Published: Fri, April 21, 2017
Business | By Max Garcia

Trump calls Canada's dairy trade policies a 'disgrace'

Trump calls Canada's dairy trade policies a 'disgrace'

As he signed an executive memo ordering an investigation into whether foreign steel hurts USA national security, President Donald Trump took a moment to slam Canada.

MacNaughton first responded soon after Trump's remarks, sending a letter to the governors of Wisconsin and NY, both USA dairy strongholds, saying "the facts do not bear out" the US president's criticism of Canada.

A similar policy is being adopted across Canada, which prompted the governors of NY and Wisconsin, two major dairy-producing states, to ask Trump to take action.

The senator said the Central New York business could be severely hurt by Canadian rules limiting the import of American dairy used in the manufacture of cheese.

Trump also lobbed criticism at Canada for what he characterized as unfair trading practices in the lumber and energy sectors.

The Dairy Farmers of Canada, which has previously denounced the complaints as "falsehoods and half-truths", said Tuesday it was confident the federal government would continue to defend the dairy industry.

The President echoed that sentiment Thursday: "We can't let Canada or anyone else take advantage of our workers or our farmers".

The U.S. dairy lobby has accused Canada of "systemic disregard" of its trade obligations, while the Canadian industry accused its American rival of "scapegoating".

"By virtue of economic weight alone, Trump has the overwhelming leverage to force open the protected Canadian dairy sector", said Canadian trade lawyer Larry Herman.

The move by Canadian producers has cost USA farms upwards of US$150 million, according to a Washington Post report. Commerce Secretary Wilbur Ross has blamed the Senate for delaying the confirmation of Trump's US trade representative.

"I welcome President Trump's statement yesterday taking issue with Canada's damaging new dairy pricing policies that are unfair trade barriers harmful to American dairy farmers", Schumer said today.

Canada's ambassador to the U.S. David MacNaughton is downplaying any cross-border tension with the United States over dairy tariffs, calling the relationship "terrific" and "a model for the rest of the world".

A spokeswoman for Canada's dairy industry said Tuesday night there has not been any new taxes on dairy imports.

The surprise tongue-lashing represents some of the new administration strongest anti-Canada rhetoric thus far, and a significant departure from the relatively warm reception Prime Minister Justin Trudeau received on his first meeting with Trump in the US capitol. "And they'll give us an answer, but we're going to get the solution - not just the answer".

"We're not going to overreact", Trudeau said.

Supply management has long vexed conservatives because it stands in sharp contrast to their belief in free markets, but most refuse to suggest dismantling the system as there is support for it in key constituencies.

"Canada is not to blame for the global situation that both Canadian and American farmers face", he said.

MacNaughton said it remains to be seen how quickly NAFTA talks can get underway because of a looming election in Mexico, and the fact the U.S. Congress still hasn't granted negotiating authority to the Department of Commerce.

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