The Press

NZ takes on Canada over dairy access

- John Anthony john.anthony@stuff.co.nz

New Zealand is taking on Canada over lost dairy market access estimated to be worth $68m over the first two years of a trade partnershi­p.

Trade and Export Growth Minister Damien O’Connor said New Zealand had initiated dispute settlement proceeding­s against Canada regarding its implementa­tion of dairy tariff rate quotas (TRQs) under the Comprehens­ive and Progressiv­e Agreement for Trans-Pacific Partnershi­p (CPTPP).

‘‘Our priority is to ensure that New Zealand exporters have meaningful access to the benefits negotiated under CPTPP, and that all parties fulfil the commitment­s they have made to each other under the agreement,’’ O’Connor said.

New Zealand had notified Canada and other CPTPP parties that New Zealand believed Canada’s implementa­tion of its dairy TRQs went against the rules of the CPTPP, he said.

‘‘New Zealand considers the manner in which Canada is implementi­ng its dairy TRQs to be inconsiste­nt with its obligation­s under CPTPP.’’

Establishe­d in 2018, the CPTPP is a free trade agreement involving New Zealand and 10 other countries in the Asia Pacific region. Many of Canada’s dairy TRQs remained unfilled, which represente­d a tangible loss to New Zealand’s dairy exporters, O’Connor said.

The value to New Zealand of lost market access in Canada was estimated to be about $68m over the first two years of the partnershi­p, he said. The losses were expected to increase each year as the size of quotas increased under CPTPP.

New Zealand had an excellent relationsh­ip with Canada, he said.

‘‘We have appreciate­d Canada’s engagement on this issue at different levels over a number of years and these proceeding­s will not come as any surprise to them,’’ O’Connor said.

‘‘Occasional­ly even good friends disagree, and it’s for that reason dispute settlement mechanisms in free trade agreements such as CPTPP exist.’’

New Zealand submitted its request for consultati­ons to Canada yesterday, he said. Canada had seven days to respond to New Zealand’s request, after which time the two parties would enter into formal consultati­ons to try to resolve the dispute.

If the dispute remained unresolved after consultati­ons, New Zealand could request a panel to adjudicate the dispute, he said.

While New Zealand had initiated disputes in the World Trade Organisati­on before, this was the first dispute New Zealand had taken under a free trade agreement, and the first dispute that had been taken by any party under the CPTPP, he said.

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