'Let's not pretend that we're in a global free market when it comes to agriculture,' PM tells Bloomberg News
Prime Minister Justin Trudeau met U.S. President Donald Trump's pointed criticism of Canada's dairy industry Thursday with calm counterarguments in defence of how Canada prefers to manage its milk.
"Let's not pretend that we're in a global free market when it comes to agriculture," he told Bloomberg News editor in chief John Micklethwait during a question and answer session in Toronto.
"Every country protects for good reason its agricultural industries. We have a supply management system that works very well here in Canada. The Americans and other countries choose to subsidize to the tunes of hundreds of millions of dollars, if not billions of dollars, their agriculture industries, including their dairy," the prime minister said.
"Different countries have different approaches, and we're going to engage in a thoughtful, fact-based conversation on how to move forward in a way that both protects our consumers and our agricultural producers," he said.
Trudeau's comments were, in the words of his interviewer, his first chance to react to the "constructive dialogue" started by Trump Tuesday, when he used a speech in Wisconsin to attack the unfairness of recent pricing changes for dairy ingredients in Canada that make American imports less competitive.
The "terrible" plight of American dairy farmers has captured the attention of U.S. politicians of all stripes as the U.S. sector grapples with the twin difficulties of overproduction and low global prices for milk.
"How certain governors are speaking to certain constituencies on that, it's politics," Trudeau said. "At the same time, the U.S. has a $400-million dairy surplus with Canada. So it's not Canada that is the challenge here."
Trump's jabs at Canada continued Thursday as the media was invited to watch him sign another memorandum on trade in the Oval Office.
"Canada ... what they've done to our dairy farm workers is a disgrace. It's a disgrace," he said. "Rules, regulations, different things have changed, and our farmers in Wisconsin and New York state are being put out of business."
But Trump didn't stop there, also raising "what's happening along our northern border states with Canada, having to do with lumber and timber."
"NAFTA, whether it's Mexico or Canada, is a disaster for our country. It's a disaster. It's a trading disaster," he said, saying his office would be "reporting back sometime over the next two weeks" on what it's going to do about the North American Free Trade Agreement.
Trump continues to promise his supporters that he will renegotiate a better deal.
"We can't let Canada or anybody else take advantage and do what they did to our workers and to our farmers," he said.
In fact, the two issues Trump raised Thursday — Canada's supply management system for dairy production and the longstanding debate over the way Canada manages its softwood lumber supply — are not included in the NAFTA agreement.
It's unclear whether they will be included in the scope of the renegotiations.
NAFTA talks won't begin until after a mandatory 90-day consultation period with the U.S. Congress. Trump's nominee for the cabinet position of trade representative has not yet been confirmed.