Canada holds off New Zealand TPP offensive for greater dairy access

Despite New Zealand’s belief that the Trans-Pacific Partnership could be adjusted in years to come, Canada slams door on more concessions over dairy

New Zealand Trade Minister Tim Groser. (AP)

New Zealand Trade Minister Tim Groser. (AP)

OTTAWA – Canadian officials have slammed the door on a suggestion by New Zealand that it might push for greater access for its dairy products as the Trans-Pacific Partnership moves forward.

But disappointed New Zealanders, who ran headlong into Canada’s sacrosanct adherence to supply management during the talks, maintained that the day will come when Canada’s dairy farmers will no longer enjoy having their “hands held” by protective policies.

New Zealand Trade Minister Tim Groser said Monday he considers the 12-country Pacific Rim trade deal to be open to future “adjustments” after his country failed in an 11th-hour bid for more tariff-free access for its dairy products.

Groser said his country had achieved its main goal of tariff elimination on all exports, except beef to Japan and certain of its dairy products.

That was a reference to New Zealand’s unsuccessful attempt to gain more access to Canada’s protected dairy industry.

Related: Why is the dairy lobby so powerful?

The Harper government trumpeted its protection of Canada’s supply management system following the conclusion of the marathon TPP talks.

Canada made a modest concession by allowing imports of dairy products to rise by 3.25 per cent, far lower that even some government insiders had been predicting.

New Zealand had been pushing for more, as it also sought greater access to the American market.

“What we’re doing is on the more difficult issues is establishing a direction of travel. Unquestionably, we will see adjustments to that direction of travel,” Groser said in Atlanta, as he and 11 fellow ministers announced the conclusion of the TPP talks.

“This will open up political space for future generations of trade ministers from my country to build on this.”

Back in Ottawa, Canadian government officials, who briefed journalists on the condition they not be identified, were adamant that there would be no re-opening of Monday’s deal, saying it was closed to further negotiation.

“The announcement made by ministers today was of the conclusion of negotiations of the Trans-Pacific Partnership,” said one official.

“This is not an agreement in principle. This is not an agreement on some elements. This is a conclusion of all aspects of a negotiation, today.”

Related: Why the TPP is such a big—and good—deal for Canada

Many dairy farmers in Canada were largely supportive of the outcome, but their New Zealand counterparts were bitterly disappointed.

Andrew Hoggard, of the Federated Farmers of New Zealand, said his country’s negotiators “threw everything at it” in their talks but ran into “some pretty entrenched protectionist views.”

“If supply management is so fantastic for one part of the Canadian economy, why don’t you do it for everything? Get the old Politburo going and everything’s supply managed,” he said in an interview.

Hoggard said that over time, it is inevitable that the protections for the dairy sector will inevitably diminish as they have in other agricultural sectors, such as pork and beef.

He said it was time for Canada’s dairy farmers to “play on the world stage, and wear big kiddie pants and not have to wear government nappies.”

One Pacific Rim diplomat, who spoke on the condition of anonymity, said the TPP is viewed by many as a “living document” that will evolve over time, as more countries are admitted and further liberalization takes place.

The diplomat said it was better to get “a good deal now” rather than hold out for a “perfect deal” that might not be attainable.

“At a certain point, it became clear that getting rid of all tariffs on all products wouldn’t happen.”

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