CCA formulating back-up plan if TPP trade deal fails

If the Trans Pacific Partnership flounders, the Canadian Cattlemen’s Association wants the federal government to pursue a separate free trade agreement with Japan.

None of the 12 member countries have ratified the deal, however if the United States says no, the entire agreement could die, the CCA foreign trade committee was told during the Canada Beef Industry conference held in Calgary Aug. 9-11.

“It is a carefully constructed 12 party agreement and if one of the 12 were to decide not to be a member I think that would certainly change the math for a whole lot of people. There is still a lot of speculation as to what might happen. For a lot of members access to the U.S. market was a key consideration in terms of how they created their negotiating position,” said Doug Forsyth, executive director for Agriculture Canada and Canada’s chief agriculture negotiator.

Canada joined negotiations in 2012 to gain additional access to the lucrative Japanese beef market. Japan has agreed to gradually reduce beef tariffs from 38 percent to nine percent for all participants.

“Japan will probably pass it this October but it is a question mark as to what is going to happen in Washington. It doesn’t look promising if you listen to some of the election rhetoric,” said John Masswohl of the CCA.

“We have to think about how we will go forward on our own,” he said.

Australia has an agreement with Japan and receives better access with lower tariffs.

Last year Canada exported about $100 million worth of beef to Japan but paid nearly $40 million to the Japanese in tariffs, said Masswohl.

Canada needs to consider another plan sooner rather than later.

“Just sitting back and waiting until an opportunity presents itself instead of being prepared for it in my mind is dropping the ball,” said Dennis Laycraft, executive vice president of the CCA.

Japan is not interested in another deal at this time.

“The focus for now is for the TPP for Japan and Canada. That is Plan A. Plan B is speculative right now, notwithstanding what is going on in the United States,” said Forsyth.

Canada went through seven rounds of talks with Japan to build a bilateral agreement but when the TPP was proposed that was set aside.

Members of the National Cattlemen’s Beef Association also want the deal signed.

“Trade agreements are never easy and they are never popular but they are very economically important. In absence of trade agreements realistically we would degrade into chaos,” said NCBA president Tracy Brunner at the committee meeting.

The NCBA argues limited access affects all the meat exporting groups who hope to do business with Japan market that takes many products that are not popular in North America.

If trade is lost the products will have to be sold domestically said Kent Bacus of the NCBA.

Contact barbara.duckworth@producer.com

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