The two neighboring countries have warned the United States they are ready to impose retaliatory measures on cross-border trade.
Canada and Mexico have fired off a final warning to the United States that if it fails to amend its country of origin labeling (COOL) rules then both countries will proceed with imposing retaliatory measures on cross-border trade.
Canada valued its retaliatory measures at $2.4 billion, while Mexico estimated its proposed actions to be valued at $653 million.
The World Trade Organization on May 18 confirmed for the fourth time that U.S. country of origin labeling measures are in violation of international trade obligations.
The biggest sticking point with the amended U.S. COOL regulations is that they require Canadian and Mexican livestock and meat products to be segregated from those of U.S. origin, which is costly since livestock and meat produced within North America has been traditionally co-mingled.
“In light of the WTO’s final decision and due to the fact that this blatantly protectionist measure remains in place, our governments today are asking the WTO for a special Dispute Settlement Body meeting to request retaliation rights against the United States, to take place on June 17,” said the governments of Canada and Mexico in a joint statement on Thursday.
“The Canadian and Mexican governments will continue to work closely to resolve this important trade issue with the United States in order to defend our farmers and ranchers and maintain jobs and economic prosperity throughout North America,” they added.
Canada and the United States, in particular, enjoy the strongest bilateral trading relationship in the world, with two-way trade in goods and services of more than $870 billion last year. In 2014, agriculture and agri-food trade between Canada and the United States was $51 billion.
“The WTO has ruled that the United States is out of options and out of time. The only way for the United States to avoid billions in immediate retaliation is to repeal COOL,” warned Gerry Ritz, Canada’s minister of agriculture and agri-food.
Canada, Mexico turn up heat on U.S. COOL
