At the same time, it is also seeking opinions on entering a possible bilateral deal with the former European Union country.
Canada’s trade with the U.K. is governed by the Canada-U.K. Trade Continuity Agreement (TCA), which came into force April 1.
That deal essentially carried over text that was included in Canada’s previous trade agreement with the U.K., the Comprehensive Economic and Trade Agreement (CETA) involving European Union members.
The need for a transitional agreement arose when the U.K. left the EU in 2020. Following a one-year transition, the text of CETA stopped applying to the U.K. in 2021.
Opposition MPs and industry associations have raised concern over Canada’s signing of the TCA, arguing the process was rushed, done without proper consultation and failed to address the failings of CETA (most of which are related to non-tariff barriers applied to Canada’s agricultural exports).
Preferential tariffs remain in place for grain and cereal exporters under the transitional deal, which is a positive for those commodities, but beef producers are concerned over the existence of non-tariff barriers.
During a federal committee meeting on the subject in 2020, Canadian Agri-Food Trade Alliance executive director Claire Citeau said, “There remains a real fear that a transitional agreement will simply reinforce a situation that remains unacceptable under CETA due to the persistence of trade obstacles that continue to hinder Canadian agri-food export.”
She joined others in urging the federal government to enter into a more “meaningful agreement” capable of removing those trade barriers with the U.K.
The Canadian Cattleman’s Association say there are some gains into how Canada’s U.K. quota is administered, but pointed to a growing beef trade deficit.
“We recognize the importance of avoiding trade interruptions and the need for a transitional agreement. However, we are strongly advocating for a swift return to the negotiating table to establish an ambitious free trade agreement that addresses the current trade-limiting factors found within CETA,” CCA president Bob Lowe said in a March 24 statement.
Federal officials have confirmed the two nations are committed to negotiating a comprehensive trade agreement by April 2024, within three years of the transitional deal coming into force.
Those negotiations may be complicated by other trade deal implications.
On Feb. 1, the U.K. formally signalled its intent to join the CPTPP, which involves Canada and 10 Asia-Pacific nations.
“Discussions towards a bilateral free trade agreement with the United Kingdom and its possible accession to the CPTPP would thus present an opportunity for Canada to further enhance its relationship with one of its largest trading partners as it continues discussions towards a bilateral free trade agreement with that same partner, the United Kingdom,” according to Global Affairs Canada.
A U.K. House of Lords committee continues to hear testimony about its possible entry into the CPTPP.
The National Farmers’ Union of the U.K., with a membership of 55,000, said in a submission that there could benefit from having more export markets, but raised several concerns.
Food safety for consumers, especially among the Southeast Asian nations, is a concern. The group also raised concern over entering the trade pact while negotiating bilateral deals.
“We have not yet seen any impact assessment or economic modelling from government, which attempts to quantify what the additional benefit to agriculture would be from joining CPTPP over and above the concessions already negotiated bilaterally,” says the submission.
NFU-U.K. is also raising concerns over the lack of animal welfare provisions and casts doubt on the ambition of the CPTPP’s already-bold climate goals.
Members are also concerned about the impact of having agricultural superpowers like Canada, included in a multilateral deal.
“Some of these countries are very competitive, major agriculture-exporting countries, so there is a concern that the cumulative impact could result in increased market access being given away by the U.K. government for our sensitive agricultural products.”
The group remained positive about the prospect of increasing exports in produce and beef.
Canada’s two consultations were announced in the March 13 edition of the Canada Gazette. Global Affairs Canada is accepting responses until April 27.