Tuesday, June 3, 2014

Canada’s trade pact with Europe not a done deal

Canada and Europe remain with only agreement in principle on free trade and the actual finalized deal remains elusive.

There are also reports that the Europeans are busy with negotiations with the United States, so finalizing a deal with Canada has become secondary.

Cheese and beef trade are sticking points. According to a report in the Globe and Mail, it’s the administration of import quotas that remain at issue.

Canada has issued import permits to those who were importing before the Uruguay Round of world trade negotiations changed protection from quotas to tariffs.

Those who hold permits are able to import at much lower tariff rates.

The permit holders can buy at low world prices and sell in Canada at high Canadian-market prices, so the permits are valuable.

Whether the increase in low-tariff imports ought to go pro rata to existing quota holders or to somebody else is a big question for Canadians.

Dairy farmers would like to hold the import permits, but that’s almost certain to be opposed by the Europeans.

Other issues yet to be resolved include municipal and provincial government purchasing policies and the length of patents on drugs and medications.


Prime Minister Stephen Harper will be talking to European leaders while he is visiting for D-Day 70th-anniversary celebrations and attending the G7 summit in Brussels.