations for the North American Free Trade Agreement (NAFTA), which was launched in 1994. It agreed to join largely to safeguard the advantages it had won from a prior free-trade deal with the United States. After the terrorist attacks on September 11th 2001, efforts to strengthen NAFTA through trilateral negotiations lost momentum. Instead, the United States, Canada and Mexico have sought to tackle border and security issues bilaterally.

Relations between Canada and Mexico have become more brittle this year; the leaders of both countries have pointedly snubbed each other.

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