Recent news that the European Union (EU) and Canada free-trade negotiations are at the final hour, but have stalled on agriculture-related issues, should come as no surprise. Both sides maintained rigid agricultural trade positions well before the discussions started four years ago.
During that time, it was bemusing to see Canadian agricultural lobby groups jockeying for the attention of our negotiators in an effort to influence their intentions on the fate of particular commodities. We might soon know that outcome, as the chief EU trade negotiator will be in Ottawa in early March to ostensibly conclude the negotiations. If that happens, I fear that certain sectors of Canadian agriculture will get the short end of the stick.
The reason for my apprehension is that when it comes to ag-trade issues, it seems to be all going according to the EU script. The most blatant being the beef trade situation.
The EU won the early rounds and shows no signs of wavering, and that’s mostly due to Canada and the U.S. giving up so easily. I cite the capitulation of both countries on the beef- hormone issue in giving up hard fought for retaliatory tariffs for what turned out to be bogus quota access to the EU beef market.
Another reality is that the EU has no intention of giving Canada a single pound of beef import advantage over the U.S. and certainly not over traditional suppliers like Argentina.
I believe it gets worse for beef exports to the EU as a new development is going to affect access. New EU members have brought into the fold thousands of small-scale farmers in eastern Europe. Internal EU ag free trade was going to impact those operators particularly those in marginal areas.
The question arose how could those folks be kept on the land — one of the brainstorms was to get them to raise the beef cattle that western Europeans could no longer afford to produce.
How does one help that initiative — first you stop the potential flood of beef imports from North America that might result from reducing tariffs and eliminating quotas in a free trade agreement. That type of EU internal political/social reality might trump any real changes to EU beef-import policy.
I suspect that our negotiators have probably offered the EU significant access for tariff and quota free EU cheese imports in exchange for more Canadian beef access. But that might not be enough of a reward, considering some other factors surrounding EU beef imports — a possible EU/USA free-trade agreement being the snake in the room.
I expect a EU/Canada free-trade agreement will be announced soon, but it will probably not include unfettered access to EU markets for Canadian beef. If the EU does relent, it has a nasty habit of subsequently tying up any concessions with red tape, health barriers and regulatory traps.
The fear, I am sure, is that Canada will agree to any crumbs on the beef issue just to get a free-trade agreement in place before the EU begins negotiating with the Americans.
Another trade irritant that seems to get a lot less public attention is the EU position on genetically modified (GM) commodities like canola, corn, soybeans and others. The EU continues to maintain trade barriers, despite all scientific evidence.
Is that because our negotiators gave up on that issue early in the process? I would suggest that unfettered access to Canadian GM commodities and food products would be more of an economic benefit than more beef access.
From news reports, I sense some urgency has developed in concluding the EU/Canada free-trade agreement sooner rather than later. When that attitude develops in negotiating circles, compromise tends to be the order of the day.
That generally works out OK if both sides are somewhat equal. But in this case, the EU is the big dog and they want to start dealing soon with that really big dog — the USA.
I suspect in that rush, Canada and our agriculture industry might not fare as well as we might have planned. I do hope I am wrong.
Will Verboven is the editor of Alberta Farmer.