Friday, 03 May 2024 11:19

NZ dairy processors want Canada to respect rules

Written by  Sudesh Kissun
It is estimated that Canada’s disregard for the CPTPP rules denied New Zealand dairy exporters over $120 million in trade opportunities. It is estimated that Canada’s disregard for the CPTPP rules denied New Zealand dairy exporters over $120 million in trade opportunities.

New Zealand dairy processors are welcoming the Government’s commitment to continuing to push for Canada to honour its trade commitments.

This follows Canada’s confirmation of its approach to administering its Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) dairy import quotas that will again place most of the quota access in the hands of domestic processors, who have limited interest in importing from CPTPP countries.

"DCANZ agrees with the New Zealand Government assessment that Canada has cynically moved to replicate the outcome that the dispute panel ruled against," says DCANZ executive director Kimberly Crewther.

"The costs of Canada’s flouting trade rules are mounting for the New Zealand dairy industry,’ she says.

It is estimated that Canada’s disregard for the CPTPP rules denied New Zealand dairy exporters over $120 million in trade opportunities in the first three years of the CPTPP agreement, and these costs continue to grow.

Earlier this week, Trade Minister Todd McClay says New Zealand has no intention of backing down in a trade dispute with Canada over dairy products.

New Zealand initiated the dispute because Canada was not complying with Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) rules, blocking dairy exporters’ access to its market.

A CPTPP arbitration panel ruled decisively in New Zealand’s favour. Canada had until 1 May to change how it administered its tariff rate quotas - to stop giving its own domestic industry priority access, and to allow exporters to benefit fully from the market access negotiated in good faith between Canada and New Zealand.

McClay says he has asked for urgent legal advice in respect of our ‘next move’ and says the Canadian government still has time to honour its obligations to New Zealand both in the spirit and substance of the agreement. 

NZ dairy exporters are also concerned that Canada is disregarding its WTO trade commitments.

Crewther points out that not only is Canada restricting access into its market, but there’s also a rising tide of subsidised Canadian dairy exports in other markets, contrary to previous WTO legal rulings.

“This is putting a billion dollars of New Zealand dairy protein exports to global markets at risk,” she says.

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