End of an Era? International Challenges to the Auto Pact
Members Briefing by
Doug Forsyth
November 1999, Source: The Conference Board of Canada, 4 pages
In mid-October 1999, leaked reports indicated that Canada lost the World Trade Organization (WTO) challenge to the Auto Pact by governments of Japan and the European Community (EC). Although the Canadian government will almost certainly appeal the final ruling, there is now a high probability that Canada will eventually have to change the rules under which the Canadian automotive industry has thrived for the last 30 years.
Document Highlights:
The Auto Pact Agreement was signed in January 1965 between the governments of Canada and the United States. It was one of Canada’s first attempts at cementing a stronger bilateral trade relationship with the U.S. The Auto Pact set out to rationalize the automotive industry; reduce tariff and non-tariff barriers; and increase automotive industry investment, production and employment. The Agreement was a success: Canada is now the sixth largest automobile producer in the world.
This study examines the Auto Pact, the World Trade Organization (WTO) challenge, the options for Canada if changes to the Auto Pact are required and the broader implications of this case for Canadian trade policy.
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