Canada has stepped away from its Cairns Group trade allies over the issue of whether tariffs that protect supply management marketing boards should be subject to sharp reductions after the next world trade agreement.
At Geneva, Switzerland, last week, the Cairns Group of medium-sized free trade-supporting countries tabled a proposal at the World Trade Organization that “all” trade impeding tariffs be drastically lowered.
Canada issued a statement declaring its general support for the Cairns campaign to end world trade-distorting subsidies and barriers.
But it could not support a blanket support for tariff reductions.
Read Also
Agriculture ministers agree to AgriStability changes
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
“Through three years of consultation with our export industries and supply managed sectors, we have arrived at a balanced position acceptable to both,” Agriculture Canada trade specialist Rory McAlpine said in a Nov. 16 interview from Ottawa. “We have no intention of jeopardizing that.”
He said Canada continues to be a supportive member of the Cairns Group, formed 14 years ago in Cairns, Australia, to fight at world trade talks for an end to trade-distorting subsidies by the major players. The European Union has been the main target, with the United States a distant second.
Over the years, free trade zealots from Australia, New Zealand and Argentina have chafed at Canada’s insistence that dairy, poultry and egg farmers can be legitimately protected by “tariff-rate quotas” as long as a guaranteed level of imports are allowed.
In Canada’s case, some of the tariff rate quotas to protect dairy and poultry products exceed 200 percent.
The Cairns Group majority, in a negotiating paper tabled in Geneva at a special session of the WTO agriculture committee, argued that even high tariffs created when quantitative restrictions were switched to tariffs in 1995 should be subject to drastic reductions.
Canada could not agree.
McAlpine said Canada continues to support the proposal that tariff rate quotas be maintained to protect sensitive sectors while a five percent minimum access requirement be maintained to allow trade and imports.
“We treat in-quota tariffs differently and I believe at the WTO there is interest in our position,” he said.
He said a goal at trade talks should be to make sure that all countries allow the required minimum access and not create artificial rules that thwart the general goal.
The Liberal government decision to shy away from more radical Cairns proposals comes near the end of an election campaign during which supply management leaders say they are taking a look at Canadian Alliance promises that they support and would protect supply management.
The federal Liberals, proclaiming their own dedication to supply management, signaled that they would not support a WTO position that could jeopardize protective supply management tariffs.
McAlpine noted it is not the first time Canada and Cairns have disagreed.
During the last round of world trade talks in 1993, Canada insisted on promoting protection for sensitive areas even as it enthusiastically supported fewer trade barriers generally.
“We support Cairns in many of its positions but we do have our own domestic policies as well,” said the Agriculture Canada official.
