International Trade Committee on May 8th, 2007

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Thank you, Mr. Chair.

This being my first term in the House, I'm more familiar with Robert's Rules of Order, but on Montpetit, maybe I could be clarified through our clerk.

Can we actually move a motion on a point of order?

[The Chair, Conservative, Leon Benoit]

It wasn't actually a point of order. Whether I should have recognized that is another question.

Mr. Cannan.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

You did recognize him on a point of order and you had a motion on a point of order, so I just wanted to strike it out of order.

[The Chair, Conservative, Leon Benoit]

Actually, that is true. I did ask Mr. Julian if it was a point of order. He indicated it was, and you cannot move a motion on a point of order, so we do not have a motion before the committee right now.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

I did not, Mr. Chair.

[The Chair, Conservative, Leon Benoit]

That is the way I remember it, Mr. Julian. We could, of course, research that, if you'd like.

I'll ask the clerk if he remembers.

[The Clerk of the Committee, Mr. Normand Radford]

I have no recollection. I wasn't paying attention.

[The Chair, Conservative, Leon Benoit]

However, because there is some uncertainty here, and I don't want to take the time and I'm not sure we could get a definite answer on that, we will continue with this.

Monsieur Cardin.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Chairman, the Conservatives are talking about having respect for our witnesses. Yet, they had agreed to set aside time to discuss this motion in order to avoid having to go along with my suggestion.

I, for one, out of respect for our witnesses today, am willing to debate this motion at the end of the meeting. However, we should begin our discussion at least 30 minutes before the end of the meeting. If we must go over the allotted time by a few minutes, then so be it. I'm prepared to hear from the witnesses, and then to set aside some time at the end of the meeting to deal with these motions once and for all.

[The Chair, Conservative, Leon Benoit]

Monsieur Cardin, I indicated at the first of the meeting, or when asked, that I would leave 30 minutes to discuss two motions on the travel budget--I don't know why that would be more than two minutes--and then your motion, if you wish to bring it up again. Now it's clear that you do want to bring it up, so we can deal with those two motions. I can't say how long the travel budget will take. You never know on these things, for sure, but I will leave half an hour, and if you wish to table your motion, then you can certainly do that.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

In that case, Mr. Chair--

[The Chair, Conservative, Leon Benoit]

It is Mr. Cardin's decision as to whether he wants to table the motion until that time.

[Serge Cardin, Bloc, Sherbrooke, QC]

At the end of the meeting, we will take a minimum of 30 minutes. If it takes longer, we can wrap up our debate on the motion before adjourning the meeting.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Monsieur Cardin. I appreciate that. We will proceed then in that manner.

Do we need a formal tabling motion, or can we just put the motion off until 12:30? Is that agreeable to the committee?

[Peter Julian, NDP, Burnaby—New Westminster, BC]

In that case, Mr. Chair, I will withdraw my motion.

[The Chair, Conservative, Leon Benoit]

Oh, it was your motion. Sorry, that's my mistake, Mr. Julian. Thank you, Mr. Julian. We will come back to that at 12:30.

Now, if we could continue, we will go directly to the witnesses.

We have, from the Department of Foreign Affairs and International Trade, Ken Sunquist, assistant deputy minister, global operations, and chief trade commissioner. We have Carmen Sylvain, director general, bilateral commercial relations, Europe, Africa, and the Middle East. We have also Peter McGovern, director general, bilateral commercial relations, Asia and Americas.

Thank you very much for being here today. We will hear your presentations. We have agreed to have you go longer than usual because you're setting the stage for this study on the machinery of government and the various government departments, agencies, and so on that are involved in trade, as I stated at the start of the meeting.

Go ahead, please, Mr. Sunquist.

[Ken Sunquist, Assistant Deputy Minister, Global Operations and Chief Trade Commissioner, Department of Foreign Affairs and International Trade]

Thank you.

Thank you very much to all members of the committee.

In starting today, I want to say thank you very much for having had the pleasure of reading your report and the comments from the different parties, because in fact it's how we can improve and how we can better meet your needs and the needs of the business community.

I do have a short statement, and then my colleagues and I would be very happy to answer any questions or have any discussion that you might like. The chair has already introduced my two colleagues with me today, so we can talk a little bit about anything that you might wish.

I start by saying that ten years ago my predecessor sitting in this chair would have welcomed an opportunity to talk about exports, but as your recent report really outlines, the world is more complex: it's about two-way trade, two-way investment, innovation, global supply chains. These have all impacted on what we do, how we do it, where we do it, and who our partners are to accomplish it.

We have in the past put emphasis on companies competing with companies, and that's still true today in a global marketplace; but as Minister Emerson has put it, within a global commerce strategy, really we have to put more emphasis on how governments compete with governments as well.

At the Department of Foreign Affairs and International Trade, we work with our partners to coordinate and manage the “whole of government” approach to Canada's trade policy, trade promotion, investment promotion business lines. That means really working with a number of groups, including businesses, other government departments, the provinces, the territories in formulating our trade policy, determining that market negotiations are priorities, helping business and investors capture global opportunities, and promoting Canada's global presence around the world.

We rely on our major stakeholders from trade associations such as the Canadian Manufacturers and Exporters Association, the Canadian Chamber of Commerce, the Canadian Association of Importers and Exporters, just to name a few, and regional associations from the Canada China Business Council, to the Canada-Arab Business Council, the Canadian Council on Africa, Canada-India Business Council, and a number of others. All of these collectively form the team.

We have industry associations from plastics to steel, from aerospace to advanced technology. We share the same clientele. We have the same members and we share the same objectives. I think this is really important, because if you look back even ten years ago, there wasn't that collective feeling of industry associations, trade associations, other government departments on the priority of what we can do overseas and how it helps our companies.

We cooperate here at home. We cooperate in key markets around the world and we cooperate through innovative electronic tools, like the virtual trade commissioner, which I'll discuss in a moment. But let's start in Canada. There are 12 regional offices in Canada whose main purpose is to find and work with business people who wish to take advantage of international commerce opportunities that are identified by our missions abroad.

The second major task is to assist provinces and municipalities to attract investors to Canada. Having regional offices in each province brings trade commissioners closer to the business community and allows us to identify key industrial subsectors that are internationally competitive. We currently have about 107 employees in the regions who provide us with a broad-based domestic footprint so critical to connecting with clients. All of the regional offices except one are co-located with Industry Canada. In some offices we're joined by representatives of Canadian Heritage, and a pilot project in Montreal is being conducted where officers in the regional offices do the front-line work of promoting and counselling for the Canadian Commercial Corporation. But it's not just a matter of co-location with other departments; it's also a matter of cooperation. I want to differentiate between the two.

The regional offices and provinces co-chair a regional trade network that provides a strategic team approach to trade, investment, science, and technology. It's composed of Foreign Affairs and International Trade plus the provinces, partner federal departments such as Industry Canada, Agriculture and Agri-Food Canada, Canadian Heritage, economic development agencies such as FedNor, Export Development Canada, Atlantic Canada Opportunities Agency, and the Western Economic Development Agency. So it's really a full team in each province.

Together we coordinate strategic plans, such as premiers' trips to China or India. We collaborate on significant events, such as incoming and outgoing trade missions. We share knowledge pertaining to the capabilities of key businesses and the funding available for international initiatives. This type of coordinated approach is extremely useful in connecting companies and businesses to global opportunities.

Turning to the rest of the world, I'd like to turn to our international presence. The continuum of domestic and overseas offices and a trade commissioner service at home and abroad to help companies is a major step forward from the past. It really is this domestic continuum—what we do abroad to what we do in Canada, and how you pull it together—that makes a difference.

As you know, the Department of Foreign Affairs and International Trade manages 168 missions in 111 countries. We also have 128 honorary consuls and 16 other offices that offer points of service. In total, we have in 312 points of service in 159 countries. Of that total, our trade commissioner service operates in more than 140 cities worldwide. We have approximately 250 Canadian-based trade commissioners, about 350 locally engaged trade commissioners, and about 200 to 250 support staff.

We are stretched thin to meet current needs and succeed in new or expanding markets. But this requires greater focus on our part, redeployment of resources, and an emphasis on results. This kind of presence provides many opportunities to work closely with our partners in some of the world's most important markets.

I'd like to illustrate this with one example: the U.S. enhanced representation initiative. By far, the U.S. is our most important trade and investment partner. Indeed, on the virtual trade commissioner we have about 20,000 companies, and about 16,000 companies explore the U.S. marketplace every year.

The ERI, U.S. enhanced representation initiative, brings together Foreign Affairs and International Trade and six other departments, including Industry Canada, Agriculture and Agri-Food Canada, the Atlantic Canada Opportunities Agency, Canada Economic Development, Western Economic Diversification Canada, and the National Research Council of Canada.

Together, the ERI partners oversee a network of 22 new and existing consulates general, consulates, and trade offices. This also includes the staffing of all positions, ensuring that programs delivered by missions across the United States reflect shared priorities and a collaborative approach.

This initiative is an important part of our effort to keep Canada's commercial relationship with the U.S. strong and vibrant, but we don't just sit with what we've had in the ERI. We're taking a look at how the ERI can transform itself into a North American platform concept, and it would include other government departments, such as Environment, Natural Resources, National Defence, and Heritage, which could join the group.

For a moment, let me expand on the numbers when we talk about who our partners are. I'll talk about co-location for a minute. For instance, Agriculture has seventeen positions located in our missions abroad; Natural Resources has three; Export Development Canada has twelve; the Canadian Space Agency has three; the Canadian Food Inspection Agency people are in four of our missions; Heritage has six; Ontario has ten officers co-located in our missions; Quebec has eight, plus 21 separate offices; and Alberta has seven inside our embassies and two outside. So it's really a team approach everywhere.

If I could explain for one moment, under the global commerce strategy, we have what's called market plans. This is a way to take a look at any country and decide what tools we need to use. In fact, it's reflected in your “Ten Steps to a Better Trade Policy”, because when you look at a market, you have to look at what are the quiver of tools that we need to use to get into it. It could be market access, it could be free trade, it could be foreign investment protection, it could be air negotiations.

For instance, too often we focus on just one aspect of what the policy tools might be. I would argue that for instance in China the biggest thing we did was air negotiations, moving from 15 or 16 flights a week to 66 flights a week. This means that our companies bypass the coasts of Beijing and Shanghai to get into the interior, to Wuhan and other parts.

This puts pressure on me, because the trade commissioner service is all about contacts and local networks. In fact, it means that we can't be stuck with a bricks-and-mortar approach to being an embassy and some consulates. How do we make our people mobile? How can they look after business in other parts of a country? I use that as one example.

We are also looking at how Canada becomes a partner of choice for international business and whether that means regulatory issues. How does that play into the provincial game? We are also looking at how we connect with Canadian business to offer the global opportunities.

On connecting with business, I'm going to take one moment to talk about a new thing we have. Not surprisingly, the bottom line for our clients is accessibility of federal services, not who delivers them. It doesn't matter to companies and provinces what department or partner provides that service; what matters is having a single window of service, one that helps them to capture global opportunities in the most innovative way.

With this in mind, we're working with Agriculture, with Heritage, with Export Development Canada, and with the Canadian Commercial Corporation to develop something called the “virtual trade commissioner”, which will more effectively serve the market information and intelligence needs of Canadian companies involved in international commerce. As you may know, the virtual trade commissioner allows Canadian companies that have registered to obtain selected country, sector, and other information, as well as intelligence from any of the participating departments and agencies. This was a step in the right direction to meeting businesses' needs. And we're still making progress.

Studies that were undertaken in 2005 and 2006 indicate that the services and information that were provided came from 23 different federal government websites. In some cases companies were required to repeat the same or similar registration information over and over again. This is not effective or efficient, and it certainly doesn't help companies. In response, we're working closely with a number of departments and agencies on something called the “government online trade services”. It's a project to determine the best, most efficient ways to provide federal government trade services to our clients based on company needs rather than the organizational structure of the federal government. Indeed, Export Development Canada chairs this innovative project on our behalf.

I understand the committee hopes to visit several countries in Southeast Asia and the Middle East in June. I encourage you to meet with Canadian companies that are active in these markets and to learn from them about how we can better meet their needs and bring prosperity and jobs to Canada. I hope you will be able to assist us by fashioning an approach for the future, not just what we have today. The point is that the government has an important role to play in helping Canadian companies and investors succeed in global markets. At Foreign Affairs and International Trade we're committed to working with our partners at all levels to find the most effective ways to deliver these services.

I should mention before I close, Mr. Chair, that the world has changed dramatically in the last ten years. The number of federal government departments that are interested in international issues has expanded exponentially. Ten years ago somebody in my job could have sat here and said that we're in charge of exports. Today if I said that most people would laugh. The fact is that everybody has an interest and it's how we coordinate and collaborate together.

Let me give you an example--aboriginal international business development. We've been working with visible minorities, with different groups, and for the last few years with the aboriginals, to develop a way to get more aboriginals into the international commerce game. Our department can't do that by itself. We have to reach out and have partnerships to be able to do that.

I could use ten more examples to show you that one department can no longer manage it all. It's how you deal horizontally. It's how you work with your colleagues. And most of all, it's how you work on behalf of companies. If you don't have a results-based focus, none of this really matters.

I could offer one other thing. When your committee travels I hope we can give you some pre-travel briefings. My colleagues will be responsible for that. Plus, our trade commissioners will look after your program on the ground. We'll get you country profiles and background information on the major issues and on some of the problems we have.

Some of the markets you're looking at are not ones that are well represented and some areas don't even have a presence right now, so collectively we would really appreciate your insight on what we can do and how we can do it better.

With that, Mr. Chair, perhaps I could say thank you very much. I look forward to your questions.

My comments started with the machinery of government issues. I know you said we could go further on it, but I thought that questions might be a better way to get at it.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Sunquist.

We will of course be asking you, if we haven't already, for briefings for both groups who are travelling. We will depend on that to give us the direction we need to be effective with our committee travel.

As well, these meetings are all about looking at how the various government departments and agencies work together and how they could better work together to deliver the services needed for companies and individuals doing trade with other countries.

We will go to questioning now. We'll start with the official opposition, the Liberal Party.

Mr. Bains, for seven minutes.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Thank you very much.

Thank you very much, Mr. Sunquist, for your presentation.

In your closing remarks you said that the world has changed. I would also say that the department has changed quite a bit. It's gone through some major transformations. In mid-December 2003 there was a plan that was implemented, a separation of international trade and foreign affairs. After that, the Conservatives came into power and consolidated that.

When I talk to people, and many people have written to me as well, there's a concern about the impact this has had on the working culture, especially abroad and especially with the trade commissioners. There's a concern that there's a lack of resources and emphasis on international trade. What's your assessment of that?

[Ken Sunquist]

That's a difficult question to answer quickly and succinctly.

In 2003 there was a recognition that the international commerce game was changing in global value chains towards an emphasis on results. So many of the decisions made about how government was organized--which was an entirely political discussion and entirely at the call of the Prime Minister with regard to machinery--were very much centred around how we get better results.

One of the things we found out from our trade commissioners was that yes, we could focus on results. But some of the companies felt that they needed the linkage to heads of missions. So how did the foreign policy side and the trade side work? If you did it independently, could you agree on what the priorities were, and could the heads of missions be further involved?

When the Prime Minister brought us back together again in 2006, it was with the feeling that over the past three years we'd spent a lot of time on determining what our value added was and on really focusing, on the trade side, on how we could make a difference. So in fact we have what I'll call an integrated department, with very strong economic and trade priorities.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

And there were no job losses during that transition?

[Ken Sunquist]

There were no job losses on the trade side related to that integration.

It gives us a different structure, but our minister, Minister Emerson, and our deputy minister are very clear that there are goals and objectives on the trade side, and it's how we tie the political side into those goals and objectives that makes a difference.

I think the argument can be made that trade is no longer something that can be done in isolation or in silos, just as you can't do anything else in silos in the international world today.

The second part of your question is a more difficult one. It has to do with the morale of the people. It has nothing to do with a separation of one department into two departments, but it gets into promotional prospects and into funding that's available for programming.

As I said in my remarks, I'm certain that for those of you who have travelled to posts, you've always heard the story that we could use more resources. I think that's true. But on the other hand, it's also true that over the last few years we have become much more results-oriented and much more focused. That means that sometimes we have to redeploy.

I can give you examples. In the past we have had as many as eight Canada-based people in Paris and about twelve locally engaged staff. Do you need so many Canadians? Maybe we can put fewer Canadians there, increase the number of locals, and put those Canadians elsewhere into the system. So we're doing that redeployment now.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

I'm sorry to interject.

Very quickly, I have a question with regard to resource allocation and this notion that there's a potential for closure of consulate offices--say 19 to 23 of them. We've read about this. These are rumours or allegations or at least commentary that's made in public. Is there any truth to this? Have you seen any plans? Have you come across any documentation that shows there's a plan to close some of these consulate offices, up to between 19 and 23?

[Ken Sunquist]

The best answer I can give you is that on a regular basis we're taking a look at posts around the world and how they perform and what their role is. For some posts for which we may have had a rationale or raison d’être a few years ago, maybe the rationale is less. We constantly evaluate. We constantly look at that.

Are there a number of posts? As you know, the announcements--

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Is there a plan in place that you've seen?