Free Trade Deal
By Jordan MacPhee (guest opinion)
In October of last year, the Harper Government announced an “agreement in principle” with the European Union on the Comprehensive Economic and Trade Agreement (CETA). Since then, several Island groups have expressed concern about the agreement, pointing to the secretive way in which it has been negotiated, the lack of information being shared about the details of the agreement, and the absence of public dialogue about it. Without opportunities for informed discussion about the implications of the agreement, there is some concern in the community about the impact that it would have on agriculture and on the people who grow our food.
It came as a surprise to many dairy producers to hear that under the CETA, the Government of Canada will allow the EU to export an extra 17,600 tonnes of fine cheese to Canada, even when European negotiators had only asked for 12,000 tonnes. This will push the new total cheese import market share to nine per cent, while Canada has access to only one per cent of the EU cheese market. The organization Dairy Farmers of Canada estimates that Canada’s losses due to the CETA will be $150 million per year. P.E.I.’s share of this would be roughly $2.5 million per year; a substantial loss under any circumstances.
European-style cheeses comprise a large part of production at ADL (Amalgamated Dairies Limited) in Summerside, so this kind of competition from foreign cheeses is sure to have an impact, not just on the processor, but any dairy producer who supplies to ADL. The company processes close to 100 million litres of milk each year, and employs more than 250 people. The federal government has already given ADL $600,000 to upgrade its technology to help the company become more efficient, and better able to stand up to European competition.
According to Gail Shea, “Farmers are concerned . . . The federal government has said any losses would be compensated.” It is hard to see the benefits of this kind of pay-out when the bottom line is: farmers lose income, processors risk being edged out of the market, and taxpayers see their own money being used as compensation.
The fact Canada gave up so much of its fine cheese market share — more than it was asked to, in fact — is seen by some as a trade-off of sorts, perhaps for the lowered tariffs on beef and pork. But on closer examination, how much do we actually gain from lowering the tariffs?
In the case of beef, it is doubtful Canadian producers would be able to meet European demands, given their environmental standards prohibiting the use of hormones. And yet increased access to the European market for beef is being touted as one of the major benefits to Canadian farmers. Under CETA, Canadian farmers who use GMO crops would also not have access to markets in the EU.
It is important to note that a) CETA is not so much about eliminating trade barriers — because there just aren’t that many trade barriers between Europe and Canada, and b) with regards to agriculture the playing field is not level — in that the European Union subsidizes its farmers, to the tune of $50 billion per year, which far exceeds any support Canadian farmers receive through federal risk management programs.
Around the world, dairy production and processing are almost exclusively a domestic industry. The markets have evolved in this way historically due to the freshness cycle of milk. In Canada, we have developed the supply management system in order to match production to demand in the Canadian market. Through a co-operative relationship between government, producers, and processors, we are able to supply a consistent, stable supply of quality milk to processors across the country to be processed into Canadian dairy products.
This system limits expensive overproduction and ensures fair prices for farmers and secures good processing jobs nation-wide.
However, it depends on matching production to supply and the more the market is opened up to foreign imports the more this smart and sustainable system is threatened.
Although the supply management system itself is not, as far as we know, on the table in the CETA, many supporters of the system are concerned that its erosion by the CETA will make it that much easier for Canadian negotiators of the next big trade agreement — the Trans Pacific Partnership (TPP) — to give up this important system that supports not only our dairy industry, but eggs and poultry as well.
Our provincial government has the responsibility to stand up for Island primary producers in trade negotiations led by the federal government. It is crucial for the Island’s elected representatives in both the provincial and federal legislatures to educate themselves about the CETA in order to gain a better understanding of what is at stake, and protect what is important to the constituents who voted them into office.
Agriculture is a major part of Prince Edward Island’s economy and we should not take it for granted. We must do everything that we can to preserve what we have. If you are concerned about the future of Island communities, our economy, and our environment, you can learn more by looking up the CETA online, and take action by writing to your MLA, your MP, your local newspaper, and by asking your friends and family to do the same.
Jordan MacPhee is a member of the Environmental Coalition of Prince Edward Island (ECOPEI) and a student at UPEI.