A dairy farmer milks a cow at the Loewith dairy farm in Lynden, Ontario. As part of the deal, Canadian cheese producers would get tariff-free access into Europe, allowing domestic companies to export more to the EU.
The National Post: Prime Minister Stephen Harper will travel to Brussels on Thursday to meet with the president of the European Commission to conclude free trade talks with Europe.
The trip comes on the heels of an announcement in Wednesday’s throne speech, in which the government said it would “soon” complete negotiations on a comprehensive free trade agreement with the European Union. In Brussels, Harper will meet with the president of the European Commission, Jose Manuel Barroso, “with the goal of concluding” the negotiations, said the Conservative government.
Meanwhile, Canada’s dairy farmers are “angered and disappointed” with the Conservative government over a looming free-trade deal with the European Union that could more than double the amount of EU cheese allowed into Canada.
A proposed agreement-in-principle is sitting with the provinces for final approval.
The official Opposition NDP said it is worried the Conservatives may be throwing Canadian dairy farmers “under the bus” on a trade deal both sides have been negotiating since 2009.
Canadian government and EU officials insist negotiations are still ongoing, although Prime Minister Stephen Harper told the Conservative caucus Wednesday the government “will soon complete negotiations” on the Comprehensive Economic and Trade Agreement (CETA) with the European Union.
The federal government has agreed to double the amount of European cheese allowed into Canada – to around 30,000 tonnes a year – to finally get the EU to sign the deal, according to knowledgeable sources. The move was first reported by the National Post.
Canadian duty-free beef access into Europe and the EU’s demands for Canada to open up its supply-managed dairy sector were some of the final sticking points in reaching an agreement.
The Dairy Farmers of Canada assailed the Conservative government Wednesday. “Dairy farmers will not support the Harper government agreeing to a deal with the EU that gives away the Canadian cheese market that Canadian dairy farmers and cheese makers have worked so hard to develop over the years,” the lobby group for Canada’s dairy farmers said in the news release.
“This deal would displace our local products with subsidized cheeses from EU and risk our small businesses being shut down or put out of business. This is unacceptable.”
If the reported deal proceeds, the Harper government will have given the EU additional exclusive access to 32 per cent of the current fine-cheese market in Canada, according to the group, which represents around 13,000 dairy farms in the country.
Federal officials note that approximately 96 per cent of the nearly 420,000 tonnes of cheese sold in Canada is produced domestically.
This deal with the world’s largest economy will bring more opportunities for exporters and lower prices for consumers
The Conservative government is expected to argue that Canadian producers won’t feel much of an impact because, with the cheese market growing by 8,000 tonnes a year, the additional EU access will amount to around four per cent of total Canadian cheese consumption.
As part of the deal, Canadian cheese producers would get tariff-free access into Europe, allowing domestic companies to export more to the EU.
The Canadian supply management system protects fewer than 20,000 dairy and poultry farmers, handing them production quotas and shielding them with a tariff wall in a system that ultimately forces Canadians to pay inflated prices for products like milk, cheese, chicken and eggs.
Major Canadian business groups have urged the government to begin planning for a transition from supply management and insist it’s in the national interest to grow out of what they say is an antiquated system.
On Wednesday, the Canadian Council of Chief Executives and Canadian Chamber of Commerce welcomed Harper’s comments that government will soon complete negotiations.
“By tearing down trade barriers and encouraging regulatory co-ordination, this deal with the world’s largest economy will bring more opportunities for exporters and lower prices for consumers, as well as encourage new investments in Canada,” Perrin Beatty, president of the Canadian Chamber of Commerce, said in a statement.
The Dairy Farmers of Canada has urged the Harper government to leave the supply managed dairy sector largely untouched, and has said it would not accept Ottawa granting any additional market access into Canada for European producers who are heavily subsidized.
The organization has also said it would not allow any reduction in the over-quota tariffs, which are close to 250 per cent.
A spokesman for International Trade Minister Ed Fast maintained Wednesday negotiations with the European Union continue and that any agreement will protect Canadian dairy farmers.
The government insists the three pillars of Canada’s supply management system must remain intact: production controls, import controls and price controls.
“Our government has always defended the interests of our supply managed sector in our trade negotiations; this approach has not changed with Canada-EU trade talks,” Fast’s press secretary Rudy Husny said in an email.
European Union trade spokesman John Clancy, in a statement, said discussions continue at “the highest level” toward a Canada-EU free-trade agreement, “with the hope to conclude the negotiations in the coming days.”
NDP Leader Tom Mulcair said he is worried the Conservatives are throwing dairy farmers “under the bus” in an effort to finally complete the deal.
“If he sells out Canadian dairy farmers on this one, having promised that he wouldn’t fool around with Canada’s system that has protected dairy farmers for years, then there’s going to be a hell of a price to pay,” Mulcair told reporters in Ottawa.
