International Trade Committee on March 8th, 2012

[Some hon. members]

Oh, oh!

[The Chair, Conservative, Rob Merrifield]

I would say welcome to the committee--a new, improved Liberal member.

[Some hon. members]

Oh, oh!

[The Chair, Conservative, Rob Merrifield]

The floor is yours, sir.

[Frank Valeriote, Liberal, Guelph, ON]

Thank you, Mr. Chair.

Thank you to all for taking the time out of your schedules to join us today. I come from the agriculture committee, and I'm replacing Mr. Easter today.

You mentioned an exemption. You said products excluded from tariff elimination commitments would include alcoholic beverages, tobacco products, and some poultry products. Could somebody expand on what those poultry products are, and why they were exempt? Could you be more specific?

[Marvin Hildebrand]

I'll start and ask my colleague from agriculture to finish.

As I mentioned, there's a very small number of exclusions on the Jordanian side. They requested exclusion of tobacco and alcohol on the basis of health and morality reasons. All across the board, from A to Z products, the only one that they really had a very acute sensitivity to was chicken, for some particular domestic reason, which was something we ultimately agreed to. It's a subset of chicken, and it's not, as you know, something that's of particular export interest for Canada in the context of our other agricultural export interests. So that's the way it went.

Denis, do you have any details on that?

[Denis Landreville, Lead Negotiator, Regional Agreements, Trade Negotiations Division, Trade Agreements and Negotiations Directorate, Department of Agriculture and Agri-Food]

Yes, it's essentially five tariff lines, primarily frozen chicken products and turkey, with two processed poultry products. So it's five tariff lines. The current tariffs on a most-favoured-nation basis are from 20% to 29%. They didn't represent export interest to us, so those are the poultry-related tariff lines that were excluded by Jordan.

[Frank Valeriote, Liberal, Guelph, ON]

All right. Then I see in a report the elimination of a vast majority of agricultural tariffs, including those applied to pulse, frozen french fries, various prepared foods, and animal feeds. What about beef and pork? Can you elaborate on beef and pork?

[Denis Landreville]

Beef and pork for the most part were eliminated immediately upon implementation by Jordan. Some exceptions are for some lines where there are slightly longer tariff phase-outs of about up to five years, depending.

[Frank Valeriote, Liberal, Guelph, ON]

Okay. I notice that services were not included in the negotiation. I don't want to speculate on this, but I know that one of the concerns in the CETA agreement is access to sub-national services, both at the provincial and the municipal level. I'm sure you're aware of the concern expressed by Canadians that municipalities will not be able to prefer local services and local bidders. Is there anything in this agreement of a similar nature, or is that not dealt with at all?

[Marvin Hildebrand]

It's not dealt with at all. It reflects, as I said, a couple of things. One is that when we did the Gazette notice, and solicited comments and input from stakeholders before the negotiations began, there was no request from stakeholders that services be part of this deal, which we think reflects—

[Frank Valeriote, Liberal, Guelph, ON]

That's great. I don't have much time, so I'd like to ask another question quickly, if I could.

The concern about labour, of course, is not just with respect to human rights, which is the most important issue, but also the fact that if they're not meeting certain labour standards, wage standards, it puts them at more of a competitive advantage than Canada. So how useful, really, are the provisions in the labour cooperation agreement, which contains a full dispute settlement process and financial penalties, should a country fail to respect International Labour Organization principles, or fail to enforce them? How useful is that mechanism, and how enforceable is it, really?

[Pierre Bouchard]

We have streamlined the dispute settlement process to make it more transparent, robust, and efficient. Essentially how it works is that any Canadian—an organization, a citizen—can present a complaint to us. For example, in the case of a violation by Jordan, an alleged violation, we start consultations if we have to decide if it's valid—if we accept it for review. We start consultations. These consultations can lead to ministerial consultations.

Of course, the emphasis is on trying to find a solution through cooperative means. Normally if you have goodwill, as we see right now with the Jordanian government, we would expect to find a cooperative solution. However, if there's no agreement following ministerial consultation, we can then call upon an independent panel of experts. It's a little like what you would find in a dispute settlement of a trade agreement; it mimics a little bit what has been done on that side.

This panel of experts would go out, investigate, and then again propose solutions, deciding if there's a violation or not. If this is trade-related, that's an important criteria at that stage. If there is a violation, the party is then encouraged to agree to a plan of action, but if there's no agreement in the end, there would be an obligation on the part of the Jordanian government, let's say, if it's a complaint against Jordan, to deposit into a cooperation fund the funds that are at a level identified by the review panel. That money would be used to do projects to resolve the matter at hand. Until the compliance issue is resolved, the country has to keep depositing every year.

It's a strong incentive for cooperation. It's a problem-solving mechanism whereby you can use those funds to actually do something about the issue. We believe it would be very effective.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Mr. Hiebert.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Thank you.

It's a pleasure to meet all of you. Thank you for joining us today

In reviewing the speech you provided us this morning, I had a couple of questions that I wanted to dig down a little deeper on. At one point you mentioned that there were “principle-based chapters on the environment and labour cooperation”, and then you referenced “high-quality side agreements with strong, binding obligations, which were negotiated in parallel”. I was just wondering if you could tell us a little more about what those side agreements were and how they were negotiated.

[Marvin Hildebrand]

Yes. I'll start with the environment and then ask Mr. Bouchard to talk about labour.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Just to clarify, I understand that there are environment and labour principle-based chapters—

[Marvin Hildebrand]

Yes.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

—but you referenced additional side agreements.

[Marvin Hildebrand]

Yes.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

So are the side agreements referring to the environment and labour, or were there other side agreements?

[Marvin Hildebrand]

No. There are only two: one on environment and one on labour.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Okay. Please proceed.

[Marvin Hildebrand]

Okay. The chapter is relatively short on environment, but you asked about the side agreement so I'll mention the high points in terms of the contents of the environment side agreement.

It commits the parties to high levels of environmental protection, to improving their domestic environmental governance, and to enforcing their environmental laws, and it prevents them from derogating from those laws. There's a non-derogation clause. It also commits the parties to conducting environmental impact assessments and to promoting public awareness of such matters and related projects that would require environmental impact assessments.

It also provides for interested persons in either country to request investigations for alleged or potential violations of environmental laws. It provides for cooperation and for the parties to develop programs of cooperation subject to funding. There's no obligation, but subject to funding, such programs could be developed in order to strengthen cooperation.

The side agreement also establishes a committee on the environment involving the two parties, to help manage the implementation of the agreement, and it also provides for a dispute resolution process in which either party can request consultations up to the ministerial level. Failing a resolution in that process, a formal review panel to resolve the dispute can be established.

Those are the high points regarding the contents of the environment side agreement. Perhaps Mr. Bouchard could provide you a similar summary of the labour agreement.

[Pierre Bouchard]

Before I do, I just want to correct an earlier answer to the committee.

When I was asked the proportion of migrant workers in the Jordanian labour force, I was really focused on the apparel industry. That's the two-thirds I mentioned.

In the overall Jordanian labour force, it's actually much lower. It's at 27%. The two-thirds is in the apparel industry that is—