What are the implications of retaliatory measures against the United States if the World Trade Organization rules in favor of Canada and Mexico in their case against the United States concerning Country-of-Origin Labeling requirements for beef and pork?
That was the focus of the House Agriculture Subcommittee on Livestock and Foreign Agriculture’s hearing on COOL. The hearing included a cross-section of agriculture, business and industry witnesses. The majority of the witnesses said the threat of retaliation is severe, and Congress must act quickly to prevent irreparable damages to industry and the U.S. economy. They suggested that Congress pass legislation to repeal COOL.
The COOL Reform Coalition, co-chaired by the U.S. Chamber of Commerce and the National Association of Manufacturers, said, “Canada and Mexico are by far the United States’ largest export markets, and purchased a record $485 billion in manufactured goods in 2014. Those exports support millions of U.S. jobs. WTO-authorized retaliation by two of the largest U.S. trading partners could result in billions in tariffs affecting multiple sectors of the U.S. economy, threatening the livelihoods of American families.”
The National Pork Producers Council said, “We cannot afford to have (pork) exports disrupted nor can workers in allied sectors. The loss of the Mexican and Canadian markets, valued at $2.4 billion, could cost over 16,000 non-farm jobs.” The National Farmers Union, a strong supporter of COOL, said that Congress needs to wait and not rush to judgment while the case is before the WTO. NFU said, “Congress should not listen to the overblown rhetoric and retaliatory threats made by foreign government officials and the meatpackers. The WTO has stated multiple times that countries have a right to label products with their country of origin and remain in compliance with WTO. We urge Congress to allow the WTO process to run its course.”
Those testifying were the NPPC, the NFU, U.S. Chamber of Commerce, National Association of Manufacturers, Wine Institute, National Confectioners Association and Harris Ranch Co.
The WTO is expected to rule by mid-May on the U.S. appeal. If Canada and Mexico win they will have the right to retaliate with tariffs estimated at $2 billion and possibly higher. Canada has released its list of products that it would place tariffs on including beef, pork, cheese, fresh fruit, steel pipes, heating appliances, office furniture and mattresses. Mexico has not released its list of products. However, if history is our guide from previous trade cases, Mexico will look at pork, cheese, sweeteners, wine, potatoes, office equipment, home appliances, etc.