Details earlier this week of a potential deal at world trade negotiations in Geneva were not good news for supporters of supply management or the Canadian Wheat Board.
If trade and agriculture ministers reach a deal later this week at World Trade Organization headquarters, it likely will force supply management sectors to accept over-quota tariff cuts of up to 24 percent during the implementation years and a more than doubling of guaranteed market access for imports.
As well, an influential group of seven countries that have been trying to find a compromise deal recommended on the weekend that state trading enterprises such as the Canadian Wheat Board lose their export monopoly by 2013.
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However, at the Western Producer’s press time July 28 and the end of Day 8 of negotiations, a deal this week was far from certain.
Developing countries continued to complain that their interests were not properly reflected in the proposed text. Other countries, including Canada, could find the concession demanded too difficult to swallow for domestic politics.
Under WTO rules of consensus, any one of 153 WTO members can veto a deal.
“It’s very optimistic here, and I think there is real momentum,” said Jeff Nielsen, president of the Western Canadian Barley Growers’ Association and vice-president of the Canadian Agri-Food Trade Alliance, in an interview from Geneva July 28.
“But there is lots of posturing, and it could unravel and that would be a shame.”
Dairy Farmers of Canada president Jacques Laforge said from Geneva that supporters of supply management were increasingly nervous.
Over the week, the message from international trade minister Michael Fortier and agriculture minister Gerry Ritz had switched from a July 21 vow that any deal undermining supply management would be unacceptable, to a July 27 promise that supply management was being defended but any deal would be assessed on its overall merit.
“The language definitely has changed over the week,” Laforge said.
“With the proposals floating around and the ministers’ comments, it makes us tremendously nervous.”
He said the two ministers, both WTO rookies and relative newcomers to their cabinet jobs, appeared to have arrived in Geneva expecting the talks to break down quickly.
Instead, they stretched into a second week and pressures for compromise were growing.
“Because I think they were expecting failure, I don’t think they arrived here as strategically prepared as they might have been,” Laforge said.
He said unless Canada could “carve out an exemption,” proposals on the table July 28 as the potential basis for a deal would reduce supply management tariffs from an average 275 percent to about 210 percent.
“Already with the strong dollars, eggs come in over the tariffs so this kind of a cut, along with a big increase in the TRQ (tariff rate quota) access would mean our sectors would take a tremendous hit.”
Nielsen said the deal on the table could create $3 billion in sales opportunities for export sectors.
“We are close to a deal here, and we can’t let it slip away,” he said.
“The ministers have told us they will not walk away from a deal and we appreciate that.”
At the what board, news of the state trading enterprise proposal was greeted with concern.
Communications manager Maureen Fitzhenry said Canada already has made a major concession by agreeing to end financial guarantees on sales by 2013.
“To add to that ending the monopoly would be disproportionate to anything wheat and barley producers might gain.”
Fitzhenry said the board has had no indication the federal Conservative government has changed its position that it opposes the monopoly, but it is an issue that should be decided in Canada and not Geneva.
“We agree with that,” she said.
