Editorial: Reposted from Feb 19, 2000

Editorial - February 19, 2000

Once again, NAFTA (North American Free-Trade Agreement) is being shoved down our collective Canadian throats by the United States. United Parcel Service, an American-based courier service is very concerned by what it considers is "preferential treatment" the Canadian government is seemingly giving to Canada Post and the courier companies that it currently holds majority shares in.
Considering the fact that Canada Post is a Crown Corporation, it should not come as a surprise to anyone that it enjoys some degree of government partiality. Since details of the suit have yet to be released to the public, it will be very interesting to find exactly what particular allegations they are bringing against the Federal government. UPS contends their $100 Million lawsuit is meant to provide an atmosphere of more equitable competition in the courier industry. What is it all about is money. UPS cannot attain the market share it feels it deserves vis-a-vis the competition, so it will try to level the playing field via NAFTA. It is interesting to note that other major foreign-based competitor, Federal Express, feels it unneccesary to pursue a similar strategy.
In reality, if UPS is successful in its suit, the result will further continue the erosion of Canada's sovereignty to foreign corporations. Article 1102, under Chapter 11 of NAFTA grants "National Treatment" to US and Mexican investors in Canada, essentially giving them equal footing with domestic businesses. However, within the provision to ensure 'national treatment', foreign investors have a power that even Canadian citizens do not have. That is the right to sue the Canadian government if they believe they have not been afforded the same treatment as domestic investors. This is a power that on the surface may seem to be a check and balance tool, but the real effects might eventually prove more far reaching than desired. In recent years, there have been moves to give such rights to the other 28 countries of Organization for Economic Cooperation and Development (OECD) under MAI (Multi-Lateral Agreement on Investment). MAI-NOT outlines the dangers of entering into such an agreement.
Globalization is a movement that has been used in recent years that many argue is inevitable and will be beneficial to all nations. What globalization is really about is the slow dissolution of the nation-state to the interests of huge transnational corporations. One of the great myths of creating a free market is that it creates competition which benefits the consumer. The effects of globalization however, will not be greater competition, but just the opposite. Corporations are merging and taking each other over to become larger and more powerful to better compete in the world market, so the end result is less competition on a larger scale.
In the Philippines, the Retail Trade Liberalization Bill was passed last year that would see the near complete removal of restrictions of foreign investment in the retail sector. This bill comes after 45 years of completely banning foreign ownership. Philippine President Joseph Estrada is very keen on opening up the country to foreign investment in order to strengthen a lagging economy, but I fervently believe that completely opening up a once protected domestic market is a formula for disaster. Estrada is trying to do too much too quickly to save his own political hide and it may only hurt the country in the long run. Unfortunately, the Philippines finds itself dealing from a position of weakness rather than strength and it is falling into the "we must look outward" trap that many Third World nations have slipped into, instead of trying to correct the long history of corruption that prevents any real change and long-lasting progess from happening.
Is it in Canada's best interest to grant rights US companies in Canada that their domestic counterparts do not have. Do we as a nation want to have any say over foreign-based companies that decide to invest in Canada? The basic issue is whether any nation has the right to regulate, protect, and control its own economy in the interest of its own citizens. I say, without any doubt, YES!