Trade Gurus & Public Affairs Mavens

“Outing” the Global Agricultural Trade Cheats

Free trade in agriculture is a Holy Grail often espoused by those who do not understand the complexities of agricultural production or the extent of rules-breaking in global markets for farm products.  It was not an accident that trade in agriculture was largely outside the GATT rules-based global trading system until 1994.

The brave experiment of the WTO Agreement on Agriculture has encountered considerable difficulty in building on initial progress.  Key players are unwilling to adopt new disciplines. Add to this the fact that rules about subsidies and disciplines are written to accommodate the practices of the deep-pocketed subsidizers.  Regional and Plurilateral Agreements cannot address these problems because they require multilateral solutions.

Even long-established free trade agreements are not immune to serious distortions resulting from the big vs. little game.  Take, for example, the long running dispute over US Country of Origin Labelling (COOL) Rules.  While it is difficult to argue against the desirability or legitimacy of providing consumer information (in this case, labelling) – this is not an unfettered right, particularly not when the workings of the US system under dispute are seen to adversely skew the market in favour of using domestic livestock at the expense of imported livestock.  Canada and Mexico have experienced considerable disruption and damage to their exports of live swine and beef cattle due to the US measures.  The dispute has been dragging on since 2009.  The aggregate damage to Canadian beef cattle and hog producers already exceeds $2.5 billion.

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