Canada and France can do better on trade


Opportunities to be had in a better trading deal

Source: Winnipeg Free Press


In a rare appearance of respective ambassadors at the same event on Monday, Canada’s ambassador to France and the French ambassador to Canada provided a double-barrelled pitch to Manitoba businesses of the benefits and opportunities of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

With representatives from some large agricultural and aerospace companies, and a collection of small- and medium-sized business from across sectors on hand, the two ambassadors — Isabelle Hudon, Canada’s representative in Paris and Kareen Rispal, her French counterpart in Ottawa — both declared that each country could do better.

A year after the ratification of CETA, trade between the countries is at about $15 billion. Not surprisingly, that number gets dwarfed by Canada’s trade with the U.S. and French trade with the European Union (EU).

Hudon pointed out that it takes France just one week of trading with Germany to match its trade with Canada, and Canada needs only three days of cross-border trade with the U.S. to equal a full year of trading with France.

Both ambassadors noted the disruption to traditional trading patterns caused by the Trump presidency in the U.S. to point out the importance for Canadian companies to diversify their export habits.

Hudon told the 20-odd company representatives in attendance, “The last 18 months have shown us that being a little too dependent on one market, and with that market being the U.S., is probably not the best growth strategy for your business. You should consider France — not only just France — but consider it as a door to the EU.”

But regardless of the uncertainty that has hung over Canadian companies’ heads with the renegotiation of NAFTA and the controversial steel and aluminum tariffs and counter-tariffs, the U.S. will always be the largest and most attractive international partner for Canadian companies.

According to Statistics Canada, merchandise exports from Canada to France decreased 7.9 per cent from September 2017 to September 2018, while French exports to Canada grew by 9.7 per cent.

WIth representatives of some large Manitoba grain and livestock producers in attendance, it was hard to hide France’s non-tariff barriers to international imports of agricultural products.

Jean-Marc Ruest, senior vice-president, corporate affairs and general counsel for Richardson International, was blunt in his assessment of trade opportunities with France.

He said Richardson International, Canada’s largest grain company, exports to 50 countries, including some of the most “rough and tumble” countries in the world. But not to France.

“Europe and France continue to be one of the toughest markets for us,” he said. “For all intents and purposes, France is a closed market to us,” he said.

The EU has long stymied Canadian grain and oilseeds exporters by its refusal to accept genetically modified organisms (GMO).

Claude Vielfaure, president of pork processor HyLife, said his company does not export to France, in part because of non-tariff barriers related to processing technologies.

But he said HyLife’s current investment and expansion to its Neepawa processing plant will make it compliant, and at least give the company the ability to export to France, if it chooses to.

The CETA deal allows for 75,000 tonnes of Canadian pork to enter the French market tariff-free, and Vielfaure said there is demand in the EU for Canadian ham and that HyLife will start looking at France and the EU market for opportunities.

“Everyone in Canada is faced with the same issues,” he said. “If not, the quota would be taken up quite quickly.”

The challenges for Canadian agricultural exporters to enter the French market are well known.

Hudon acknowledged, “France is somewhat protectionist for some key sectors, and agriculture is one.”

In defence, Rispal cited the Rocquette investment in Manitoba and McCain Foods’ investment in France as examples of the possibilities that can exist, and that Canadian investment in France has increased by 30 per cent over the past year.

She did not deny France’s protection of its food industry, but said, “It’s easier to invest (in France) rather than export because of regulations (when it comes to the agricultural sector).”