The MAI - The Affirmative Argument

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by James Moore, BA Political Science, University of Northern British Columbia

Although the Multilateral Agreement on Investment (MAI) is essentially "dead," one still hears rumblings across Canadian campuses, warning us against adopting the trade agreement. Signs reading "Stop the MAI" are still visible in shop windows and on bumper stickers. What was all the fuss about? The MAI trade deal was, in fact, a rather reasonable attempt to simplify trade regulations, and broaden opportunities for expanded markets for Canadians. Hopefully, talks of a new multilateral trade agreement will be spurred soon so that Canada’s naturally exporting economy can continue to expand into newer growing markets well into the next millennium.

The MAI was nothing more and nothing less than a common set of rules that define the rights and obligations of investors from 29 countries when they invest in any of the other 28 countries that were negotiating the MAI agreement. Currently, Canada either has or is negotiating investment protection agreements with 44 countries. Rather than keeping track of who qualifies for what treatment under any given deal, the MAI proposed similar ground rules for everyone. It set out a level playing field - rules known to everyone ahead of time and the treatment of investors equally rather than discriminating against them on the basis of nationality or country of origin. It required all persons investing in Canada to follow our laws, and respect our sovereignty; but it did not allow any government to change its laws in order to discriminate against a specific investor. International trade, invest- ment in Canada, predictable application of known laws, equal treatment, job creation - that’s what the MAI was about.

The MAI had a lot of principles that appeal directly to all Canadians. Its sections on transparency require that all laws be published so that an investor will know what they are. Transparency is a cornerstone of the Canadian legal process. Even Parliament’s bills are not laws until they are "pro- claimed," or published. Transparency is a healthy Canadian tradition, and its presence in a successfully negotiated MAI would greatly strengthen our trading abilities and give more firms the security they need to trade abroad.

National treatment was another pillar of the MAI. Just as Canada’s constitution forbids discrimination on the basis of race, colour, or ethnic origin, the MAI’s "National Treatment" section required us to treat investors equally whether they come from Sault Ste Marie, Stockholm or San Diego. This is completely consistent with our legal system and we should support it.

The MAI also offered protection to investors in just the same way that Canadian law does. Our laws do not allow a government to confiscate a person’s property without due process and proper compensation. When a road is widened and property expropriated, the fair market value is determined and compensation is paid. The MAI demanded the same treatment for foreign investors. This is simply fair and Canadians agree with it. The MAI required the quick and fair settlement of disputes, something that all Canadians favour. Indeed, in any dispute between a foreign company and a government in Canada, the MAI first suggested Canadian courts as a forum for settling the disputes. These provisions of the MAI are compatible with Canadians’ sense of fair play and the rule of law.

Given Canada’s natural resource base, our stable system of government, our courts recognized for their fair settlement of disputes, our well-educated population, and our national infrastructure, Canada can compete with the best and brightest from around the world. The MAI was just one more way of giving Canadian companies the access they need to the markets of the world. When one actually studies the specifics of the MAI and the potential boost to Canada’s economy such a multilateral trade deal would give, and when one sheds the anti-American, anti-free market, tired socialist rhetorical clichés, the MAI is actually a reasonable trade agreement with many benefits for all Canadians.

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Last Modified: Friday, November 5, 1999.