Canada/Korea trade talks back on track: CCA

Free trade talks between Canada and South Korea, stuck on the back burner for months, have resumed with what appears to be renewed interest in a deal, the Canadian Cattlemen’s Association reports.

The CCA and Canadian Pork Council in particular have pressed Canadian officials since January to get trade talks with South Korea back on track, especially after the Koreans’ trade pact with the U.S. took effect in March 2012.

The Korea/U.S. (KORUS) pact put Canadian beef at an “immediate tariff disadvantage” to U.S. beef, the CCA reiterated Monday. Seoul’s tariff on U.S. beef imports is decreasing by 2.7 percentage points per year until U.S. beef is duty free in 2026, the association said.

Canadian beef will remain subject to the full 40 per cent tariff when entering Korea until Canada and Korea reach an agreement to improve access, the CCA said.

On chilled and frozen pork exports to Korea, the U.S. is expected to have no tariffs by 2016, Richard Davies of Canadian pork packer Olymel said in 2011, “while we will pay 22.5 and 25 per cent respectively.

“Even though the full reductions will not occur immediately, they will cumulate quickly,” Davies warned in 2011. “With this disadvantage our Korean business will be gone within two years.”

Before Canada’s first case of BSE in a domestic cow cut off Canada’s exports to Korea and other markets in 2003, Korea was Canada’s fourth largest export market for beef, the CCA said, taking 14,400 tonnes of Canadian beef in 2002.

After Korea restored market access for Canadian beef, with the first shipments resuming in May 2012, total shipments for eight months of 2012 were just over 2,000 tonnes, nearly all frozen beef. Since then, the CCA said, “monthly shipments throughout 2013 have steadily declined.”

“Highly motivated”

Talks between Canadian and Korean trade negotiators have been sporadic at best, at times stalling for years, since the two countries agreed to formal negotiations in 2005.

However, Canadian negotiators went to Seoul last week, Nov. 25-29, for the first full negotiating round since last year, the CCA reported Monday.

“With a new chief negotiator having been appointed since the last meeting, it appears that Korea may be prepared to work quickly to finalize an agreement,” the CCA said.

As a further inducement, the CCA noted, Korea has also been floating its interest in joining the Trans-Pacific Partnership (TPP), a group of nations in talks toward an Asia Pacific free trade zone.

“To join the TPP, Korea will have to be accepted by all of the existing partners, a list which includes Canada, Australia and New Zealand,” all of which are still subject to full tariff walls on meat exports to Korea, the CCA noted Monday.

“We believe that Korea may be highly motivated to conclude bilateral agreements with Canada, Australia and New Zealand in order to pave their way into the TPP.” — AGCanada.com Network

Related stories:
Canada formally joins Trans-Pacific trade talks, Oct. 9, 2012
Canada formally drops WTO beef dispute with Korea, June 19, 2012
South Korea allowing Canadian beef ‘immediately,’ Jan. 20, 2012

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