Good morning, Mr. Chair and committee members. Thank you for the opportunity to be here today. We congratulate the committee on holding this hearing on the WTO.
I'm a grains and oilseeds farmer from Saskatchewan, and I am vice-president of the Canadian Agri-Food Trade Alliance. With me here today is Tyler Bjornson, who is with the Canola Council of Canada. The Canola Council is one of the 15 members of CAFTA.
CAFTA is a coalition of 15 organizations made up of farmers, processors, marketers, and exporters, as well as input suppliers. We represent the majority of the farmers in Canada, and we represent all of Canada's important agricultural export commodities. We also represent value-chain partners. We are the only trade advocacy organization that represents the entire agricultural value chain.
Our members do about $50 billion worth of business annually, and we provide half a million Canadian jobs. It's important to note that 91% of Canada's farmers depend on international markets, either as international price-takers on their products that are sold domestically or more directly as exporters of product.
We have circulated a submission. Today I'm just going to be making a few comments as an overview of the submission we have circulated to committee members.
Canada is the most trade-dependent of the G-8 countries. Canada is the world's fourth-largest exporter of agriculture and agrifood products. One in three jobs in Canada depends on exports.
CAFTA's members are highly dependent on international trade, and we continue to be forced to compete in a market that is highly distorted by subsidies, prohibitive tariffs, and non-tariff barriers. If Canada’s agriculture and food sector is to make a growing contribution to the Canadian economy, we require a solid set of international rules that will address these distortions.
A more open trading system would mean increased opportunities for Canadian farmers, processors, and exporters. Estimates of the benefits of more open trade for Canada and for the world are as high as $56 billion U.S. annually.
The Doha development round of the WTO, launched in 2001, is a chance in a generation for countries to address unfair subsidies and access barriers, to create a better trading environment for trade-dependent countries like Canada, and to provide a development tool to lift millions of people in the world’s poorest countries out of poverty.
Canada was a strong supporter of the ambition prescribed in the Doha mandate in 2001, where three outcomes were outlined: substantial reductions in trade-distorting domestic support, substantial improvements in market access, and reductions of export subsidies with a view to phasing them out completely,.
Then Canada went further in 2004 by signing on to the framework. There were three commitments there: it committed countries to an end date for export subsidies; we committed to the harmonization of domestic support cuts by ensuring higher subsidizers make deeper cuts; and we committed to substantial improvements in market access for all products, including sensitive—meaning politically sensitive—products.
This would lead us to believe that Canada is committed to an ambitious WTO deal and, as one of the world's largest exporters, may even be a leader at the WTO table. I'm here today to tell you nothing could be further from the truth. While we have one of the best teams of negotiators in the world, their work has been complicated and conflicted by messages and directions from our politicians.
I will give you three examples of this. Last November, a motion unanimously supported by members of Parliament in the House of Commons called for Canada not to accept any reductions in over-quota tariffs or expansions in tariff rate quotas, and this seriously impacted Canada's negotiation position.
Then in December in Hong Kong, ministers from around the world were prepared to accept language on agricultural market access that would have moved negotiations forward on sensitive products. Canada’s minister stood alone in rejecting the language, ensuring that no progress was made and putting the WTO process at risk.
The third and perhaps most alarming example is from only a few weeks ago. On May 5, Canada’s negotiator stood alone in a session on sensitive products to block an emerging consensus that would have seen at least minimum reductions in over-quota tariffs. We stood in the way of progress at this critical stage of negotiations, and Canada stood alone—148 to 1.
Let us be clear why Canada's current position on sensitive products is a problem. Canada's two largest exports are meat and grain or grain products. Meat and grain are the two most sensitive products in the world. Canada's resistance to negotiations towards any compromise on sensitive products sentences Canadian farmers and processors to continue to face prohibitive tariffs and tariff quotas in the majority of WTO countries, because in these countries our major exports are considered sensitive.
Canada's isolation in the agricultural market access negotiations poses other risks for our international trade interests.
Firstly, it puts at risk our ability to play a strong role in other areas of the negotiations, in export competition and domestic support.
Secondly, it threatens overall progress in the entire round of negotiations, since progress in agriculture will determine the level of ambition in services, rules, industrial tariffs, and other areas where Canada has strong interests. It threatens progress and it threatens the round due to critical deadlines being pressed.
Thirdly, it puts at risk Canada's ability to participate fully in the post-modalities phase of the negotiations, where small group negotiation sessions will determine schedules.
Improved trade rules are vital to the majority of Canada's farmers and the industries that depend on them. We must remove some of the distortions in the international marketplace and improve the futures of Canadians who rely on it.
CAFTA asks this committee to direct the government to take three specific actions. One, clearly and publicly state its commitment to the Doha Round and to an ambitious outcome in all three pillars of agricultural negotiations, including improved access for sensitive products. Two, give clear direction to Canada's negotiators to seek ambition in all three pillars of the negotiations, including agricultural market access. Three, take a leading role in these negotiations by participating fully in all ministerial level negotiations in a way that will help to build consensus on an ambitious outcome.
Thank you very much for your attention. I look forward to your questions.
I'm now going to turn it over to Tyler to speak about canola, which very clearly has some good examples about the damage I've spoken about.