Groser confirmed for Atlanta TPP talks as dairy deal heats up

Wednesday 30th September 2015

Trade Minister Tim Groser will attend a meeting of trade ministers in Atlanta, Georgia, where negotiations are attempting to conclude the Trans-Pacific Partnership trade and investment pact.

Groser had been playing hard to get for the meeting, indicating a willingness to attend only if there was an improvement on the "wholly inadequate" offers of dairy market access from the heavily protected agricultural sectors in the US, Canada and Japan.

A spokesman for Groser told BusinessDesk the Minister would now travel from New York, where he has been attending climate change talks ahead of the global summit scheduled in Paris in December.

Groser said last week that New Zealand negotiators could "see a very good deal for New Zealand in everything except dairy and I don't know to characterise the deal there because it's not a deal we could accept."

Since then, there's been a flurry of reports in US and Canadian media suggesting that the US is pressuring Canada to accept more dairy products from the US as part of a deal that would begin to prise open the US dairy market for New Zealand and Australian dairy products.

The Toronto Globe & Mail news website reports that "dozens of tractors and several milk cows stopped traffic in front of Parliament Hill (in Ottawa) Tuesday as hundreds of dairy farmers from Ontario and Quebec brandished signs such as 'No to imports'.”

A press conference is expected on Thursday, US time, for a declaration of the outcomes from the latest talks, which negotiators hope may see a conclusion to five years of talks between the 12 TPP nations, which together account for around 40 percent of the global economy and would be creating a new era trade and investment framework that critics say places undue limits on national sovereignty.

Dairy market access is especially politically sensitive in Canada because the country faces a federal election on Oct. 19 and the country's dairy sector is highly protected, using a system of supply management intended to match local dairy production volumes with domestic demand.

However, it appears the Harper government's political calculus is that a dairy deal would hurt its electoral chances most in Quebec, where it is already comparatively unpopular, and that there would be political damage in being seen to walk away from a new Asia-Pacific deal and some kudos in being able to demonstrate trade opportunities for Canadian firms.

“This government remains absolutely committed to making sure we preserve our system of supply management through trade negotiations,” the Canadian Prime Minister, Stephen Harper was reported as telling a campaign meeting in Ontario. “Decisions to be made on whether we have such a system or not are decisions we want Canadians to take, not foreigners to take.”

However, he stopped short of ruling out increased competition from imports.

Canada faces tough negotiations in two of the three remaining areas of disagreement in the TPP negotiations, dairy and automobile manufacturing. The Globe & Mail speculated that Canada was "sure to grant TPP countries a bigger slice of the market than it gave the European Union in negotiations that ended in a deal last year, where Ottawa agreed to let another 18,500 tonnes of cheese enter Canada tariff-free each year.

Meanwhile, Groser also announced that New Zealand has formally accepted the World Trade Organisation Trade Facilitation Agreement (TFA).

"The implementation of the TFA will provide concrete benefits to New Zealand businesses over time, minimising costs associated with getting products across borders and into the marketplace," he said. "In particular, New Zealand’s agricultural exporters will benefit from a provision to provide for the release of perishable goods within the shortest possible time."

BusinessDesk.co.nz

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