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Canada's NAFTA strategy: 'Heads down and our mouths shut'

  • Former Canadian prime minister says despite US politicians knocking Canada, 'don't take the bait.'
  • Brian Mulroney says from economic standpoint 'Americans should be more fearful of us than Russia.'
  • Mulroney negotiated two free trade deals with US, including NAFTA.

Leaders of Mexico, the U.S., and Canada during NAFTA treaty signing in San Antonio, Texas, Oct. 7, 1992. Pact didn't formally go into effect until 1994.
Bettman Collection | Getty Images
Leaders of Mexico, the U.S., and Canada during NAFTA treaty signing in San Antonio, Texas, Oct. 7, 1992. Pact didn't formally go into effect until 1994.

With NAFTA modernization negotiations around the corner, Canada's winning strategy is essentially staying quiet says a former Canadian prime minister who led talks on the pact in the 1990s.

"What we should do is what we've been doing: We keep our heads down and our mouths shut," said Brian Mulroney, who served as Canada's prime minister from 1984 to 1993. Besides negotiating the North American Free Trade Agreement, Mulroney also was behind an earlier free trade deal in 1988.

Mulroney, who knows President Donald Trump, made his comments Friday at a think-tank conference in Ottawa and it was reported by the Toronto Globe and Mail newspaper.

There's been a trade spat with the U.S. and Canada over everything from dairy and aerospace to softwood lumber. Also, Trump has taken to Twitter to lash out at some of Canada's trade policies, even calling Canada a "disgrace" for its treatment of American dairy farmers.

"Don't take the bait," Mulroney said, the paper reported. "We deal with this at the negotiating table."

Last month, Trump held a brief chat with Canadian Prime Minister Justin Trudeau on the sidelines of the G-7 Summit in Italy. Trudeau later confirmed trade was discussed.

Trump notified Congress May 18 that he would initiate renegotiation talks with Canada and Mexico to modernize the 23-year-old NAFTA deal. The first formal talks on NAFTA, however, are not scheduled to happen any earlier than mid-August.

Canada's trade relationship with the U.S. is second only to China, representing nearly $544 billion in goods in 2016, according to the U.S. Trade Representative's Office. When including both services and goods, that figure is closer to $630 billion.

"We're not some pushover little country," Mulroney said. "Hell, the Americans should be more fearful of us than Russia."

The NAFTA pact was signed in 1992 by former President George H.W. Bush, Canada's Mulroney and the president of Mexico at the time but wasn't approved by the U.S. Senate until late 1993. And the pact did not formally go into force until 1994.

Watch: Renegotiating NAFTA?