Agriculture Committee on Dec. 7th, 2023

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

You don't have knowledge of that situation. Do you not get feedback from your employees?

[Gonzalo Gebara]

Yes, we do—100%. It's just that I didn't get that type of feedback.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

My colleagues have been talking about how your company is considering backing out of the grocery code of conduct. You've given your reasons in the answers to them, but a lot of people on the other side of the equation—the suppliers, the primary food producers—have long complained of arbitrary fees and just a complete unfairness, given that the grocery retail sector is so concentrated.

Why does it seem that you're trying to avoid accountability and transparency in these discussions?

[Gonzalo Gebara]

Accountability and transparency is what we stand for. That's how we have been conducting business with our supplier partners for 30 years in Canada—and more than that across the world. The only thing I said related to the code is that there are still provisions that we still doubt are going to provide the environment for all of us to have the right businesses so that we can offer the lowest prices possible to Canadians.

[The Chair, Liberal, Kody Blois]

Thank you very much, Mr. MacGregor.

Thank you very much, Mr. Gebara.

We'll now turn to Mr. Epp for five minutes.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Thank you, Mr. Chair.

Thank you, Mr. Gebara, for being here.

In the meeting that you had with Minister Champagne, it was stated that he gave direction to the grocery CEOs that they should stabilize prices but stressed that these actions should not necessarily negatively impact the price that farmers or small suppliers receive for their products.

If you're supposed to stabilize prices, let's start with some basic assumptions. Would you agree that there are cost pressures on the supply chain?

[Gonzalo Gebara]

Could you please elaborate on the question?

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Are there cost pressures on the supply chain?

[Gonzalo Gebara]

The supply chain has its natural costs. I just don't know.... Compared to what—to previous times, to the beginning of the year? The supply chain is a very complex ecosystem, and it's very costly to operate. It has many different participants, and different participants bear the cost of running the supply chain.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

You've referenced your concerns around the code as being that it doesn't provide Walmart with the proper environment to achieve everyday low prices. Well, the allegations are that Walmart has placed that pressure onto their suppliers.

How would you respond to that? Where's the government failing to implement a code that allows you to provide everyday low prices but also treat suppliers fairly?

[Gonzalo Gebara]

I don't think that we treat our suppliers other than fairly, in a transparent way and in an arm's length way. As a matter of fact, we pride ourselves on being very good at planning together with suppliers. We provide information and our plans so that they can organize their production lines and production capabilities, so that they can cope with our demands in advance.

Look, I'm still new to Canada, but I've been with Walmart for 23 years. The relationship with our suppliers has been great all over the world. Canada is not an exception.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Walmart owned ASDA in the U.K. and operated under a system with a grocer code for over 11 years—successfully, I understand. If not, please challenge me on that.

What is the problem, from this government's handling of the implementation of a grocer code, that is giving Walmart issues when you successfully operated with the U.K. under a grocer code?

[Gonzalo Gebara]

I'm sorry. Even though I've been with Walmart for quite a long time, I'm—

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

You're stretching the credibility at this committee when you say that you've been in the business for 23 years, you're co-chairing the grocer code and you do not know about the U.K. example. I'm sorry. Please try again.

[Gonzalo Gebara]

No, I've never worked for Walmart in the U.K. I would be remiss if I commented on the code of the U.K.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Are you not familiar with the code?

[Gonzalo Gebara]

Excuse me, sir?

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

You're not familiar with the U.K. or Australian code of conduct while you're chairing a committee that's exploring the code of conduct in Canada.

[Gonzalo Gebara]

I don't think I'm chairing any committee.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Your company is co-chairing it.

[Gonzalo Gebara]

Our company is participating in the discussions of the code. The people who participate have been very well informed and educated on the code for Canada.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

In your opening statement, you said that the responsibility for delivering lower prices to consumers fell across the entire value chain, including government. What direction did you give back to government to reduce prices for groceries in your meetings with the minister?

[Gonzalo Gebara]

Apart from having talked about all the plans and programs that we have, we also provided some suggestions to the government on improving the conditions in the supply chain and making sure that we could have streamlined import processes. All those things would help us bring prices down.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Are the import processes to compete with Canadian...or where Canadian products aren't available? Can you be more specific on what direction you've given this government? I mean, this government has front-of-package labelling, which my colleague has raised, of $6 billion to $8 billion. There's the carbon tax. There's a whole host of costs that the Canadian system is putting in. Did you not raise any of those with the government?

[Gonzalo Gebara]

No. We talked about a national supply chain strategy, and we talked about transportation and border operations so that we can streamline product flow and deliver better prices for our customers.