Stumbling Toward a U.S.-Canada Free Trade Agreement

June 18, 1987 • Policy Analysis No. 88

Officials of the U.S. and Canadian federal governments are now negotiating a free trade agreement between our two countries. A proposed agreement is expected to be submitted for approval by Congress in October 1987. Although a free trade agreement would yield significant benefits for the United States and substantial benefits for Canada, approval of the proposed agreement by both governments is not assured. The primary barriers are the United States’ record of indifference to Canadian concerns and Canada’s record of extraordinary sensitivity about its independence from the United States. Significant concessions by each government will be needed to ensure approval of the proposed agreement by the other government. Failure to attain mutual approval is likely to lead to a deterioration of the trade relations between the United States and Canada and jeopardize the prospect of success in the round of multilateral trade negotiations that was initiated in Uruguay in September 1986.

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