Agri-food products spotlighted by internal trade report

Too many internal barriers are costing the Canadian economy billions annually

The agri-food sector featured prominently in a report from the Senate banking committee on internal trade barriers that are said to cost the Canadian economy at least $50 billion annually.

In addition to the often-cited restrictions on sales of Canadian wine across the country, regulations on maple syrup, brie cheese, beer bottle sizes, the size of dairy containers and organic food standards were served up by the senators in a report to Parliament as examples of interprovincial trade barriers.

The tone of the report, titled Tear Down These Walls, was reinforced with observations and examples throughout its 60 pages.

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“Some of the recently negotiated international trade agreements would make it easier for international businesses to trade with Canada than it currently is for Canadian businesses in one province/territory to trade with other provinces/territories,” the committee report states.

Ron Bonnett, president of the Canadian Federation of Agriculture, said in an interview internal trade barriers need to be addressed. He welcomed the committee’s call for urgent action on the matter.

“Our internal trade rules are more stringent than our international ones,” he said. “We have to ask how relevant they are.”

He also urged the government to include the supply-managed sectors in any discussions on the rules.

The first agreement on reducing domestic trade barriers was signed in 1994, the report points out. Since then, action on internal trade barriers has mostly been of the platitude variety compared to the expansion in free trade deals with other countries, committee deputy chair Sen. Joseph Day said.

“It is baffling that, during a period of such progress in relation to international trade, internal trade-related progress has been so slow,” Day said. “Federal and provincial/territorial governments must take urgent action to correct this deplorable situation.

“While Canada is opening itself up to international businesses, internal barriers to trade have never been more entrenched,” he said. “This is perplexing and utterly outrageous. It shows a lack of respect for Canadian businesses, workers and consumers.”

A renewed internal trade deal was supposed to be signed in March.

“Sadly, it is now June, and no announcement has been made. Nor have Canadians received any information about a new deadline for the completion of negotiations. The committee believes that continued delay must not be an option,” the report states.

Economic Development Minister Navdeep Bains is responsible for the file.

Bains says he understands the committee’s arguments and is working to arrange a meeting with the provincial trade ministers.

“There hasn’t been one in 12 years,” he said.

Sen. David Tkachuk, chairman of the banking committee, said Canadians should be able to live, practise their profession or trade, purchase goods and services freely and without penalty anywhere in Canada as a right.

“To do otherwise makes us less of a country and makes citizens tied to their region rather than their nation,” he said. “The federal government should be exerting pressure to get rid of internal trade barriers. Why spend so much time on international negotiations when we don’t have free trade within Canada?”

The politicians should set July 1, 2017, as the deadline for a new deal and if they won’t act, then a reference to the Supreme Court of Canada should be considered, Day said.

The report recommends new internal trade rules include mutual recognition, regulatory harmonization, an effective dispute-resolution mechanism, improved consideration of trade in services and a permanent federal co-chair for the Committee on Internal Trade to ensure the issue receives the attention and priority it deserves.

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