OTTAWA – The Trans-Pacific Partnership can’t go ahead without the United States, Canada’s trade minister said Tuesday in the wake of Donald Trump’s renewed vow to pull his country out of the controversial 12-country pact.
International Trade Minister Chrystia Freeland said it’s long been no secret that the Pacific Rim deal would hinge on the participation of the U.S., a factor that boils down to simple arithmetic.
The TPP, as it is known, can only come into force if ratified by six of the 12 member countries representing 85 per cent of their combined GDP, Freeland said Tuesday.
“What that means, in practice, is the TPP agreement as currently structured and finalized can only come into force if it’s ratified by the United States — but that’s not new,” Freeland said.
In a YouTube video released Monday, Trump said he will issue a notification of intent to withdraw from the agreement on his first day in power, a move many believe would kill the deal outright.
A Canadian government official, speaking on condition of anonymity because of the sensitive nature of the issue, said no decision on pulling out of the TPP becomes final until February 2018.
When the participating countries signed the agreement last February in New Zealand, that two-year time frame was built into the process to take into account the domestic political situations in all 12 countries, the official said.
The TPP is intended to open up trade among the 12 countries that encompass nearly 40 per cent of the world’s GDP, including Canada.
Trump, who has repeatedly criticized the TPP as “a potential disaster” for America, did not mention NAFTA, which he has also promised to either renegotiate or withdraw from altogether.
Freeland said the U.S. and Canada both benefit from NAFTA.
“Canada is the chief export market of 35 U.S. states, and nine million U.S. jobs depends directly on U.S. exports to Canada.”
David MacNaughton, Canada’s ambassador to the United States, has said Canada would be willing to renegotiate NAFTA if that would make it a better deal.
Trump’s message was issued after U.S. President Barack Obama, Prime Minister Justin Trudeau and other APEC leaders met in Peru, where they issued a call to fight the backlash against global trade.
The Canadian government says it believes in free trade but has opted to open the TPP up to widespread consultations prior to making a decision.
The House of Commons trade committee is also studying the deal.
In September, a federal study predicted Canada would generate more than $4 billion in long-term GDP gains if it joined the TPP, but stands to take a $5 billion loss if it opts out.
The analysis, conducted by the office of the chief economist at Global Affairs Canada, assessed the impact of the TPP on Canada and other countries.