Trump eyes big changes in NAFTA negotiations
There may be more than just a "tweak" coming to NAFTA. Last month, Donald Trump had stated that Canada should just expect modest requests for changes during upcoming re-negotiation of the North American free-trade agreement. But a draft letter to Congress outlines more than 40 objectives that the U.S. is seeking to achieve in an "America-first approach" in talks with Canada and Mexico (for subscribers).
One key area mentioned in this letter: a stipulation that would let the U.S. slap taxes on Canadian exports that threaten the business operations of American companies. That description mirrors earlier talk of a border-adjustment tax, which has raised alarms in Canada's business community. Canadian goods may also need to be manufactured with more American-made parts in order to be sold in the U.S. tariff-free.
Trump is also expected to sign an executive order today that will demand an investigation of the U.S.'s trade deficits with Canada and 15 other countries.
This is the daily Morning Update newsletter. If you're reading this on the web, or if someone forwarded this e-mail newsletter to you, you can sign up for Morning Update and all Globe newsletters here.
Special prosecutor joins political fundraising probe in B.C.
A special prosecutor has been hired to assist the RCMP in its probe of political donations in British Columbia. The RCMP launched the investigation after The Globe and Mail revealed lobbyists were making donations under their own names, only to be reimbursed by companies – a violation of one of the province's few fundraising rules. By donating in their own name, lobbyists were obscuring the source of the funds. The B.C. Liberals announced last week they were returning $93,000 in improper donations. Unlike the rules at the federal level and in many provinces, there are no limits to political contributions in B.C. On the heels of a provincial election in May, Premier Christy Clark said she is open to reforming the province's fundraising rules.
Flynn open to testifying before Congress, but with conditions
Michael Flynn is willing to answer questions in a congressional probe of potential Russian ties to the Trump campaign. But first, he wants protection from "unfair prosecution," his lawyer said. Flynn was fired from his position as Donald Trump's national security adviser after he failed to properly disclose his discussions with Russia's U.S. ambassador. Earlier this week, the top Republican and Democrat on the U.S. Senate intelligence committee pledged to work together in their Trump-Russia investigation. But the independence of the House of Representatives committee has been called into question over its chairman's alleged collusion with the White House.
Toronto mulling vacancy tax as house prices soar
Toronto may take a page from Vancouver as its real estate market continues to soar. Mayor John Tory said he's considering a vacant-home tax, a measure that will be fully in place on the west coast by 2018. Tory is trying to curb real estate speculation in Toronto; the average price of a detached home has reached $1.6-million. Vancouver's vacancy tax will force owners who leave a home empty for at least six months of the year to pay an extra 1 per cent in property tax. But with little reliable empty-home data, it's unclear whether a similar measure in Toronto would help push down housing prices.
MORNING MARKETS
Global stocks dipped on Friday as investors locked in some of the more than 6-per-cent gain that has given them their best start to year since 2012, while the U.S. dollar inched towards what could be its strongest week of 2017. Tokyo's Nikkei and Hong Kong's Hang Seng each lost 0.8 per cent. In Europe, London's FTSE 100, Germany's DAX and the Paris CAC 40 were down by between 0.1 and 0.6 per cent by about 5 a.m. ET. New York futures were also down, and the Canadian dollar was just shy of the 75-cent U.S. mark. Oil prices fell after a three-day rally ran out of steam, promising to notch up the oil market's worst-performing quarter since 2015 as investors fret that growing U.S. supplies are undermining OPEC-led cuts.
WHAT EVERYONE'S TALKING ABOUT
Trump's NAFTA goals: 'What's yours is mine and what's mine is mine'
"Welcome to the new trade reality for Canada in U.S. President Donald Trump's 'Buy American, Hire American' world. Forget Mr. Trump's suggestion that all he wants is to 'tweak' NAFTA. The document calls for a total 'rethink' of trade in North America in a way that tilts the playing field for the U.S. And by default, away from Canada and Mexico. … Prime Minister Justin Trudeau's strategy on NAFTA has been to avoid antagonizing Mr. Trump, while deploying a vast network of surrogates to sell his administration on the benefits of economic integration. That view isn't evident in Mr. Trump's NAFTA wish list. Maybe it's time to remind him that what's ours is just that – ours." – Barrie McKenna (for subscribers)
Brexit is unlikely to deliver what supporters believed they voted for
"There is a vaguely articulated belief among ardent Brexit proponents that Britain might be able to maintain and even expand its economy without EU trade, by building trade relations with China, Canada, the United States and other advanced countries. That belief was acknowledged by Theresa May when she declared, in her speech to parliament Wednesday, that post-Brexit Britain would be a 'great, global trading nation.' It could not. A study this month by the Centre for Cities found that 61 of Britain's 62 largest cities rely on the EU more than any other market for their employment and earnings; even the least EU-dependent cities sell more than a quarter of their exports to Europe." – Doug Saunders
HEALTH PRIMER
Canadian coroners drop the term SIDS
Canadian coroners have stopped using the term SIDS, which stands for sudden infant death syndrome. The decision has sparked a debate among parents and within the medical community about whether SIDS is a real condition. Medical examiners say the term doesn't have value because it offers no insight into a cause of death, and that its broad interpretation has led to some infant deaths being miscategorized. But doctors, researchers and parents say SIDS is a real condition that requires further study in order to prevent these types of deaths in the future.
MOMENT IN TIME
The first Heritage Minutes air
March 31, 1991: The statistics were dire: In a 1987 test, Grade 10 through college-age students correctly answered only 29 of 51 questions about Canadian history. And 23 per cent couldn't name a Canadian event or achievement that made them proud. Inspired by Bicentennial Minutes – brief history lectures that aired on U.S. TV in the mid-1970s – philanthropist Charles Bronfman set out to give Canadians entertaining nuggets about their past, in the familiar form of TV commercials. The first Heritage Minutes, including the Underground Railroad, Jacques Plante's goalie mask and three First World War veterans from a single Winnipeg street awarded the Victoria Cross, aired in a one-hour special on CBC and Radio-Canada. More than 86 have now been made; last year's spot on Cape Dorset artist Kenojuak Ashevak was the first produced in English, French and Inuktitut: a part of our heritage. – Simon Houpt
Morning Update is written by Arik Ligeti.
If you'd like to receive this newsletter by e-mail every weekday morning, go here to sign up. If you have any feedback, send us a note.