TPP ministers back at table as Canada preps final offer on dairy, autos

How badly do Stephen Harper's Conservatives want Canada to be part of this week's anticipated Trans-Pacific Partnership trade deal? We're about to find out, less than three weeksbefore the election.

Ministers from the 12 Pacific Rim countries today begin what's expected to be their final talks in Atlanta. Hopes are high foran agreement in principle by week's end.

But this is a complex, multi-directionaltrade pact, not a charity: no one gets infree.

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That's the catch for Canada, even asmultiple federal government departments Agriculture, Natural Resources, Fisheries and Oceansalready circulatestatements about what Canada gains in new export markets.

The cost of TPP admission will be controversial, in particular for the final two sectors in play: the recentlytroubled automotive manufacturing industryand the supply-managed dairy business.

"If Canada is not prepared to move on either one of those, personally I think an agreement can be done without Canada fairly easily. And I don't think [U.S. President Barack] Obama would lose any sleep over that or anybody else," said trade lawyer Mark Warner.

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NAFTA do-over?

As Canada joined the talks three years ago, critics warnedTPP wasa back door to reopening theNorth American Free Trade Agreement (NAFTA.)

Then,July'sministerialtalks in Mauiwent sideways shy of the finish line,asMexico and Canada nixeda bargain between the U.S. and Japan to changeregional content rules for automotive manufacturing.

To staytarifffree under NAFTA,auto parts needed60 per cent North American content, and an assembled vehicle had to contain 62.5 per cent North American content. The U.S. and Japan now suggest30 per cent for parts and 45 per cent for vehicles.

Senior negotiators scrambled towarda compromise between the two, perhaps closer to what Japan wants.But there could beexemptions for particular parts or technologies.

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Harper previewed the concession during the Calgary leaders' debate, sayingtheindustry won't like everything.

Jerry Dias talks TPP

9 years ago

Duration 5:36

Unifor President Jerry Dias weighs in on Trans-Pacific Partnership negotiations and possible impacts on the auto-sector

Last Saturday, International Trade Minister Ed Fast's office started suggesting media contact two major Canadian auto-parts employers supportive of the deal: Rob Wildeboer from Martinrea and Linda Hasenfratz from Linamar Corp.

"If a company likeLinamarstands up around London, Ont., and says we're OKwith this, there will be some weight to it," Warner said."It seems to me that [Harper]probably has enough cover to make the concessions that he needs to make."

As well, the 60 per cent rule is "silly to defend," he said. "It was linked to a footprint for the automotive industry in southwestern Ontario that no longer exists our industry has been cut in half."

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NAFTA didn't stop recent declines,and auto companies can't be strong-armed into doing business in Canada, he said.

"Are you really going to spend a lot of political capital to defend something that's obviously not working?" Warner said.

Cows come home

When Canada joined the talks, debate began over whetherthe price of admission wasa dairyconcession.

Othercountries sure hoped so. Now the answer appears to be yes. But on what, or perhaps whose, terms?

Harper needs to positionCanada's final offer inside, not offside withhis pledgeto defend supply management or risk backlash, particularly in Quebec and parts of rural Ontario.

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The impetus for change must behis own, not something forced by Americans or anyone else.

"Decisions to be made on whether we have such a system or not are decisions that we want Canadians to take, not foreigners to take," Harper told reporters on the campaign trail Wednesday.

Stephen Harper defends TPP trade negotiations

9 years ago

Duration 2:25

Conservative Leader Stephen Harper and Liberal Leader Justin Trudeau both address the Trans Pacific Partnership deal that could be closed this week.

Warner sees an implied linkage between the auto concession and the final offer on dairy not a straight tit-for-tat, but a measure of commitment.

"If Canada were to make some concessions on the rules of origins for autos, then the demands coming back from the United States on dairy would be softened. I don't think they would be eliminated, but I do think it would be enough to get to some kind of agreement," Warner said.

Fast's strong denials last weekend thatCanada would offer the market access theU.S. asked for 10 per cent of Canada's consumption suggests Canadawon't go too far with its offer, Warner said.

This week's talks may not finish sorting out what countries get exactly what dairy imports. Import penetration is already at6.3 per cent for cheese (more if the Canada-Europe tradedeal is ratified), 10 per cent for butter and 10 per cent for milk powder.

"Our trading partners would just like to see us move. I don't think we have to go the full distance," Warner said, adding thatsome would be happy enough to seea shift in Canada's"architecture."

RAW Tractors take over Parliament Hill

9 years ago

Duration 0:42

Dozens of farming tractors pulled up in front of Parliament Hill on Tuesday to protest TPP.

That "architecture" shift shakes the so-called pillars of the supply management system: production control, price-setting and import control. But planning is underway for a multibillion-dollar transition program to help that happen gradually.

The corporate dairyindustry ispreparing more than their rhetoric might imply, Warner said.

Sales job or sell-out?

Harper wants to fuel the home stretch of his election campaign leading up to the Oct. 19 votewith a success story on trade.

• Ed Fast confirms attendance in Trans-Pacific Partnership negotiations in Atlanta

While neither Liberal Leader Justin Trudeaunor NDP Leader Tom Mulcairhas put down markers for the kind of TPP deal an alternative government could accept, a perceived lack of transparency during the negotiations offered ammunition for critics.

Tom Mulcair says Harper risking 80 thousand jobs on TPP

9 years ago

Duration 2:38

NDP Leader Tom Mulcair says he wants to protect supply management, and that Conservative Leader Stephen Harper is risking 80 thousand jobs during an election to get a TPP deal.

A handful of ridings could swing into the loss column for the Conservatives, particularly in Ontario, over both these concessions. But other voters the Tories target may embrace the deal.

Lower consumerprices are coming, Conservatives will say.

But fordairy, Canada's lowerretail competitiveness, higher labour costs andthe relatively smaller economies of scale on farms and atprocessing facilities matter as much as theprice farmers receive.

There are "one thousand different interests" to be balanced, Harper said.Including some political ones.

Ed Fast on TPP negotiations

9 years ago

Duration 8:25

Trade Minister Ed Fast discusses the Trasn-Pacific Partnership negotiations that are due to restart in Atlanta