Foreign affairs minister meets with U.S. counterpart

by James McCarten THE CANADIAN PRESS

Canada won’t shy away from defending its national interests when North America’s three leaders sit down together next week, Melanie Joly said Friday as she wrapped up her first stateside visit as the new foreign affairs minister.

Joly said that was part of the message she delivered earlier in the day when she sat down with her U.S. counterpart, Secretary of State Antony Blinken.

The meeting came one week before Prime Minister Justin Trudeau is to meet with President Joe Biden and Mexican President Andres Manuel Lopez Obrador at the White House, ostensibly to talk about how to reinforce continental supply chains.

EV tax credit

Canada and Mexico, however, are both deeply worried about the Biden administration’s proposed tax credit for electric vehicles, which foreign automakers, suppliers and industry leaders say is overly friendly towards union-friendly U.S. companies.

“We know that we have a strong economy because of this integrated supply chain and because of this friendship, but at the same time, Canadians know that we have to defend our interests, and we can never take anything for granted,” Joly said after the meeting.

“That’s my job – to defend Canadians’ interests, while making sure that we have a very strong friendship.”

The strategy, as it often is for Canadian emissaries in U.S. political circles, will be to emphasize that given the integrated nature of the North American auto industry, any policy that’s bad for Canada will be bad for Americans as well.

“Canada is the biggest exporter of U.S.-made cars, and also the biggest exporter of U.S.-made auto parts,” Joly said.

“In that sense, thousands of jobs on both sides of the border are dependent on this supply chain being integrated. We will continue to make sure that this is well known throughout the administration but also throughout Congress as well.”

The tax credit, which if passed would be worth up to $12,500 on certain electric vehicles, is part of Biden’s $1.75-trillion centrepiece Build Back Better bill, which includes a raft of social spending and climate-change initiatives.

The credit has powerful opponents on both sides of the political aisle, most notably West Virginia Sen. Joe Manchin, a moderate Democrat and a critical vote for the White House to get the bill through an evenly divided Senate.

Earlier this week, Manchin reportedly denounced the idea of encouraging the purchase of vehicles made with union labour as “wrong” and “not American” because it involves using tax dollars to pick winners and losers.

Protectionism

The proposal is only the latest example of U.S. policy measures in Biden’s domestic agenda that have taken a decidedly protectionist turn, alarming political and economic observers north of the border.

Biden has imposed rigid new standards for using American-made, union-friendly components and materials in U.S. infrastructure projects, and Canadian contractors and suppliers fear a trickle-down effect from his emphatic rhetoric.

His Day 1 decision to cancel a presidential permit for the Keystone XL pipeline expansion has Alberta’s energy sector nervous about two existing cross-border energy conduits: the Enbridge-owned Line 3 and Line 5, both of which are the targets of protesters and legal challenges.