Sorry, could you repeat that, please?
Evidence of meeting #18 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was tpp.
Evidence of meeting #18 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was tpp.
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
Sorry, could you repeat that, please?
12:25 p.m.
Conservative
Randy Hoback Conservative Prince Albert, SK
Your local OEMs will be supplying.... I'll use BMW, for example. Yes, Ford may be leaving, but BMW looks at the opportunity and says, “If I come into Canada, we can trade in such a wide range around the world by having our plant here.” Wouldn't your OEMs be excited about that opportunity to have them come here?
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
The other OEMs that we have in the region?
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
The other OEMs will definitely look at that as competition.
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
Yes. The other OEMs, such as Ford and Chrysler that are already here, for them, having another OEM come in would definitely be seen as competition. They'll be fighting for the same resources, for the same talent pool, and for the same supply chain. In some ways it will help them; in some ways it will be considered a competitive challenge.
12:25 p.m.
Conservative
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
For the region, it will be definitely good. But the same OEMs will be, then, subject to the TPP constraints that we have in terms of the phase-out of the tariff. Whether they are local OEMs or others, if they're in Canada, they'll be subject to the same tariff.
12:25 p.m.
Interim Chief Executive Officer, WindsorEssex Economic Development Corporation
It will be equal.
12:25 p.m.
Liberal
The Chair Liberal Mark Eyking
I'd like to thank all the panellists for coming. We had a very good discussion with this panel.
Before I break, I'd like to remind the audience that we're going to be here at two o'clock for open mike comments. Right now we have six speakers. We have room for a few more, if anybody else wants to speak. You have until a quarter after one to register to speak.
I'll adjourn the meeting. We're going to come back in half an hour to start our last panel.
1 p.m.
Liberal
The Chair Liberal Mark Eyking
We'll get started on our last panel for Windsor. We're continuing with our consultations on the TPP agreement.
We have with us this afternoon the Grain Farmers of Ontario, the Ontario Health Coalition, and the United Steelworkers.
Welcome. We usually give around five minutes for each group, so you each have five minutes.
Mr. Huston, do you want to go ahead?
1 p.m.
Mark Huston Vice-Chair, Grain Farmers of Ontario
Good afternoon. Thank you for the opportunity to present to you some of the benefits that I and my fellow farmers see in the Trans-Pacific Partnership.
My name is Mark Huston. I live and work in Chatham-Kent on a seventh-generation family farm growing corn, soybeans, wheat, and pigs. I've been elected by my fellow farmers to represent them on the board of directors of the Grain Farmers of Ontario, or GFO, where I serve as vice-chair.
GFO is the province's largest commodity organization, representing Ontario's 28,000 barley, corn, oat, soybean, and wheat growers. The crops they grow cover six million acres of farmland across the province and generate over $2.5 billion in farm gate receipts. These result in $9 billion in economic output, and are responsible for over 40,000 jobs in the province.
From GFO, I was appointed to the board of Soy Canada, where I currently serve as chair. Soy Canada is the national association representing the full soybean value chain. Our members include producer associations representing farmers across Canada, seed development companies, soybean exporters, and soybean processors. We facilitate industry co-operation, and represent the industry on domestic and international issues affecting the growth and development of soybeans, the crop that I will be talking about the most today.
The soybean sector in Canada is growing. Since 2005 the area of seeded soybeans grew by 87% to five million acres, with production nearly doubling to 6.2 million tonnes last year. All this production needs to find a home. Since 2005 soybean exports have increased by roughly 250%, to 4.4 million tonnes, and about 65% of our production.
Domestic use, processing, and the export of Canadian soybeans contribute over $5.6 billion to Canada's annual GDP, and are linked to over 54,000 direct and indirect full-time jobs. We are a growing segment of the agriculture industry. With more expansion forecasted in the future, we see more reliance on export markets. This is why international trade is critical to our industry.
The Asia-Pacific region encompasses a large segment of our key markets, with roughly 40% of total Canadian soybean exports shipped to TPP nations, at a value of close to $1 billion in 2015. TPP provides a platform for our industry to access these growing markets and build on existing trade relationships with major soybean importers.
All members of the soybean value chain—producers, processors, exporters, seed companies, and other affiliates—directly or indirectly stand to benefit from the TPP. The agreement provides a more secure and equal trade environment free from tariffs and administrative quotas on all soybeans and soy products. Canada's participation in the agreement ensures that other oilseed-exporting nations do not have preferential access to TPP markets, allowing us to better compete against some major soybean-producing nations. This is a major advantage for Canada when combined with the increase in demand throughout the Pacific Rim for high-quality Canadian soybeans.
The TPP also includes important provisions relating to biotechnology. Innovation through the application of biotech to seed development has provided tremendous benefits to crop production, but it's also a frequent contributor to trade disruption. The application of zero tolerance regulatory frameworks and increasingly acute testing technologies in a world of increasing availability of biotechnology is a recipe for trade challenges.
Recognizing this, the TPP provides a working group to facilitate co-operation and information exchange on biotech issues, including regulation of the low-level presence of GM materials and regulation of new plant-breeding technologies. These are positive steps towards reducing disruption to trade in the grains and oilseeds industry and establishing predictable trading rules with TPP members.
The TPP is a modern and comprehensive agreement, and an important milestone in reforming international agriculture trade. Canada is a trading nation, and our grains and oilseeds sector is heavily reliant on international markets. With our many commodities, while access to export markets is very important, we do not have the size and export might of our competitive nations. In order to compete, Canada relies on predictable, rules-based trade. We need a predictable environment where all participants play by the same rules. The TPP and other trade agreements seek to establish these rules and support existing trade rules such as WTO agreements.
In conclusion, I'd like to thank the international trade committee for allowing me to speak on the importance of TPP to our industry, and to participate in your study of this topic. The groups that I am a part of support the implementation of TPP and urge the committee to recommend its ratification as soon as possible.
Thanks again. I look forward to your questions when the time comes.
1:05 p.m.
Liberal
The Chair Liberal Mark Eyking
Thank you, sir, for being on time.
We're going to move over to the Ontario Health Coalition.
Ms. Mehra.
1:05 p.m.
Natalie Mehra Executive Director, Ontario Health Coalition
Thank you to the committee for the opportunity to speak with you today.
The Ontario Health Coalition is a network of organizations and individuals dedicated to protecting single-tier public health care in Ontario. We represent more than 70 local health coalitions, more than 400 member organizations, and more than half a million individuals.
There is widespread consensus among experts that the trade opportunities in the Trans-Pacific Partnership agreement are small to negligible. In fact, the term “trade deal” is from the health care perspective a misnomer; as it relates to health care, the TPP is much more a corporate control arrangement over government policy than it is about increased trade.
Such being the case, if this standing committee and our Parliament are acting in the public interest, then you must recognize and act upon the urgent concerns of public interest groups when it comes to the TPP's proposed constraints on our government's ability to set policy not strictly related to trade at all, in particularly in the new chapters of the TPP that contain implications regarding the regulation of the pharmaceutical industry and drug prices.
It's our testimony that the changes proposed in the TPP would increase costs for both public and private purchasers of pharmaceuticals. They would restrict future policy options for our government for the benefit of brand name pharmaceutical companies' profits at the cost of Canadian patients and of the public interest.
Public health care advocates and trade experts are united in warning that the TPP's most significant detrimental impact for Canada's health care system is its impact on drug costs. Higher drug costs will impact the entire health care system, placing competing demands on scarce resources, thereby increasing pressure to cut services across the health care system, accelerating privatization, increasing out-of-pocket costs for patients, and exacerbating inequities and suffering when people are facing illness and aging.
Imposing unnecessary costs and unpredictable risks on the Canadian health care system in exchange for negligible increase to our GDP is a bad deal for Canadians and Ontarians. As health and trade policy expert Scott Sinclair warns:
The increased burden on taxpayers and consumers from higher drug costs alone would likely exceed the full savings to Canadian consumers from the TPP’s elimination of tariffs on imports into Canada, undercutting one of the chief arguments for liberalized trade.
In addition, it's a deeply held principle among Canadians that we have an obligation to those less fortunate than ourselves. International humanitarian organizations are speaking with one voice when they warn about the TPP's damaging impact on access to medications for patients in some of the worlds poorer nations.
Canada's drug costs are already too high. According to the most recent data available from the Canadian Institute for Health Information, Canadians pay the second-highest cost of all OECD nations for drugs, second only to the United States, and our costs are significantly higher than average.
Across Canada, drugs are primarily paid for by private health insurance or directly by individuals: 36% by private insurers; 22% out of pocket by patients and households; and the remaining 42% by public drug plans, primarily provincial and federal government plans.
Among the provinces, the proportion paid by the provincial governments varies from 31% in New Brunswick to 51% in Saskatchewan. Ontario is in the middle at just over 40%. The burden of higher drug costs resulting from the TPP would fall on private insurers, individual households, and provincial governments.
In Ontario, there may be a bit of a misunderstanding that there is public coverage for drugs through the Trillium drug program and the Ontario drug benefit program. In our experience there are very significant gaps in those programs, leaving very high drug costs for individuals already, without the TPP's impact.
I have no idea when I started.
1:10 p.m.
Liberal
The Chair Liberal Mark Eyking
That's fine. You have about a half a minute, if you want to round to a conclusion.
1:10 p.m.
Executive Director, Ontario Health Coalition
The main issues with the TPP are the limitations in chapters 8 and 25 on the ability of the Canadian government to intervene to set regulations controlling the price of drugs; the ability for investors to sue the federal government more widely; the failure to exempt health care clearly; and the intellectual property provisions.
What's clear to health care advocates is that Canada does not need the TPP, but what we do need is a national, universal, comprehensive drug program for all Canadians.
Thank you.
1:10 p.m.
Liberal
The Chair Liberal Mark Eyking
We're going to move over to the United Steelworkers, with Mr. Lundblad. Go ahead, sir.
May 12th, 2016 / 1:10 p.m.
Troy Lundblad Staff Representative, Research, Public Policy and Bargaining Support, United Steelworkers
First, I'd like to thank this committee for holding these hearings today on the Trans-Pacific Partnership and for inviting us to speak.
The USW is the largest industrial union in North America, representing more than 250,000 active and retired members in Canada. Our members proudly work in virtually every tradeable sector, from mining and metals, glass and rubber, paper and forestry, automotive and aerospace to countless other areas, including services, universities, health care, and security.
In the TPP text we see little to suggest that this deal will provide a net benefit for ordinary Canadians. We believe the TPP will not resolve the most important challenges that have decimated our manufacturing base in recent years, and we worry that this government has not fully considered the broad impacts the TPP will have on the Canadian economy, on public policy, and on Canadian workers and their families.
To be clear, the USW is not opposed to trade agreements. We recognize that Canada is a trading nation. Trade agreements that include reasonable reciprocity and fair trading provisions and adequate labour and environmental standards can serve to strengthen our economy.
But this agreement is not about free trade. It is worth remembering that currently 97% of Canadian exports to TPP countries already occur duty-free. Shockingly, the federal government has yet to complete a comprehensive economic and sectoral impact assessment of the TPP. We have signed on to a deal with little evidence that it will benefit Canadians.
In fact, independent studies suggest that the alleged benefits of the TPP have been grossly overstated. One recent study predicts the TPP will cause more than 58,000 job losses and will shift substantial wealth from workers to the corporate sector and exacerbate inequality. We believe that the very purpose of the TPP is to coerce governments into making concessions that they would not be able to justify to their constituents.
These treaties are better called investor rights agreements, and we do Canadians a disservice by not recognizing this fact. What we have is a managed trade regime, and the question we must ask ourselves is cui bono, or in whose interests the rules of the market economy are made.
Turning briefly to tariff reduction, we believe that the TPP will undermine an already weakened manufacturing base in this country. The privileged access of Canada's auto parts manufacturers to North American markets will be eroded, and Canada's 6.1% tariff on vehicle imports from Asia will be eliminated in just over five years, which will threaten 20,000 well-paying jobs.
The impact of these provisions will surely bleed into other areas of this country's industrial and manufacturing base and further lock Canada into a pattern of unprocessed raw materials export.
We are worried about the damage this deal could cause to the steel industry, which is already under severe stress as a result of foreign competition, dumping, and currency manipulation. The TPP will also drastically erode national and international protections for labour, among other things driving down the wages of workers in Canada by putting them into competition with poorly paid foreign workers, both at home and abroad.
Restrictions on generic medicines will increase drug prices throughout the world with serious implications on global health and well-being.
The TPP reduces environmental protection that minimizes the harm caused by logging, resource extraction, pollution, and global warming.
Most troubling however, are the controversial investor-state dispute settlement provisions—chapter 28—which are really at the heart of the TPP. ISDS operates beyond the domestic jurisdiction of states and national legal systems as it forces sovereigns into private arbitration systems dominated by international trade lawyers and economists.
In effect, ISDS severely constrains environmental, health and safety, and financial regulations deemed to have significant impacts on the ability of foreign companies to profit from their investments, but ISDS does not require of investors equivalent responsibilities to respect environmental, anti-corruption, or labour standards. ISDS leaves governments vulnerable to costly legal battles when foreign investors say they have suffered financial losses. For example, under NAFTA's chapter 11, Canada has been subject to 35 ISDS claims, with 63% of them challenging environmental protection or resource management measures.
ISDS under the TPP reflects a further evisceration of the roles of domestic policy and institutions in the Canadian economy and poses even greater risks for governments and domestic stakeholders.
Under the previous federal government, TPP negotiations were conducted behind closed doors with no input from civil society. We regard these discussions as illegitimate. We commend this committee for its efforts to consult the public in advance of making any decision to ratify the treaty, but there is no reason for this government to ratify the TPP, even as the leading U.S. presidential candidates, as well as congressional Democrats and Republicans, voice concerns. There are ways to reopen the treaty in order to preserve jobs, protect the environment, limit the power of multi-national corporations, and avoid higher drug prices.
There is a better deal for Canada, and this government can push for renegotiation or decline to ratify the deal on Canada's behalf. We strongly urge you to make this recommendation.
Thank you.
1:15 p.m.
Liberal
The Chair Liberal Mark Eyking
Now we are going to open up dialogue with the MPs. We're going to start with the Conservatives for five minutes.
Mr. Van Kesteren, you have the floor.
1:15 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Leamington, ON
Thank you all for being here this afternoon as our last panel. It's an interesting discussion that we've had.
Mark, you're from my neck of the woods, and I'm going to start my questioning off with you.
We have heard repeatedly the call and the encouragement to move forward with this agreement. I know that we have two panellists who would not agree with that position, but I want you to talk about southwestern Ontario. I want you to tell us what's happening in land production, where our corn yields are going, where our soybean yields are going, and how on the one hand that creates an opportunity, but on the other hand the challenge that you mentioned. We need those markets.
I wonder if you could give us a brief history of where we've come in the last 20 years and what that's done to the farm gate.
1:20 p.m.
Vice-Chair, Grain Farmers of Ontario
Agriculture has been in a time of renaissance over the last 20 years. We've seen phenomenal growth in the area being planted and the crops that we have traditionally grown just in the southwest, which are now spreading across Canada. Soybeans is the one I draw closest to, because that's the one I'm most affiliated with, but corn has a similar story, and wheat can tell a similar story in the future.
We've seen massive increases in the ability to produce these without detriment to our environment. We're doing things more responsibly, using less input, and getting more crop out.
The challenge is what you do with it afterwards. We're not seeing vibrant growth in populations here in Canada, so with that extra product we produce, we have to find homes for it. That very much depends on what interest we've been able to solicit from other countries. It's the export market that's been able to take a lot of our excess production and for us to be able to find a home for it, and it still buoys the Canadian economy.
When we look to the TPP nations—and I did an analysis on the nations that were affiliated and the ones that weren't—there are a number of them that haven't historically been large consumers of Canadian products, but they are starting to be. You're seeing some growth in those regions as their economies buoy up, and I think we have the opportunity to fill some of those opportunities.
That's where I see the hope in TPP.
1:20 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Leamington, ON
As a farmer and an agriculturalist, you see a bright future. Let's face it, if we go back 10 years ago, it was a different situation at the farm gate. We know.
I remember the tractors coming to Ottawa and the farmers being very concerned. What's changed? What's happened in the last 10 years?