Fisheries Committee on Nov. 21st, 2013

[Steve Verheul]

Yes, I'm happy to.

We have agreed that we would not treat EU vessels any less favourably than we would treat vessels from other countries in like circumstances. That's the extent of the commitment that we have made. Essentially, we can't unfairly discriminate against EU vessels compared with other vessels.

We have entirely maintained the discretion of the Minister of Fisheries and Oceans to have authority over licensing of fishing and related activities, including access to fishing vessels in various waters and ports. If we take an action for environmental reasons, for safety reasons, for issues related to the state of the resource, as long as we don't discriminate against the EU, we have full scope to do that, as we have now.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

Okay.

The provinces have played an unprecedented role in these negotiations. Like I said, we're trying to get more information. I understand there are a couple of appendixes to this that deal with the role of the provinces, appendix A and B.

[Steve Verheul]

No, there won't be specific appendices that would relate to provinces and territories. They are integrated in the various chapters where we could cover issues that fall under provincial and territorial jurisdiction. For example, on services and investment, you will see reservations that are specific to each province and each territory in light of what they're prepared to do in that sector.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

Right. Okay.

I want to pass this on to Mr. Cleary and mention that I'll be joining the trade committee next week in Halifax. I'm looking forward to hearing from a lot of people in industry and from our communities. We're going to have some representation from some people in the fishing industry. I'm looking forward to hearing more about that. Thanks very much.

Mr. Cleary.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

Thank you, Mr. Chair.

To start, I'd like to read a notice of motion I'm going to bring forward at a later date:

That the Standing Committee on Fisheries and Oceans undertake a study of the impacts of the Comprehensive Economic and Trade Agreement (CETA) for the fishing industry in Newfoundland and Labrador, including the repercussions of the elimination of Minimum Processing Requirements, and that the Committee report to the House on its findings.

Now I have two quick questions.

First off, how would the eventual removal of minimum processing requirements impact the processing jobs in Newfoundland and Labrador and Quebec? That's the first question.

The second question follows on a question that Robert asked. Just so there's clarity here, in the past Canada has restricted access to Canadian ports of EU ships that have been cited for illegal fishing outside the 200-mile limit. Under the CETA deal, when this comes into effect, will that no longer be allowed to happen? Will Canada no longer be able to block EU vessels, pirate vessels, from access to Canadian ports?

[Steve Verheul]

First of all, with respect to the first question relating to minimum processing requirements, I think it's important to clarify that what we're doing in CETA is not applying minimum processing requirements against exports to the EU. For all other destinations, those requirements remain in place.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

That's clear.

[Steve Verheul]

Certainly, from what we've been told, minimum processing requirements are of most benefit in protecting processing jobs for more local competitors, whether in other provinces or from the U.S. It's not of a great value to the EU, because some of those minimum processing requirements are fairly modest, such as putting elastic bands around the claws of lobsters.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

So there would be no job losses?

[Steve Verheul]

I would not anticipate any job losses. I would anticipate quite a bit of job gains. In fact, what we do now, because we have limited access to the EU, we send raw product to countries that have unlimited access. So we sell raw product to Greenland, to Iceland, to Norway, all of whom have access to the EU market. Without having to do that, we can process in Canada and send directly to the EU. So I think we'll see quite a bit more processing in Canada as a result of this.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

Why is there $400 million in compensation, then?

[Steve Verheul]

Well, there has been some concern expressed in various places that the removal of minimum processing requirements on exports to the EU might have some impact, and some, I'm convinced, probably believe that. I think that was part of the justification.

The other justification is that if we're going to take full advantage of this new access into the EU, we need to be prepared, well positioned, to do that, particularly if we're going to go into the retail market, which we haven't done to a great extent so far.

So it's more about restructuring the industry, positioning it to compete in the European market.

Now I'll add on your second question.

[The Chair, Conservative, Rodney Weston]

Please be very brief, Mr. Verheul.

[Steve Verheul]

Sure.

You mentioned the issue of illegal fishing and the concerns we've had in the past with some EU vessels doing illegal fishing. Absolutely nothing will change on that front. We have the full scope of powers that we've had before and will have them under CETA to address those issues. We will not be inhibited in any way.

[The Chair, Conservative, Rodney Weston]

Thank you very much.

Mr. Cleary, I take it that you'll provide text for that notice of motion to the clerk.

[Ryan Cleary, NDP, St. John's South—Mount Pearl, NL]

Absolutely.

[The Chair, Conservative, Rodney Weston]

Thank you.

Mr. Weston.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you.

This is a historic agreement, and it's really great to meet two of its architects. Thank you for being here. I'm sure it was a long, hard process, and we might love to hear the novel behind the presentation sometime. It's such an exciting agreement, with so many benefits for Canadians.

I understand that there are some specific niche markets for seafood of which we can take advantage. I wonder whether you could touch on a couple of those.

I'm from the riding of West Vancouver—Sunshine Coast—Sea to Sky Country, in British Columbia. it would be interesting for me and a couple others on the committee to know what British Columbian products might go there. But generally, what niche markets do you think we're going to be able to take advantage of?

[Steve Verheul]

Well, I think there are many and that they coincide nicely with the key products that we have been producing in our fisheries sector over the last while. It's not on the west coast, of course, primarily, but shrimp in particular will be a big success story. We have faced significant obstacles into the EU market on cooked and peeled shrimp, for example. But we will have entirely open access in that market. Newfoundland and Labrador is very interested in that specifically.

When it comes to the west coast, the tariffs on salmon will be completely eliminated as of day one that the agreement comes into effect. We will have full access to the EU market on the first day for all salmon products, no matter what degree of processing they may have.

We'll also have access on various other types of fish species of interest to British Columbia, whether it's ground fish, or whether it's.... Well, British Columbia has indicated an interest in hake and sablefish and.... Let's find another one. Certainly the salmon we have covered. I'd have to say that with the exception of tuna, in which British Columbia has a modest interest, everything else is going to be duty-free immediately.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

You know, there was a point as recently as 2012 when the sovereign debt crisis in Europe meant that countries lacked the capacity, possibly, to make decisions. That must have been one of your impediments.

Can you talk about that, or any of the other key impediments in getting to where we are? What was the big breakthrough?

[Steve Verheul]

There were a lot of bumps along the road, I can assure you. When the European Union went through those financial difficulties, we got a fair number of questions about whether this was the right trading partner to be launching such an ambitious enterprise with. But at the end of the day, the EU is still the largest, wealthiest market in the world. Certainly some of its member states are having some struggles—we've all read about Greece—but when you look at the strength of the German economy and even the strength of the U.K. economy, the big three with France included, there is a lot of economic wealth, and there is certainly a lot of growth in some of the new member states that have entered as well.

They've hit a few bumps in the road, but the European Union is not going away. It is going to continue to be an extremely wealthy market.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Would either of you like to comment on what competitive advantage we might have vis-à-vis the United States in accessing the European market, based on CETA?

[Steve Verheul]

It's a considerable advantage. It's probably an advantage that the U.S. would have little chance to compete with. If we have faced a 20% tariff on some of our key exports, such as lobster or shrimp, and now have access to the retail market, the U.S. would have neither of those. They would have to pay those tariffs and would not have access to the retail market. That allows us to establish customer relationships; it allows us to develop markets and name brands. We have a significant advantage in that respect.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

We've heard that more than 80,000 new Canadian jobs may result from CETA. We've heard that the average Canadian household may receive $1800 or more per year out of this. Our seafood exports were some $400 million between 2010 and 2012. What increase do you see in the seafoods category, above that $400 million? Is it possible to even predict?

[Steve Verheul]

It is difficult to predict, I think. I tend to think that the studies that were done before the negotiation were underestimates somewhat, but there was an estimate done that in the fish and seafood sector we'd be looking at a 20% growth as well.

I think we have to keep in mind first of all that the 20% relates to the volume of exports, and I think our exports have a very good chance of being of much higher value than our current exports, given that we'll have access to the retail market. Personally I think we have the opportunity to achieve much higher growth rates than 20%.