Trade opportunity with U.K. not one to be squandered

Canada is in the rare situation of likely having better access to our former mother country than key competitors.  At least for a while. 
| Screencap via YouTube/Government of Canada

Canada might be able to steal a march into the United Kingdom’s sizable, wealthy and quality-conscious market.

With the United States under a Joe Biden administration possibly ignoring the opportunity that Brexit opens to his country’s farmers and food companies, and the European Union running the chance of losing some access, Canada is in the rare situation of likely having better access to our former mother country than key competitors.

At least for a while.

That hasn’t been true since the early 1970s, when the U.K. went behind the EU’s wall of tariffs and regulatory bulwarks.

It’s not an opportunity to be squandered. It was heartening to see Canada and the U.K. announce an interim deal on Nov. 21, one that rolls over most of the existing Canada-EU trade deal provisions.

That will keep open Canada’s present access to the U.K., which is a good thing because it is Canada’s most important market in Europe.

And while EU nations provide most of the U.K.’s agriculture and food imports today, that might begin to shift come Jan. 1, when Brexit finally concludes. The EU has a tradition of making last-minute deals within itself and with foreign countries, so perhaps a trade deal will continue to see Danish pork, German and French wheat, and Italian pastas favoured in British supermarkets come 2021.

But maybe there will be major glitches, regulatory nightmares, U.K.-EU intransigence and perhaps no deal at all.

As Canada knows from dealing with the EU, it can be a tricky market to get into. Canada tends to put up with the plethora of non-tariff barriers the bloc maintains, despite the CETA trade deal, but the U.K. might not be so amiable if it is still trying to negotiate access next calendar year.

There’s an opportunity for Canada to further fulfill the U.K.’s massive hunger for imported food. (HSBC says the country imports about 80 percent of the food commodities it consumes.)

After all, Canada produces the same sort of high quality meats and crops that EU nations supply. If those continental supplies become less accessible and more costly, supplies from across the pond become much more competitive.

And Canada’s are likely to be more attractive than those of the U.S., which has an incoming president who doesn’t seem keen on making nice with the U.K.

Democrats like Joe Biden don’t tend to prefer the U.K. as America’s partner in Europe, but favour Germany and the EU as a collective body. Plus, Biden has already glowered at the U.K. over its Conservative government’s attempts to keep Northern Ireland economically integrated with the rest of the U.K. while keeping the border with the Irish republic open, something the EU is threatening to prevent.

If the U.S. doesn’t bother to ink a trade deal with the U.K., so much the better for Canada’s competitive position.

Much could change in the next month, but Canada’s access to the U.K. could greatly improve in 2021.

But that isn’t taking advantage of the full opportunity if Canada just makes permanent a CETA-like deal. There is the potential for getting something much closer to NAFTA with the U.K., which traditionally favours free trade over managed trade.

The EU has indulged in anti-GMO regulations for decades, blocked meat imports on dubious grounds and allowed local politics like Italy’s anti-Canadian durum situation to linger.

None of those sorts of behaviours will suit a U.K. that chooses a path toward free trade. Soon it might become much easier to export Canadian agriculture and food products to the U.K. than it is today.

Will it? That will all depend upon how much the desire to create a “global Britain” is more than just Conservative talk. The Boris Johnson government isn’t very popular and might not last long if it screws up the conclusion of Brexit.

A future Labour government might not be so keen on free trade, and it might indulge in the same sort of regulatory complications typical of Europe.

Certainly, on the British left, there is a lot of anti-GMO feeling, for example.

So, the EU could make a last-minute deal with the U.K. and preserve its position in the market. The U.S. could make a quick deal too and achieve similar access to Canada’s.

And the U.K. might make itself just as frustrating to deal with as the E.U. presently is.

But for a moment let’s be hopeful. This could all work out well for Canadian farmers, and in this time of anxiety and woe, let’s be happy that Canada continues to have a chance to improve its position in world food trade.

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