Trade War with Canada and Mexico Looms Over US

Angered by US laws requiring that meat sold to consumers be labeled with the name of country to animal was born, grown and killed, Canada and Mexico won a formal complaint they had lodged with the World Trade Organization against the US requirements.

Mexico and Canada say these rules discriminate against imported meat, and are threatening to take steps to retaliate in what could become a full-blown trade war.

“Our governments will be seeking authorization from the WTO to take retaliatory measures against U.S. exports,” stated the Mexican and Canadian ministers for trade and agriculture.

Canada has already published a list of potential products to target for trade sanctions, such as wine, chocolate, ketchup and cereal. Mexico has not released a similar list, yet.

The beef and pork industries in Canada point to the fact that the US restrictions increase their expenses, reducing livestock exports. They say they have lost an estimated $1 billion a year in revenue as a result of this law.

Michael Conaway the Republican chairman of the House of Representatives Committee on Agriculture would like to see Congress do something fast.

“It is more important now than ever to act quickly to avoid a protracted trade war with our two largest trade partners,” Conaway said.

Republicans have a majority in the Congress, but they will most likely come up against a strong Democratic response to leave the labeling regulations in place. The top Democrat in the Committee on Agriculture, Collin Peterson, said he would oppose a change in the law. He added that he believes there are still steps that can be taken at the WTO before making any big changes.

The focus of the dispute is a law enacted in 2009 that requires retail outlets to label meat and pork in a way that gives consumers more information about the safety and the origin of the meat they purchase and eat.

Jonathon Bowes

About Jonathon Bowes

Jonathan Bowes started his career in banking. After a few years, he took courses in business and finance and worked his way up the corporate ladder. Today, while writing part-time for Business District, Bowes assists talented people to find jobs in the field of economics. Contact Bowes at Jonathon[at]businessdistrict.com