Almost six months into the Biden administration, the United States and Canada are at odds over a range of trade policies, undermining the harmonious message both sides stress in public.
Canadian officials complain about U.S. tariffs on solar products and softwood lumber as well as Biden’s proposed “Buy America” initiative, which they worry will prevent Canadian contractors from participating in the administration’s proposed infrastructure plan.
The Biden administration, for its part, has accused Canada of violating the new North American trade deal by setting quotas that lock American dairy farmers out of lucrative export opportunities.
Mary Ng, Canada’s trade chief, visited Washington on Tuesday for consultations with Katherine Tai, the U.S. trade representative. Ng said the roughly 90-minute meeting was largely devoted to areas of potential collaboration. A short readout from Tai’s office mentioned “the close relationship” between the two nations and acknowledged that they had discussed the softwood lumber and dairy issues.
Pressed in an interview about Biden’s continuation of Trump’s protectionism, Ng highlighted the positive with a swipe at the former president’s use of social media to govern.
“I’m not getting notifications by tweets,” she said. “I’m working — with my partner. We’re working on these issues together.”
The two sides say they are in accord on ensuring an economic recovery from the pandemic, combating the use of forced labor, tackling climate change and buttressing North American supply chains.
But talk of common goals is undermined by some of their actions. Ng touted the allies’ shared interest in addressing climate change and cooperating on electric vehicle manufacturing even though the U.S. tariffs on Canadian solar energy products mean fewer sales of such “green” goods in the United States.
After talks between the two sides failed to resolve the impasse over the 18 percent U.S. tariff on solar panel cells, Canada formally requested the formation of a special dispute settlement panel under the U.S.-Mexico-Canada Agreement (USMCA). The panel’s report is not expected until early next year.
In May, the United States took a similar step as it challenged Canadian dairy quotas that Tai said undermine “the ability of American dairy exporters to sell a wide range of products to Canadian consumers.”
Ng also referenced the virtues of integrated North American supply chains for averting delays and cost increases on major projects but soft-pedaled her government’s concern about Biden’s “Buy America” plan, calling it “a work in progress.”
Eric Miller, president of Rideau Potomac Strategy Group, said the Canadian government is worried about losing access to the U.S. government procurement market. Canada this year is the nation’s largest export market and ranks No. 2 in total trade volume with the United States.
“In a relationship as big as ours, of course, there are going to be issues that we’re going to have to work through. I mean, that is just, I think, the course of doing business,” said Ng, who is scheduled to join Tai in Mexico City on Tuesday for trade meetings with Mexican officials.
Canadian officials appreciate Washington’s improved tone. And with a federal election likely later this year, the government in Ottawa wants to avoid unnecessary friction.
“The government is not interested in emphasizing dissonance with the U.S. administration. They are interested in projecting harmony,” said Roy Norton, a former Canadian diplomat now with the Canadian Global Affairs Institute.
The polite language the two sides use today is a far cry from the acrimony of the Trump era. Following the 2018 Group of 7 summit hosted by Canada, Trump blasted Canadian Prime Minister Justin Trudeau as “very dishonest and weak” in a tweet complaining about the Canadian leader’s criticism of the president’s tariffs.
And Peter Navarro, Trump’s trade consigliere, went on television to say “there’s a special place in hell” for Trudeau. He later apologized.