Canadian Cattlemen’s Association wants Ottawa to get behind CPTPP expansion because it is a particularly good agreement
Canada should support Taiwan in its bid to become part of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, says an Alberta think-tank.
A new briefing paper released by the University of Calgary’s School of Public Policy Publications said Canada has been forced to tread lightly in its dealings with Taiwan.
That is because China considers Taiwan to be a “rogue province that must eventually be reunified with the mainland,” stated report author Hugh Stephens.
There has been little appetite for bilateral trade negotiations with Taiwan because Canada fears a backlash from China.
“That attitude is finally changing,” said Stephens.
“One main reason is because China is already angry with Canada and vice-versa.”
With relations at an all-time low, Canada is free to consider negotiating a trade deal with Taiwan. It is timely that Taiwan has expressed interest in joining the CPTPP.
“By supporting Taiwan’s accession to the CPTPP, Canada can achieve a free trade agreement with Taiwan without having to negotiate one bilaterally,” he said.
Stephens said the risk of retaliation is lower in allowing Taiwan to join an already existing multilateral trade deal.
“Canada should move quickly and enthusiastically to support Taiwan’s accession,” he said.
Fawn Jackson, director of government and international relations with the Canadian Cattlemen’s Association, thinks Ottawa should support any expansion of the CPTPP because it is a particularly good free trade agreement.
“It’s very progressive. It’s very ambitious,” she said.
“I think it makes a lot of sense for Canada to be a champion of countries joining.”
The CCA would like to see the agreement expanded to include the United Kingdom, Thailand, Taiwan and South Korea.
Beef consumption in Taiwan is on the rise, averaging 6.8 kilograms per person per year in 2019, up from about five kg per person just five years ago, according to Meat and Livestock Australia.
The country’s per capita beef sales rank third in Asia, behind Japan and Hong Kong.
“They certainly love the product,” said Jackson.
Canadian beef faces import duties of about 43 cents per kg in that market. There is also a ban on shipping beef from animals older than 30 months, a restriction that does not apply to American or Australian beef exports.
Taiwan imported $22 million of Canadian beef in 2019 and $23 million in 2018.
Stephens said Taiwan would be able to meet the CPTPP’s admission standards because it is already a full member of the World Trade Organization.
The CPTPP suffered a big blow when the United States dropped out of the pact. And four of its original signatories have yet to ratify the agreement.
But the agreement has entered into force for seven countries — Canada, Australia, Japan, Mexico, New Zealand, Singapore and Vietnam.
The first priority is to ensure Brunei, Chile, Malaysia and Peru complete the ratification process.
Stephens said the next step is to expand the pact to include other countries such as the United Kingdom, Thailand, Indonesia, the Philippines, South Korea, Taiwan and possibly China.
Japan has been a strong supporter of Taiwan’s accession to the CPTPP. Canada has been non-committal, although it is not opposed to Taiwan’s inclusion, he said.
Taiwan is Canada’s fifth largest trading partner in Asia with $8 billion of total two-way trade in 2019. That compares to $98 billion of two-way trade with China.
That is the main reason Canada does not want to risk angering China by supporting Taiwan. China recently blocked Canadian pork and canola imports in response to Canada’s detention of Huawei executive Meng Wanzhou, said Stephens.
But he thinks supporting Taiwan’s accession to a multilateral trade agreement with 11 participating partners is different than pursuing a bilateral agreement with the country.
As the second-largest economy in the CPTPP, Canada could play an important role in getting the accession process started.
Stephens hopes CPTPP members will solicit firm expressions of interest from new potential member countries in 2021 and immediately establish an accession working group to launch negotiations with those countries.