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Farm-Scape, Episode 2207

Canadian agricultural industry officials are expressing their disappointment with the suspension of talks aimed at establishing a new world trade agreement and urging Ottawa to do all it can to encourage a resumption of the negotiations.

Negotiations on Hold

On Monday, following the weekend collapse of talks in Geneva, Switzerland involving ministers from Australia, Brazil, the European Union, India, Japan and the United States, World Trade Organization (WTO) director general Pascal Lamy called for “a time out“ to allow members time to reflect, review the situation, examine available options and review positions.

The decision brings the WTO Doha development round of negotiations, which are attempting to hammer out a new trade agreement for agricultural and manufactured goods, to a standstill. In a statement issued on the WTO web site (http://www.wto.org) Lamy said, “In practical terms, this means that all work in all negotiating groups should now be suspended, and the same applies to the deadlines that various groups were facing.“

The director general has not indicated when the negotiations will resume but suggests movement towards a conclusion can only result from internal work within countries. “Now we have to think first at home,“ he told journalists.

Federal Officials Voice Disappointment

David Emerson ,Canada’s Minister of International Trade, and Chick Strahl, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board, both expressed their disappointment.

In a news release posted on the Department of Foreign Affairs and International Trade web site (http://www.dfait-maeci.gc.ca) Emerson stated, “Despite enormous efforts by all WTO members and 11th-hour meetings between G6 participants, the gaps in negotiating positions proved to be too large to bridge within the current time frame.“

“This is very disappointing for Canada and for all developed and developing countries, given the significant economic benefits that could have been achieved through an ambitious outcome to these negotiations,“ he said.

At the same time, he indicates Canada remains deeply committed to the WTO stressing, “Canadian agricultural producers and processors, as well as other manufacturers and service providers, would benefit from the expanded market access that the Doha Round was aiming to achieve.“

Strahl agrees, “Although this is a serious setback, Canada remains committed to pursuing opportunities and seeking a fairer international trade environment for our agricultural producers and processors.“

He says Canada will consult with provinces, territories and stakeholders to determine how best to pursue its trade objectives. “We will continue to advance the interests of Canada's agriculture sector, including both supply-managed and export-oriented industries.“

He adds Canada will also continue to pursue regional and bilateral trade initiatives that serve its future commercial interests.

Stakeholders Hopeful Talks Will Resume

While stake holders within Canada’s agricultural industries have also expressed disappointment with the latest development, they remain hopeful that reason will prevail and that the negotiations will get back on track.

“It’s disappointing they haven’t made more progress,“ says Canadian Federation (CFA) of Agriculture President Bob Friesen. “We’ve always said that we’d like the WTO to be the forum where we develop fair and equitable trade rules. Certainly two areas where Canadian agriculture needed progress is we needed more and more profitable market access. We also needed, at the very least, the US to significantly reduce it's domestic support and so it's too bad there isn't more progress there.“

At the same time, Friesen is hopeful. “Clearly we are going to continue to work with other countries. I believe our government and our negotiators will as well and, hopefully, we can get the WTO and the Doha round to a place where there will be more progress.“

WTO Agreement Considered Fundamental to Expanded Global Trade

Canadian Pork Council (CPC) President Clare Schlegel agrees, “The multilateral trading platform is key to the pork industry having access to markets around the world. It’s key to having our ag policies in North America more similar and to reduce distortions and make a fair and level playing field around the world as the world continues to evolve and unfold and move towards globalization.“

He suggests, “Once in awhile these types of negotiations at the WTO need some breathing space so that their importance can be, again, understood. We would fully expect that that realization sets in and that common sense prevails and we get back to the table as soon as possible.“

“This negatively affects the opportunities for the swine industry in Canada,“ Schlegel explains, “so we would urge the Canadian government to play an influential role at the world level in what ever way they can position themselves to try to encourage the kick starting of these negotiations. Do what’s necessary at home and in negotiation with the significant players, the G-8, and try to work to encourage these conversations to again start.“

“The Canadian canola industry as a whole is disappointed to hear that trade ministers weren’t able to come to any sort of compromise on the key sticking points,“ says Canola Council of Canada vice-president of corporate affairs Tyler Bjornson.

“This is a serious disappointment for our industry. We have a lot at stake in international trade and this isn't good news for us,“ he says.

Suspension Considered a Wake Up Call

Bjornson suggests, “The suspension of the negotiations really serves as a serious wake up call for all of those countries that have a significant amount of influence over the negotiations, particularly the big players like the European Union, the United States, Japan, Brazil and Canada.“

He adds, “I think what has happened here is the suspension is probably looking at the heart of the problem that we’ve seen in the negotiations to date which is virtually no tough political decision making to get over the hurdles that trade ministers face in coming to an agreement.“

He believes, “Canada can play a very positive role in the back room discussions that are obviously going to have to happen between now and September when the WTO normally comes back on track from its summer holidays so Canada can play the traditional role of trying to find the tough compromises that have to be made.“

He adds, “We would encourage the Canadian government to be fully engaged with the United States and the European Union in particular to see where we might be able to find some of those compromises.“

Bilateral Trade Issue Heightens in Importance

Meanwhile, with the suspension of the multilateral discussions, the importance of bilateral trade negotiations clearly increases. “It certainly heightens it,“ says Friesen. “We needed to do them anyway but my guess is that other countries are going to start focusing much more on bilaterals as well now and so then it becomes ever more important that Canada doesn’t stay behind and that we also do some negotiating at the bilateral level and make sure that we get some good agreements so that Canadian agriculture can benefit from them.“

He recalls, “The Canadian Federation of agriculture together with some other organizations had sent a letter to Minister Emerson urging him to spend more time and resources on bilateral negotiations.“

He stresses, however, this should not be at the expense of the WTO. “The WTO is, we consider, to be the primary forum to develop fair and equitable rules but, what we were seeing is, especially the U.S. doing a lot of bilateral negotiations where we were losing preferential market access. We can’t afford for that to happen and where we may have opportunities to gain preferential market access, we thought it was very important that we also focus on bilateral negotiations.“

“Unfortunately,“ he notes, “bilaterals are not the place where we’re going to be successful in getting the U.S. to reduce their domestic supports so that part is missing but clearly we need to make sure that we don’t lose preferential market access. We would just urge the minister to, of course, focus on bilaterals…again not at the expense of the WTO but just as a compliment to the WTO.“

Canada Falls Behind on Bilateral Front

Schlegel agrees, “Our concern is of course that some countries are putting a lot of emphasis on bilaterals. We've encouraged the Canadian government to try to catch up because we’re losing some of our preferential access in a number of markets around the world. It certainly heightens the concern, [and] heightens the importance of the bilateral emphasis at the Canadian level but again we commit ourselves and would encourage the Canadian government to make its absolute first priority the multilateral trading platform.“

He notes, “It [the WTO] talks about trade rules, trade reform that's consistent across all countries. Bilaterals really are agreements between two countries and bilaterals talk about preferential access and preferential treatment of those countries.“

He adds, “A number of groups have already written the minister highlighting what the United States and Chile and Mexico are doing on the bilateral front and how we’re losing some of our access or others are getting preferential access when we are not and, in this type of environment, where the multilateral trading platform is not moving forward, the only alternative for Canada is to increase its emphasis on bilateral arrangements.“

Bjornson echoes the notion, “The canola industry has always seen the bilateral negotiations as complimentary to the WTO. In particular we would look to the key markets like China, Japan and India as being prime targets to negotiate bilateral agreements with.“

However, he stresses, “That being said, we can’t replace the WTO. It’s a cornerstone for trade policy for the canola industry because that's where you get at the difficult questions of international subsidies and that's how you can resolve some of the broader systemic problems the canola industry faces.“

Bjornson notes, “We [canola growers] certainly remain hopeful the players will come back to the table and negotiate a deal that’s good for the world. I can’t see how all of the countries would back away from the WTO because, clearly, this is a lot more than just agriculture at stake.“

Farmers Urged to Recognize the Importance of a World Trade Deal

Schlegel adds, “Often on the farm we don’t realize the impact of government policy and government negotiations between governments around the world. Canadian farmers, particularly pork and beef farmers have benefited significantly from the last round of world talks, the Uruguay round, and we were looking forward to increased opportunities. Those opportunities are currently put on hold. We believe it affects not only farmers but it also affects further processors, our industry partners, [it] also affects every Canadian in a negative way.“

Bjornson maintains, “We have excellent negotiators and our industry has complete faith in their ability to come up with innovative solutions but, if we don’t have our government supporting the negotiators to go in and do that then obviously they can’t play that role and that's not a positive result for canola.“

Schlegel concludes, “The world is changing. The world is becoming a much smaller place and that reality needs to be reflected in our arrangements in the market place. As farms have gotten bigger, as multinationals have gotten bigger, as processors have gotten bigger it's absolutely critical that the market place also becomes bigger.“

He believes, “For the market place to become bigger that means that there needs to be trade arrangements that make the playing field as level as possible around the world.“

Staff Farmscape.Ca