International Trade Committee on March 13th, 2012

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Let's hope we won't be the victims of our naïveté. The CEO of Bombardier, which is of course a Canadian company, was in favour of more protection for our procurement.

Nevertheless, I am going to raise another issue. Since the implementation of the United States-Mexico free-trade agreement, we have been subject to arbitration provisions between investors and the state. I am referring to the infamous Chapter 11. And we are negotiating that, potentially, with the Europeans.

Concerning those kinds of provisions, we can extrapolate and say that it amounts to a denial of our rule of law, since we are offering to take power away from government businesses and hand it over to investors—who already have significant recourse—leaving government businesses vulnerable.

At the end of the day, Mr. Minister, aren't we creating two categories of people, ultra-protected investors and the rest of the population, including government businesses, which are always vulnerable and at risk of being sued for whatever reason? Why do we continue to negotiate that kind of provision?

[Ed Fast, Conservative, Abbotsford, BC]

I'm not sure I accept the underlying premise of that question, but I will respond.

When you refer to chapter 11, you're referring to the ability of investors to seek a resolution of disputes. I want to assure you right up front that in every one of our free trade negotiations that Canada undertakes, we do not sacrifice Canadian sovereignty. Understand that when we negotiate a free trade agreement, it is a two-way street. Among other things, we seek to protect investors--Canadian investors as well as the investors from our partner countries. The dispute resolution processes that are put in place are absolutely critical to provide the kind of confidence that investors need that they'll be treated fairly.

If an investor from another country invests based on the rules that have been established under a free trade agreement, we want to make sure they have appropriate redress, and the same would apply, of course, to Canadian investors as well.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Minister, they already have provisions for that.

We negotiate on a negative list basis, but unfortunately, the private education system was not excluded. This could give rise to some abuses. Why wasn't this considered, Mr. Minister?

[Ed Fast, Conservative, Abbotsford, BC]

We have taken it into account. Again, I disagree with you. In any of our trade negotiations we want to make sure that in key areas such as health, environment, and education our ability to regulate is protected.

CETA will be no different. We are very much cognizant of the fact that Canada does need to protect its sovereignty over public health, public education, and over social services. I can assure you we will not compromise that as we move forward with our negotiations for a free trade agreement with the EU.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Mr. Holder, the floor is yours. We'll give you five minutes, and then we're going to have two very tight votes. We'll then adjourn.

Go ahead.

[Ed Holder, Conservative, London West, ON]

Thank you, Mr. Chair.

I'd like to thank the minister and his staff for attending with us this morning. Your comments have been very helpful.

I've been on this committee for close to four years. Through that time, I have seen a change on this committee. There was a time when the Liberal Party was very supportive of our trade initiatives. I'm feeling a wavering of that support, which is quite disappointing. It's almost as if they've taken the position of “trade if necessary but not necessarily trade”. I think that's exceptionally disappointing, from what I've heard from my young colleague opposite here.

Minister, I think this committee should be in violent agreement about what trade means for Canada. You made the point, and I'd like to emphasize, that almost 65% of our gross domestic product is predicated on trade--65%.

When I hear you talk about our relationship to the United States, it prompts two questions, please, Minister.

Acknowledging that since NAFTA came into play—and we have some detractors around this table with respect to NAFTA—the trade we have done between our countries has tripled. If I'm right, it's reaching close to $1 trillion. You've emphasized trade with the United States several times. I think we're their biggest trading market in some 35 of the 50 states. Could you expand on that a little more?

The other piece I'd like to understand a little better is the shared vision for perimeter security and the impact that will have on trade from your perspective.

I would appreciate responses in both those areas, please.

[Ed Fast, Conservative, Abbotsford, BC]

Thank you for that question.

You mentioned that we should be in violent agreement on trade. I share that sentiment, and I say that without any partisan motive. I believe trade should be a non-partisan issue because it is so critical to Canada's long-term prosperity.

There are some who make the assumption that trade is a zero-sum game. It is not. You don't have just a winner and a loser. Expanded trade agreements increase the size of the overall pie if they're done right, and I'm committed to doing them right. The purpose of expanded trade relationships and trade agreements is to build prosperity in all of the partner countries. So thank you for that question. I will continue to focus on doing that.

The initiatives that President Obama and Prime Minister Harper recently announced on our border vision and regulatory cooperation are examples of the close working relationship between the United States and Canada. That relationship is of critical importance. With those two initiatives we have focused on identifying security risks early, moving the security perimeter to our perimeter, and ensuring that trade across our mutual border can happen in a less impeded way—removing trade barriers and facilitating trade.

In the area of regulatory cooperation there's a huge step forward for Canada and the U.S. We're looking at regulations that are inconsistent, not because of any substantive issues, but because of historically being passed at different times and not taking into account each other's own regulatory regimes. We're moving toward a system where we actually have a greater level of regulatory coherence. That will eliminate the delays and the costs that those delays impose on the businesses that are doing business across our border.

Let's not forget that our trading relationship is in the order of $650 billion a year, and anything we can do to remove the billions of dollars of extra costs we impose on our businesses is well worth the effort.

[The Chair, Conservative, Rob Merrifield]

Thank you very much, Minister, for giving us your time. I know that Minister Baird was in front of the foreign affairs committee yesterday. He actually has the lead on this, and your time here is almost an exception. We thank you for that. This has been a great hour to be able to capture the main estimates.

Shall vote 20 in Foreign Affairs and International Trade carry?

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Chair, on this motion on vote 20, how much in dollars are we talking about, and how does it compare to last year?

[The Chair, Conservative, Rob Merrifield]

I believe you have the information in front of you there.

[Wayne Easter, Liberal, Malpeque, PE]

Yes, I do.

[The Chair, Conservative, Rob Merrifield]

Is it half a million less?

[Wayne Easter, Liberal, Malpeque, PE]

Just give us the total numbers, Gerald.

[The Chair, Conservative, Rob Merrifield]

Go ahead.

[Nadir Patel, Assistant Deputy Minister and Chief Financial Officer, Corporate Finance and Operations, Department of Foreign Affairs and International Trade]

There's a decrease of $32.9 million year over year.

[Wayne Easter, Liberal, Malpeque, PE]

There's a net decrease of $32.9 million. So you're proposing to spend $2.582 billion, minus or plus.

[Nadir Patel]

That's correct.

[Wayne Easter, Liberal, Malpeque, PE]

That's $32 million less than last year.

[The Chair, Conservative, Rob Merrifield]

All in favour?

[Brian Masse, NDP, Windsor West, ON]

I would like a recorded vote.

[The Chair, Conservative, Rob Merrifield]

I already started the vote. We can do a recorded vote on the next one, if you like.

[Brian Masse, NDP, Windsor West, ON]

We can do a recorded vote. We still haven't finished the voting process.

[The Chair, Conservative, Rob Merrifield]

We can have a recorded vote if you want.

FOREIGN AFFAIRS AND INTERNATIONAL TRADE Canadian Commercial Corporation Vote 20--Payments to the Canadian Commercial Corporation..........$15,482,000

(Vote 20 agreed to) [See Minutes of Proceedings]

[The Chair, Conservative, Rob Merrifield]

Shall I report vote 20 of Foreign Affairs and International Trade to the House?

[Some hon. members]

Agreed.