Thank you, Mr. Chair.
My name is Richelle Andreas. I'm the CEO of S3 Enterprises. We're a small manufacturing company out of Swift Current, Saskatchewan. I'm also the board chair of Agricultural Manufacturers of Canada or AMC.
AMC is very pleased to be able to take part in the consultations by the House of Commons Standing Committee on Finance in advance of the 2019 budget. I'm humbled to have a chance to address you on behalf of our members at a time when there's such an incredible opportunity through innovation and smart policy in the agri-food sector to make expanded and long-term contributions to Canada's economy.
With over 250 members, AMC is a national organization dedicated to sustaining a strong, viable and highly respected Canadian farm equipment manufacturing industry. It can be said of our members that innovation is truly in our blood. Many Canadian farm equipment manufacturers started out as farmers or members of small rural communities. Over the years, they have used their experience and ingenuity to develop cutting-edge farm equipment that met the unique needs of local farmers, given the harsh climate and growing conditions of the region.
Today our agricultural equipment is among the highest quality and most sought out in the world. In 2017, AMC member companies exported more than $1.9 billion in agricultural implements to 154 countries.
Let me point out that AMC's member companies see themselves as playing a significant part in helping to advance the federal government's goal of increasing Canada's exports of agri-food and agricultural products to at least $75 billion by 2025. As you know, our manufacturers and farm customers are dealing with significant challenges arising from uncertain trade patterns and our commitment to balance growth with ensuring a safe, secure and environmentally sustainable agricultural sector.
The agricultural equipment manufacturing sector is an important one for Canada's economic success. For our sector to thrive and ensure Canada's competitiveness, budget 2019 should include measures that support the innovation that is already taking place and help us get our products into global markets.
Our number one recommendation for the 2019 budget is for the federal government to provide a better incentive to invest in the purchase of farm equipment by raising capital cost allowance rates available to farmers. Specifically, AMC recommends the government modernize the capital cost allowance rates for purchases of new farm equipment and machinery by combining the two classes they now fall into and providing a higher rate of amortization.
At a rate of 50% amortization, the writeoff period associated with farm equipment purchases would more closely match their technological obsolescence and incent Canadian farmers to invest in technologies that will reduce their emissions, decrease their carbon footprint and increase the overall productivity of their operations, better positioning them against global competitive threats.
I should mention in this context that the federal government-commissioned economic strategy tables on the agri-food sector recently singled out improved CCA rates as a significant incentive that would accelerate investments and enhance Canada's competitiveness.
AMC also recommends that the federal government continue pursuing free trade agreements and diversifying Canada's export markets. Based on the favourable global reputation of specialized Canadian-made farm machinery and equipment, Canada's manufacturers are in a strong position to take advantage of the expanded market access in Asia, Europe, South America and other regions. We also recommend the government encourage Export Development Canada to continue and strengthen its support for Canadian exporters active in developing markets such as South America.
Canada's manufacturers of specialized farm machinery are proud of their unique, made-in-Canada success. We are national in scope and play an important role in rural communities where AMC companies employ approximately 12,000 people, primarily in communities of less than 10,000.
Innovation starts at home. Modern farm practice is advancing at an unparalleled rate, and our members are creating the solutions to execute the science of tomorrow's farm. As a leader in the global advancement of agronomy with good public policy, Canada stands poised to increase our exports and become the worldwide model for sustainable agricultural practice. We believe with improvements and crucial incentives from the federal government we can greatly increase our contribution to the country's long-term success.
Thank you. I would be happy to take any questions you may have.