Glacier FarmMedia – The United Kingdom says it will seek a stronger commercial relationship with Canada after it leaves the European Union than it currently has under the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).
Andy Barr, head of trade and economics at the British High Commission in Canada, is optimistic a better trade relationship between the two nations can be formed after Brexit.
Why it matters: Players in the Canadian agriculture industry will be seeking to tie down improved market access as the U.K. leaves the EU.
“The (Brexit) withdrawal agreement we’ve agreed to with the European Union, that will give us back the ability to do things that we haven’t had policy competence in for over 40 years, and one of which is our free trade agreements and trade policy,” Barr said. “What I think in a nutshell, we would be looking to do from the U.K. side is explore ways in which we could develop an even stronger commercial and economic relationship.”
The U.K. was due to leave the EU on Jan. 31. An 11-month implementation period will follow, where essentially agreements remain status quo, while the U.K. refines its relationship with the EU and other countries.
“Thereafter, what I’d like to see us do is lock in the benefits of CETA and then boost the relationship from there,” said Barr, echoing a sentiment expressed by U.K. Prime Minister Boris Johnson. “It’s kind of hard to say and comment on the details of the negotiation before it’s actually taking place on both sides.”
Mary Ng, Canada’s minister of Small Business, Export Promotion and International Trade, says as the U.K. continues to make decisions around Brexit, the Canadian government will, “continue that work so that there is a seamless transition, you know, between Canada and the U.K.”
She also hesitated to comment on specifics of what a deal could look like, or when a deal could potentially be negotiated.
There are doubts any new trade deal between the U.K. and Canada will mean much to farmers here, especially when considering the experience of CETA thus far.
The EU is the world’s largest importer of agriculture and agri-food products, about 16 per cent of the world’s total imports for the sector, but Canada continues to have less than two per cent of the market share.
CETA has allowed some Canadian industries to prosper, but agriculture isn’t one of them. Since coming online in 2017, the agreement has failed to offer lucrative new markets for Canadian farmers, despite removing almost all bilateral trade tariffs between the EU and Canada.
Largely due to non-tariff trade barriers, agriculture and agri-food exports have actually decreased since CETA came into force as export quotas are left unfilled by Canadian producers.
That is part of the reason why Carlo Dade, director of the Trade and Investment Centre at the Canada West Foundation, doesn’t see any potential deal with the U.K. meaning much for Canadian farmers.
He noted the U.K. will be prioritizing new trade deals with its larger trading partners, and said negotiations with Canada could be “really, really tough.”
“I’m not optimistic that we are going to get a quick agreement unless the U.K. is ready to roll over and hand us a better deal than the EU agreement, with fewer concessions, taking fewer concessions from us in exchange for giving us more concessions,” he said.
“The key message for importers and exporters in (agriculture) is that we know the terms of trade on the 31st of January. So there is complete certainty that those commercial relationships will be able to continue at least for the next 11 months. And then during those 11 months, we’re looking at ways that we can begin to seek new opportunities to trade and open up new markets.”