The bully's sidekick: Canada’s subservience to the U.S. sanctions agenda & its impact on the world
Credit: (The Media Express/Google Images)
Written by: Morgana Adby
The Impact
The plane crash over Iranian airspace remains fresh in the Canadian mind as we collectively mourn the 176 people on board, including 57 Canadians.
In the time between Jan. 8 and the present some clarity has been brought forward to many of the specific details of the event. In particular, the sanctions that created the conditions for so many Canadians to be on Ukrainian International Air (UIA), flight 752.
Younes Zangiabadi, the research director for the Canadian Iranian Congress was one of the first to point out the role of sanctions in the large Canadian percentage of those on board.
“Major airlines no longer work with Iran, including Air France, British Airways, KLM, you name it,” he explained to Global News 640 Toronto. He also noted that UIA was a more affordable option for travel between Canada and Iran, which may be why so many students and new professionals choose that flight.
That last point is of particular interest because it brings into question who is going to be most threatened by the extraneous consequences of sanctions. In light of Iran’s decision to publicly admit that they had mistakenly shot down the flight due to ‘human error’, it is hard to say to what extent the sanctions can be credited with the tragedy.
Certainly, the reason so many Canadians were on board the flight was related to sanctions, but officials of all nationalities recognize that the plane never should have been hit at all.
The major airlines mentioned stopped servicing flights to Iran in September, noting that it would be unprofitable given the reinstatement of US sanctions, along with a decrease in Iran bound customers.
In addition to those major airlines, the primary airline run from Iran has been drastically limited by U.S. sanctions. Mahan Air and other Iranian airlines have prohibited everything from maintenance to refuelling contacts.
As stated in an advisory from the United States Treasury Department, “If the item is subject to U.S. export licensing requirements, both US and non-US persons must abide by strict conditions as they do business with any Iranian airline.”
The Comparison
From the large impact of these sanctions, arose a larger question about the Canadian identity as it engages in foreign policy.
It is worth establishing to what extent the current state of our civilian’s relationship with Iranian business is caused by U.S. policy, agreeable Canadian policy and where Canadian policy might divert from our elephant ally. Also, how the economic affairs of the North American nations have become so interconnected in the first place. Lastly, what we can learn from the mid-twentieth century.
Canada’s diplomatic relationship with Iran has been unstable for years, including a situation where the consulate services in Iran was moved to Ankara, Turkey.
“The final break came with the passage of the Justice for Victims of Terrorism Act (JVTA) in March 2012, and the listing of Iran as a state sponsor of terrorism in September 2012. The legislation allowed for the seizure and sale of Iranian government properties in Canada.” Dennis Horak, Canada’s ambassador to Saudi Arabia (2015-18) and head of Canada’s mission in Iran from 2009-2012, written in an opinion piece for The Globe and Mail.
However, our economic sanctions were during the past decade. After Iran was confirmed to have complied with the Joint Comprehensive Plan of Action (JCPOA), Canada removed provisions that prohibited “the blanket prohibition on imports from Iran and exports to Iran” and only trade that could contribute to nuclear weaponry in Iran remained sanctionable.
A similar policy change occurred in the US, where sanctions on oil and financial services were lifted in 2016. However, since the fall of 2018, the strict sanctions outlined above were reinstated by the US. By May, a Whitehouse briefing announced the country was out of the JCPOA altogether.
What this means is that even though Canada continues to have the shortened list of prohibited action with Iran, the U.S. sanctions had a snowballing effect on civilian air travel to Iran.
Past Patterns: Notable Moments of the 20th Century
The U.S. influence on Canadian foreign affairs is not a new development, and may even appear to be an unquestionable part of Canada’s economic condition. However, our relationship is the result of a 20th-century history that includes the US’s time of isolationism in the 30s, as well as the development of the North American Free Trade Agreement in the 90s. What happened between those decades shaped our current dynamics.
The events of the Cold War define this relationship to a large extent. Our geographical closeness, along with allied status required that the U.S. and Canada work parallelly to manage interests in Central and South America. However, the Cold War in South America demonstrates how Canada chooses to comply or differ in its approach to our neighbour.
From the sanction of Nicaragua to trade with Cuba, Canada has responded in various ways to U.S. economic and political involvement in South America. This has been done with the expected compliance of a U.S. ally. However, most relevant to this topic, are the examples where U.S. economic sanctions limited legal Canadian businesses in substantial ways.
The most famous case of divergence is Canada’s response to the Cuban embargo. Although Canada did participate as an ally during the Cuban Missile Crisis, it has kept an independent relationship with Cuba since its revolution in the mid-20th century.
Between the establishment of the embargo, and 1984 Canada maintained that Canadian trade with Cuba would continue to fall under Canadian regulations. Then, the Foreign Extraterritorial Measures Act 1984, was passed which intended to deter Canadian companies to participate in the trade embargo, even if those companies benefited from US trade.
A few factors make this case very different from Canadian relations with Iran, or other South American nations. Firstly, that Cuba provided a market that had been beneficial to Canadian business since as early as the 18th century. Secondly, the anti-americanization outlook of the Pierre Trudeau cabinet that was trying to push for more Canadian influence abroad.
Finally, the diplomatic ties between Cuba and Canada. Pierre Trudeau was the first western leader to visit post-revolutionary Cuba in 1976, although it would cut off Cuban aid shortly after because of Castro’s involvement in Angola.
The history of subservience to U.S. policies is both longer and more recent. Within the last few years, Canada has added various sanctions to individuals in Venezuela, including the addition of 43 new persons in April 2019, citing human rights abuses.
Likewise, in June 2019 Canada placed sanctions on Nicaraguan officials, for human rights abuses. However, Canada also supported the unelected Bolivian opposition government after it seized power in 2019, a situation that has since spiralled into violence.
In all of these recent examples of Canadian economic sanctions, or lack thereof, Canada and the U.S. have been on the same page.
NAFTA and CUSMA
Before the North American Free Trade Agreement (NAFTA), there were already trade deals between Canada and the US. By including Mexico to create the largest free trade area worldwide there was bound to be some domestic pushback.
Since its creation in 1994, some in the US and Canada alike argued that NAFTA would hurt domestic workers by undercutting the market with cheap Mexican goods. This concern was doubly ominous because Mexico had a protectionist policy until it ran into some issues with debt and was convinced to try free trade by the International Monetary Fund.
For many citizens, this felt like an unpredictable thing. Hence, when the U.S. elected a right-wing populist, President Trump, the whole deal needed to be renegotiated.
Then arose the United States–Mexico–Canada Agreement (USMCA), a new trade deal with the same geography and key goals. The changes from NAFTA include provisions about the settlement of the dispute, labour, intellectual property among others. For most people, it does not change how they interact with the economy. North America remains a bloc of conditionally-free trade.
For the purposes of evaluating U.S. economic influence over Canada, that grossly oversimplified summary will do. The point is that Canada shares the largest border in the world, with its largest trading partner and also happens to have the largest military in the world. The U.S. has many interests abroad. Our economy is tied to the U.S. through trade agreements, and from the socio-cultural factors that promote travel and consumption of similar goods.
Since the Canadian economy is almost entirely tied to the U.S. both formally and informally, it should come as no surprise when Canada either goes along with U.S. sanctions or when Canadian business is affected by U.S. sanctions.
Looking Forward
Predictions are a dangerous thing in an unpredictable world, but some deep-rooted things are unlikely to change.
For Canadian relations with countries like Iran, it is likely that sanctions that the U.S. approves of will continue. Likewise, Canada’s history of not putting economic sanctions on Saudi Arabia will probably continue, based on the Saudi Arabian-US relationship and Canada’s apparent economic interest in the current state of affairs.
On sanctions, Canada generally aligns its policy with the U.S., but one understated factor is diplomacy. Canada has acted as a buffer between the U.S. and hostile countries before. Since the flight 752 crash, there is a newfound interest in independent Canadian relations with Iran.
“It would be a welcome outcome if this incident provided new impetus to the effort to resume diplomatic ties and a return to Tehran in due course, taking into account the broader geopolitical context,” Dennis Horak.
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