The Canadian government is asking for international approval for trade retaliation against the European Union over its refusal to open its border to North American beef produced with use of growth hormones.
On May 13, the EU ignored a World Trade Organization-imposed deadline for opening the border. It said new health studies raise questions about the safety of hormone-treated beef.
Late on May 14, Canadian trade minister Sergio Marchi announced Canada would apply to the WTO for the right to retaliate. The United States is doing the same.
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federal government proposed several months ago to increase the compensation rate from 80 to 90 per cent and double the maximum payment from $3 million to $6 million
Once WTO sanction is received, Canada could impose 100 percent tariffs against a variety of agricultural products from Europe.
It says a European ban on hormone-produced beef is not based on science, does not meet WTO rules and is costing the Canadian beef industry a $70 million annual market.
“Our priority is to win access,” agriculture minister Lyle Vanclief told reporters May 14. But if that does not happen, “certainly we want compensation and the last time I heard about it, the compensation discussion was going, not going extremely well, but it was still going ahead.”
Hours later, he joined trade minister Marchi in announcing Canada was asking the WTO for the right to retaliate.
“Access to European markets is important to the growth of the Canadian agriculture and agri-food sector,” he said. “Our first preference is to resolve this dispute in a trade-enhancing manner. However, if we cannot find a mutually agreeable solution, we will not hesitate to exercise our WTO rights.”
Deadline ignored
The WTO in 1997 said the EU ban is not based on science. In 1998, it gave the EU until May 13, 1999 to open its border.
The EU did not and produced a new scientific challenge to the safety of hormone-produced beef, which Canada dismissed as rehashed “political” science.
If there is retaliation, the Canadian list contains only agricultural products, ranging from cucumbers and gherkins to gin, vodka, beef, pork and gingerbread. Missing from the list are such major European exports to Canada as cheese and wine.
The American list is more comprehensive. Besides food items it includes such industrial products as motorcycles.
It likely will be months before Canada’s retaliation strategy is clear.
Canada said it may ask the WTO for authority to impose up to $60 million in duties on EU products.
