Canadian Heritage Committee on Jan. 31st, 2011

[Peter Van Loan, Conservative, York—Simcoe, ON]

At this point, the only issue is the question of the programs on publishing. We are obviously of the view, from the position we take, that something that would compromise those programs or end them would have an adverse impact on our publishing industry. That's why we take the position that we wish to maintain the programs and are holding that position in the negotiations.

[The Chair, Conservative, Michael Chong]

Thank you, Minister.

Mr. Del Mastro.

[Dean Del Mastro, Conservative, Peterborough, ON]

Thank you, Mr. Chairman.

Thank you to the minister and Mr. Verheul for appearing here today.

Every once in a while I'm struck by the comments of members. Of course, on any trade agreement that would be negotiated, the process--as I'm sure they and you are well aware--would be to present the deal to the House for full debate and ratification by the House of Commons. Is that not correct?

[Peter Van Loan, Conservative, York—Simcoe, ON]

We have an established process for treaties that does not necessarily require debate; it requires tabling in the House. However, if legislative changes are required, that does require debate in the House. I think it's fair to assume that this agreement will require legislative changes, and thus it will be subject to debate in the House.

[Dean Del Mastro, Conservative, Peterborough, ON]

Thank you.

I don't think it's the job of the Canadian heritage committee to negotiate free trade deals, Mr. Verheul, but I've been involved in the odd deal, and if you need some help, I could probably prove very handy.

But in all seriousness, Minister, first of all, I want to congratulate you for your efforts in expanding Canada's trade opportunities. Whether it's my farmers or local businesses that are talking to me, they are seeing success in markets in which they previously struggled to establish a beachhead and realize economic success. I think the bilateral trade deals that you have worked on, and that our government has successfully completed, are building a much stronger Canadian economy.

I was in London recently, where they talked about the opportunity for trade and the opportunity that trade presents to expand our economy. Are there specific sectors in the Canadian economy that you think would benefit? You talked about the potential for investment in Canada as a result of our position with the United States and the EU. Where do you see the opportunity for Canada in this deal?

[Peter Van Loan, Conservative, York—Simcoe, ON]

The nature of the Canadian economy and the European economy is that, as developed economies, they're mature and complex. As a result, the benefits that stand to be derived are quite broad.

That is what the study done in advance of this indicated. For example, you can't just say you're going to be able to sell a whole bunch more softwood lumber and that's where all the gains will be. There will be gains in services, gains through investment, and gains through reduced tariffs. Tariffs are already reasonably low, but about a third to a half of the gains to be made are simply in the area of reduced tariffs, and they affect a whole range of sectors. You can't point to one in particular.

The study that pointed out $12 billion in benefits was done with an assumption that the Doha Round of the World Trade Organization would be completed. The actual benefits are likely far in excess of that, because many of the benefits that were discounted are unlikely to be realized. I don't see Doha being completed in the next few months. As a result, the actual benefits for Canada from the Canada-EU deal are even greater in reality than what that study indicated, the $12 billion. That means jobs for Canadians in a wide range of sectors.

[Dean Del Mastro, Conservative, Peterborough, ON]

Minister, the European economy, the EU economy, is very large. I think something like half a billion people live in the EU. It's a much larger economy than other places that we have agreements with. We've signed previous deals with other countries. If we look at the Canada-U.S. deal, which then became NAFTA, how many jobs have we generated as a result of those agreements? How many businesses now operate on both sides of the border in an efficient manner?

What are some of the benefits we've seen from NAFTA? Do you think we can expect to see similar benefits in a Canada-EU deal?

[Peter Van Loan, Conservative, York—Simcoe, ON]

Well, the best way I like to look at it is to look at what the critics said before the Canada-U.S. Free Trade Agreement and then look at what happened in the result. We were told in advance that we would lose our culture, we would lose our health care system, we would lose our water, we would lose our fine Canadian Baby Duck wines. In reality, since then Canada's culture has prospered, and in fact has been embraced in many cases by the Americans. As I indicated, our health care system is something that more and more American political leaders seem to be trying to emulate rather than run away from. Of course our water is still very much firmly in our control, and Canadian wines are now better than they've ever been.

That proves the point that Canada has benefited from the competitive discipline of the free trade agreement, and in fact our economy has grown. We have now a 21% share of the North American auto market in manufacturing even though we're about 9% of the population. We have had 4.1 million new jobs in Canada since the North American Free Trade Agreement, and more than that since the Canada-U.S. Free Trade Agreement.

The results are quite clear: the tales of doom and gloom that we would lose the auto industry didn't come true. The success that has made Canada now the economic envy of the world--the strongest economic growth, the lowest debt and deficit--is the true story of the success of the agreement for us.

[The Chair, Conservative, Michael Chong]

Thank you very much, Minister.

Madam Crombie.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Welcome, Minister.

Happy new year to you both.

I do have legitimate concerns about protecting our wine industry from those fine European brands, by the way.

I also have some real concerns about this agreement. In your opening statement you said that the agreement will protect any domestic cultural interests. I want to know how, specifically; what measures are in place to ensure that Canadian culture will be legitimately protected?

Minister, you made some comments in the House of Commons that created some uncertainty about your determination to defend Canadian culture. You flippantly said that you're not worried about a possible Lithuanian cultural invasion, through their videos or whatever. Specifically what will you do to protect Canadian culture?

[Peter Van Loan, Conservative, York—Simcoe, ON]

We've been seeking cultural exemptions and protections for the programs that we have in Canada, and seeking to protect any future programs that any government, provincial or federal, might wish to institute provided it's done with the objective of supporting Canadian culture.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

And how has that gone?

[Peter Van Loan, Conservative, York—Simcoe, ON]

It's gone very well. It's gone well in the past and it's going very well right now.

The reason I make the flippant comments about the flood of Lithuanian culture is that I want to point out the rather absurd positions of the opponents of the Canada-European Union free trade agreement, who, in trying to raise fears, are pointing to fears that even in the worst-case scenario are unlikely to be realized. I think Canadians see that. I think it's important to point out situations like that, because it helps highlight that the European Union also has the same interest in the protection of cultural diversity that we do.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Thank you.

Minister, I noticed that you didn't answer Mr. Del Mastro's question when he asked specifically how many jobs you expect to be created by the agreements. I would like to add to that and ask how many jobs could be lost, and which industries in particular could be impacted.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Well, we would have a net benefit of $12 billion to the Canadian economy, plus, so I don't know what that will work out to--

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

But there's also a negative balance of trade with respect to cultural goods. I am going to ask you about that shortly, but first, how many jobs do you expect to be generated here?

[Peter Van Loan, Conservative, York—Simcoe, ON]

It will come down to how productive our Canadian economy gets. I'm not going to try to quantify what $12 billion of additional gross domestic products represents, but you could do a fair bit of math yourself to figure out that it will be in the many tens of thousands.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Minister, what impact, if any, will this agreement have on the CBC?

[Peter Van Loan, Conservative, York—Simcoe, ON]

On the CBC?

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Correct.

[Peter Van Loan, Conservative, York—Simcoe, ON]

I foresee no impact whatsoever on the CBC.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Well, there are concerns from the EU about subsidies to industries, energy, agriculture; so what about culture? Are they concerned that we perhaps subsidize our cultural industries and are protectionist of our heritage? Will they have that view about the CBC?

[Peter Van Loan, Conservative, York—Simcoe, ON]

I don't know if you heard the questions I was answering for Mr. Julian, but I said there was only one substantive issue about which they are raising concerns, and that was the issue of the subsidies and programs we have to support our publishing industry. Our position has been that we wish to maintain the ability to have such supports in place.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

Minister, have the EU negotiators expressed concern about the high degree of vertical integration that exists in Canada, and could that present an obstacle in negotiations of the agreement?

[Peter Van Loan, Conservative, York—Simcoe, ON]

I'm not aware of that, of if they have ever....

Mr. Verheul is telling me that he's never heard that raised.