Free trade lets us feed ourselves and the world
The WTO recently sounded the alarm that because of COVID-19, global trade may fall more than 30 per cent this year — three times the decline during the 2009 global recession. And these distressing figures don’t yet account for the possibility the pandemic may make countries turn to protectionism, especially when it comes to food. Doing so would only make things worse, especially for post- pandemic recovery efforts. Embracing free trade has never been more important for farmers, food businesses and families alike.
People the world round, Canadians obviously included, rely on a stable supply of food and agricultural products from this and many other countries, particularly in this time of crisis. Despite the near shutdown of dozens of economies worldwide, global agri- food markets remain relatively stable, grocery store shelves are still stocked and food prices have not spiked. Lineups outside stores are now par for the course but inside most food items are available. For two main reasons, this is likely to continue.
First, governments around the world have recognized that keeping borders open to essential agrifood is vital to preventing shortages and chaos. For Canada, keeping the U. S. border open to trade is especially important, given our highly integrated supply chains. Other key measures, such as deeming food and agricultural supply chains an essential service, preserving the Temporary Foreign Worker program and establishing food safety protocols, ensure goods keep flowing and provide confidence in the continued reliability of the Canadian supply chain.
Second, farmers, food manufacturers, retailers, transport workers and the many other partners in the agri- food supply and value chains are a resilient bunch who take their work seriously and are backed by a solid science- based regulatory system. Trade plays a key role every step of the way and, in the process, supports jobs in urban and rural communities across Canada. That is why commitments to keep international borders open to agri-food help maintain the stability of a network of sectors that need to remain robust and resilient both for the workers they employ and for the consumers they feed.
There is still reason to worry, however. It would be wrong to assume that COVID-19 won’t cause disruptions in these networks. Though global trade in agrifood remains open, some countries are gradually introducing measures that threaten the current stability, including export restrictions and protectionist subsidies. Any supply shortfalls that do emerge are instead best addressed through increased production and the unfettered flow of products. For our export- oriented sectors and the 90 per cent of Canadian farmers who depend on trade, taking away the possibility of selling abroad would remove the foundation of a system already under pressure. Agriculture is probably the economic sector that is most vulnerable to protectionism, whether from tariffs or non- tariff measures thrown up without warning. Food safety rules, to take but one example, are unquestionably legitimate. But in the current environment we must work doubly hard to ensure they aren’t trade barriers in disguise.
A tide of protectionism creeping under the cover of nationalism may be very difficult to roll back. As one of the world’s leading agricultural trading nations, Canada has a leading role to play to ensure free trade does not become the latest casualty of COVID-19. We’re already a leader in the Ottawa Group of countries looking to reform the WTO. And we’re the only G7 country with comprehensive trade agreements in North America, Europe and throughout Asia — the most lucrative markets in the world. Our recent success modernizing NAFTA to create the Canada- United States- Mexico Agreement ( CUSMA) is testament to Canada’s ability to negotiate with tough, protectionist-inclined partners.
Putting that experience to work post- pandemic will be very important. Canada has the know- how and credibility to ensure the right policy choices are made coming out of the crisis. This will be especially important should the U. S. retrench into an “America First” agenda that leads to a proliferation of protectionism around the world.
The reality is that Canada has become an agriculture powerhouse precisely because we have specialized in growing and manufacturing commodities and products that the world wants and needs, leveraging our vast arable lands, our abundant water, our infrastructure, research and innovation and our long experience in the sector. Whether we’re selling pulses to India, beef to China, pork throughout Asia or grains and oilseeds to every corner of the globe, Canada’s export- oriented agri- food sector is good for us and good for the world. Protectionism won’t just hurt farmers; it will disrupt global supply chains and erode everyone’s competitive edge. To sole- source food and shut down borders is, almost literally, to sow the seeds of famine and economic ruin.
Fortunately, the lessons of history can guide us. Protectionism worsened the effects of the Great Depression. Opposing protectionism helped advance recovery following the 2009 global recession. Just as keeping trade open is feeding people today, embracing it tomorrow will be essential for economic recovery when life returns to normal.
Fortunately, the lessons of history can guide us.