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Canada Threatens U.S. Oil Supply Over NAFTA

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Feb 27, 2008 4:20 pm US/Eastern

Canada Threatens U.S. Oil Supply Over NAFTA

Proposed re-opening of NAFTA is unacceptable to Canadian government without Consequences for U.S.

TORONTO (CBS4.com) ― Less than 24 hours after both Senators Hillary Clinton and Barack Obama said they would use the threat of withdrawing from the North American Free Trade Agreement, the Canadian Trade minister warned the U.S. against this action. Trade Minister David Emerson said access to Canada's oil fields might be at stake if NAFTA is reopened.

"Knowledgeable observers would have to take note of the fact that we are the largest supplier of energy to the U.S. and NAFTA has been the foundation for integrating the North American energy market. When people get below the rhetoric and pick away at the details, they are going to find out it's not such a slam dunk proposition," Emerson told the Candian press.

NAFTA and similar free trade agreements with China and other countries have been the target of U.S. labor groups. The groups blame free trade for the loss of hundreds of thousands of U.S. manufacturing jobs.

In a Tuesday debate, Clinton called NAFTA flawed and said her plan includes telling Canada and Mexico that the U.S. will opt out unless the core labor and environmental standards are renegotiated and the enforcement mechanism is enhanced. Former President Bill Clinton signed NAFTA into law in the 1990's.

Senator Obama said he would make sure the U.S. renegotiates the deal and, "use the hammer of a potential opt-out as leverage."

Minister Emerson added that in his belief,  the United States' current economic problems stem not from NAFTA, but from the country's own self-made subprime mortgage crisis that has battered the housing sector and from growing competition from Asia, particularly China.

(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)

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