Ottawa-The undermining of the powers of the World Trade Organization has made bilateral and other regional trade deals more important for midsized countries such as Canada, says Steve Verheuil, a former Canadian trade negotiator.

Trade rules are needed and with no international effort expected to restore its power to set and enforce them, the WTO is fundamentally broken, Verheuil told the Annual General Meeting of the Canadian Federation of Agriculture.

The WTO kept politics out of the setting and enforcement of its rules-based trade system. Now there is no effective dispute settlement mechanism, said Verheuil, who was Canada’s Chief Trade Negotiator from 2017 to 2021 including the CUSMA and European agreements.

Canada must work with other midsized countries on trade agreements that are fair to all parties. The North American trade deal with the U.S. and Mexico is one of the results of the undermining of the WTO as were the European and Pacific trade agreements.

One issue to watch for in future trade talks will be the idea of a carbon border adjustment, which will make it harder for countries without programs to reduce carbon emissions from their farms to export to countries that finance efforts by their farmers to reduce greenhouse gas emissions, Verheuil said.

There is no coherent effort currently underway to make some mechanism for carbon border adjustments part of trade agreements but there will likely be increased pressure for them to protect farmers to have to pay for them.

The U.S. will probably be looking for concessions in the future from Mexico and Canada although Verheuil thinks they will not create a major impact on CUSMA.

Work on at the WTO and on the European trade deal was done in a problem-solving approach while the U.S. was more confrontational in the CUSMA talks.

Verheuil, a graduate from the University of Western Ontario, was Canada’s Chief Agriculture Negotiator from 2003 to 2009.

Prior to that, he worked in international trade policy at Agriculture Canada from 1989 to 2009, which included the NAFTA negotiations, the Multilateral Trade Negotiations that led to the establishment of the WTO.

This news story was prepared for National Newswatch