Canada says WTO text on farm goods "unacceptable"

Mon Dec 8, 2008 10:58am EST
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OTTAWA (Reuters) - Parts of a revised WTO negotiating draft for liberalizing world trade remain unacceptable to Canada and pose a threat to its dairy and poultry sectors, the country's farm minister said late Sunday.

"Canada has very serious concerns about some elements of a revised text ... that would negatively affect our supply managed industries. We remain opposed to these provisions," Agriculture Minister Gerry Ritz said in a statement.

The chairman of World Trade Organization negotiations on agriculture, New Zealand ambassador Crawford Falconer, issued on Saturday a revised negotiating draft on agriculture and industrial goods. The drafts would serve as a blueprint for an outline deal by ministers in a meeting that may be called for this month.

Canada is under pressure internationally to open up its decades-old "supply management" scheme, which protects these two industries by imposing high tariffs on imports as well as controlling domestic prices and production.

By declaring these products "sensitive," the government can shield them from the full impact of tariff cuts under a potential WTO deal but must allow for additional import quotas at a lower tariff.

Canada is pressing for 6 percent of its products to be designated as sensitive, while the new negotiating document allows only 4 percent. The quotas calculation is highly complex and there is an accompanying paper that suggest a possible deal for Canada.

But Ritz said he was still not satisfied.

"While there has been an acknowledgment that Canada has insisted on having 6 per cent of tariff lines as sensitive, the approach to this and other elements of the text remain unacceptable and more work remains to be done," he said.

Japan and some other developed country importers also have doubts about the 4 percent limit.

Ritz said Ottawa remained committed to the WTO process and applauded the text's provisions for sharp reductions in trade-distorting farm subsidies and for new market access for Canadian farmers and exporters.

(Reporting by Louise Egan; Editing by Frank McGurty)