New Zealand objects to Canada favouring local wines

It was not only in the on-trade that New Zealand shone. In the off-trade, “again New Zealand was the star performer increasing value by 12.2 percent.” (Photo: The Shout)

New Zealand has followed Australia’s lead in joining a World Trade Organisation complaint against Canada protecting local wines over imports.

In the Province of British Columbia (BC) only BC wines can be sold on normal grocery shelves, while sales of imports are restricted to “a so-called store within a store”.

The NZD $7 billion Canadian market is New Zealand’s fourth largest wine customer with sales to June 2017 of NZD $107 million. A level playing field could greatly boost wine sales to Canada.

While it is frustrating for New Zealand’s wine exporters to be the victims of protectionism, there is evidence to suggest that Canadian producers will suffer rather than benefit from an artificial trade barrier in the long term. Trade subsidies are, in my view, like a drug that gives short-term relief but ultimately results in dependence and reduced competitiveness.

One thought on “New Zealand objects to Canada favouring local wines”

  1. Mahmoud Ali says:

    There seems to be a misunderstanding in the way this story has been written and understandably it continues to be used when there is no other narrative. From what I understand the BC government has a lowed a few large supermarkets to sell BC VQA wines within their store, the so-called “store within a store”. Apparently there are only 14 supermarkets that have been granted a license to do so and none are in Vancouver. “Normal grocery stores” cannot and do not sell any wines. All private wine stores, and the ubiquitous BC Liquor Board (government owned) can and do sell wines from all around the world.

    There is no doubt thus is a leg-up for local wineries, especially the smaller wineries with limited production wines. A visit to the BC liquor board store in Kelowna last year had them directing me to the local supermarket with the “store within the store” because, in their words, the liquor board operation could not handle and allocate small production wines.

    I understand that many countries made representations to the Canadian/BC government when the policy was first announced but it was only later that the US government filed an official complaint and now Australia and New Zealand has followed suit.

    Yes, in effect, we are talking about 14 supermarkets in the entire province of British Columbia selling smaller and boutique wines with the VQA designation. Hardly a big deal one would think but it might be considered a precedent that Ontario and New Brunswick (the only other provinces with wineries) might adopt. Legal opinion usually suggests protecting ones rights at every opportunity and we all know that.

    Prosecco anyone?

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