CETA and Its Impact on Agriculture

Prior to CETA, both Canada and the EU applied higher customs duties in the agricultural sector than in any other. The significant drop in tariff barriers instituted by the CETA will thus have the greatest effect on the agricultural sector, with zero-duties now applying to most forms of production.

Just one example: Canada has secured a quota to export 55,000 ton of beef to the EU – this has particular resonance for Ireland. There is every reason to believe that the additional volumes allocated to Canada will be almost entirely served with high-quality hind cuts, especially rib and sirloin, in which case the 55,000-ton quota could equate to the high value cuts of approximately 800,000 head of cattle; to put this in context, Ireland’s weekly kill is about 30,000 head. Imports of this magnitude will decimate our beef industry.

Regarding what are called ‘non-tariff barriers to trade’; again focusing on food and taking just one element, the text states that CETA must ‘ensure that the sanitary and phytosanitary measures taken by the Parties do not create undue obstacles to trade’.  This will be decided by a new court that will be established under this deal, the Investment Court System (ICS), a court that can be used ONLY by the global corporations who originated and are pushing this deal.

Then there is the Regulatory Cooperation Forum. Because CETA is what’s described as ‘a living agreement’ it will be continuously updated so that those issues that can’t be agreed now can be incorporated at a later stage under agreements reached in the above forum.

The main European standards potentially targeted under the CETA, considered by Canada's government and/or businesses as significant obstacles to their trade, are as follows: 

  • The ban on treating animals with ractopamine;
  • The ban on the use of hormonal growth stimulators in beef cattle;
  • The ban on certain decontaminating substances on products of animal origin intended for human consumption.

Many other standards are potentially affected, anywhere that ‘barriers to trade’ – our protections – exist between both parties. Those risks, the weakening of European standards, have already been raised in a report commissioned in 2013 by the European Parliament.

Finally, and perhaps most damaging of all to farmers, there is the implicit threat to farm supports.

The percentage of agricultural producers’ income derived from direct subsidies is higher in the EU than in Canada. While CETA does not contain any obligations regarding these subsidies, one Party may request that consultations be opened if it deems that its interests are being adversely affected (or are likely to be so) as a result of grant-aid by the other Party. It is interesting to note that much of the Commission’s ‘kite flying’ in advance of the 2020 CAP reform centres on the provision of ‘financial instruments’ and measures to ‘combat price volatility’.  Where can we find these in operation?  Canada of course, where there are no direct payments, just crop insurance and loans. Farmers should be very aware of the insidious erosion of the current CAP support system.  

Be warned, CETA is NOT a good deal for either food producers or for food consumers – that’s all of us. It is being voted on this coming Wednesday; contact your local MEP, let them know how you want them to vote. Before it’s too late.

Europe, Press ReleasesPaul Cotter