April 30, 2012

 

Unless Canada's heavily protected dairy sector, particularly in Ontario and Quebec, is exposed to greater foreign competition, Canadian beef producers won't get long-sought access to the huge European market of a half-billion consumers, the EU's ambassador to Canada said Thursday (Apr 26).

 

Ambassador Matthias Brinkmann said he is optimistic the barrier will be overcome and a Canada-EU trade deal will be negotiated this year.

 

The cautioning from the senior European diplomat comes on the eve of a major public relations campaign Friday (Apr 27) by the federal government to promote the proposed deal, with Tory MPs fanning out across the country to give speeches in favour of trade and investment liberalisation with Europe.

 

Not so fast, cautioned Brinkmann in a presentation to Canadian journalists.

 

"For the Prairies the beef issue is a big one, and there will be no beef without dairy, it's almost a foregone conclusion," he told journalists.

 

He confirmed that formal offers haven't even been exchanged on the sensitive agriculture issue even though negotiations have been underway since 2009, but added it's normal for negotiators to leave the toughest issues to the final round.

 

Brinkmann said the EU and its 27 member states aren't demanding that Canada end its supply-management system, which provides production quotas to dairy producers and shields them against competition with high tariff charges on imports.

 

But he said Brussels is pushing aggressively for an increase in the Canadian quota limit on imports, which is set at 20.4 million kilogrammes of cheese annually.

 

EU exporters typically get about two-thirds of that quota, and all foreign producers must pay a prohibitive 245% tariff on products above the quota, according to the EU.

 

Brinkmann said Canadian dairy producers shouldn't fear lost sales due to greater competition from world-class cheese producers in countries such as France and Italy.

 

"It can be a win-win situation because if you have more variety, consumers buy more," he said.

 

Mike Sturk, Postmedia News Files / A Canada-EU trade deal could be negotiated this year, the EU ambassador to Canada says, but beef and dairy quotas remain hurdles.