When administrations change in the largest trade producing country in the world, and when they change so directly as under president-elect Donald J. Trump things on the books from the previous administration become suspect in some cases and expendable in others.
Trade deals are particularly suspect under the new president-elect Trump’s administration once he takes office on January 20, 2017. However, until then it really becomes only a guessing game because while some indicators are out there, what the final outcome will be only time will tell.
One trade agreement in existence for many years, NAFTA, may or may not be ripped up, or at least renegotiated at the request of the United States, and the other one that hasn’t seen much light of day in the new Trudeau administration in Canada, is Trans-Pacific Partnership (TPP).
Ron Davidson, the Director for International Trade, Government and Media Relations with Canadian Meat Council says if the TPP moves forward, it’s critical that Canada be part of it.
In October representatives of the Canadian Meat Council appeared before the House of Commons Committee on International Trade for a presentation on the Trans-Pacific Partnership and the committee is conducting hearings to obtain perspectives on what the various groups think about the potential of ratifying the TPP.
Davidson says, countries conclude this agreement, it will be a major multilateral agreement that sets new rules for the world trading environment. This is another one that president-elect Trump reiterated many times how unfair the present agreement is to the U.S. companies and the workers sending jobs elsewhere.
“As I believe you know, we already have free trade agreements with some of the TPP countries including the United States and Mexico but we do not have a free trade agreement with countries such as Japan and Malaysia and Vietnam,” said Davidson. “Particularly in the case of Japan, this agreement contains substantive improvements in access for pork products and beef products. If we could obtain those improved markets access conditions we should be able to increase our exports of pork and beef to Japan particularly but also to Vietnam and Malaysia.
Combining all the meats together we might be able to increase our exports by $500 million.”
He says it’s important not just to look at what Canada can gain but also what Canada loses if not part of this type of agreement.
“Japan is our most valuable overseas market for pork and beef combined and we have a billion dollars of exports on the line, about a fifth of our total exports,” Davidson said. “If we should lose our competitiveness in the Japanese market in particular it would have a devastating impact on feed grain farmers, on livestock producers and our Canadian meat processors.”
Davidson says it’s absolutely critical that, if there’s a TPP, that Canada be part of it.
On the other hand, Florian Possberg, the chair of the Saskatchewan Pork Development Board says in the event the TPP fails to make it to the finish line, the Government of Canada needs to refocus its efforts on the creation of new bilateral trade agreements.
Possberg says two thirds of the pork produced in Canada and 20 per cent of the pork produced in the U.S. go outside the country and Canada needs to trade globally to maintain levels of production and the TPP would allow pork to move to where people need it at a reasonable price so the prospects of rejection of the deal are concerning.
“It really is problematic for the U.S. pork producers because they’ve got a 20 per cent stake in moving product outside their borders. I would assume that the buyers still need our pork,” he said. “Whether that comes from Canada, the EU, Brazil, it’s going to come from somewhere. There was a lot of rhetoric during the election. At the end of the day, though, I think there might be adjustments to trade deals but I’m pretty sure that the U.S. is going to realize that they have to maintain significant levels of trade to maintain their economy.” Possberg says Canada needs to maintain its ability to export pork, particularly to Japan so, if the deal has a problem getting to the finish line, Canada needs to have an acceptable bilateral agreement with Japan so Canadian products continue to flow there. • — By Harry Siemens