Canada should be welcomed into the Trans Pacific Partnership providing it is willing to meet the TPP's free-trade goals, Dairy Companies Association of New Zealand chairman Malcolm Bailey says.
Commenting on the invitations issued to Canada and Mexico to join the negotiations to create a TPP free-trade agreement, Mr Bailey said both Mexico and Canada were important markets for New Zealand dairy exporters.
In 2011, New Zealand exported $343 million worth of products to Mexico, while it exports $55 million of dairy products to Canada at present.
Mexico had already shown through the North American Free Trade Agreement (Nafta) and other agreements that it was willing to eliminate all dairy tariffs, Mr Bailey said.
"Mexico joining TPP is an opportunity for New Zealand to eliminate remaining tariff barriers not faced by our competitors in that market." Despite strong demand from Canada's food industry, opportunities for dairy export growth were limited by the "enormous" tariff protection imposed by Canada. Many tariffs were between 200% and 300% with small quotas, he said.
Canada was one of the most protected dairy sectors in the world. If it was willing to tackle those tariffs in accordance with the goals of TPP, its joining should be welcomed by both dairy exporters and by Canadian food companies and consumers.
However, it was difficult to see a satisfactory TPP market access result being achieved for New Zealand if Canada was unwilling to put its high dairy tariffs on the negotiating table, he said.
