New Zealand Escalates Trade Dispute Over Dairy Tariffs with Canada

New Zealand has intensified its trade conflict with Canada over dairy tariff quotas, accusing Ottawa of violating CPTPP rules. The matter, involving misallocation of quotas to domestic firms, has now moved to mandatory negotiations. It's the first such dispute under CPTPP, garnering support from five other member countries.

In a significant move on Friday, the New Zealand government announced that it has escalated a prolonged trade dispute with Canada concerning access to dairy products within the North American country. New Zealand is calling for mandatory negotiations, accusing Canada of violating the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) rules.

The conflict, originally initiated by New Zealand in May 2022, centers on Ottawa's allocation of dairy tariff rate quotas. New Zealand asserts that Canada agreed to permit some market access to foreign dairy firms via a quota system but improperly allotted portions of these to domestic companies, breaching trade agreement stipulations.

This dispute is unprecedented—it is the first initiated by New Zealand under any free trade agreement and the inaugural contention brought forth under CPTPP by any party. Canada has yet to respond, while New Zealand is backed by five CPTPP members: Australia, Japan, Mexico, Peru, and Singapore, all emphasizing fair treatment in international trade.

(With inputs from agencies.)