New Canadian interprovincial free trade deal a boon to farmers say industry associations

Tuesday, August 2, 2016

by SUSAN MANN

Internal trade barriers cost Canadian small businesses, including farms and agribusiness firms, $14 billion a year. But agricultural spokespeople see a new free trade deal among the country’s provinces as a step in the right direction to improving the flow of goods across Canada.

“We’re very pleased with the agreement-in-principle overall,” noted Mandy D’Autremont, Canadian Federation of Independent Business director of agribusiness. “We feel this is long overdue and it’s something we’ve been calling for to improve the movement of goods across the country and reduce red tape.”

The federation represents 109,000 Canadian small businesses, including 7,200 farms and agribusinesses.

Last month, Canada’s premiers reached an agreement in principle on a new Canadian free trade agreement during their summer meeting in Whitehorse, Yukon.

The agreement will support the premiers’ goal of “promoting trade, investment and labour mobility across provincial and territorial boundaries as part of a broader economic vision for Canada,” according to a July 22 press release issued from the meeting.

The agreement will apply broadly to the Canadian economy, reduce regulatory burdens and enhance procurement opportunities, the release said.

The deal will be based on a “negative list” approach, which means all goods, services government measures are considered part of the agreement unless they are specifically excluded.

The list hasn’t been released yet, and the Canadian Federation of Independent Business has asked to see it.

“We don’t yet know whether there are areas specifically related to agriculture that will be on the negative list,” she said. “But certainly we hope that for Ontario farmers, they’ll be able to benefit from this initiative to the fullest extent.”

Canadian Federation of Agriculture president Ron Bonnett said the deal would harmonize and streamline some of the regulations on moving products across the country that tie up farmers, such as different standards for meat inspections between provincial abattoirs and different transportation standards among the provinces.

“There’s more harmony sometimes between the United States and Canada than there is across the provinces,” he said.

The deal “will help develop more unifying regulations and standards between provinces,” and that should particularly be the case for the Federation of Agriculture’s priorities of transportation and inspections, he added.

D’Autremont said some of the Federation of Independent Business’s earlier recommendations on internal trade included that the government should harmonize provincial rules on truck signage and dimensions and food manufacturing standards, such as container sizes.

For labour improvements in the internal trade agreement, she said farmers who own land on both sides of a provincial border shouldn’t have to register their employees for workers’ compensation in both provinces as they do now.

“Even on the labour side, the trade agreement should help some farmers who are operating in multiple provinces,” she said.

Bonnett said supply-managed commodities wanted protection in the internal agreement for their ability to allocate how much each province produces.

Farm leaders haven’t seen anything in the agreement in principle that would change the commodities’ power to set allocations, he noted.

According to a Federation of Independent Business survey released last year, 46 per cent of small businesses sold goods and services in another province or territory during the three years leading up to 2014. That number is the same for farms and agri-businesses, D’Autremont said.

The survey also found that 75 per cent of agri-businesses and farms bought goods and services from another province during the three years leading up to 2014.

“We know that farmers are active interprovincially, so this is an agreement that would certainly be welcome and applauded within the agricultural community,” she noted.  

Wine, beer and spirits have been specifically excluded from the internal Canadian trade deal, which has disappointed Restaurants Canada, a trade association representing 30,000 food service businesses, including restaurants, bars, caterers, institutions and suppliers.

The premiers’ agreement includes establishing a working group on alcoholic beverages to explore opportunities to improve the trade in beer, wine and spirits across Canada.

In a related development, Ontario, British Columbia and Quebec reached a three-way agreement to make it easier for customers to buy wines made in each other’s provinces.

In a July 26 news release, Restaurants Canada said its Raise the Bar report on provincial liquor policies, released in November 2015 noted interprovincial trade barriers hampered their members’ ability to do business across the country.

Once the new trade agreement is in effect, likely by July 2017, it will replace the existing Agreement on Internal Trade, in place since 1994.

In a written statement, Ontario Premier Kathleen Wynne said the Ontario government has led the negotiations among Canada’s provinces, territories and the federal government since December 2014 on removing trade barriers that “are keeping us from reaching our full potential as a nation.”

She called the Canadian Free Trade Agreement an “ambitious and comprehensive trade and economic growth agreement that will help expand businesses, create jobs and grow our local and national economies.”

The agreement in principle will remove trade barriers and improve the flow of goods across internal borders, reduce bureaucratic red tape and allow workers to move more freely across the country, she said.

As for what the deal means for Ontario agriculture specifically, “we don’t know those details yet,” says Christina Crowley-Arklie, press secretary to Jeff Leal, Ontario Minister of Agriculture, Food and Rural Affairs. BF