WTO text made worse: Canada’s SM5

Canada’s supply-managed commodity groups say a new draft modalities text aimed at a global trade deal on agriculture is worse for their sectors than earlier versions.

A group representing Canadian ag exporters, however, has praised the text as closing several gaps and building on consensus reached in world trade talks in recent months.

Crawford Falconer, chairman of the World Trade Organization’s (WTO) agriculture negotiations, issued the new text Monday and said Tuesday that an ag trade deal is now within sight. A draft modalities text is meant to outline the points on which negotiators agree and clear the path for a ministers’ meeting on an outline deal.

“Supply management depends on three
equally important pillars—import controls, producer pricing and production
planning,” said Laurent Souligny, chairman of the Canadian Egg Marketing Agency, in a release Wednesday by Canada’s supply-managed commodity groups.

“If Mr. Falconer’s proposals were accepted, the import controls
pillar would be wiped out, devastating the sectors that rely on supply
management.”

The groups said federal Agriculture Minister Gerry Ritz also saw little progress on proposals that would protect Canada’s needs on supply management. “These needs include no reductions in over-quota tariffs on dairy, poultry
and egg imports and no increase in the minimum market access for these
products,” said Mark Davies, chairman of the Canadian Turkey Marketing Agency.

Furthermore, Davies said, “other countries’ needs are clearly being
accommodated in this text. Specific language was added to address the
needs of the European Union, the United States, Norway and Japan for
example.”

The groups said the text issued in Geneva is worse for the Canadian
supply-managed farmers than earlier versions of the document.

Provisions pertaining to the use of a “special safeguard” are contrary to the
efforts being made by the Canadian government to give effect to current
safeguard provisions, they said.

Gyslain Loyer, chairman of Canadian Hatching Egg Producers, said the draft text’s proposals would also reduce countries’ ability to establish their own food policies.

“The proposals, if adopted, would destroy our farms by allowing Canada to
be flooded with imported food,” Souligny said.

Although Ritz panned the draft text for “so little progress in the area of sensitive products,” he noted it also “continues to move toward an aggressive tariff reduction formula; substantial cuts to and strengthened disciplines on trade-distorting domestic support; and the elimination of all forms of export subsidies.”

The Canadian Agri-Food Trade Alliance, a group representing processors, exporters and a number of commodity groups, sees the new text as maintaining the potential gain Canadian farmers could realize from the previous draft text.

CAFTA president Darcy Davis said that gain could be worth up to $3 billion per year for Canadian farmers in the sales of seven key commodities.

Furthermore, Davis said, “for livestock producers, the timing of this text is very
welcome — the benefits that will flow through this agreement provide long-term
prospects and stability that our beef and pork producers so badly need.”

The draft text released Monday marks the latest stage in the Doha round of WTO talks, which have been mired in haggling invoving wealthy nations and developing countries since 2001.

“Every day we wait for an agreement represents almost $10 million in lost
opportunity for Canadian exporters,” CAFTA’s Davis said in a release Wednesday. “Export-dependent farmers
produce nearly 80 per cent of Canada’s farm gate receipts — so a deal that is good for
exporters is good for Canada.”

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