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Could TPP & CETA be election issues?

Centre for International Governance Innovation senior fellow John Ibbitson comments in the Globe and Mail today, “If Barack Obama and (Japanese prime minister) Shinzo Abe can hammer out a deal on agriculture subsidies this week, then next year’s Canadian election could be the first in a generation in which trade is a key issue, with Stephen Harper favouring the Trans Pacific Partnership (TPP) and Thomas Mulcair and (possibly) Justin Trudeau opposing it.”

The Trans-Pacific Partnership is 12-country corporate rights ‘trade’ deal that involves Canada, the United States, Mexico, Australia, Chile, Peru and other countries. The TPP would eclipse the North American Free Trade Agreement in size and scope. The concerns that have been raised include: extended patent protections for prescription drugs that would delay the introduction of less-expensive generic drugs; investor-state provisions that would allow companies to sue governments over rules to protect the environment; procurement rules that would mean more corporate bidding-rights and restrictions on government spending to meet public interest priorities; common regulations and rules of origin; and the loss or weakening of Canada’s supply management system.

Ibbitson notes, “Things are at a make-or-break stage, and this week could prove decisive. All parties have generally agreed to broad tariff reductions, limits on the abilities of governments to favour local suppliers and increased protections for intellectual property. The devil in the details is Japan, which refuses to lower tariffs on agricultural products and automobiles. The Americans are insisting on greater access. Various media, including the Japan Times, reported over the weekend that the two sides are approaching a deal on rice and wheat, in which the United States would grant Japan some continued protection in exchange for a gradual increase in import quotas.”

For its part, Canada is seeking to preserve the supply management system that protects the dairy and poultry industry within the TPP. But if Japan agrees to lift agricultural tariffs, Canada will have no choice but to do so as well. There will no doubt be ample time provided to phase out dairy and poultry quotas, along with financial compensation, but the Conservative government, if it must choose between protecting supply management and signing the TPP, is almost certain to sign the TPP, for reasons of politics as well as policy.”

“For the Conservatives, the political stakes of abandoning supply management are relatively low. Many of the affected farms are in rural Quebec, where there are no Conservative MPs. Signing on to the TPP might cost the Conservatives a couple of seats in Eastern Ontario, but Cheryl Gallant, for example, is safe in Renfrew-Nipissing-Pembroke no matter what happens to the dairy farmers in her riding. The political costs for the Tories should be marginal. …(But) those Quebec dairy and poultry farmers are in ridings held by the NDP. There is no way the party would ever support dismantling supply management. …The Liberals are determined to expand their base in Quebec. That means winning seats in rural Quebec. That means protecting supply management.”

“An election in which both the Liberals and the NDP opposed a Pacific trade agreement while fighting over Quebec seats that Conservatives could never hope to win anyway – even as Mr. Harper promotes the new trade deal in suburban Ontario as further proof that only he can be trusted to manage the economy – is not the worst scenario for a governing party seeking a fourth mandate and trailing in the polls. The TPP won’t decide the election. But it could be a useful Conservative wedge. And in any election, a useful wedge is worth its weight in gold.”

Last year, Ibbitson also wrote about the Canada-European Union Comprehensive Economic and Trade Agreement in relation to the October 19, 2015 federal election. He said, “Failure (to secure CETA) would leave people wondering what the Conservatives managed to achieve after four years of majority government.” While an agreement was signed in principle last October, CETA still has a complicated ratification process in Europe to survive and is currently caught up in European concerns about investor-state provisions in the Europe-US Transatlantic Trade and Investment Partnership (TTIP).