The Chinese government is simply using Canadian canola as a pawn in its ongoing trade war with the United States, Prime Minister Justin Trudeau said Friday — as the world’s two largest economies escalated their trade dispute.
“We know that Canadian canola is the best in the world, is unimpeachable in terms of its quality and China is simply using phytosanitary concerns as an excuse to prolong what is fundamentally a conflict, not even with Canada, but between the two largest economies in the world,” Trudeau said.
The prime minister was in Edmonton for a meeting with Mayor Don Iveson about infrastructure funding. Alberta is Canada’s second largest canola-growing province.
China pulled the export permits from two major Canadian canola exporters — Richardson International Ltd. and Viterra — in March, citing pest concerns. Chinese importers have stopped purchasing Canadian canola seed. Beijing has also revoked the export permits from two Canadian pork companies, citing labelling issues, while administrative trade issues are also affecting Canadian exports of livestock genetics from Semex and Alta Genetics.
Forty per cent of the canola Canada exports is sent to China. In 2018, the market was valued at $2.7 billion.
China’s decision to ban Canadian canola is having a “terrible impact on farmers across the country,” the prime minister told reporters, adding the federal government will continue to support farmers.
“We need to continue to work to end this dispute with China, this conflict with Canada,” Trudeau said, adding the federal government will continue to try and “lower the temperature on this.”
The prime minister did not say whether Canada planned to challenge the issue at the World Trade Organization (WTO).
Canada-China relations have been frosty since December after Canadian authorities arrested Huawei executive Meng Wanzhou in Vancouver following an extradition request from the United States.
Days later, two Canadians — former diplomat Michael Kovrig and businessman Michael Spavor — were arrested and remain in Chinese detention.
Trudeau said he spoke with Trump about China on Thursday where he raised the “challenges against Canada because of this conflict with China,” including the two detained Canadians.
“We have gotten strong assurances from people around the world, that they stand firmly with Canada and indeed are concerned about the way China is engaging in the world,” the prime minister said of the call Friday.
Last month, Agriculture Minister Marie-Claude Bibeau requested permission from the Chinese government to send a delegation of scientists — led by the president of the Canadian Food Inspection Agency — to China to discuss Beijing’s concerns.
China has yet to approve that travel request.
Trump ups trade war, will buy more farm goods
The United States escalated its ongoing trade war with China on Friday with the Trump administration increasing tariffs from 10 per cent to 25 per cent on some US$200 billion worth of goods. Multiple media outlets have reported Beijing plans to retaliate against the United States in response to the tariff hike.
In a tweet Friday, U.S. President Donald Trump said he was in no hurry to reach a deal with China, saying talks remain “very collegial” and promised to help American farmers who remain caught in the cross hairs of the trade war.
American and Chinese negotiators were set to meet in Washington, D.C. on Friday. Talks ended for the day shortly before noon local time.
“Your all time favourite President got tired of waiting for China to help out and start buying from our FARMERS, the greatest anywhere in the World!,” Trump tweeted.
That tweet came just hours after he said he would use funds collected from the tariffs to “buy agricultural products from our Great Farmers, in larger amounts than China ever did, and ship it to poor & starving countries in the form of humanitarian assistance.”
The prime minister did not comment on the U.S. president’s food-aid plan on Friday, nor did he specifically discuss Washington’s decision to increase its tariffs on Chinese products.
Trump’s plan would likely violate international trade rules and pose serious consequences for international exporters of farm products, including Canada.
Under WTO rules, food aid must be “needs driven” and can’t “be tied directly or indirectly to commercial exports of agricultural products or other goods and services.”
The global trading body also stipulates that international food aid cannot be “linked to market objectives of donor Members.”
A 2005 report by the World Trade Organization found “the dumping of subsidized food aid … has the same effects as the dumping on world markets of below cost price products.”