Evidence of meeting #44 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

Steve Verheul  Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade
Ray Armbruster  Director and President, Manitoba Beef Producers
Cam Dahl  General Manager, Manitoba Beef Producers
Gordon Bacon  Chief Executive Officer, Pulse Canada

11:30 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

Well, at this point I would say that it's having very little impact. I think that from a broader perspective the European Union is seeing the achievement of free trade agreements like this one as an opportunity to provide a source of growth outside of the European Union itself, which is finding itself increasingly limited with respect to growth prospects.

The debt crisis in itself has not come to the negotiating table. I would perhaps mention one small exception to that, and it comes with respect to financial services. The EU initially in this negotiation came out with quite aggressive demands when it comes to financial services. We've seen those moderated quite a bit, because I don't think either side is interested in removing a lot of its regulatory framework around the banking system and other financial institutions.

11:30 a.m.

Conservative

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

Also since we last met, we've had an election in France, with President Hollande and the Socialist Party coming to power. Has that had any impact on negotiations?

11:30 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

Not as of yet. Certainly when it comes to some sensitive issues like agriculture, France has always been one of the more resistant member states we've needed to address, but I think we haven't really seen an impact on the new government down to the policy level in the negotiations yet—to this point.

11:30 a.m.

Conservative

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

In your statement you mentioned labour mobility just briefly. I know that you had mentioned work on progress for access to employee service providers and people to manage investments. Have you been able to finalize any kind of progress in that area or in mutual recognition of qualifications such as those for architects and engineers?

11:30 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

Well, on the latter, on mutual recognition of qualifications, we have essentially closed that chapter. We've finished it and managed to reach agreement. There are a couple of issues left over that relate to other chapters, but not consequential to that one.

On the other issue of temporary entry for business people, contract service suppliers, independent professionals, and all of that, we've been making some steady progress. It's a sensitive issue in the EU because some are concerned that it could lead to immigration, or they're concerned about precedents for other countries, such as in the negotiations they're having with India. But overall, I think they recognize that Canada is in a different situation. We're looking for a lot of labour mobility both ways. We need some specialized expertise in parts of Canada as well. So I think we're headed towards a strong outcome in that area too.

11:30 a.m.

Conservative

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

My last question deals with a comment that was made by His Excellency Matthias Brinkmann, the EU ambassador, last November at the French Embassy. You might recall the seminar that was hosted there.

He made the suggestion that there might be a push for one standard for manufacturing for North America as part of these negotiations. Has that come up at all?

11:35 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

No, I wouldn't say that anything that broad in scope has come up.

We have come up with a number of provisions and chapters in relation to regulatory standards. We have a regulatory cooperation chapter for the first time in a free trade agreement that will address trying to get us on the same page on standards as they're being developed—that's one element. We're also advancing a chapter that will provide us both with the ability to provide assessments to each other's standards through our own agencies. In other words, a company looking to export into the EU market wouldn't have to go to an EU standard-setting body to get approval. We could do that in Canada, saving time and saving money.

In other areas we've talked about where we might be able to converge on standards over a longer period, but comprehensively this is a much broader issue. Standards in many areas between North America and the European Union are somewhat different. It's a rather lengthy and difficult task to harmonize them.

11:35 a.m.

Conservative

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

As ambitious as this agreement is, it's perhaps more ambitious than—

11:35 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

Yes.

Certainly we're aware that the EU is also talking to the U.S. about a potential new kind of trade relationship down the road. Even under that kind of framework, it would take a very long time to move in that direction if the desire was there to do that.

11:35 a.m.

Conservative

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

Thank you, Mr. Chair.

11:35 a.m.

Conservative

The Chair Conservative Rob Merrifield

Thank you very much.

We'll now move to Madam Papillon.

The floor is yours.

11:35 a.m.

NDP

Annick Papillon NDP Québec, QC

Thank you very much, Mr. Chair.

I would like to go back to a point that I feel is very important: maintaining the integrity of the supply management system. You already brought it up, but I would like us to discuss it in more depth because we are talking about the official Canadian position.

To what extent is Canada prepared to negotiate access to Canadian markets for agricultural products that are covered by a supply management system, not just dairy quotas, but other products too?

11:35 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

First of all, as negotiators we're under very strict instructions not to do anything to jeopardize or threaten the integrity of the supply management system. The government has made that very clear on many occasions, and they made it clear to us directly, as negotiators.

As to whether we would open any of our markets to these products, as I mentioned in response to an earlier question from Mr. Easter, we've certainly had some discussions, as we have on all issues, but we have not provided the EU with any kind of formal proposal. We haven't had any specific request from the EU. We simply haven't confronted this issue. We'll have to see if we do manage to do that at the end of the day, or whether we'll follow another path instead.

11:35 a.m.

NDP

Annick Papillon NDP Québec, QC

If the Canadian supply management system were part of an agreement with the European Union, what consequences would that have on Canada's present and future trade negotiations?

11:35 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

I am not going to speak to future negotiations given that it is a bit beyond my role.

Certainly within the CETA negotiation there will not be a threat to the system of supply management. It will remain as it remains now.

Certainly I've seen no evidence of any flexibility on that issue with respect to any agreements. We've consistently protected supply management throughout all of our international trade agreements. I spent many years in Geneva doing exactly that. We have not seen any sign of change.

11:35 a.m.

NDP

Annick Papillon NDP Québec, QC

On another matter, according to the Quebec commentator Pierre-Marc Johnson, there is still no consensus on protecting cultural diversity despite Canada and various political authorities in Europe having ratified UNESCO's convention on the protection and promotion of the diversity of cultural expressions. Apparently, its definition of cultural industries is too wide and too vague for the tastes of European negotiators.

Do you feel that Canada is open to amending the definition?

11:35 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

I think you're quite right. When you speak about the UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, that's something that Canada and Quebec work very closely with the European Union on. They are our closest ally when it comes to that convention, both in developing it and in promoting it over time.

The European Union has many, if not most, of the same views about culture as we do. I think there would be no other entity that we could negotiate culture with and be in a better position with than the European Union.

We are having some discussions about what the most effective way to protect our cultural interests would be. I think that if we see opportunities to improve or strengthen our cultural exceptions, then that's something I think we would want to be able to explore.

But at the end of the day, we will be ensuring that culture in this agreement will be protected as it has been in previous agreements.

11:40 a.m.

NDP

Annick Papillon NDP Québec, QC

I also have some questions on the mining and energy sectors. Especially given the Plan Nord initiatives, Quebec is interested in the agreement with the European Union.

Will there be advantages for Quebec in this agreement? What exactly would they be?

11:40 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

I would certainly think so, and from a number of perspectives—and Quebec has expressed an interest in this. There are a number of opportunities for further investment to attract European interest in some of those areas, to allow them to develop more effectively. We have a lot of expertise in mining and construction services. It will be further developed in those kinds of projects. We expect that we will have openings within the European Union market to provide that kind of expertise. It's something that they have expressed an interest in, as have we.

So I think that there are a lot of opportunities, from the services and investment side to the exchange of goods. Once we mine some of those commodities, we have a good market in Europe to sell them. They're very interested in them. Also, for the kinds of skills we learn, we'll be able to apply to market those services and abilities into the European Union.

11:40 a.m.

Conservative

The Chair Conservative Rob Merrifield

Thank you very much.

We'll be moving on to Mr. Holder.

The floor is yours.

11:40 a.m.

Conservative

Ed Holder Conservative London West, ON

Thank you, Chair.

I'd like to thank our guests for attending this morning.

A couple of months ago, Mr. Verheul, we had European parliamentarians come to Ottawa. We had a special chat with them. It was rather interesting. At that time, they were pushing members of this committee to push you to move this agreement along and were suggesting that somehow Canada was the laggard or at least the slower one in the process in terms of the negotiations.

I've heard some feedback that this might not be the case, but I'd like to get a clarification from you, if I may, please. You've been going at this for a little while. I don't know if you think this is breakneck speed, but I think we're making progress. I'm sure that sometimes to you it feels painful, that progress, but—

11:40 a.m.

Voices

Oh, oh!

11:40 a.m.

Conservative

Ed Holder Conservative London West, ON

I'm trying to understand: is Canada the laggard in these negotiations? Is there one? Is there fault to be laid?

Also, then, I guess ultimately, what's your sense of this deal concluding, if you had a belly-button guess, on December 31, 2012? Your thoughts, please.

11:40 a.m.

Chief Trade Negotiator, Canada-European Union, Department of Foreign Affairs and International Trade

Steve Verheul

Well, just on the last part first, I'm hesitant to make specific predictions because in a negotiation you never quite know what's going to happen. You get hung up on an issue and everything changes entirely. We have been committing, as has the European Union, to completing negotiations by the end of the year. I certainly think we're on track to do that.

As for the timing, I don't want to assign specific blame to my trading partners, but I would say that they are in a somewhat different position than we are. We are a single country and would have a lot of support from provinces and territories behind us, but they are trying to negotiate deals on behalf of 27 individual sovereign countries.

We have asked them to do things that they've never done before, such as the negative list approach on services and investment. It is taking an enormous amount of time to go back to member states and have them check with their subnational governments and their municipalities. It's a long, painful process to do that. We are also needing to go through the kinds of rules of origin issues that I mentioned, where you have to go product by product, and they often have to go back and check with member states that are the largest producers of those products to get a reaction.

So I would say that the greater complexity on the EU side has meant that they are not able to move as quickly as we can in the negotiations. Its services and investment reservations have taken longer than we would have expected. Our rules of origin discussions have taken longer than we would have expected. But clearly we've been ready for this all along and are prepared to finish as quickly as the European Union can.

11:45 a.m.

Conservative

Ed Holder Conservative London West, ON

I think that's fair. Are you suggesting you are generally pleased with the progress that has been made from a timing standpoint?