Harper to conclude Canada-EU trade deal on trip to Brussels

Prime Minister Stephen Harper will travel to Brussels tomorrow toconclude aCanada EU free trade deal with thePresident of the European Commission, Jos Manuel Barroso.

Canada and the European Union have reached a tentative free-trade agreement after Canada agreed to increaseimports of European cheese, CBC News has learned.

International Trade Minister Ed Fast, who has been leading the negotiations for Canada,will accompany the prime minister on his two-day working visit to Brussels.

Both Harper and Barroso tweeted Wednesday morning that a deal was close.

"We will soon complete negotiations on a Comprehensive Economic and Trade Agreement with the European Union," he tweeted. It was one of several tweets sent out on his official Twitter feed Wednesday, quoting from a speech to his Conservative caucus on the morning of the throne speech.

"Hope to conclude soon the negotiations between #EU and #Canada on Comprehensive Economic and Trade Agreement (CETA)," Barroso said.

Harper is expected to leave Brussels Friday evening.

Greater Canadian access toEuropean cheese has been one of the main stumbling blocks to a deal, as has increased market access in Europe for Canadian beef and pork.

Industry sources confirm to CBC News that Canada has agreed to raise cheese import quotas to 37,000 tonnes from 20,000, and to increaseEurope's share of thatto 30,000 tonnes from 13,000.

In return, it is expected Canada has received concessions on beef and pork. It was reported the two sides reached a deal on those issues last month.

A trade source privy to the negotiations told CBC News thatquotas would be phased in by sector over three, fiveor sevenyears, giving producers in Canada and in Europe time to adjust.

The deal is worth an estimated $1 billion to the beef and pork industries, the trade source said.

The deal still needs sign-off from the EU trade commissionerand Harper. Sourcestell CBC News the provinces were notified of the tentative deal on Monday.

Quebec has said it won't approve a deal that threatens its dairy industry, but the Conservative government has said all along it has no plans to dismantle Canada's system of supply management.

Dairy farmers concerned

The Dairy Farmers of Canada is "angered and disappointed" to hear about the tentative deal.

In a written statement issued on Wednesday, dairy farmers say the tentative deal will put small and local Canadian cheesemakers out of business.

"If this deal proceeds, the Canadian government will have given the EU an additional exclusive access of 32 per centof the current fine cheese market in Canada, over and above the existing generous access. This deal would displace our local products with subsidized cheeses from EU and risk our small businesses being shut down or put out of business. This is unacceptable," the Dairy Farmers of Canada said.

Quebecs dairy farmers are also furious about the tentative deal that would allow twice as much tariff-free European cheese across the Canadian border, in exchange for exporting tariff-free pork and Alberta beef.

NDPLeader TomMulcairsaid he has yet to see the text of the deal, but hopes Harper "is not selling out the Canadian dairy industry in general and the fine cheese manufacturers in particular."

Mulcairsaid Canada's supply management system was supposed to have been protected by the Conservatives.

The question now, according toMulcair, is whether the federal government isgoing to open up the dairy market in such a way that "there's going to be a flood of subsidized European cheeses squeezing out Canadian producers."

A spokesperson for the international trade minister told CBC Newsin an emailon Wednesday, "our governmenthas always defended the interests of our supply managed sector in our trade negotiationsthis approach has not changed with Canada-EU trade talks."

European Commission trade spokesman John Clancy told CBC News that a deal has not been finalized.

"Discussions do indeed continue with the aim of reaching an agreement as soon as possible" Clancy told CBC. "I have no further information at this time."