Speaking at a public hearing on the US International Trade Commission’s (USITC’s) investigation into the economic implications of a TPP that includes Canada and Mexico, National Chicken Council (NCC) president Mike Brown said that the agreement could give the US industry important negotiating powers with both countries.
He pointed out that Mexico’s participation in TPP negotiations would offer nothing in terms of tariff reductions, because the US already has a free-trade agreement with Mexico under the North American Free Trade Agreement (NFTA).
However, he said that it could offer an opportunity to negotiate on two of the biggest issues between the US and Mexican poultry industries, namely the lack of progress on sanitary issues, preventing Mexico from exporting poultry to the US, and the “use of bogus anti-dumping cases to hinder trade”.
Improving trade relations
Brown explained that some regions of Mexico are affected by Exotic Newcastle Disease (END), and that progress towards recognising states as END-free had been slow. Additionally, Mexico’s poultry inspection services have failed to meet the equivalancy standards required by the USDA’s Safety Food Inspection Service (FSIS), leaving the country unable to export chicken to the US.
He said that the “lack of significant progress in establishing some level of two-way trade in poultry products after 17 years of NAFTA” had resulted in trade litigation, with a US processor filing an anti-dumping case against imports of US chicken leg quarters. He added that, in the NCC’s view, the Mexican government would not have accepted the case had it not been for the fact no progress had been made towards gaining Mexican chicken exports access to the US market.
With this in mind, Brown recommended that negotiating objectives for Mexico’s inclusion in the TPP should include the negotiation of a timetable for recognition of END-free areas of Mexico and recognition of equivalancy of Mexican poultry inspection services, as well as the negotiation of a “peace clause” preventing either country from bringing anti-dumping cases on poultry products.
Concerns over Canada
With regards to Canada, Brown said that the US poultry industry was“aggravated” that Canada had refused to give US exporters duty-free access after entering into NAFTA. However, he added: “Canada’s participation in the TPP would also be considered a positive opportunity by our industry provided that Canada agrees – in advance – to put its import protection policies on the negotiating table.”
The USITC’s investigation into the possible economic impact of entering into a free trade agreement with the 10 countries in the TPP – Australia, Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam – was launched at the request of the US Trade Representative, after Canada and Mexico joined negotiations earlier this year. The final report on the investigation is expected by 19 November 2012.
