Thank you, Mr. Chairman. Thank you for the invitation.
The George Morris Centre is a national, non-profit agriculture and food policy think tank. We're in our twenty-first year of operation. We're located in Guelph, and we have a national mandate, as I said. We provide economic and policy analysis, market analysis, and educational programs for more advanced farm management and food-sector-level management, and we have a value-chain management centre for both research and educational programming.
I provided the committee with a presentation in both French and English. I'm not going to go through it, Mr. Chairman. I'll just focus in on the last couple of pages.
As we and Macdonald-Laurier Institute see it—as expounded in a recent report by that institute—the challenge for Growing Forward 2 is that the situation of Canadian agriculture has eased considerably compared to the history of structural surpluses facing many parts of the Canadian agriculture and the Canadian food system. We have tighter supply-demand balances. Unless there's dramatic change in some of the emerging markets, we should stay that way. Policy based on trying to remove product from the marketplace may not be as advantageous to Canadian agriculture as that based on where we're going to be in a very volatile, very competitive agrifood system, with competitors here and outside Canada. It's very competitive.
There has been a long-term trend up in agriculture and the food trade, albeit with a small glitch during the recession. However, Canada's position has actually dropped slightly even though our agriculture and food trade have increased. The competition is there, and the competition is not weakening. We see demand growth in the emerging markets as their incomes go up. Their patterns are shifting more and more to the North American or western European style, though not dramatically or not overnight. They are looking for opportunities for North American, Australian, Brazilian, or other nations' agriculture, to feed that kind of opportunity. But we also have to be aware that we must have high standards and be sustainable. My colleagues raised the point that we have to be watchful of consumer patterns and trends. It's going to be a very volatile market, but also a very competitive one.
As for competition, my colleagues were referring to the organic food movement and the expansion there. There is competition--other nations are looking at their opportunities--but the competition is already here. One of the slides I have in the presentation will look at imports and exports. Imports have consistently gone up, which is not unknown in a highly developed market like Canada's. With high wages and relatively high incomes, you're going to be demanding great produce from across the world. I will tell the committee, the competitors from across the world are not sending us the worst product they have; they're sending us the best product, which means that we have to be extremely competitive, even in our home markets, across the wide range of those opportunities. On the other hand, the opportunities for organics, for different products to go with the shifting demographics or with the ethnic markets, open up new opportunities. But, again, you have to be competitive.
The response we see and encourage is that industry and governments must take a look at the programming activities. They have to look at investing more in skills, talent, and technology. They have to meet standards, understand consumers, and be innovative. They need improved management up and down the supply chain, so they can meet the demands of the market, both here and overseas.
Our view is that Canada needs to raise its game on competitiveness and innovation and be prepared to compete globally. A large part of Canadian agriculture has to compete at that level, unless we want to see dramatic restructuring. A number of processors have that capacity. We have a good opportunity here to compete locally. How do we do this? How do we raise our game to match the competition that's already inside Canada and will continue to be here?
We see a need for Growing Forward 2 to realign its policy functions, to shift its focus over time away from business risk management and towards improved competitiveness and improved innovation. Where the consumers demand it and the farm and food community can do it, they need to improve sustainability.
Our one key criticism--and it's not just of the current government but has been a long-standing issue with any support programs in Canada--is that we don't make very good decisions on, or analysis of, measures. What do we really want to achieve from these programs? How are they really affecting the farm or food community? What changes would we see result from a better understanding of the impacts? From our base case, where do we want to go?
We see this as a challenge and have taken a look and commented on the Saint Andrews statement on the discussions held by the federal-provincial-territorial ministers. There is a need to develop measures and to have greater transparency in our analysis and in how the programs are working, and a need to restructure and realign.
Our view is that it's not necessary to add money; it's time to reallocate money and possibly even reduce it over time. You need to look at investments in people and investments in technology and encourage those investments in technology by the private sector.
If we need to see a shift in the direction, the Saint Andrews statement had the right general goals. But there are major challenges in all decisions. What are the end results that we want from these efforts? What are the trade-offs? I mentioned sustainability, as did the Saint Andrews statement.
We're going to be as sustainable as possible. What does that mean for competitiveness both locally and globally? If we are as hard-hitting as possible in reducing costs, how does that affect our sustainability? And how well can we be innovative and yet still meet the other goals? There are trade-offs here. With limited dollars and greater wants, how do you make these shifts?
We also have to involve a wider part of the food industry, the farm industry, and suppliers in this process. Governments have been doing more. They should be complimented on that and supported in it, but they need to do more.
As for Ted's comment on organic agriculture, how do we bring them and other parts of agriculture more into the discussion so that we have a better sense of all the trade-offs and all the options that are necessary and of what the programs are really doing now?
Finally, concerning our census, we need to invest both public and private dollars in people, in talent, through management programs and improved capacity to handle the technology and the marketplace. We need to invest in newer technology, wherever it's appropriate, and be ready to move.
We also need to have a capacity to invest in scale. This may offend a few members of this committee. While it's good and nice to have a lot of small operations, to feed the population we have here and to feed the population in the world that we may want to access, we have to have a sufficient scale to compete at that level, either provincially, nationally, or globally. That takes a number of policies, a number of efforts geared towards it, and Growing Forward can assist us in reaching that scale.
Thank you very much, Mr. Chairman.