Trump advisers take aim at Trudeau over trade stand in Davos

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On the eve of Donald Trump's arrival in the Swiss Alps for the World Economic Forum, the U.S. President's top economic advisers gave a robust defence of his "America First" trade agenda, including taking a shot at Prime Minister Justin Trudeau's handling of North American free-trade negotiations.

Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross set the stage for the President's protectionist message in Davos on Wednesday, with Mr. Mnuchin saying the administration's aggressive trade action is aimed at "looking out for American workers and American interests."

Mr. Ross, a hardliner on trade, singled out Mr. Trudeau after he hailed the new 11-country Trans-Pacific Partnership trade agreement as the "right deal" for Canada and for those who believe in "progressive trade."

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Mr. Ross told U.S. reporters Mr. Trudeau was using the Davos forum of bankers and corporate chief executives to "put pressure on the U.S. in the NAFTA talks."

The Prime Minister's Office responded that Mr. Trudeau is a champion of progressive trade, while Finance Minister Bill Morneau dismissed the Commerce Secretary's criticism as the usual back-and-forth of trade talks.

"What I can say with NAFTA is that negotiations are tough," Mr. Morneau told reporters. "We are in the middle of a negotiation where we are trying to make sure that we improve NAFTA for Canadians and we should expect there will be challenges."

Mr. Ross later told CNBC that there is a "good chance" a deal on NAFTA can happen, but added "the President made it clear if it is not a deal that he likes, he won't do it."

Mr. Trump pulled the United States out of the original TPP deal and launched talks to revamp the North American free-trade agreement as part of his protectionist agenda that has included heavy duties on Canadian softwood lumber and Bombardier jets.

Mr. Trudeau, German Chancellor Angela Merkel and Indian Prime Minister Narendra Modi have used their keynote speeches at the gathering of the global elite to champion free trade and to warn of the dangers of protectionism.

In his remarks on Tuesday, Mr. Trudeau was applauded for saying "we are working very hard to make sure our neighbour to the south recognizes how good NAFTA is and has benefited not just our economy, but his [Mr. Trump's] economy and the world's economy."

The Prime Minister, who is spending three days at the ritzy ski resort of Davos, will leave late on Thursday and miss Mr. Trump's keynote speech, in which the President is expected to defend his trade policies.

Mr. Trudeau has spent most of his time in Davos lobbying U.S. corporate heavy hitters to defend NAFTA and to keep investing in Canada, despite Mr. Trump's threat to scrap the continental treaty.

On Wednesday, he held a private roundtable with executives from Dow Chemical, UPS, the New York Stock Exchange, Tyson Foods, Cargill, Qualcomm Inc. and global investment firm Blackrock.

"We just had a great conversation about all the jobs in Canada and the United States that rely on NAFTA," Mr. Trudeau later told reporters. "We talked a lot about ensuring citizens and workers and families on both sides of the border understand that the integrated supply chains, the trade back and forth between Canada and the U.S. and Mexico has been tremendously beneficial."

McKinsey and Co. managing director Dominic Barton, who heads Mr. Trudeau's economic advisory council, chaired the roundtable. He said the CEOs were committed to making sure their work force understood what was at stake if NAFTA were to die.

"What was talked about [was] the importance of NAFTA for everyone, and people were talking very specifically about the jobs that were created or the jobs that could be lost … and people need to talk to their employees about this just so there is an awareness," Mr. Barton said.

David Abney, CEO of UPS, said NAFTA has created millions of jobs in the United States, Canada and Mexico. He expressed hope that NAFTA negotiators can manage to reach a deal to reform the treaty.

Despite warnings from the Bank of Canada that global investors are holding back on putting money into Canada because of uncertainty over NAFTA, Mr. Abney said his multinational courier service will continue to invest in Canada no matter what happens.

John Negroponte, who was the former U.S. ambassador to Mexico when NAFTA was originally negotiated and later served as president George W. Bush's national intelligence director, praised the Trudeau government's "civility" in its handling of the NAFTA talks.

"I worry a lot about NAFTA. It is critical that it stay in effect and not be abandoned by the President," Mr. Negroponte told The Globe and Mail. "There have been a number of negative things said on our side that I think could have sparked some kind of spontaneous reaction from our negotiating partners, but so far there has been considerable civility, notwithstanding the seriousness of the problem."

The Prime Minister has been criticized by the opposition parties for travelling to the Davos gathering of billionaires, celebrities and world leaders. He is staying at the Ameron Swiss Mountain Hotel, where a hamburger platter costs $75.

But John Manley, head of the Business Council of Canada, defended Mr. Trudeau's trip to Davos, calling it a rare opportunity to meet a lot of multinational corporate executives in a short period of time.

Many of the executives with major investments in Canada and Mexico almost certainly share Mr. Trudeau's view that NAFTA is too important to be torn up, as the President has threatened to do, Mr. Manley said.

"It is going to be hard to find somebody in Davos who thinks that Donald Trump is on the right track in tearing up NAFTA," Mr. Manley said in an interview. "I think people are willing to be less inclined to believe that Donald Trump will actually abrogate NAFTA."

Mr. Trudeau met with Israeli Prime Minister Benjamin Netanyahu on Wednesday, but his office did not tell Canadian journalists until after it was later revealed by Israeli media. The Trudeau-Netanyahu discussion comes weeks after Canada abstained from voting on a United Nations resolution condemning a controversial U.S. decision to relocate its embassy from Tel Aviv to Jerusalem.