Food for Thought? Trade Agreements and the Politics of Food

Elizabeth Smythe. Concordia University of Edmonton, Edmonton Alberta [email protected]

Paper presented at the Annual Meeting of the Canadian Political Science Association Meeting, May 31, 2016, Calgary, Alberta.

Introduction

This paper examines recent trade agreements through the lens of food. The two agreements that Canada has signed, the Comprehensive Economic and Trade Agreement (CETA) and the Trans- Pacific Partnership (TPP) are two of three major pending agreements (the third being TTIP) involve two of the most important actors in international trade the United States and the European Union. These latter two agreements then are likely to set the template for other agreements and may themselves broaden over time, if they are ratified, to include even more countries. As such major provisions of these agreements have become a focus of analysis and debate. In particular Intellectual Property (IP) provisions, Investor State Dispute Settlement (ISDS) and the fate of the automobile sector have all generated much concern, disagreements and tough negotiations. Complaints have also been raised in a number of countries about the lack of transparency in the process and the limitations of public input or consultations. Beyond these concerns, however I will argue for several reasons that a focus on food and what these agreements imply for food systems merits attention.

First “food is different” (Smythe, 2014). Food remains a very sensitive issue not just for food producers who may fear being shut out of export markets or face import competition, like Canadian dairy farmers, but also for consumers, more correctly eaters of food. Growing public demands to know the provenance of food and how it is produced are reflected in battles over food labelling, the marketing strategies of major retail segments of the food system from supermarkets to restaurant chains and the development of food movements. Second these agreements involve several countries or regions that are major food exporters including the US, EU, Canada, Australia and New Zealand, which although a small economy has been described as the Saudi Arabia of milk (Wall Street Journal, 2008). Agreements to which they are a party are going to have implications for the agricultural sectors of their economies and for the global food system as a whole. Third the attention to more localized and sustainable food systems often linked to the concept of food sovereignty and the fate of smaller scale producers has led proponents of local food systems to see trade agreements including the WTO as impediments or threats to the development of local and alternative food systems. Food sovereignty and its relationship to international trade and the livelihood of farmers, especially in terms of commodity exports remains an area of contention and disagreement even among food sovereignty advocates (Bennett and Murphy, 2013).

Finally, as acknowledged by many analyses of international trade the most significant barriers to trade are no longer tariffs on goods crossing borders but rather a range of non-tariff measures which often related to national or regional regulations and standards.(World Bank, 2016) Many of these may relate to food partly because of public safety and because of the sensitivity and cultural differences around food that result in differing standards and regulations, not all of which can be dismissed as trade protectionism. This reality is reflected in the large number of extremely contentious and protracted trade disputes that involve food and food standards and the very politicized nature of the setting of some of those standards at the international level reflected in the work of the international standard setting body the Codex Alimentarius. It is within this context that we must situate the CETA and the TPP and examine how they addressed these issues. We begin with an overview of the relationship of the EU and Canada as it relates to food and agricultural trade.

Standards, Trade Barriers and Market Access: The roots of CETA

Over the years of rounds of trade negotiations and in its involvement in disputes at the WTO Canada and the European Union have often been adversaries. Canada has pushed for a reduction in EU agricultural subsidies while the EU has pushed for greater market access in sectors that have been limited by Canada’s system of supply management. Canada has also been involved in several protracted trade disputes at the WTO, along with the US, that related to differences in standards regarding the production of meat, milk and the approval of crops and foods using crops involving genetically modified organisms (GMOs). The capacity to challenge such regulations at the WTO that negatively impact trade and market access stems from two important aspects of its agreements.

When it was created out of the final agreement of the General Agreement on Tariffs and Trade in 1994 the WTO included two agreements that addressed the issue of national regulation of food and other products and the degree to which they could limit market access for exporters. The agreements on Sanitary and Phytosanitary (SPS) measures and Technical Barriers to Trade (TBT) cover most aspects of regulations that relate to food. In keeping with trade liberalization obligations WTO members, while their right to regulate is recognized, are obligated to notify other members of any new or changed regulations, avoid discrimination against foreign products or those of a single country, employ the least trade restrictive regulations possible and, in the case of food safety, base or justify regulations only on scientific grounds and, where available, relevant international standards. The relevant standards identified as it relates to food are those of the Codex Alimentarius.

Founded 1963 as a joint body of the Food and Agriculture Organization (FAO) and the World Health Organization (WHO) the Codex mandate is to develop and harmonize food standards both “protecting the health of consumers and ensuring fair practices in the food trade” (Codex website). Codex work is carried out by member state delegates serving on committees which work on food standards. After an eight step review process these standards eventually go forward to the annual meeting of the full Codex Commission for final approval. Despite its membership of 186 countries the work of the Codex is dominated by key actors who have a material interest in food standards and the resources and technical expertise to dominate the process, especially at the committee level. Non-governmental groups such as food processors or biotechnology companies and consumer groups may also attend, observe and even speak on issues following the UN model of NGO representation. Canada and the United States have been very active Codex members and host and chair two of the most important Codex committees on Food Labelling (CCFL) and on Residues of Veterinary Drugs in Food (CCRVDF) where some of the most protracted battles over food standards have occurred. Moreover as fairly like-minded food exporters Canada and the US coordinate their activities with New Zealand and Australia. These four known as the Quad regularly meet prior to Codex meetings to strategize on key agenda items. Often on the other side on food standard issues is the European Union which also attends Codex and depending on the issue and what the division of competence is between the 28 individual members and the Community they may speak with one or several voices on an issue. Their votes, if necessary, are counted, however, as individual members. The Codex standards are referenced in the SPS agreement and can thus be used as a justification to the WTO for national measures to protect food safety or require particular forms of labeling. This has given much more weight to Codex standards which historically had been seen more as guidelines relying on their voluntary adoption by member states. Deviation from Codex standards, particularly in the direction of ones that are more restrictive than the Codex could mean a trade dispute and, in the event of a loss at the WTO, costly trade retaliation. It has also created incentives for powerful food exporters and their allied industries to seek to shape Codex standards in a way that advances their trade interests. Those interests and the differing national regulations for example on growth promoters in meat production are discussed below and have been at the heart of some of the most bitter Codex and WTO trade disputes most notable of which are hormones in beef. Debates over standards regarding growth promoters centered in the Codex Committee on Residues of Veterinary Drugs in Food (CCRVDF). Given the weight which the WTO puts on scientific evidence as the basis of any legitimate justification of regulations that might restrict trade, and the Codex’s other mandate of food safety, technology-intensive industrial meat and milk production have posed challenges for scientific committees that provide advice to Codex delegates. One of the most important of three established bodies is the Joint FAO/WHO Expert Committee on Food Additives (JECFA)

Growth Promoters and Meat Production Standards in Canada

While the EU has long banned the importation of meats produced using growth promoters under EU Council’s directive 96/22/EC three types of growth promoters have been widely used in North American meat production and are listed below. The first two go back over 50 years and coincide with the intensification of meat production. The third set have a shorter history as the drugs in question have only been approved for use in the case of the US since 2003.

Table 1: Growth Promoters used in Meat Production in Canada

Type of Growth Promoter How Administered Hormones: Six hormonal growth promoters Usually implants behind the ear of the animal approved in Canada for use in beef cattle: three natural - progesterone, testosterone and estradiol-17ß; and three synthetic - trenbolone acetate (TBA), zeranol and melengestrol acetate (MGA)

Antimicrobials (Antibiotics) Usually in the feed

In the feed for animals: common names Beta Adrenergic Agonists-. Ractopamine for feed with ractopamine-paylean (pigs) hydrochloride and zilpaterol Cattle and large turkeys Zilpaterol, called Zilmax and Intervet. Given near the end point of the feeding period, ie close to slaughter. Sources: Health Canada http://www.hc-sc.gc.ca/dhp- mps/vet/faq/growth_hormones_promoters_croissance_hormonaux_stimulateurs-eng.php Beef Cattle Research Council Jan 2013, http://www.beefresearch.ca/blog/growth-promotants/

Issues related to the usage of growth promoters in meat production tend to be in two main areas. The first is human health and safety. The second is animal welfare. In the case of human health the use of antibiotics for growth promotion has come under increased criticism. Amid the growing concerns about antibiotic resistant bacteria in human communities and on farms a number of countries have moved to restrict use. Following action in the US in April 2014 Health Canada announced a three year phased in plan to eliminate the use of antibiotics in livestock except to treat disease.

Hormones and beta agonists remain widely used and are claimed to be safe by regulators in Canada and the United States. Three synthetic and three natural hormones are approved in Canada for use with cattle. In Europe however, a series of concerns surrounding some studies linking the hormones used in meat production to various forms of cancer, declining male fertility and early onset of puberty in children, led to a public outcry and the EU strictly regulating the use of certain types of hormones (only for therapeutic use), and banning intra- European and import trade in such hormone-treated beef which initially came into effect in 1989 and then faced trade challenges from the US and Canada in the late 1990s.

Beta agonists are more recent and have been in use for about less than a decade in Canada initially in pigs and later in cattle and turkeys. The first product ractopamine hydrochloride which is produced by Elanco Animal a division of the Eli Lilly drug company. Under various names such as Paylean, Optaflexx and Topmax ractopamine is added to animal feed. Its effect is to speed up the heart rate of the animal and produce heavier leaner more muscled animals which are more profitable to producers and have lower fat. However, to be effective it must be fed to animals until shortly before slaughter. The result of which is that a small amount of drug residue remains in the meat. A second beta agonist zilpaterol hydrochloride was approved for use in cattle by the US FDA in 2006. Produced by Merck it has been aggressively marketed in competition to ractopamine since its approval in both the US and Canada under the brand names Zilmax and Intervet.

Work on setting a standard or a maximum safe residue level of the drug ractopamine in meat which could be deemed safe for human consumption had been initiated within the Codex CCRVDF and advanced as a result of a JECFA reviews in 2004 and 2006. However the process was stalled in subsequent years as questions were raised about both the adequacy of the scientific risk assessment and other factors that need to be taken into account. While adopting standards is normally by consensus and votes are rare, a vote on whether to adopt the ractopamine MRL occurred in July 2012 at the Codex Commission meeting in Rome. After fierce lobbying both for and against the US, Canada and others permitting the use of the drug such as Brazil were able to win a narrow victory against the delegates from the EU, Russia and China who opposed adopting the standard. Adopted by 69 to 67 votes the standard was technically approved. However that does not mean countries were willing to alter domestic regulation in line with it.

The approval of the standard however, would provide the basis for a trade challenge at the WTO for countries whose standard was more restrictive and limited exports. It was presumed by some observers that a US trade challenge against the EU would be the likely result of this victory. The EU was clear, however, that it would not alter its regulation or adopt the Codex standard. China also made its opposition clear as did Russia and a number of other Codex members. Given that the EU and China and account for 70 per cent of world pork consumption there would be a trade impact. Despite threats to launch a trade challenge one did not emerge. It may be that the experience of the dispute over hormones in beef between the US, Canada and the European Union suggested that even though a trade challenge could be made, and even “won” and trade retaliation could be undertaken against the EU this would not result in increased market access for exporters. In fact in both the cases in Canada and the United States what did occur was the creation of a parallel process of certified hormone free meat production destined for the EU market.

By 2012, an estimated 70 to 80 percent of the U.S. cattle herd was being fed Zilmax or Optaflexx. In Canada there are no firm numbers and it seems to vary by region. Since then however, there is growing evidence that some producers of necessity are moving away from beta agonists as the challenge of gaining market access and concerns about animal welfare mount. In 2013 a major US processor of pork Smithfield’s began development of dual track of ractopamine free pork production to meet the demands of the Chinese and Russian markets (Chicago Tribune) despite having claimed a few months earlier that ractopamine was “safe and effective FDA feed supplement that has been widely used in the hog-farming industry for years.” Smithfield’s which produced 15.8 million hogs in fiscal 2012, was by June 1, 2013 producing half its hogs without ractopamine. (Zilmax Zinger, 2013)

The EU ban has kept meat produced with hormones or beta agonists out of the EU market and led, despite rulings at the WTO, to a 2010 agreement between the EU and Canada which established a system of certification by the Canadian Food Inspection Agency of any exported meat from Canada headed to the EU as hormone free. With the use of beta agonists in meat production in recent years further certifications processes have been developed to certify pork for example as ractopamine freei. Such certification is required to obtain an import license and qualify under EU quotas and various Tariff rates. It is these agreements that formed the basis of negotiations over enhanced market access for Canadian meat to the EU market which is discussed below. We begin with a brief discussion of the roots of CETA and the issue of market access for food exports.

CETA, Canada, the EU and Market Access

As the Table below indicates the CETA’s has its roots in bilateral summit in 2007 and a Conservative government whose economic growth strategy involved the aggressive pursuits of trade and investment agreements (Seizing Global Advantage 2008) especially in light of the slowing momentum reflected in the failure of the Doha Round of WTO negotiations in 2007-8.

Table 2. Timelines CETA and TPP CETA TPP June 2007 – At the 2007 European Union 2006: Trans-Pacific Strategic Economic (EU)-Canada Summit in Berlin, Canadian and Partnership Agreement (TPSEP or P4) is EU leaders agree to conduct a joint study on signed by Brunei, Chile, Singapore, and New the costs and benefits of a closer economic Zealand partnership. 2008 US, Australia and Viet Nam and Peru December 2008 – A notice in Canada Gazette join the process. seeking Canadians’ input on the possibility of negotiating a trade agreement with the EU. 2010 Canada becomes an observer

March 2009 – A Canada-EU joint report is 2010 – 2013: Nineteen negotiation rounds are finalized, defining the scope of potential held negotiations. 2012 Canada and Mexico officially join the May 2009 – Prime Minister Harper, EU talks President Mirek Topolánek and European Commission President José Manuel Barroso 2013 Japan joins the talks announce launch of negotiations. 2014 – 2015: Chief negotiators meetings and October 2009 – First round of negotiations ministerial meetings continue. toward an Agreement is held in Ottawa. 2016 TPP was signed on February 4 in October 2011 – Nine formal rounds of Auckland, but has not yet entered into force. negotiations are completed.

November 2012 – Canadian and EU trade and List of Member Countries: agriculture ministers meet in Brussels, Belgium, to take stock. Australia Brunei February 2013 – Canadian and EU trade and Canada agriculture ministers meet in Ottawa to Chile further narrow the remaining outstanding Japan issues in the negotiations Malaysia . Mexico August 2014 – Canada and the EU announce New Zealand that they have reached a complete text of the Peru Canada-EU Trade Agreement. Singapore VietNam February 2016 – Legal review of text United States released. Note EU request re investment section.

What follows is a brief analysis of the aspects of the CETA that relate to market access. As the discussion above makes abundantly clear this issue is closely tied to differences in standards and regulations in the case of meat and Canada’s supply management system in relation to dairy and cheese.

The government of Canada made much of its announced trade deal with EU in October 2013. The agreement’s final text released in late 2015 is over 1500 pages of which 1300 are annexes covers a wide range of issues. Of its 30 chapters a number of which have implications for food and agriculture. The focus here will be on the main aspects that affect market access both in terms of exports and imports, standards that relate to food and restrictions that might limit the capacity of public authorities at various levels to privilege local food (however defined) in an effort to support domestic food producers.

Chapter two deals with National Treatment and Market Access and it is in this chapter and its lengthy Annex that the Canadian government has claimed a major breakthrough in access for Canadian food products. Market access for a range of products from seafood to maple syrup has been increased. The Global Affairs website heralds in particular however, an increased access for Canadian beef and pork. Specifically:

Beef and veal market access • duty-free in-quota access secured for total of 50,000 tonnes carcass weight, including the incorporation of Canada’s share of the hormone-free quota (3,200 tonnes product weight or 4,160 tonnes carcass weight) »» includes 70% (or 35,000 tonnes carcass weight) for fresh, chilled product »» includes 15,000 tonnes carcass weight for frozen product • in addition, immediate duty-free in-quota access for Canadian product shipped under the existing high quality beef quota (11,500 tonnes product weight or 14,950 tonnes carcass weight, but administered on a product-weight basis): current in-quota duty 20% • continued access to the EU’s existing beef quotas

Pork market access • immediate duty-free in-quota access secured for 81,011 tonnes carcass weight of Canadian pork, including the incorporation of Canada’s country-specific quota (4,624 tonnes product weight or 6,011 tonnes carcass weight) • available for fresh, chilled and frozen product • duty-free immediate treatment for pig fat; salted, dried, smoked and cured boneless pork; and all other processed pork tariff lines in Chapter 16, such as sausages (http://international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/ceta- aecg/understanding-comprendre/technical-technique.aspx?lang=eng)

The enhanced access, however, touted as a real gain is for meat that is certified as free of growth promotants. The government summary at first glance gives the impression that exports will expand significantly from the low levels described above. Canada already had a quota of 23,200 tonnes of hormone-free beef but in 2011 only exported 9000 tonnes according to the National Farmers Union. Similarly with pork exports Canada did not export any pork to the EU in 2011 and in 2010 exported only 5,000 tonnes of pork. (CCPA 2014) Again while there is a significant expansion in access for ractopamine free pork it is not at all clear that Canadian producers, slaughter houses and processors can ramp up this growth promoting free production to take advantage of this. Moreover another sector of the food system in Canada, many would argue, paid the price for that so-called increased market access. The Dairy Farmers of Canada made it very clear after the conclusion of the agreement that it came at a cost to them. We reacted strongly to the news of the excessive access that was given to the EU, in particular in the fine cheese segment of the Canadian cheese market. It is important to note the impact that the access granted to the EU could have as it is more significant than what’s been reported. The EU would get an additional tariff-free access of 18,500 tonnes (16,000 tonnes of “fine cheeses”, 1,700 tonnes of “industrial” cheeses and 800 tonnes under the existing TRQ). This is over and above the 13,471 tonnes the EU already has under the Canadian cheese TRQ.

The EU access will total 31,971 tonnes or 7.5% of the Canadian cheese market. Imports (all countries) will then move from 5% to 9% of total Canadian cheese market. This gives the EU an additional exclusive access of 32% of the current fine cheese market in Canada, over and above the existing generous access. The loss to the dairy farmers is real. The additional access is equivalent to a 2.25% cut in farm quota, bringing a potential farm income loss of nearly $150 million/year. To put that into perspective on the level of the significance to the Canadian dairy sector, the projected loss from the additional access given to EU is the equivalent of the total milk production in Nova Scotia or other small provinces. In total, the estimated impact to dairy farmers and cheese makers is a loss of domestic market valued at $300 million annually. (Dairy Farmers of Canada, 2015)

Both the Conservative and current Liberal governments in Canada have promised the sector compensation, however, no details appeared in the most recent federal budget and talks with the industry are continuing. Pressures on the dairy sector continues however with the signing of the TPP which will be discussed below.

Since, as outlined above, many of the barriers to market access come in the form of regulations the CETA does address both TBT and SPS measures in Chapter 4 and 5. These incorporate much of the WTO agreements and reaffirm the signatories’ obligations under the TBT and the SPS. Further vague commitments are made about regulatory cooperation in Chapter 21 of the agreement.

Without limiting the ability of each Party to carry out its regulatory, legislative and policy activities, the Parties are committed to further develop regulatory cooperation in light of their mutual interest in order to a) prevent and eliminate unnecessary barriers to trade and investment; (b) enhance the climate for competitiveness and innovation, including by pursuing regulatory compatibility, recognition of equivalence, and convergence; and (c) promote transparent, efficient and effective regulatory processes that support public policy objectives and fulfil the mandates of regulatory bodies, including through the promotion of information exchange and enhanced use of best practices (21.1.4)

In addition 21.6 creates a regulatory cooperation forum involving officials of the European Commission and deputy minister level Canadian officials. The text however provides commitments to develop a work plan, hold regular meetings and report to the CETA joint committee. In contrast it is in the TPP where we see aggressive language on limiting or challenging SPS and TB measures as trade barriers reminiscent of the approach the United States and its Quad partners have taken in the Codex Alimentarius to eliminate any regulatory barriers to their export products not based on “sound science”.

While market access appears to be a mixed picture for various sectors of food production in Canada the chapter on government procurement appears, in the case of building and supporting local food systems, to have created a barrier to those aspirations. MacRae (2014) has argued that existing trade agreements such as the WTO and NAFTA and the agreement on internal trade barriers within Canada have not posed significant obstacles to those authorities at the municipal or provincial level who might seek to use procurement policies in the health and education sectors to support local food producers and sustainable food systems despite claims by the federal government to the contrary. CETA however, does in the view of many pose significant barriers. As the Global Affairs website notes the coverage in Chapter 19 includes municipalities and a low threshold value of contracts above which will be subject to the non- discrimination obligations of the agreement.

provinces and territories: 200,000 SDR ($315,000) for government entities including municipalities, academia, school boards and hospitals (MASH)

Despite a campaign by the Council of Canadians and concerns expressed by municipalities which led 50 of them to request exemption the exceptions listed in the agreement are very few.

The Trans-Pacific Partnership which was signed and concluded in February 2016 in Auckland N.Z. provides a number of contrasts to CETA. It has even more potential given the array of countries that are signatories and their differing standards and regulations to provide both challenges and opportunities for food producers.

The Trans-Pacific Partnership

As the table above indicates the roots of the TPP lay in a rather small group of member countries who expressed an interest at an Asia Pacific Economic Cooperation Forum meeting to further trade ties. The group included Brunei, Chile, Singapore, and New Zealand who signed a Trans-Pacific Strategic Economic Partnership Agreement (TPSEP or P4) which came into effect 2006. New Zealand with an economy very export dependent especially in food has been zealous in pursuing trade agreements and its close trade ties to Australia made in likely that that country would join talks for a future expanded agreement. However once the United States signalled its intent to also become involved in a broader set of negotiations it was all but inevitable that Mexico and Canada as NAFTA partners would become involved. There are parallels here to Canada’s defensive response to Mexico’s efforts to negotiate a bilateral trade deal with the US in the early 1990s which resulted in NAFTA.

Unlike CETA where the two sides in the negotiations were in terms of standards and per capita income fairly similar there is a broad range of diversity among the members. The presence of the US has also meant that key US objectives in the areas of investment, intellectual property would be reflected in the negotiations. As a large food exporter along with Canada and Australia and New Zealand (all Codex Quad allies) it is also not surprising that a range of issues related to market access for food products and standards that might inhibit agricultural trade would form an important part of the negotiations as well.

Market Access

Unlike the EU the countries of the TPP are significant markets for Canadian meat. While a range of Canadian food products will benefit from tariff reductions and access to these markets meat producers have much to gain. About half and almost two third of Canadian beef and pork is exported and over 80 per cent of these exports go to the TPP countries. Tariff reductions in Japan (the most important market) and Malaysia and Vietnam offer some opportunities for growth in exports. Regulations on the use of growth promotors do not pose the barriers they did for access to the EU.

The situation for supply managed products was quite different however. From the outset these products were likely to be a target given that Australia, New Zealand and the US were part of the negotiations. Indications are that access on dairy was one of the major and final sticking points in negotiations. The Canadian government claimed it had largely resisted the pressure:

Canada offered only limited new access for supply managed products. This access which will be granted through quotas phased in over five years amounts to a small fraction of Canada’s current annual production: 3.25 for dairy (with a significant majority of the additional milk and butter being directed to value-added processing), 2.3 % for eggs, 2.1 % for chicken, 2% for turkey and 1.5 % for broiler hatching eggs. (http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/tpp- ptp/benefits-avantages/sectors-secteurs/01-AgriSector.aspx?lang=eng)

However the announcement of a TPP deal just prior to the October 2015 election was also accompanied by the commitment to support producers and “keep them whole” as a result of the TPP and CETA negotiations through four programs:  Income Guarantee Program for 10 years from the day the TPP comes into force  Quota Value Grant Program to protect against declines in the value of quotas  Processor Modernization Program  Market Development Initiative to promote products

Once again the supply manage sectors especially dairy were in their view sacrificed to get agreement that would benefit other food producers. The Executive Director of the Dairy Farmers of Canada (DFC) was clear about this when appearing before the House of Commons Standing Committee on Agriculture and Agri-Food, Feb. 25, 2016.

Unfortunately, the combined effects of CETA and TPP will seriously impact Canadian dairy farmers' bottom line year after year. DFC conservatively estimated that the combined impact arising from both CETA and TPP to be between 4.85% and 5.8% of the 2016 milk production forecast by Agriculture and Agri-Food Canada. It represents between $282 million and $357 million in lost revenue. These are perpetual losses that cannot be substituted through exports. While we are working on a strategy to take advantage of some export opportunities, these remain limited as a result of the WTO panel, which essentially concluded that any export sales at below the domestic price constitutes an export subsidy.

DFC supports trade agreements as long as they have no negative impact on dairy farmers. Canadian dairy farmers should not bear the cost.

Contrary to the claim that trade agreements have helped to shape a better world market environment, it is difficult for us to conclude that. Now, 20 years after the WTO the world marketplace is not a friendlier place for farmers.

When DFC appeared before the Senate committee in November 2014 we told members that the world dairy market was essentially a dumping ground. Unfortunately, the situation remains disastrous. (Emond)

She also pointed to an anomaly that has been raised by critics of the TPP and goes back to differing standards and regulations in relation to the production of milk.

While we were pleased that Canada's compositional standards for cheese were preserved in the TPP agreement, we do have some concerns with respect to whether or not Canadian regulations and standards will be applied to imported goods. The growth hormone rBST, for example, is banned in Canada but remains in use in other countries.

The products of concern are related to the United States which approved Monsanto’s BST synthetic hormone to increase milk production in the early 1990s. In contrast BST was not approved in Canada despite enormous pressure from Monsanto partly because of concerns about increased production of milk in a supply managed system (Mills) and later concerns about animal welfare which led scientists in Health Canada in 1999 to not approve it. A similar situation had occurred in the EU which also led to a ban.

Once again differing standards became an issue at the Codex Alimentarius as the US pushed hard for adoption of a standard. While space does not permit a discussion here (see Smythe, 2013) the extent of disagreement is reflected in the fact that despite being considered by the relevant Codex CCRVDF in 1998 consensus on developing a safe level has eluded delegates both at the committee level and at the full Codex Commission, which as recently as 2012, tried to find a compromise with JECFA once more assessing the safety of BST. The Codex finally admitted at its 2015 meeting that no consensus was in sight and not wishing to approve standards that would not be implemented by members (as was the case with ractopamine) held the process of approval in abeyance. Thus if Canada sought to limit imports it would be harder for the US to challenge it given no Codex standard. Such an action is unlikely however, since as few Canadians are aware Canada’s position at the Codex was one of siding with the US to get standards adopted for BST in the name of regulations based on “sound science” narrowly construed in terms of food safety and not animal welfare or a consumer’s right to know. Even in the US consumer resistance to milk from cows treated with the hormone has resulted in only about 17% of US milk production involving the use of BST and companies regularly label their milk as BST free.

In addition to market access the TPP can be examined in terms of the other two areas discussed above namely government procurement and regulatory standards under the SPS and Technical barriers. Government Procurement provisions will have less of an impact since they do not go as far as the CETA provisions and were driven by a failure of Canadian negotiators to get much more access to the US and limit its Buy American provision. The limited results meant that there was no incentive to offer up coverage beyond provincial authorities leaving municipalities, school boards and hospitals not covered by the procurement obligations (Sinclair, 2016). In the case of regulations however the TPP is different and very much reflects an agenda that more aggressively targets regulatory barriers to the major food exporters and their industry supporters.

The United States Trade Representative’s office highlights this gain in the TPP which supporters have labelled “SPS plus” in comparison to the WTO. It is hard to view this section of the agreement and the provisions on biotechnology buried in the second chapter on National Treatment and Market Access as anything but a prelude to the TTIP.

Article 2.27 Trade of Products of Modern Biotechnology is a lengthy section in chapter 2 which deals with a number of issues and measures regarding the approval of new products and the export of food products containing inadvertent low levels of GMOs. It calls for extensive evidence of risk and food safety assessments and speedy review of applications for new products and mechanism to resolve regulatory differences. Both the US and Canada have been heavily invested in GM crops and been because of regulatory differences shut out of the EU market and in some cases had shipments of products turned back because of inadvertent contamination and the EU requirement for mandatory labelling of any foods produced with GMOs. Again this conflict was reflected in a protracted battle at the Codex Alimentarius where the US, Canada and their allies fought to stop any standard in the Codex Committee on Food Labelling that would be permissive of mandatory labelling (Smythe, 2009). They were not wholly successful and thus unable to mount a challenge against the EU’s regulations on labelling. While the provisions of 2.27 reiterate that

Nothing in this Article shall require a Party to adopt or modify its laws, regulations and policies for the control of products of modern biotechnology within its territory. (2.27.3)

The intent is to target regulations that might limit the access of GMOs and insist on risk and food safety assessments based on “sound science” the mantra of the United States at the Codex. Standard then become a market access problem. The TPP chapter on SPS makes no reference to 2.27 or foods containing GMOs. What it does do however is develop further mechanisms by which exporters can challenge regulations that would impact market access and force tighter timelines on the regulator to justify such measures. New elements are described by the USTR as a major gain that goes beyond the WTO and includes:  New obligations that promote science-based and transparent regulation  Commitments to promote the use of risk analysis to improve the scientific basis of SPS regulations and the use of risk communication.  TPP promotes transparency by requiring publication of SPS regulations for public comment  New TPP obligations require all TPP countries to notify importers or exporters of shipments being detained for SPS concerns. This rapid notification will help importers and exporters address concerns, which is particularly important for perishable products (7.11)  TPP commitments permit an importing country to conduct an audit of an exporting country’s food safety regulatory system to determine whether the exported food meets the importing country’s requirements. This will mean that the U.S. can use systems audits to enhance confidence in the safety of imported food, while minimizing the need for inspections by multiple foreign countries of tens of thousands of U.S. food processing plants.  TPP provides a new consultative mechanism for seeking quick resolution of measures related to U.S. food and agricultural exports (USTR, 2015)

The SPS chapter article 7.11 regarding import checks and the right if an importation is restricted for the importer to challenge it has been called a “Rapid Response Mechanism” which was a demand of the Food and Agriculture Task Force of the U.S. Business Coalition for the Trans Pacific Partnership. Critics like the US Consumers Union and Food and Water Watch see it as a “ as a private right for an importer/exporter to dispute at the treaty level an official action by a government to enforce its food labeling and safety laws.” (Center for Science and the Public Interest, 2013). It had been widely supported by the major food and food processing corporations in the US and their advocates such as the Grocery Manufacturers Association. Their support for the TPP was reflected in what the Guardian calls corporate payments to the US Senate to fast track the TPP (Guardian). As a Common Cause report indicates one of the groups of large corporations lobbying for TPP are food and beverage companies. Their association the Grocery Manufacturers of America spent over 4.5 million on lobbying in 2014.

The fate of the TPP is of course by no means ensured. Even CETA has been subject to challenges including the demand of the European Parliament to alter the investment dispute settlement process. It has yet to be ratified. The TPP is also being challenged in a number of countries where it will likely be an election issue. Most widely covered in the media is of course the US presidential election. However Australia is also voting in July and a food scare involving hepatitis and imported berries from China has those supporting upcoming changes in labelling regarding country of origin and the made in Australia criteria are already sounding the alarm about the TPP and whether it will foreclose such changes. Even more troubling for TPP supporters may be the fact that several analyses by a variety of entities including the US International Trade Commission, the World Bank and economists at Duke University show that over an extended time period there is very little net economic benefit to all of the major high income countries, and food exporters who are involved in the deal.

Conclusion

While this assessment of trade agreements through the lens of food is very preliminary it is suggestive of the extent to which trade agreements have mixed results for those producing for the domestic or export market. The reality of is that these agreements have focused on enhancing market access by trying to harmonize or gain mutual recognition of standards and regulations. In the case of the EU and the US and Canada, as I indicated above, this is an unlikely prospect given what the EU perceives to be the resistance of its food eaters to accept some of the methods and standards of production that prevail in North America. What has emerged is what the World Bank calls conformity assessments, where “ Country A trusts Country B to certify that the products made by Country B conform to Country A’s standards.” Thus the US and Canada established mechanisms by which they certify meat meets the EU standard of being produced without growth promotants before it is shipped. While this is a savings of time and some cost for those in North America who produce that way it may limit increase in the producers market access unless they can create parallel processes of raising animals and processing meat or abandon the use of growth promotants altogether. It is also a recognition that protracted trade disputes when it comes to sensitive matters related to food may not lead to enhanced market access.

For Canadian dairy producers who serve the domestic market the pattern of CETA and the TPP is worrisome and may suggest that without a strong level of support their interests may be further sacrificed as part of the process of global dairy production unfolds. Their future remains uncertain.

For those wanting to use public institutions to help further develop and support more sustainable and locally-oriented food systems by privileging domestic producers in procurement through purchasing contracts the picture is also mixed and not totally encouraging. The low thresholds of the CETA agreement despite quite strong efforts on the part of municipalities and others to raise the threshold or get an exemption suggests that if negotiators see more lucrative access to foreign procurement contracts they are willing to see this option traded off.

The more aggressive push to limit trade barriers in regulations covered by SPS and TBT commitments which the TPP reflects are also relevant to building local food systems to the extent that those regulatory differences may reflect domestic public demands to know more about how food is produced that go beyond the narrow notion of food safety and risk and encompass issues like animal welfare or environmental sustainability. Even in the case of risk there are differences in acceptable levels of risk which the cautionary principle reflects. The push to harmonize standards and limit trade barriers while it may benefit large food corporations and processor who wish to source globally has proven difficult to realize to date. Food is different and what we eat and how we produce food is very sensitive issue and culturally imbedded.

References

Barta, Patrick (2008) Saudi Arabia of Milt Hits Production Limits, Wall street Journal, May 8.

Bennett and Murphy (2013) What Place for International Trade in Food Sovereignty, Conference on Food Sovereignty: A Critical Dialogue Yale University.

Canada Meat Council (2016) Trans-Pacific Partnership (TPP) Canadian Meat Industry Position http://www.cmc-cvc.com/sites/default/files/publications/tpp_trans- pacific_partnership_canadian_meat_council_position_8_apr_16.pdf

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CBC (2015) TTP would allow milk from cows receiving hormones into Canada (October 23) http://www.cbc.ca/news/politics/trans-pacific-partnership-milk-imports-hormones-1.3276739

Center for Science and the Public Interest (2013) Letter to Michael Froman, May 9

Common Cause (2015) The Political Money Behind the TPP (June) http://www.commoncause.org/fact-sheets/the-political-money-behind-trans-pacific- partnership.pdf

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Gibson, C. Robert and Taylor Channing (2015) Here’s how much corporations paid US Senators to fast track the TPP bill, The Guardian, (May 27)

Hanson-Kuhn, (2016) Following the Breadcrumbs: TTP Provides Clues to US Position on TTIP Minneapolis: Institute for Agriculture and Trade Policy.

Mills. Lisa (2002) Science and Social Context: the regulation of recombinant bovine growth hormone in North America Montreal: McGill-Queen’s Press.

MacRae, Rod (2014) Do Trade Agreements Substantially Limit the Development of Local/Sustainable Food Systems in Canada, Canadian Food Studies 1:1: 103-125.

Scott Sinclair (2016) Major Complications: The TPP and Canadian Health Care, Canadian Centre for Policy Alternatives (CCPA).

Scott Sinclair, Stuart Trew and Hadrian Mertins-Kirkwood (eds) (2014) Making Sense of CETA (CCPA).

Smythe, Elizabeth (2014) Food Is Different: Globalization, trade regimes and Local Food Movements. The Handbook of the International Political Economy of Trade, David A. Deese, (ed.) Edward Elgar.

Smythe, Elizabeth (2013) What's the Beef with Food standards? Industrial Meat and the Politics of International Trade, Paper Presented at Canadian Political Science Association of Panel: IPE, Natural Resources and Trade Policies June 6, 2013, Victoria B.C.

United States Trade Representative (2016) Trans-Pacific Partnership: Ensuring Food Safety

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i The Canadian Ractopamine-Free Pork Certification Program, was developed in cooperation with Canadian Meat Council (CMC), the Canadian Pork Council (CPC), the Canadian Food Inspection Agency (CFIA), the Market Access Secretariat (MAS), Agriculture and Agri-Food Canada (AAFC). “It covers all aspects of the industry from feed mills and producers to slaughter facilities and processors” (Canadian Pork International May, 2013)