Prime minister Justin Trudeau’s plan to improve relations with the United States just got bit more complicated.
The World Trade Organization ruled Dec. 7 that Canada can impose more than $1 billion in retaliatory tariffs against the U.S., its largest trading partner, for damages caused by country-of-origin labelling.
Those tariffs, the Canadian Cattlemen’s Association’s John Masswohl said Dec. 7, could be in place as soon as Dec. 21.
It means the new Canadian government has two weeks to convince its southern neighbour to repeal a policy that’s been at the heart of a protracted trade dispute for nearly eight years.
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International trade minister Chrystia Freeland was choosing her words carefully in the lead up to the WTO decision, refusing to say whether the government was even preparing a retaliatory tariff package.
Agriculture minister Lawrence MacAulay has insisted that the Americans “follow the rules,” but he, too, has opted for softer language, saying in an interview with iPolitics in November that Canada would retaliate “if all else fails.”
“It’s not what we want to do, but if we were forced to do it, it’s something that we would likely have to do,” MacAulay said.
It’s a far cry from the Gerry Ritz and Ed Fast days under the Conservatives, when the agriculture and trade ministers pushed hard for the full repeal of COOL.
Ritz once referred to the Americans as “school yard bullies,” saying in an interview with Reuters “it’s hard to have respect for the stance the Americans are taking on TPP when you look in the rearview mirror and you’ve got (country of origin labelling) staring at you.”
The NDP would later accuse Ritz of starting his own personal trade war.
A trade war with the U.S. is probably the last thing Trudeau wants these days.
With the prime minister already committed to ending Canada’s air strike mission against ISIS and a softwood lumber trade agreement that needs to be renegotiated, Trudeau is already treading carefully when it comes to his relationship with the U.S. administration.
Having to impose retaliatory tariffs at the same time likely won’t make things easier.
In a joint statement Dec. 7, MacAulay and Freeland called on the U.S. Senate to follow the House of Representatives’ lead and repeal COOL.
“If the U.S. Senate does not take immediate action to repeal COOL for beef and pork, Canada will quickly take steps to retaliate,” the statement reads.
“Canada continues to work with our partners in the United States, and in the U.S. Senate, to urge the full repeal of the discriminatory COOL policy for beef and pork.”
Neither minister specified a timeline for Canada’s retaliation.
It’s the strongest language the two ministers have presented thus far. Whether it will be enough to convince the Americans remains to be seen, but at least one Conservative MP isn’t holding his breath.
Asked whether he thought the U.S. Senate would repeal COOL before Canada took steps to retaliate, Conservative MP and former cattle rancher James Bezan said Canada will have to take the lead.
“It’s just all been a shell game down in the U.S. administration, and that has not helped their cattle industry or the hog industry in any ways, means or form,” Bezan said.
“We have to step up and bring forward the tariffs and countervail those products in the United States so that they finally wake up and smell the coffee.”
