Downplaying trade rift

Photo: The Canadian Press

Ottawa's envoy to Washington downplayed talk of growing trade irritants with the U.S., a day after President Donald Trump sharply criticized Canada's well-guarded dairy sector.

Ambassador David MacNaughton says despite some U.S. rhetoric — and his own rebuttal letter released Tuesday — he still expects there will be "constructive discussions" between the two countries because so many jobs on both sides of the border depend on trade.

After a meeting Wednesday with the Nova Scotia cabinet, MacNaughton said upcoming negotiations around revamping NAFTA won't be easy, but the process will work out "just fine" in the end.

He did not address Trump's comments directly and avoided questions about whether they signal the onset of a cross-border trade war.

"All I can tell you is I've had ongoing discussions with the White House ... and all of those discussions have been positive and professional — they've been extremely responsive," said MacNaughton. "Our relationship with the U.S. administration is extremely strong and I think it's going to pay dividends in the long run."

In the meantime, MacNaughton said Canada needs to be prepared on every single issue when it comes to cross-border trade and shouldn't isolate any one sector.

"We've had a tough time on softwood lumber for 30 years. I'm sure we'll hear lots about dairy and we'll hear lots about other things and I'm sure there will be a lot of things that we will want to talk to them about, too."

Trump called out Canada by name Tuesday amid a brewing trade spat that has seen the U.S. dairy lobby accuse Canada of "systemic disregard" of its trade obligations.

The U.S. President also signalled he wants to do more than simply tweak the North American Free Trade Agreement, saying he is looking for "very big changes" to the trilateral pact that includes Mexico, or else he will scrap it once and for all.