Mr. Chairperson, thank you for the opportunity to participate in the committee's study on the benefits to Canada of the Trans-Pacific Partnership.
The Dairy Farmers of Canada recognizes the importance of trade for this country and is on the record as supporting the government entering the talks based on the balanced trade negotiating position.
Our director of trade, Mr. Yves Leduc, who was originally scheduled to appear before this committee, is currently in Brussels, unfortunately—I don't know if it's fortunately or unfortunately, but he's in Brussels—following the CETA negotiations and I'll try to replace him and answer your questions, if I can.
The aim of the Canadian milk supply management system is to balance supply and demand, as well as balance market power among the supply chain stakeholders. Despite concentrating our effort on the domestic market, international trade talks are an important aspect when it comes to maintaining the integrity of the Canadian system in the future. Predictable imports are critical considering that dairy farmers discipline their production to ensure domestic demand is met without creating unnecessary surpluses.
Between 6% and 8% of our Canadian dairy consumption is supplied by imported dairy products coming in tariff-free, which makes Canada more generous than the U.S. or EU in terms of access. Predictability and import control are not equal to no imports. Dairy farmers are proud of the dairy sector's contribution to the Canadian economy, and we consider ourselves job sustainers, providing stability in the economy and supporting our rural communities.
It should also be noted that the Canadian dairy sector increased its number of Canadian jobs between 2009 and 2011. Dairy farmers are doing their part of the economic action plan to keep our economy strong and prosperous.
Essentially 100% of our dairy sales take place on the Canadian market. Exports only represent roughly 1% of Canada's milk production and export opportunities are virtually nil as a result of the negative decision in the late 1990s of the WTO panel on Canada's export policy. Any market opening, therefore, even if it were reciprocal, would come at the expense of Canadian dairy farmers.
Canada has negotiated 11 trade agreements with a number of negotiating partners over the past 20 years and has always maintained supply management for dairy and poultry. In other words, no concessions have been made with respect to TRQ expansion or over-quota tariff reduction. This is fully in line with the position defended by the Canadian government and which was clearly spelled out in the motion which was unanimously adopted in the House of Commons on November 22, 2005. The motion clearly states that Canada will accept no over-quota tariff reduction and no TRQ expansion for its supply-managed products as part of its balanced negotiating position in any trade discussions.
DFC would like to express its appreciation for the comments made by the Prime Minister, Minister Ritz, Minister Fast, and their parliamentary secretaries, who have consistently reiterated on a number of occasions that they will not make any concessions on supply management. We also very clearly want to acknowledge and appreciate the continued support of all parliamentarians for a system that is working well for Canada.
We've tabled with you a more detailed brief this afternoon, but I would like to address two issues with regard to the TPP trade talks.
First, negotiations like those on the TPP are often presented as being subject to no a priori exemptions. It is interesting to note, however, that domestic support in agriculture cannot be found on the negotiating agenda. Failing to discipline the use of such subsidies which can be very trade distorting goes against the principle of a no a priori exemption.
Second, I would like to mention that all countries, including New Zealand, Australia, and more particularly the United States, have a number of sensitive sectors. There are several examples outlined in our submission, but many more can be found. While we may be more up front about it, as Canadians, we don't have to be shy to defend what is in the best interests of Canadians and Canadian industries.
In conclusion, Mr. Chair, Dairy Farmers of Canada is on record as supporting the Canadian government entering the TPP trade talks as part of the government's trade agenda that is based on the balanced trade negotiating position. For dairy farmers, this means that the government will continue to defend supply management both domestically and internationally, in line with the June 3rd, 2011, Throne Speech and the November 2005 House of Commons motion.
Consequently, Canada must not give any concessions in the TPP or any other trade negotiation that would in any way undermine the credibility of the Canadian negotiating position at the international level with respect to Canada's right to maintain supply management.
Thank you for your attention. I will be happy to respond to your questions.