Canada will be constructive in the round of NAFTA talks that begin today in Montreal but it will “be firm” in support of its supply management system for dairy, poultry and eggs, said International Trade Minister Francois-Philippe Champagne. The United States made no headway when it proposed elimination of the supports during the previous round in Mexico City.
“Canadians want us to be constructive… Canadians expect us to be creative, but at the same time, Canadians expect us to be firm when it is about key sectors like supply management,” Champagne told reporters in a rebuttal of U.S. complaints that its NAFTA partners were not forthcoming in the talks. President Trump has repeatedly suggested U.S. withdrawal from the trade pact, if only to win larger concessions.
U.S. farm groups want to maintain duty-free access to Canada and Mexico, which generate one-third of U.S. agricultural and food trade. The Trump administration put duty-free access at the top of its list of objectives for the new NAFTA, followed by “Expand competitive market opportunities for U.S. agricultural goods … including by eliminating remaining Canadian tariffs on imports of U.S. dairy, poultry and egg products.” Canada would have to scrap its supply management system to accommodate that request.
Ahead of the talks in Montreal, a new coalition was formed, Americans for Farmers and Families, that “will work to ensure President Donald Trump and congressional leaders understand the importance of preserving and modernizing (NAFTA) to America’s agricultural and retail economies.” Members of the coalition are farm, processor, shipper, retailer and consumer groups.
While agriculture may appear an intractable dispute, more attention has gone to disputes over automobiles, dispute settlement, a sunset clause and U.S. insistence that the pact eliminate trade deficits.
“The tension between the United States and its trading partners, especially Canada, sets up a pivotal round of talks in Montreal,” said Bloomberg. It said the United States “is serious about its threat to withdraw from the North American Free Trade Agreement if there’s no breakthrough on proposals the Trump administration has made…”