November 3, 2011 - In today's Vancouver Sun, MLI author Larry Martin writes about how Canada should be poised to capitalize on the opportunity to feed the world. He says, "We are uniquely positioned due to our vast tracts of arable land, abundant water,  infrastructure and long experience in the sector. And yet Canadian agriculture and agri-food business are not only failing to maintain their share of world  markets, but are falling behind."

He outlines three areas where policies hold us back:

First, Canada's regulatory system is an oppressive weight on innovation in the  food sector that not only discourages investment, but drives it out of the  country while destroying opportunities for Canada to be an early adopter of  game-changing new technologies.

Second, our preoccupation with subsidizing small farming operations distorts  farmers' decisions, reduces our competitive advantage and reduces the amount of  capital available for investment.

Third, Canada suffers from serious tariff and non-tariff barriers in accessing  markets that are big consumers of products that Canada can supply.

The full op-ed, which also appeared in the Edmonton Journal, is copied below. It is based on MLI's recent study, Canadian Agriculture and Food: A Growing Hunger for Change, co-authored by Larry Martin and Kate Stiefelmeyer.

 

The seven billion need Canada's crops

The world craves our food, agricultural expertise, but outdated regulations keep us from seizing the opportunity

By Larry Martin, The Vancouver Sun, November 2, 2011

World population has reached seven billion people and will grow to nine  billion or more within 30 years. The incomes enjoyed by these new populations  are growing more rapidly than ever. More food will be consumed in the next 50  years than in the rest of the history of humanity. Demand for food climbs with  population and income, creating a huge opportunity. Canada should be poised to  capitalize on this opportunity to feed the world. We are uniquely positioned due  to our vast tracts of arable land, abundant water, infrastructure and long  experience in the sector. And yet Canadian agriculture and agri-food business  are not only failing to maintain their share of world markets, but are falling  behind.

We could do so much better.

Canada has the third-largest and most accessible endowment of arable land per  capita in the world, behind Australia and Kazakhstan. Most of Canada's  competitors have less than half the arable land per capita that we do.

Many of the world's soils have been badly degraded, including much of Asia  and Africa where growth in food demand is occurring. Canada has some of the most  stable soils in the world, which constitutes another significant advantage for  our country.

Much of the world faces some degree of fresh water scarcity. Not Canada. Our  nation contains about nine per cent of the world's renewable freshwater supply  and our use of renewable water resources is very low compared to our  competitors'.

In addition to these magnificent natural advantages, Canada possesses three  advantages created by the energy and intelligence of our people.

The first is infrastructure. In a comparative sense, it is much easier for  Canadians to deliver their products to markets than many of our potential  competitors.

Second, Canada maintains a world-beating scientific and research-based  capacity to support the industry.

Finally, Canadians enjoy a long history and experience with agriculture and  food processing. We know what we're doing.

Yet our share of world markets is falling, our agricultural productivity is  rising more slowly than our competitors', and our influence in world trade talks  about agriculture is falling. As a result, our rural communities are forgoing  greater prosperity, our food processors are losing out on export opportunities,  and our economy is missing out on potential growth. That is a missed opportunity  for Canada. But it is also far more: At a moment when it is not clear that the  world can meet the growing demand for food, it is a potential humanitarian  tragedy for the globe. Canada faces both an economic and a moral imperative to  do better.

The solution is largely in the hands of Canadians and our governments.  Canadian policies were developed in a world of surplus, but we've been  increasingly in scarcity for over five years; it's time for our food policy to  catch up with reality. Here are just three areas where old policies hold us  back:

First, Canada's regulatory system is an oppressive weight on innovation in  the food sector that not only discourages investment, but drives it out of the  country while destroying opportunities for Canada to be an early adopter of  game-changing new technologies.

Second, our preoccupation with subsidizing small farming operations distorts  farmers' decisions, reduces our competitive advantage and reduces the amount of  capital available for investment. In total, according to the OECD, Canadian  government financial support for agriculture remains between 20 and 25 per cent  of gross farm income on average. These policies do the farm and food sector no  favour. Our big competitors, countries such as Australia and New Zealand, have  reduced their market support to below 10 per cent, or have begun to replace  market support with policies aimed at improving productivity and the  environment. They are the countries now winning markets that used to be  Canada's. They are the countries now at the cutting edge of agricultural and  food processing technology where Canada used to be.

Third, Canada suffers from serious tariff and non-tariff barriers in  accessing markets that are big consumers of products that Canada can supply. In  other words, there are markets where consumers want products made in Canada but  which are partly or wholly closed to Canadian firms because of trade barriers.  Yet Canada's ability to influence global trade talks in favour of more open  markets for food and other agricultural products has declined because of our  obdurate insistence on our own protectionism in sectors like dairy and eggs.

These wounds are largely self-inflicted. Policy-makers in particular must  face up to the fact that this country's laws and regulations are sadly out of  date, reflecting a mistaken belief that agriculture and food processing are  industries of the past, not the future. Canada's potential as a world leader in  farming, food and food processing can yet be unleashed. An increasingly hungry  world deserves no less.

Larry Martin is the lead author of Hungry for Change, recently released by  the Macdonald-Laurier Institute, www.macdonaldlaurier.ca. He is a senior  research fellow at the George Morris Centre in Guelph, Ont., and a research  advisory board member for the Macdonald-Laurier Institute.

© Copyright (c) The Vancouver Sun

 

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