Economic Relationship between Canada and the United States Committee on April 8th, 2021

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Regarding this, the World Trade Organization made an important decision in August 2020.

How has that decision changed Canada's approach to obtain from the Americans a full exemption of all tariffs on the export of Quebec softwood lumber to the United States? Is that decision now being used as a sort of precedent?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I am not a lawyer, so I don't want to speculate on what this involves. It is certainly something we have to deal with, but I could not tell you how it will end. We have to wait for the WTO to come to a final decision. For the time being, we will have to wait to see what happens.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

How much time do I have left, Mr. Chair?

[The Chair, Liberal, Raj Saini]

You have one minute.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

That's great. In that case, I will ask another question, still on the same topic.

The new U.S. administration does not seem to be especially open to improving the commercial dispute resolution process. So far, we have not seen any signs in that direction.

The new administration has been in power for a few months. We wrongly believed that protectionism and trade wars were invented by Trump, but that is not at all the case. This is an entrenched culture in the United States' trade relations.

What steps has Canada taken with the United States concerning the blockage of the World Trade Organization's appellate body? Have you received information from U.S. representatives indicating an interest in moving forward on this file? In other words, has the new administration changed the United States' position on this issue?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I cannot give you specific answers. As you know, the new administration has been in power for only three months. I could refer this to my colleague Steve Verheul, who may have information, but I also want to mention that we are at the very beginning of our relationship with the new administration. I think it would be premature to presume what its position on the softwood lumber issue is.

So I turn to Mr. Verheul should he want to add anything.

[The Chair, Liberal, Raj Saini]

I'm sorry. You're over the time limit.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

That is what I feared.

Thank you.

[The Chair, Liberal, Raj Saini]

Maybe Mr. Verheul can add his comments when Mr. Savard-Tremblay has another round.

We'll now go to Mr. Masse for six minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Thank you, Minister, for being here. Thank you again for your quick and decisive action on trucks carrying hazardous material going across the Ambassador Bridge during this past Christmas holiday season. Your intervention with Governor Whitmer was significant in blocking these trucks carrying dangerous material from crossing over our Great Lakes system.

With that, I want to ask about another issue with the FAA in our region. That's the Nav Canada study to close the Windsor airport. I have presented your government with Bill C-278, a private member's bill that would give the government the power to stop the study from happening.

Have you had a chance to review this? Why would we want to get into a dispute with the FAA? With that airport tower being closed, planes are having to share space, especially with the U.S. military and their private and commercial aircraft.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

Thank you very much, Mr. Masse, for your opening comment. I want to thank you for bringing to my attention the transportation of dangerous goods over the bridges. That was a good example of a team effort between two parties and also two individuals in the Government of Canada. I appreciate that very much.

I know you are very concerned, as are a number of local government officials, with respect to the Windsor airport. As I have explained to you in the past, at the moment the organization called NavCan, which is responsible for air control in our country, decided some time ago to re-evaluate the service needs of different airports across the country.

I'm no longer at Transport, but as far as I know they have not made any final decisions. They are responsible, and they are an arm's-length organization. We have to allow them to do their work. Hopefully they will take into account all the factors you and others, such as the mayor of Windsor, have brought up.

[Brian Masse, NDP, Windsor West, ON]

I'll leave it at that, but what has changed is that NavCan has changed its process. Second, I have presented a bill that will provide the government with the remedy right away. I hope you have a chance to look at that.

I want to quickly move to our auto sector. Semiconductor computer chips are in shortage in North America, in particular in Canada. In Windsor, our assembly plant is down again. Because we're dependent mostly on China's supply chains for this, have you talked with any American manufacturers or your political colleagues to look at a domestic solution? These semiconductor chips are like vaccines for the automobile industry. We cannot produce them without them. We have no supply capacity for ourselves.

Have you had any discussions, or will you follow up the discussions, to produce domestic manufacturing for North America for semiconductor chips?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

You raise an important point. In a broader context, if I can talk about other critical materials, let me talk about critical minerals as an example. That will be very important in the transition towards electric vehicles, and they are also used in a lot of electronic products. I know both Canada and the Biden administration are looking at those considerations very carefully because, as you pointed out, they're critical elements in the supply chain.

One of the things we're doing as we move forward is ensuring that in both countries, for industries we strongly support, we look at all the different methods available to us to ensure we have that availability with respect to certain critical components.

I know the United States is looking at integrated circuits, but I know Canada also has the potential to be extremely helpful in the area of critical minerals because we're rich in that area. We're looking at North American self-sufficiency with respect to certain critical components.

[Brian Masse, NDP, Windsor West, ON]

I would suggest that batteries shouldn't be alone; semiconductor chips should be part of that, because we are dependent on that entire infrastructure.

I want to move to a proposal by the Wilson Centre to have a border task force to deal with the health-related issues of COVID-19 and building back our two countries.

Is this being considered by the government right now? Similar to the issues over COVID, we have the Canadian Association of Moldmakers, who cannot get workers across the border properly.

The order in council you're a part of didn't accommodate those types of employees. We also have families who can't get reunited. Could you make a commitment today to having a border task force created, as many businesses, including the Business Council of Canada, have advocated? There are so many issues under that. It's going to take ongoing operations.

Is that something the government is considering?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I sit on the COVID committee, and we are constantly evaluating border policy. It's probably fair to say that the number one driver in making any decision is the health and safety of Canadians.

Having said that, the situation is gradually changing and we are very sensitive to the need to recover our economies. We are looking at fine-tuning the process, so in some cases we will examine whether certain classes of workers who aren't on the original list of essential workers need to have access across the border.

Those are the kinds of things we're looking at as we move forward and improve our processes with respect to getting people checked before they cross the border, getting people checked after they cross the border, and refining our quarantine regulations. All those things are being dynamically examined at the moment by all the relevant people.

We are talking to stakeholders and they are certainly talking to us, especially from industry but also from the United States, where some groups want to reopen the border more quickly. However, we have to always bear in mind that the number one consideration is the health and safety of Canadians. They have to—

[Brian Masse, NDP, Windsor West, ON]

There's no doubt there, but I guess what I'm looking for is a commitment to a formal task force like we used to have with the Manley-Ridge accord and others. Previously, we actively worked on untangling border issues on a regular basis, not just with the government, but with the private sector, the public sector and so forth.

[The Chair, Liberal, Raj Saini]

Did you want to answer that really quickly, Minister?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

The COVID committee's tentacles reach out to those stakeholders, so we are talking to them.

[The Chair, Liberal, Raj Saini]

Thank you, Mr. Masse.

We will now begin our second round, with Ms. Alleslev for five minutes, please.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you very much, Mr. Chair.

Minister, you stated that Canada's approach to the “made in America” executive order is to educate all aspects of the political and industry sectors in the U.S. on Canada's integrated approach to make sure they're aware of any unintended consequences. Speaking candidly, President Biden is not new to this, and it could be viewed as naive for us to think that President Biden and our U.S. neighbours haven't made themselves aware of all of the consequences and have decided this course of action anyway.

Canada's current approach hasn't been working. The U.S. has cancelled Keystone XL. We've lost auto jobs. We are not making progress on softwood lumber. The steel and aluminum tariffs that were imposed saw a great loss of steel and U.S. manufacturing jobs, which went to the U.S.

What is Canada's plan B? Minister, how are you changing your approach to ensure that Canada achieves a different result?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I'm sure you understand that I take exception to the way you presented some of those statistics. I disagree with the way you painted the picture of how things are going between our two countries, because I think things are going very well between our two countries, notwithstanding that we are going through a pandemic.

We were extremely successful in renegotiating NAFTA, and I believe very strongly that we'll be successful in making the point clearly to our American neighbours that buy America has to be looked at very carefully because it can have unintended consequences, and that we should stay very close together in following it to make sure it doesn't have those unintended consequences.

I'm confident that on.... Remember, again, that we're doing 2.7 billion dollars' worth of trade between our two countries on a daily basis. This is not a small exchange between two countries. This is gigantic and it involves all 50 states. It requires us to do our work as team Canada across those 50 states, and that's what we're doing.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Minister, do you know what percentage of the trade we do every day will be at risk because of these new “made in America” provisions?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I'm confident that our trade is going to continue to be strong between our two countries. I guess time will tell, but we continue with our approach of advocacy with respect to our relationship with the United States. It worked very well—

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

You don't feel that Canada needs a different approach. We should just continue with the current approach and we will be able to mitigate the messaging that the Americans are looking to protect and repatriate to the U.S. a significant number of manufacturing jobs in steel, iron and manufactured goods.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

Many American lawmakers—governors—realize just how important that mutual trade is because of our integrated supply chains, and we will continue to advocate amongst those who may not be as aware of it. It has worked very well with the previous administration in renegotiating CUSMA. We will continue in that way.