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CRA is experiencing ‘higher than normal volumes of work’ on tax-return reviews

Posted on 08 August 2018 by admin

Ellen, a management consultant in Barrie, Ont., sent in her taxes electronically on March 9. On July 31, she was still waiting for the Canada Revenue Agency (CRA) to process her return.

On its website, the CRA says it aims to issue a notice of assessment within two weeks of receiving a digital individual income tax return and within eight weeks of receiving a paper return. It also says it has a goal of meeting that standard 95 per cent of the time.

“You see 95 per cent and you think you’re going to fall into that good number,” Ellen, who asked to be identified only by her first name, told Global News. This year, however, “I guess my ticket came up.”

There was nothing remarkable in her 2018 return, she said. She claimed self-employment income and tax credits for a home office and business use of her car, but that was no different from what she had been claiming for the past several years. And her expected tax refund was under $2,500. And yet, she said, her notice of assessment wouldn’t show up.

In almost five months since filing her taxes, there was “not a peep out of CRA … never any correspondence.” And when she called the agency, the answer, she said, would always be “wait.”

Eventually, though, an agent did tell her that her return had been selected for random review, although the CRA never asked her for more information or additional documents, she said.

She also said she started hearing repeatedly about processing delays due to backlogs.

Global News has received similar accounts from taxpayers who say CRA agents have blamed delays and missed deadlines on excessive workload.

The CRA told Global News via email it is “currently experiencing higher than normal volumes of work in the review programs.” The agency also said that it has “shifted workloads across various sites to maximize efficiencies.”

For example, the tax processing centre in St. John’s has now been converted into a National Verification and Collections Centre.

Still, “the vast majority of the files are being processed within the expected time frames,” the CRA added. “In some cases, it can take longer to complete a file because of the complexity of the issue under review.”

Delays in receiving a notice of assessment often happen when the CRA conducts a so-called pre-assessment review.

One of three types of tax review, pre-assessments usually take place between February and July, according to Get Smart About Money (GSAM), a financial literacy website maintained by the Ontario Securities Commission. Essentially, the CRA decides to take a closer look at the deductions and credits you claimed before formally assessing your return.

A processing review is similar to a pre-assessment but happens after the CRA has sent out a preliminary notice of assessment, according to GSAM. They usually take place between June and November.

A matching review also happens after the CRA sends you a notice of assessment. The process entails the CRA comparing the information on your return with that provided by third parties like your employer or your bank. These reviews usually take place between September and March.

Pre-assessments can delay your tax refund but they do not usually result in a cutoff of government benefits, such as the Canada Child Tax Benefit (CCTB), the Guaranteed Income Supplement (GIS) or the Ontario Trillium Benefit, said Lisa Gittens, senior tax professional at H&R Block Canada.

Unless you’ve failed to respond to CRA questions about your return, your benefits will continue to flow at the rate set by your previous tax return, Gittens added. If the CRA later assesses that you should be receiving smaller amounts (for example, because your income went up), you may have to pay something back, she added.

Taxpayers who haven’t yet received a notice of assessment, “should not panic,” she added.

“By the end of September, typically we see a rash of notice of assessments going through. That’s when [the CRA’s] staff is back on board in full force.”

Still, Gittens said it was “very unusual” for someone to have filed a return as early as March 9 and not have received an assessment by the end of April.

It was even more unusual for the CRA not to communicate with a taxpayer whose return is under review.

The CRA told Global News that “to minimize the delay of returns, the majority of reviews are performed after the Notice of Assessment has been issued.”

Ellen said her main concern isn’t about the fact that her return was singled out for review or that the CRA missed several self-imposed deadlines when dealing with her files.

“Delays happen, I get that,” she told Global News.

But she is upset about the lack of communication. Being able to get through to a human being on the phone was a challenge, she said. And when she did get hold of an agent, she would end up being on the phone for between 30 and 50 minutes for every call.

On the whole, she estimates she has spent six hours on the phone with the CRA.

 “The story was consistently that there is a backlog,” she said. But if that is the case, she adds, “they should have advised Canadians.”

On Aug. 3, shortly after Global News flagged Ellen’s case to the CRA, she said she received an electronic notice saying that her notice of assessment would become available on Aug. 14.

According to her electronic files, Ellen said it appears the CRA found small Canada Pension Plan (CPP) and Employment Insurance (EI) overpayments and will be paying her $18.90 in interest charges. The agency has flagged no errors so far.


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Why the Bank of Canada should pull the trigger on another rate hike

Posted on 11 July 2018 by admin

Kevin Carmichael: There’s an opportunity now for the Bank of Canada to raise, given the economy appears to be entering dog days.

A little more than a year ago, the Bank of Canada stopped worrying about Donald Trump’s Twitter feed and focused on real news.

“Life goes on and decisions must be made in the meantime,” Carolyn Wilkins, the senior deputy governor, said near the end of a speech in Winnipeg on June 12, 2017.

Four weeks later, the Bank of Canada raised interest rates for the first time during Stephen Poloz’s tenure as governor. It would do so again at its next opportunity in early September, putting the benchmark rate back at the level at which Poloz found it when he took over from Mark Carney in the middle of 2013.

Pretty much everyone expects the four men and two women on the central bank’s Governing Council will decide to lift the policy rate another quarter point to 1.5 per cent on July 11, which would be the first increase since January.

That’s the right call based on what the Bank of Canada has been telling us it cares about. If there is a pattern in the institution’s decision making over the past year it’s opportunism. Think back to last summer. Trump already had everyone good and freaked out halfway through 2017. Yet Canada’s economy was on a roll. It seemed likely that U.S. policy would disrupt things eventually, but the central bank had a moment of relative calm in which it could act — and used it.

Policymakers have a similar window now. The economy isn’t growing as quickly, but it’s probably stronger than it was at this point in 2017.

Employment has plateaued after two strong years; Statistics Canada reported on July 6 that employers added about 32,000 net positions last month, reducing the overall decline since January to about 17,000.

Some have described the net job losses this year in negative terms, but they are too small to be considered definitive statements about the direction of overall hiring, given the margin of error StatCan applies to its monthly Labour Force Survey.

The unemployment rate suggests the Canadian economy rarely has been stronger: it rose to six per cent in June, still one of the lowest rates found in records that date to the mid-1970s. The jobless rate increased because more than 75,000 individuals joined the labour pool in June, the biggest monthly increase in six years, according to StatCan. Only about half of them found jobs, so the unemployment rate rose. Still, it’s a positive sign because it suggests employers are starting to make places for marginalized workers, something Poloz has said he hoped could be achieved by keeping interest rates low.

“Any doubts that the recent pause in Canadian job growth might lead the Bank of Canada to hold off on a rate hike have likely been erased,” Brendon Bernard, a former Finance Department economist who now works at the Toronto office of Indeed, the web-based hiring company, said in a statement on the latest employment figures.

To be sure, Trump is less of a theoretical threat today than he was a year ago. The U.S. is now engaged in tit-for-tat trade skirmishes with China, the European Union, Canada and Mexico that threaten to disrupt the strongest global economic growth in a decade.

That would hurt Canada, which has struggled to take full advantage of the surge in global demand. In a separate report on July 6, StatCan said the value of merchandise exports dropped 0.1 per cent in May from April — before Trump’s tariffs on steel and aluminum went into effect. International shipments of goods have averaged $47.3 billion per month this year, a three per cent increase from the monthly average in 2017, which is only mediocre given the level of demand.

“This is one of the rare instances where you could argue that given this uncertainty out there, why would you proceed with a rate hike if things turn from bad to worse later this summer?,” Stéfane Marion, chief economist at National Bank Financial, said in interview with BNN Bloomberg on July 3.

The central bank will rework its forecast to reflect the various tariffs that have been applied since its last economic outlook in April. It’s possible that the results of that work could prompt policymakers to leave interest rates unchanged, much as their assessment of the oil-price shock prompted them to unexpectedly cut interest rates in January 2015.

But it’s also time to acknowledge that monetary policy can’t do everything. Take hiring. Wholesalers and retailers have cut more than 60,000 positions since the start of the year, according to StatCan. It’s the only industry to post such a dramatic shift, either positively or negatively. Some of the job cuts will be in response to weaker demand. Higher minimum wages could be playing a role. Yet what if the main reason for the decline is automation and the surge in e-commerce? If it’s the latter, lower interest rates won’t bring back those retail jobs.

The central bank’s main job is to control inflation, which is currently on target. Its other main job is to oversee financial stability, which should be a worry after about a decade of ultra-low borrowing costs. Not everything can be about Trump. The Bank of Canada has an opportunity to raise interest rates and it should use it.


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Trade woes, interest rates to significantly slow Canada’s economic growth

Posted on 28 March 2018 by admin

Rising interest rates, moderating employment expected to curb household spending in 2018.

Uncertainty around NAFTA talks and the possibility of increased U.S. duties will contribute to a significant slowdown in the Canadian economy this year after a stellar 2017, the Conference Board of Canada says in its latest forecast.

While household spending will remain the main economic driver, the pace of spending will ease amid rising interest rates, high household debt and moderating employment growth, the board’s 2018 economic outlook for Canada says. It adds that exports and business investment are unlikely to pick up the slack.

The forecast notes that GDP growth began to taper off late last year, and the trend is expected to continue, with 2018 growth pegged at 1.9 per cent, down from 3 per cent in 2017.

Fears that North American Free Trade Agreement negotiations will fail to produce an agreement and that the Trump administration will impose tariffs on Canadian steel and aluminum “are challenging businesses and exporters alike,” said Matthew Stewart, the economic research and analysis group’s director of national forecasting.

On March 8, the U.S. president imposed a 25 per cent tariff on imported steel and a 10 per cent duty on U.S. aluminum imports, but included exemptions for Canada and Mexico that could be rescinded if the free trade talks fail.

Recent Conference Board research found that real GDP would lose half a percentage point of growth in the year following the termination of NAFTA, but the impact could be larger if business confidence or foreign investment to Canada is undermined by the loss of free trade.

The trade uncertainty has helped keep a lid on investment plans, with business investment spending forecast to expand by just 1 per cent in 2018, down from growth of 2.3 per cent in 2017, despite a more positive outlook for profits and sales.

Stewart said some may also find Canada to be a less competitive destination for investment considering the large American tax cuts passed at the end of last year.

And even with strong demand in the U.S. and a competitively low Canadian dollar, the forecast says Canadian exports will continue to underperform in 2018. For the third year in a row, non-energy merchandise exports are on track to record almost no growth, while exports in the wood products, aerospace and automotive sectors are all forecast to decline for the second year in a row, the outlook says.

It adds that tight labour markets and increased retirements from baby boomers will lead to much slower employment growth in 2018, with job gains to fall to 232,000 positions in 2018, down from 336,900 in 2017. Low unemployment, however, will help support wage growth, which the outlook says could help cushion the impact of rising interest rates.

And as consumers dial back spending, purchases of durable goods are expected to bear the brunt of the slowdown. Overall, real personal consumption is expected to increase by 2.4 per cent, down from 3.5 per cent last year.

The outlook also sees further housing market cooling on factors including a “stress test” imposed on mortgage borrowers by federal regulators that reduces the maximum mortgage borrowers can qualify for and which will reduce housing demand, particularly for higher-priced units.

This will be partly offset by stronger population gains from higher immigration targets.

Housing starts will ease to roughly 213,200 units this year from 219,700 units in 2017, the outlook says.

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Federal government spending has lifted economy, helped slow household debt, Bank of Canada head says

Posted on 21 March 2018 by admin

Stephen Poloz says Ottawa’s recent spending on programs, such as enhanced child benefits and infrastructure, have lifted the economy and pushed interest rates to a level higher than they would have been without government stimulus.OTTAWA—The governor of the Bank of Canada says the federal government’s steps in the last couple of years to take on more public debt has helped prevent an even faster buildup of household debt that has still managed to climb to historic highs.

Stephen Poloz says Ottawa’s recent spending on programs, such as enhanced child benefits and infrastructure, have lifted the economy and pushed interest rates to a level higher than they would have been without government stimulus.

He says the higher rates have helped keep the accumulation of household debt lower than it otherwise would have been had Canada continued with government belt-tightening approaches of the past.

Poloz made the comments Tuesday as he responded to questions following a speech at Queen’s University in Kingston, Ont.

His remarks come a couple of weeks after the Trudeau government tabled a federal budget that has faced criticism for its plan to continue running annual multibillion-dollar deficits across the five-year projection horizon — despite the country’s surprisingly strong economic performance.

In response to a journalist’s question, the governor says he agrees with the view consumers are facing high debt loads today because they filled in the debt-accumulation void left when governments turned to austerity by shutting down stimulus measures to address fallout from the 2008 financial crisis.


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ICAP organized Session of Canadian Income Tax System for its members

Posted on 01 March 2018 by admin

Canadian Chapter of Institute of Chartered Accountants of Pakistan (ICAP) had organized a Session for its members on Canadian Income Tax System on Saturday 24 February 2018 at Mississauga’s Eat More Restaurant & Café.  A large number of Chartered Accountants members had attended the session. The presentation on Canadian Income Tax System was made by two Chartered Accountant members Mr. Mohammad Nadeem, Vice Chairman of Canadian Chapter, who works with a local public accounting firm KPMG in its corporate tax group, and Mr. Mohammad Sharif Awan, who runs his own public accounting practice.

Both the members had presented with charts, all aspects of Canadian Income Tax System and its components.  After the presentation, there was question and answer session, where members’ questions were answered. The members present were benefited with the presentation and they praised the Canadian Chapter for this important and informative session, particularly at this time, when every Canadian has to file his tax return for the last year.

At the end of the session Chairman of Canadian Chapter, Mr. Rauf Ali Jan expressed thanks to the members for joining this session.

The election of Canadian Chapter Management Committee was held in December 2017 and 5 members Management Committee was elected. The Management Committee is comprised of Mr. Rauf Ali Jan Chairman, Mr. Mohammed Nadeem Vice Chairman, Miss Urooj Fatima Vohra Secretary, Mr. Farrukh Anwar Head of Financial Affairs and Mr. S. Shamshad Husain Joint Secretary.


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What to do about your debt and mortgages after the interest rate hike

Posted on 07 February 2018 by admin

Personal finance expert Laleh Samarbakhsh shares her advice on the best ways to take advantage of the increased rates.

Many consumers will soon find their debt loads heavier now that Canada’s central bank and the country’s biggest commercial lenders have raised their benchmark rates by one-quarter percentage point.

The country’s biggest banks raised their prime rates after the Bank of Canada hiked its overnight lending rate earlier this month by a quarter of a percentage point to 1.25 per cent.

It’s a challenge for Canadians still struggling to cope with the record amounts of consumer debt they amassed after the 2008 financial crisis because lenders use their prime rate as a benchmark for setting some other short-term rates including variable-rate mortgages and lines of credit. A hike is good news for savers as the prime rate also affects interest rates for savings accounts.

If you’re contemplating how to best take advantage of the increased rates or avoid falling into further debt, personal finance expert and Ryerson University business professor Laleh Samarbakhsh shared her advice.

Now that the rate has gone up, what financial choices should I be making?

With the interest rate increase, debt becomes more and more expensive. Before you do anything, you have to understand what kind of debt you have to start with.

We have good types of debt and bad types. Good types can include any investment that is made to contribute to progressing your future. For example, a student loan is a good type of loan because you are investing in your ability to make more money. At the same time, debt you have from real estate or your primary residence is considered a good type of debt because you’re accumulating equity.

Focus first on what is considered bad debt like credit card debt, lines of credit or any kind of debt with higher interest rates and no future investment. Pay off the debt with the higher interest rate first, but also consider what debt you have that is tax deductible.

If I have some money in a Tax-Free Savings Account, but also some debt, should I pull out that money in the account and pay off the debt?

A lot of times people might consider borrowing from a lower debt to cover a higher debt or borrowing from a TFSA to make a payment. My recommendation is if you have some tax deductibility because of debt you have, keep it. As much as paying off debt is important, if you won’t be able to pay off all your debt, you can use the deductibility you have from some to save on taxes and create an income to pay off the high-interest or bad debt.

We have had a successful year on the investing market, so if an individual makes contributions to their TFSA and has a portfolio with a higher return of 20 per cent or 25 per cent, it makes sense to keep that because the advantage is no tax being paid in the TFSA.

What should I do if I have been looking at buying a home or if I just bought a home and am dealing with a mortgage?

For individuals who care about their credit score and are applying for a mortgage shortly, consider your credit limit. The types of debt that have a credit limit should be paid off first to release your capacity.

The typical concerns after a hike are usually individuals with mortgages because those are the biggest debts people carry. My advice would be for individuals with variable mortgage rates to consider locking down a fixed mortgage rate.

What should I do if I have no debt, but want to take advantage of the hike?

Saving is making even more sense now because savings accounts will have fairly higher interest rates, so if you have no debt, my recommendation is to start with capping your Registered Education Savings Plan contributions first because that brings you tax savings.

Once the RESPs are capped, I would also invest in a Tax-Free Savings Account. The interest you make is tax-free, so I recommend maximizing your TFSA contribution.

After that, there are lots of forums and markets for investment and you can consult with your financial adviser about what is best to invest in at the time.

Some economists think we might see further interest rate hikes later this year. Should I act on those rumours now?

It’s hard to predict what is going to happen, but we know the decade of low interest rates are over. It’s important to be more careful with spending and what kind of debt we are taking on and how and what the plan for repaying it is.

If you’re concerned, take action sooner rather than later and don’t let it bring mental pressure to your daily life.

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Government of Canada Launches Pre-Budget Consultations

Posted on 14 December 2017 by admin

Canadians Invited to Offer Their Ideas on How to Grow and Strengthen the Middle Class

Department of Finance Canada Our government is working hard to grow the economy and provide more support for the middle class. Over 500,000 new jobs have been created since 2015 and the unemployment rate is nearly the lowest it has been in a decade. Canada now has the fastest-growing economy in the G7, giving the Government the ability to reinvest the benefits of that growth back into the people who contributed most to that success. As Canada’s economy continues to grow, it is important to ensure that the benefits of that growth are shared by the middle class and those working hard to join it. That means continuing to make smart investments in people and communities to ensure continued progress for the middle class, and investing in lifelong learning to give Canadians the tools they need to find good, well-paying jobs in the economy of tomorrow. It also means ensuring that government policy and budget decisions consider impacts on all genders and advance gender equality. Leona Alleslev, Member of Parliament for Aurora—Oak Ridges—Richmond Hill is inviting residents, businesses and non-profit organizations to provide their input for Budget 2018. Let the government know what your family, community, and country need in order to position for the future with confidence. Canadians can submit their ideas and suggestions online through the website launched today, and to MP Alleslev by email at Quote “Our Government’s plan to strengthen and grow the middle class is working. It is creating jobs, improving lives, strengthening communities and growing the economy. But we still have work to do. This is why we are continuing with our plan to invest in the middle class and those working hard to join it. Our government needs the ideas and suggestions of all Canadians on how we can strengthen our country together. I look forward to hearing from residents of Aurora—Oak Ridges—Richmond Hill to ensure we work together on Budget 2018 to build a strong foundation in order to position our nation for the next 150 years. – Leona Alleslev, Member of Parliament for Aurora—Oak Ridges—Richmond Hilll


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Ontario households squeezed by worst income growth in Canada

Posted on 22 September 2017 by admin

QUEEN’S PARK – Despite paying high prices for everything from hydro to housing, Ontario households faced the slowest median income growth in the nation according to 2016 Census data from Statistics Canada.

“This report shows what families already know – they’re being squeezed,” said NDP Economic Development critic Catherine Fife. “Household costs have gone up under Kathleen Wynne, but wages are being held back.

“It’s clear that Wynne doesn’t get what families are dealing with today. It seems like she doesn’t remember what it feels like to open her own hydro bill or worry about whether your kids will ever be able to afford to move out.”

Of the 152 Canadian cities included in the report, nine saw median incomes fall. Eight of those nine are Ontario cities. Windsor topped that list, with household incomes dropping 6.4 per cent between 2005 and 2015, and London was not far behind – with a 2.1% decline in median income during that same time period.

Fife said that not only have families been let down by Wynne, but that the continuation of cuts and underfunding in services people count on threaten to squeeze families even further, like paying more out-of-pocket for public transit or home nursing care.

“Ontario families need a government that thinks less about itself and its party and more about how everyday families are doing,” said Fife.

“It’s troubling that Conservative Patrick Brown opposes raising the minimum wage, choosing to stand with big corporations instead of regular Ontario families. He also stood with Mike Harris as he cut 6,000 nurses and closed 28 hospitals. He stood with Tim Hudak as he announced a plan to lay off 100,000 workers. And he stood with the Conservatives when they pitched the privatization of both Hydro One and Ontario Power Generation. He needs to come clean on what he’d cut – because families have an important choice to make about which leader will come after Kathleen Wynne: Andrea Horwath or Patrick Brown.”

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How Will the Auto Industry Fare After Central Bank Interest Rate Rise?

Posted on 26 July 2017 by admin

Perspective from Canadian Black Book on the July 12 Rate Hike and our Auto Industry’s Record Growth

Markham, Ontario, July 14, 2017 – On Wednesday July 12, Bank of Canada Governor Stephen Poloz announced a 0.25 per cent key interest rate increase, the first rise in rates in seven years.

How will this news affect the Canada’s auto business?

What most new vehicle buyers may assume, is that the cost of higher interest rates will get passed onto them today. It is actually unlikely in the short term, that that would be the case.

For the most part, manufacturer new vehicle incentive budgets will likely absorb the rate hike for consumers so that they can continue to advertise 0% or 0.9% or 1.9% for new cars. To keep things in perspective, on a $40,000 car loan a hike of 0.25% is only an extra $100 per year of interest.

All that said, if rates continue to climb, at some point the OEMs will have to pass along those costs to vehicle buyers, initially resulting in less cash incentives. This will then eventually raise monthly payment, all else being equal.

The bigger impact of a rate increase is its immediate effect on the strength of the Canadian dollar and what that will mean to the Canadian auto industry. Our more valuable dollar is of greater concern, for both the new and used vehicle market in Canada. The dollar has increased $0.06 since May, which is a significant climb. This could lead to a cooling of new vehicle sales and is expected to cause Canadian used vehicle prices to fall over time.

As the strength of our dollar had been declining since 2013, U.S. interest in Canadian used vehicles increased. Depending on who you ask, upwards of 200,000 vehicles have been being exported to the U.S. annually. U.S. buyers and/or Canadian exporters have been taking full advantage of a lower Canadian dollar and been moving vehicles across the border to sell at a higher price in the States versus here at home. This export demand has inflated our used car prices domestically.

As a result, Canadian consumers are being pulled out of their vehicle loans/leases early by dealers who are eager to sell the consumer’s current vehicle on the used market and put the consumer into a brand new one, often for the same or lower monthly payment. This “pull forward” activity is helping to drive record levels of new vehicle sales. This activity is also possibly due to higher used vehicle prices putting consumers into a positive equity position (owe less than the vehicle is worth) much sooner.

Given that the domestic supply of U.S. used vehicles is up by about 500,000 more off lease units versus past years, U.S. used prices are falling. The Black Book (USA) Price Index is showing a ten per cent decline since last year, which is significant. The U.S. vehicle market is bracing for a large downward adjustment in used prices. Add in a stronger Canadian dollar, driving up acquisition costs and there will be less demand in the U.S. for Canadian used vehicles

At some point soon, the rising Canadian dollar and falling U.S. used vehicle prices will make it unattractive for U.S. buyers to purchase Canadian inventory in such large volumes. The impact to the Canadian auto industry will be a slowdown of “pull forward” activity, as it won’t make economic sense to pull as many consumers out of their vehicles early because they won’t command such high prices on the used market. Canadian Black Book expects that a $0.85 dollar is around the tipping point for U.S. exports to significantly slow.

On the positive side, Canadian used vehicle shoppers and used vehicle dealers will be rewarded with better deals in the market compared to what they have seen over the last few years.

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Canada ‘very prepared’ for NAFTA renegotiation talks with U.S., trade minister says

Posted on 28 May 2017 by admin

Francois-Philippe Champagne said he had a “good first meeting,” with U.S. trade representative Robert Lighthizer in Vietnam during the Asia-Pacific Economic Cooperation forum gathering.

HANOI, VIETNAM—Canada is prepared to start talks to renegotiate the North American Free Trade Agreement and is confident it will get a successful outcome, Trade Minister Francois-Philippe Champagne said Sunday.

“When you start a discussion you start with saying, ‘Well, we’re the first client’,” Champagne said on the sidelines of a meeting of Asia-Pacific trade ministers in Hanoi. NAFTA, negotiated more than two decades ago, “has been amended about 11 times so we said we’re happy to sit at the table,” he said.

Robert Lighthizer, the new U.S. trade representative, has begun the process for renegotiating the three-way agreement with Canada and Mexico, issuing a 90-day notice to Congress.

During his election campaign, President Donald Trump called NAFTA a “disaster” that cost millions of U.S. jobs and crippled the U.S. manufacturing sector. A few weeks ago, he was considering whether to pull out of the agreement entirely.

Champagne said some parts of the deal could be modernized, citing e-commerce, but he wouldn’t say whether Canada had any limitations for the discussions.

“We are very prepared and we are taking that very seriously, but we’ll put things on the table when it comes to the time to negotiate,” he said. “I am confident, if history has been guiding us, that if we succeeded 11 times that we are likely to succeed again.”

Champagne said he had a “good first meeting,” with Lighthizer in Vietnam during the Asia-Pacific Economic Cooperation forum gathering. “Whatever discussions you have start from the premise of a very fruitful relationship,” he said.

Champagne also met Sunday with the 11 remaining members of the trans-Pacific Partnership, a trade deal from which Trump the U.S. in one of his first acts as president. The TPP would have included 40 per cent of the global economy.

Some nations are pushing to continue with the TPP despite the loss of the U.S., arguing that too much effort went into negotiating it and that there are benefits for remaining countries, though some have been less committed.

In Hanoi, there was a sideline meeting on Sunday of TPP-member nations and ministers agreed to start a process to put it into force, according to a joint statement. They will ask senior trade officials to arrange how to take the continue the partnership and report back by the APEC leaders’ summit in November.

“Canada’s always been clear: we will look at whatever options would be to the net benefit of Canadians and Canadian workers,” Champagne said. “This is very much now at the stage of looking at options.”

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