Legal Advice Sought Over Canadian Backflip On Dairy Trade

Trade Minister, Todd McClay, has slammed Canada’s refusal to comply in full with a CPTPP trade dispute ruling over dairy trade as “cynical” and says New Zealand has no intention of backing down.

Mr McClay said he has asked for urgent legal advice in respect of the Government’s “next move” and says the Canadian Government still has time to honour its obligations to New Zealand both in the spirit and substance of the agreement.

New Zealand initiated the dispute because Canada was not complying with Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) rules, blocking dairy exporters’ access to its market, the Minister said.

A CPTPP arbitration panel ruled decisively in New Zealand’s favour. Canada had until 1 May to change how it administered its tariff rate quotas – to stop giving its own domestic industry priority access, and to allow exporters to benefit fully from the market access negotiated in good faith between Canada and New Zealand.

“The changes Canada has published today do not comply with the ruling. Canada’s ongoing failure to meet its legal commitments is disappointing, but we have no intention of giving in on this. We back our exporters and we will defend hard-won free trade agreement commitments,” Mr McClay says.

“New Zealand’s prosperity depends on international trade, making up 60% of the country’s total economic activity. It is only through a strong economy that we can reduce the cost of living and afford the public services Kiwis deserve."

“We continue to engage in good faith throughout this process and I’ve asked officials to provide advice on next steps. I will be making an announcement on that in due course.

“New Zealand supports trade rules and takes seriously its obligations to trade partners. We expect others to show us the same courtesy,” he said.

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