Negotiations underway | Canada seeks greater access and lower import tariffs
A senior federal international trade official is in Tokyo this week to help arrange the launch of Canada-Japanese trade talks that agricultural export interests say are a significant opportunity.
Ian Burney, assistant deputy minister in the foreign affairs and international trade department, told MPs on the House of Commons international trade committee last week that he will fly to Japan to prepare for the first round of negotiations now that agreement has been reached to begin negotiations.
Chief negotiators will be named soon.
Pork and beef exporters told the House of Commons trade committee May 3 that the talks represent a major opportunity.
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“The Japanese market is extremely important for all pork industry stakeholders, with sales in 2011 of 220,000 tonnes roughly valued at almost $900 million,” Canada Pork International president Jacques Pomerleau told MPs.
It represented 28 percent of the value of Canadian pork exports last year and was Canada’s second largest market.
Japan is actually the largest export market for Alberta, Manitoba and British Columbia producers.
Pomerleau said a deal that reduced tariffs and non-tariff barriers would maintain the Japanese market as a key destination.
“Even if Canadian pork already enjoys an excellent reputation in Japan, we see this as an excellent opportunity to gain an additional competitive advantage over our major competitors, especially the United States, in the most sought-after market in the world,” he said.
For the Canadian beef industry, it is an opportunity to convince the Japanese to raise the bar on Canadian beef imports from cattle younger than 21 months to 30 months.
As well, there is a 38.5 percent tariff on the relatively small volume of Canadian beef allowed into the market, said John Masswohl, the Canadian Cattlemen’s Association’s director of government and international relations.
Canada supplied just four percent of Japan’s 700,000 tonnes of beef imports last year. The 12,287 tonnes of exports were worth just $66 million.
“We really see this as an opportunity,” said Masswohl. “If we get a preferential agreement with Japan, we could shift that balance somewhat.”
Burney told MPs that is the goal, but he offered no predictions on when negotiations will start or when they might finish.
He said negotiating better access for agriculture and food products will be a high priority for Canada. They face among the highest levels of Japanese protection, “so that would be very much what we will be going to the table to pursue.”
Burney also said Canada’s supply management protections are not an issue in these negotiations because Japan is a food-deficit country with no interest in trying to export dairy or poultry products to Canada.
He said Canada’s agricultural interests in a potential deal go far beyond the meat industry.
“It’s a huge market for us for canola as it is for wheat, both durum and non-durum,” he said.
“It’s a major market for soybeans, for barley, for malt, for beef and frozen french fries, maple products and ice wine.”
He said it is one of Canada’s largest overseas agricultural export markets with sales last year of close to $4 billion.
“This is an area where Japanese tariffs average more than 17 percent so it’s a long list and it’s an area where I think there could be very substantial benefits for Canadian companies,” Burney said.
However, powerful Japanese domestic lobby groups, including farmers, are concerned about increased imports, and Canadian officials say they do not under-estimate how sensitive it is for the Japanese.
They expect agriculture will be one of the last issues discussed.
That sensitivity was reflected last week when the Commons trade committee formally changed the name of its study from an investigation of a Canada-Japan Bilateral Trade Agreement to a study of “A Comprehensive High-Level Economic Partnership Agreement with Japan.”
The name was changed to accommodate Japanese preferences, although committee chair Rob Merrifield did not explain the significance of the difference.
