Happy Birthday to free trade!
Twenty-five years ago this week, Canada and the United States agreed to terms on a free trade deal that would become the subject of heated debate and even an election campaign.
Brian Mulroney's Progressive Conservatives' won the 1988 election, the deal was ratified and the rest, as they say, is history.
That history has, for the most part, been good for Canada.
The Globe and Mail's Barrie McKenna recently put together an excellent overview of the deal.
He states that Canadian exports to the United States tripled in the first fifteen years of the deal but then stagnated due to several external economic forces. He also notes that all the boogeyman scenarios that critics of the deal warned us about, never came to fruition. Canada, McKenna says, didn't lose its sovereignty or identity, we didn't lose our medical system and, on balance, we didn't lose our industries.
BMO deputy chief economist Douglas Porter says the FTA has buoyed Canada's trade and foreign direct investment.
"The overall conclusion is that the FTA, and then NAFTA, were critical ingredients in helping modernize the Canadian economy, and have ultimately played a big role in transforming Canada from a relative underachiever among industrial world economies to a relative overachiever," he wrote in a publication for the MacDonald Laurier institute.
And in a recent interview with the MacDonald -Laurier Institute, Brian Mulroney — one of the architects of the deal — says free-trade with the U.S. "established Canada as a winner."
"The Free Trade Agreement has proven to be of great significance for Canada, both economically and psychologically. It's established Canada as a winner, a clear winner in our bilateral relationship, and by that I mean that we were not at all crushed as many of our opponents said.
On the contrary, we've competed very effectively, as I believed we always could, and it's helped us multilaterally, as it led to NAFTA, a tremendous profile now throughout Latin America, and it was the basis for the World Trade Organization multilateral agreements.So I think the Free Trade Agreement did a lot of good, and I think it will be so regarded as the decades flow by."
Mulroney's achievements with regards to free trade have paved the way for the current Conservative government to move forward on its own set of free trade deals.
According to Foreign Affairs and international trade Canada, since coming to power, the Harper government has signed free-trade agreements with Columbia, Honduras, Jordan, Panama, Peru, Iceland, Liechtenstein, Norway and Switzerland.
Negotiations are also underway with 50 more countries, including the European Union and India — with very little opposition.
My, how things have changed in 25 years.