Harper 'surprised' by protectionist feelings from U.S

Canada has changed its views when it comes to trade to the point that protectionist feelings on the Canadian right are "virtually non-existent," Prime Minister Harper told a business audience in Ottawa Monday.

Harper said critics who opposed the North American Free Trade Agreement 25 years ago "predicted the disappearance of Canada as a nation" and "took a credibility hit" as a result.

But Harper admitted he is surprised by the strong "protectionist discourse" coming from the United States.

Harper was participating in a question-and-answer "dialogue" at a meeting of the Canadian American Business Council, answering questions put to him by Maryscott Greenwood, an American government relations lawyer and former Clinton appointee to the U.S. embassy in Ottawa.

The theme for this year's CABC gathering is the state of Canada-U.S. relations after the U.S. presidential election.

Replying to a question about whether "Obama lost Canada" during his first term as president, Harper told the audience of U.S. and Canadian businesspeople that Canada's most important relationship remained the one with the United States.

He threw in the fact that he had just talked to Israeli Prime Minister Benjaman Netanyahu, and quipped "talk about a difference in neighbourhood."

As soon as the interview was over, the Prime Minister's communications director said in an email, "The call happened last Thursday. The two leaders spoke about the recent developments between Israel and Hamas in the Gaza Strip.

The prime minister told PM Netanyahu that Canada supported Israel's right to defend itself, while urging Israel to take precautions to avoid civilian casualties."

In a wide-ranging conversation centred on trade, Harper said he agreed with many businesspeople that the biggest challenge either country faces is a shortage of skilled workers, particularly skilled tradespeople, scientists and engineers.

He said his government is readjusting its immigration programs so that they're not as "passive," a recognition that Canada is now in competition with many other countries for skilled labour.

This is the 25th anniversary of the CABC, which describes itself as non-profit, non-partisan organization that gives a voice to private sector concerns on issues that affect the two countries.

One of the earlier speakers at the conference, Jim Prentice, a former cabinet minister in the Harper government now a vice-president with CIBC, noted that it's likely Obama will spend the first 18 months of his second term on domestic issues, which Prentice said would be beneficial for Canada given that the two countries share the "largest free-market energy system in the world."

Prentice's main point was that it is essential that Canada, an oil-producing nation that sends 99 per cent of its oil exports to the U.S., seek other markets, specifically in China.

He said that Canada's oil riches have made it "too easy" to be lulled into complacency and miss being a player in what he called the "global chessboard" of energy. That has meant that Canada often sells energy at what he termed a 35 per cent discount.

Prentice said he applauds Harper's decision to diversify Canada's energy markets.

"Mere ownership of a resource base does not make any country an energy superpower," he said, describing Canada as more of a "price-taker" than "price-maker."

The fact that the U.S. is well on its way to energy sufficiency is one reason it is vital for Canada to access the Chinese market, Prentice said, and he suggested that there is an opportunity now to develop that access. He characterizes the U.S.-China relationship as declining, whereas the state of Canada-China relations is "blossoming."