Pushing the politicians on trade

A federal election is coming this October. Now is the time for farmers to push for policies that will allow agriculture to deliver economic growth.

Agriculture and agrifood give more jobs to Canadians than the auto and aerospace industries combined. But our jobs are spread out across Canada and not concentrated in big centres. That means we don’t see headlines about thousands of jobs being lost because of agriculture trade disputes. But that is exactly what is at risk if we don’t see a refocus of trade policy.

The last 20 years have seen a push for reduced tariffs and increased market access through broad trade agreements. Agricultural trade liberalization has been successful for Canada. In fact, farming cash receipts in 2018 were more than double the level in 1999. At the same time, farmers’ utilization of agricultural safety net programs has been cut in half.

Much of agriculture’s steady economic growth has been fueled by increased trading opportunities. That growth has spawned investment in Canadian infrastructure. Opportunity and growth in agriculture has led to new processing in our rural communities. A growing agricultural economy has generated new jobs in every region of Canada.

All this is under threat from protectionist policies and we need to see new policy approaches.

Italy was once the largest market for Canadian durum, the wheat used to make pasta. But it has adopted protectionist country-of-origin labelling requirements that have reduced our durum exports by about 60 percent. This has happened after the agricultural provisions of the Comprehensive Economic Trade Agreement with Europe was negotiated.

India was once our leading export market for pulse crops like lentils and peas. Non-tariff and tariff trade barriers have slashed these export opportunities.

China is a potential alternative market for pulse producers, but this comes with significant market risks. China, a market that has taken over four million tonnes of canola over the last several years, has effectively closed its doors to Canadian canola.

There are other agricultural trade issues as well — Saudi Arabia, Peru and Vietnam to name a few.

The world has changed and we need to adjust our trade policies to counter these threats.

We need our political parties to present a comprehensive approach to protecting our trading interests.

A start would be an acknowledgement that a new systematic approach is required to counter the new world of protectionism. We need to do more than sign trade agreements, we need to place a priority on making sure trade agreements actually work.

We need to challenge our trading partners when trade agreements are not followed.

We also need political parties to articulate clear policies that will facilitate market diversification. This does not mean that governments hire a sales force to sell wheat or lentils or canola. Marketing is the job of industry and exporters. Government’s job is to create an international regulatory environment that will minimize commercial risks.

Government can expand the scientific and regulatory knowledge at our embassies and high commissions. It is important to have scientific expertise in-country to quickly respond to phytosanitary and regulatory issues. The most recent budget allocated additional funds to the Trade Commissioner Service and that is a good first step.

Government also must develop a comprehensive approach to mitigate potential non-tariff trade barriers before they arise. Canada does not have a systematic approach to building the science-based regulatory capacity of our trading partners. This needs to change, especially because our marketing efforts continue to diversify exports into countries with less-developed regulatory systems, such as Nigeria and Bangladesh.

Farmers must challenge candidates and their parties in the coming election to outline their plans to protect agriculture investment and jobs.

Here are three questions that every candidate should face:

  • What is your party’s comprehensive plan to deal with non-tariff trade barriers facing agriculture?
  • Will your party use our existing trade agreements to challenge non-tariff trade barriers?
  • Will your party commit new resources to proactively mitigate non-tariff trade barriers before they arise?

Cam Dahl is president of Cereals Canada.

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