Why would it be important for a Canadian Trade Diversification Office to open in the Indo-Pacific?
On June 1, 2022, executive members from the Canola Counsel of Canada, Pulse Canada, Cereal Canada, Grain Growers of Canada, and Justice for all Canada testified as witnesses in front of the Standing Committee on International Trade. The main concern that the witnesses presented to the committee was the increasing difficulty of agricultural growers, in their respective sectors, to access global markets. Specifically, the witnesses want assistance in overcoming tariff and non-tariff trade barriers in the Indo-Pacific. The Canola Counsel of Canada, Pulse Canada and Cereal Canada commissioned a report on agricultural trade strategies that would help them overcome international trade barriers in the Indo-Pacific. The report gave them a better understanding of how to approach trade policy to gain better market access within the region. The report was able to accomplish this by assessing the current on the ground capacity and programming available to Canadian agricultural food exporters in the Indo-Pacific and by examining the current on the ground approaches and programming executed by their competitors in the Indo-Pacific. It also assessed gaps, opportunities and priorities for the improved design and delivery of Canadian government support for agriculture in the region.
The commissioned report went on to recognize that there are agricultural export opportunities to the Indo-Pacific, however, these opportunities have not gone unnoticed by competitors. In fact, there are 70 or more countries discussing agricultural export opportunities with nations within in the Indo-Pacific region. The witnesses are calling on the Government of Canada to assist them in tearing down as many tariff and non-tariff trade barriers as possible, as they embark on accessing the agricultural import market in the Indo-Pacific. Some of these non-tariff trade barriers include fumigation requirements in Pakistan, unjustified weed-seed requirements in Vietnam and abrupt and unwarned import bans in Sri Lanka and Nepal. The main problem with these non-tariff trade barriers is that the Government of Canada was given no warning. Shipments have been either turned away at ports after they have docked or have been informed the shipment will not be accepted while they are on route. Therefore, these issues require a reactionary response by the Canadian government and agricultural exporters. The organizations who sat before the Standing Committee on International Trade want there to be a proactive process rather than a reactionary response. This is why they have asked the Government of Canada to have a larger presence within the region and an increase of government-to-government relations. Therefore, they have requested the Government of Canada to set up a Trade Diversification Office in the Indo-Pacific with the aim that such an office will prevent the non-tariff trade barriers from obstructing agricultural export growth, development, and diversification in the region.
Canada is the world’s largest pulse exporter reaching a staggering 130 global markets. Pulse products include dry beans, dry peas, lentils, and chickpeas and are primarily a cold-season crop. However, in this region, countries such as the United States, EU, Australia, and others have invested heavily in resources to grow their respective export capabilities to the region. When it comes to wheat exports, cereal in particular, it brings roughly $10 billion annually to the Canadian economy. Canadian wheat exports have reached 80 countries in the last five years and given the Indo-Pacific’s astonishing economic and population growth; wheat exporters wish to diversify their export portfolio to the region. In fact, Indonesia is one of Canada’s largest growing wheat export markets. Non-tariff trade barriers should not be happening in certain markets, and it is up to the Canadian government to ensure Free Trade Agreements (FTAs) are being enforced and that countries who break agreements are held accountable.
Non-tariff trade barriers usually occur because the countries in which the goods are being exported to do not have the resources to ensure that the goods are safe and that they won’t affect indigenous plant and animal life. In other words, they need to pass sanitary and phytosanitary requirements and these tests are performed by the country that is importing the goods. Goods are turned away, more times than not, because the importing countries do not have the resources to perform the sanitary and phytosanitary tests. A Trade Diversification Office would employ multi-disciplinary experts – such as veterinarians, plant scientists, plant pathologists and technological experts - that can address the lack of resources of the importing country. This in turn, would allow for a quicker response to such issues so that goods are not turned away and Canadian farmers have access to international markets in the Indo-Pacific. The United States has a very large presence in the region, both diplomatically and by the American agricultural industry and the witnesses told the committee members this is a prominent reason as to why they are having trade success there. Therefore, it is time for Canada to do the same and the witnesses believe a Trade Diversification Office would meet the growing concerns.
It's as simple as this, Canadian farmers get paid when the goods they produce find markets. Therefore, finding new markets around the world to export their goods is extremely important to agricultural producers in Canada. Here’s hoping the Minister of International Trade, Mary Ng, and her office take the advice of the witnesses and get a strong and prosperous agricultural export connection to the Indo-Pacific before their competition does. The future of Canada’s agricultural industry depends on it.
Comments