Canada signs Trans-Pacific Partnership

Oct 05, 2015

New supply management programs introduced

By Diego Flammini,

After rounds of intense negotiations, Canada became one of the member nations of the Trans-Pacific Partnership (TPP), an agreement that will create the largest group of trade partners in the world.

The full details of the agreement between Canada and the other 11 countries have not been finalized and will have to be approved by all governments involved before coming into full affect.

Among the negotiated items was Canada’s dairy supply management system. Currently, about 10 per cent of dairy products are from outside Canada and as per the TPP, another 3.25 per cent could be from foreign markets.

Dairy cow

In addition, 2.3% of eggs, 2.1% of chicken, 2% of turkey and 1.5% of broiler hatching eggs could be offered to TPP partners through quotas phased in over five years.

As a result, the Canadian government is implementing new programs to assist supply-managed farmers and processors:

The Income Guarantee Program will provide 100 per cent income protection to producers for 10 years from the day the TPP gets implemented. Income support assistance will then continue on a tapered basis for five more years, totaling 15 years. The government set aside $2.4 billion for the program.

The Quota Value Guarantee Program will protect farmers from a reduction in quota value when it’s sold after TPP is implemented. The program will be in place for 10 years and the government has put aside $1.5 billion for the program.

The government is investing $450 million into the Processor Modernization Program. It will provide supply-managed processors with support to increase competitiveness and growth.

$15 million will be invested into the Market Development Initiative to help supply-managed groups with marketing and product promotion.

The total investment by the government is about $4.3 billion.

About the TPP

  • Along with Canada, it consists of Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.
  • 81% of Canadian exports go to TPP countries
  • The member countries represent about 800 million people and a GDP of $28.5 trillion
  • Canada is the only G-7 nation with free trade to the United States and the Americas, Europe and the Asia-Pacific region

Join the conversation and tell us your thoughts about Canada joining the TPP. What are your thoughts on the federal government’s investments to help compensate the affected farmers?

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