VANCOUVER -- Back in the 1980s, when the Canada U.S. free trade agreement was negotiated but not yet implemented, I addressed a group of British Columbia winemakers. To say they were upset would be to put it mildly. They stated loud and often all that good, cheap wine from California would wipe out the B.C. and Canadian wine industries, destroy producers, eliminate jobs and be a general disaster.
Those old enough to have bought and consumed wine before the free trade agreement will remember that finding a wine that was both good and reasonably affordable was nearly impossible. Almost all good wines were imported and expensive. B.C. and Canadian wines were generally cheaper, but were at least as low on the quality scale as they were on price. The term 'plonk de plonk' was an often used descriptor.
I told those B.C. vintners that their industry was not in trouble because of coming free trade, but because they made bad wine. They must have listened. Faced with better quality imports at the low-cost end of the market, wine producers got their act together and started producing the kinds of wines that won prizes at international competitions and offering good value for money at all price levels. All Canadians who drink or serve wine benefitted.
Today, it is the cheese makers who are crying doom because of the recently announced agreement in principle on free trade with Europe. Some details and final ratification of this agreement are still to come, but among the provisions that have been announced is that an additional 15,000 tonnes of European cheese would be allowed to enter the Canadian market, double the current limit and bringing the total amount of European imports to 30,000 tonnes.
This is a mere three per cent of the total Canadian cheese market or 30 per cent of the fine cheese or artisanal market. Canada's supply management system will remain unchanged, with Canadians still being woefully overcharged for their milk and milk products to the advantage of dairy producers. Still, the Dairy Farmers of Canada and their vice president, Ron Versteeg, are making noises like it is the end of the world.
I don't think so.
A fine selection of Canadian artisanal cheeses was served at a special dinner at the Governor General's residence in Ottawa I attended. Most of the guests had not tasted these special cheeses before and asked where they might buy them. We were provided with a list, (google fromageries or artisanal cheese Canada) but told not to bother trying to purchase any of the specialty cheeses as the amount produced was so low that the kitchen at Government House could absorb the whole supply.
While we may need to raise a little public awareness, surely there is market in Canada for all that our excellent fromageries can produce and more. Now add in the huge market potential in Europe under the free-trade agreement. And given that better access to European markets, Canadian artisanal cheese producers will almost certainly develop more uniquely Canadian, high quality, specialty cheeses.
The Dairy Farmers should also remember that the government of Canada will also be offering compensation to those who might be negatively affected by the changes that will benefit Canadian consumers.
Canada has a relatively small economy that is highly dependent on trade and disproportionately dependent on resources with their volatile markets and prices. However, with the European free trade agreement, Canada will have something no other nation has and that most would envy. We will have free trade with both the United States (our biggest customer) and Europe (our second biggest customer). The new European agreement will raise our economy by $12 billion and add 80,000 jobs. It will give our businesses more customers and all of us a greater variety of goods, many at cheaper prices. Phone services, automobiles and other goods will be less expensive and available in wider variety.
The government of Canada is making things better for the Canadian consumer by negotiating this historic agreement with Europe. Now all we need to do is deal with supply management so we will not have to line up at the U.S. border to find affordable groceries.
Troy Media B.C.'s Business columnist Roslyn Kunin is a consulting economist and speaker.