Evidence of meeting #36 for International Trade in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was japan.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Andrew Casey  Vice-President, Public Affairs and International Trade, Forest Products Association of Canada
  • Bob Kirke  Executive Director, Canadian Apparel Federation
  • David Worts  Executive Director, Japan Automobile Manufacturers Association of Canada
  • Kathleen Sullivan  Executive Director, Canadian Agri-Food Trade Alliance

11:45 a.m.

NDP

Don Davies Vancouver Kingsway, BC

We will have one each.

11:45 a.m.

Conservative

The Chair Rob Merrifield

Okay, that's fine, and then we'll go to Mr. Hiebert.

11:45 a.m.

NDP

Don Davies Vancouver Kingsway, BC

Thank you, Mr. Chairman.

I think the current policy on hemp is that you're okay growing five plants of hemp without, as it were, getting into too much trouble. I'm teasing: It's under six.

Mr. Kirke, when we think about textiles and the production of clothing and free trade allowing garments made all over the world to come into our country, it is a fact that many clothes and products are made in countries where people are being paid cents an hour as opposed to dollars an hour, and in appalling conditions, with child labour and those kinds of things.

Besides the impact that has on our domestic companies' ability to compete with that—I don't know how they compete in making products when they have to pay workers' compensation and EI premiums and minimum wages, etc.—I'd like you to comment on how that may factor into this. Also, does your organization have any ethical concerns about the free flow of goods into our country, in this case garments, made in what everybody would agree are appalling conditions. That's not Japan, of course.

11:45 a.m.

Executive Director, Canadian Apparel Federation

Bob Kirke

Understood.

You play the cards you're dealt sometimes. We didn't ask in 2003 for the Canadian government to eliminate duties on least developed countries. In fact we came to this committee and to those in the Senate and said, don't do that. But they did. You have to think about what was prevailing in 2003: We had high and quite restrictive import quotas on many countries, and we had at that time an 18% duty on those garments.

So it was done pretty much overnight. I'm the guy who got the call from a DG in Industry who literally said that everything was going ahead on December 22, 2002, and that effective nine days later the duties were going to zero and there would be no quotas.

So my first comment is that government policy directs the industry. All of our major retail customers in Canada were following just as closely as we were, and so they would say to their suppliers, “Well, it's done. Go to Bangladesh. We have a factory for you. Go do the product there”.

That's certainly not what I would consider reasonable industrial policy, but that's exactly what happened in 2003. And yes, we are well aware that there are different sets of circumstances there, and again, the companies that remain in Canada don't directly compete with that product. That's gone forever. They produce better goods at higher prices.

I would also say that those companies are aware of what's going on there and they are trying to deal with that. Bangladesh has recently had some very serious problems and we're working with the Retail Council of Canada, the National Retail Federation in the States, and various industry associations in Europe to try to bring more standards to that.

11:50 a.m.

Conservative

The Chair Rob Merrifield

Very good. Thank you very much.

Actually, the time has gone over here. I'll allow a very quick question and a very quick answer.

May 10th, 2012 / 11:50 a.m.

NDP

Jasbir Sandhu Surrey North, BC

Thank you, Mr. Chair.

I am from British Columbia where I've had family work in the lumber industry. So I'm very familiar with the types of job losses in the last number of years. In fact, the mills that my cousin and my brother worked in closed down. So I'm very concerned.

What would you like to see in a trade agreement that would enhance our value-added industry, and foster and enhance the value-added products that we export to Japan?

11:50 a.m.

Vice-President, Public Affairs and International Trade, Forest Products Association of Canada

Andrew Casey

I think the elimination of the tariffs is essential. That would make all of the products that we're sending there more competitive. Those are the wood panels, the engineered lumbers, and those types of things. So any movement on those tariffs—and this deal will result in a zero essentially—is really all we can ask for in terms of the added value, moving up the value-chain concept.

11:50 a.m.

Conservative

The Chair Rob Merrifield

Thank you very much.

Mr. Hiebert, go ahead very quickly.

11:50 a.m.

Conservative

Russ Hiebert South Surrey—White Rock—Cloverdale, BC

I'm one of the four British Columbia MPs. It's good to have good representation on this committee to serve our constituents there. Since the others have asked great questions about forestry, I'm going to ask one about the apparel industry.

Mr. Kirke, you said that we are hindered or constrained by NAFTA and the rules of origin that we have in that agreement. I'm wondering whether Japan has similar rules of origin with any free trade agreements they have and whether they would be hindered by those as they come to the table on this issue.

11:50 a.m.

Executive Director, Canadian Apparel Federation

Bob Kirke

In general, no, I think anything they have signed recently might involve single transformations, so cut and sew. I would also say that at one stage Japan was subject to the quota system. They were a low-cost provider in the sixties and so on. They have been very open and committed to open trade, because they were subject to the other side. So I would say in general terms they're very straightforward in what they sign, and I don't think they have any sort of similar problems in their past, if you will.

11:50 a.m.

Conservative

Russ Hiebert South Surrey—White Rock—Cloverdale, BC

I have one last question for both of you. We haven't talked much about non-tariff barriers. Are they of concern? Do we need to incorporate them into this agreement?

11:50 a.m.

Vice-President, Public Affairs and International Trade, Forest Products Association of Canada

Andrew Casey

There are none, really. There are some minor ones, but we're able to negotiate. The pine beetle was a bit of an issue with the lumber that was going there with the blue stain. That was an issue but we've managed to get rid of that.

I would just quickly add that you may have seen all the best questions asked about our industry, but one of the interesting things about our industry is that we may soon be members of Mr. Kirke's organization. We're producing something called dissolving pulp, which is part of where the industry is going. Dissolving pulp is being turned into fabric—rayon, essentially—and we're becoming big competitors in that area.

So once we move beyond all the traditional lumbers and pulps and stuff, that's where we're going, in the bio-economy. So look for other questions in other parts of where we're going.

11:55 a.m.

Conservative

Russ Hiebert South Surrey—White Rock—Cloverdale, BC

There are also biofuels.

11:55 a.m.

Vice-President, Public Affairs and International Trade, Forest Products Association of Canada

Andrew Casey

Biofuels, absolutely.

11:55 a.m.

Conservative

The Chair Rob Merrifield

Make it a very quick answer, please.