Trading places
Since the Second World War, it has often been argued that Canada has followed a policy of multilateralism both in its security relations and in its international trade policies. Multilateralism was the response of a young country that at once relied on other countries for its security and economic prosperity, but also sought to maintain its political independence from those powers that served its interests. In national defence, Canadian policies supported collective security, particularly through the United Nations (UN) and the North Atlantic Treaty Organization (NATO); in international trade, the government supported multilateral trade liberalization under the General Agreement for Tariffs and Trade (GATT). Canada rejected the notion of closer economic relations with other countries along the lines characterized by the Common Market in Europe, and it explicitly tried to diversify its economic relationships with the “Third Option Policy” adopted by Prime Minister Pierre Trudeau’s government in 1972. Multilateral policy had a clearer meaning in security relations than in economic relations, and the NATO treaty thus called upon its signatories to “unite their efforts for collective defense and for the preservation of peace and security” (North Atlantic Treaty Document, 1949, Preamble). However, there was no similar concept of unified action in the GATT. The GATT made no reference to a common organizational effort, but rather simply called upon its signatories to achieve certain economic objectives such as full employment and increased living standards. The means to accomplish these objectives were negotiations to reduce tariffs and to eliminate discriminatory treatment in international commerce by the various countries. In sum, the GATT was a decentralized mechanism mainly bound together by the most favoured nation (MFN) principle. The result is that when we say Canada historically followed a multilateral policy, it may take a greater effort to interpret the meaning of this statement in international trade policy than in other areas of Canadian foreign policy. Furthermore, the uncertainty over the meaning of multilateralism in international trade policy is not just historical, but it continues today. For example, former Canadian Minister of International Trade Roy MacLaren has described Canada’s current efforts to negotiate a free trade agreement with the European Union as an example of “renewed multilateralism” (MacLaren, 2008). However, the proposed Canada-EU agreement is an example of a preferential trade agreement, and would surely be regarded by free-trade proponents, like Professor Jagdish Bhagwati (2008), as inconsistent with the principles of liberalism and multilateralism. 125