International Trade Committee on March 23rd, 2010

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

One of the things I always wonder about is, very simply, what we do next. We have the deal. A couple of you may like it, a couple of you may not, or you may like it with varying degrees of intensity. But what should we do next? How do we capitalize on the 37 states that have tied in with long-term procurement? How should we market what we do have as far as what's left of the stimulus bill goes? What are some positive suggestions for me to gear our perspectives so that we can expand sales and help companies go forward?

We'll start with Mr. Ross.

[Steve Ross]

We're a free-trading company. That's what we do. We're competitive. Our preference is to work in places where we're simply in a competitive marketplace, where you simply put a price out for a job, and if yours is the low tender you get the job. There are no advantages to other companies through.... For example, in New Brunswick they used to have a 10% local preference, just between borders. We eliminated that over time. Right now, there are no provincial trade barriers among provinces. Really, when we start working in the U.S., in most of the states we work in now, we just don't see these trade barriers as far as something like an additional 5% local content fee goes. We're looking for something across the board so that we can trade equally back and forth, the same way I can get on a plane and go next door and they can come here. We're looking for a free trade marketplace between the United States and Canada.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Does anyone else want to take up my question?

[Steven Shrybman]

I think probably the single most important thing I would advocate is that there be transparency in the negotiation process. We learned of this agreement only after it was negotiated, because somebody leaked it to the civil society organization. That isn't the way for any government to conduct itself in international negotiations. Canadians should see--

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

That wasn't really the question. The question is what we should do to take advantage of this agreement to help our businesses get more business.

[Steven Shrybman]

Well, listen, the temporary agreement expires in a year and a half. There isn't an awful lot of advantage in the commitments the U.S. has made already. So my answer to you, sir, would be if there is to be any advantage to be derived in procurement negotiations, either with the United States or with Europe, the negotiations have to be conducted in a transparent manner, or we won't do any better the next time than we did this time.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Anyone else want to...?

Mr. Keddy apparently wants to take the rest of my time.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

No, no, no, you can have your time. I just was going to answer your question.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Okay.

[The Chair, Conservative, Lee Richardson]

You have a minute or two.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

I guess then my next question goes to a 37-states procurement.

Everyone was concentrating in previous testimony on the stimulus package. My understanding of the American stimulus package was there was a lot of social welfare spending in there. It was sort of similar to what would be considered transfers to provinces, not quite as much nuts and bolts sorts of things that could be bid on. So some of the numbers about how much there is or what percentage we have access to are somewhat misleading, and misleading by saying we've been tied out of more than we have.

With 37 states that are procurement on long term that have signed on to the WTO, what elements would you want to see expanded with those 37 states, what could we negotiate, and how could we bring in other states to join those 37 states? Does anyone have any ideas?

[Guy Caron]

If you're asking me what I would recommend to Americans, it is very obvious. I think you will recognize that Americans are doing it their own way during negotiations, right? They are very tough negotiators, and this is why we're in this situation right now.

I think it's a good point to actually look at what is in the permanent agreements. The interim agreement itself is very lopsided. We've come to that conclusion. In the permanent agreement, Mr. Brison mentioned that there will be about $33 billion a year available in local procurement in Canada for U.S. companies to bid on.

[Scott Brison, Liberal, Kings—Hants, NS]

That's total—

[Guy Caron]

Total, yes. That's it, all the provinces.

[Scott Brison, Liberal, Kings—Hants, NS]

—that's not just local.

[Guy Caron]

Now in the U.S.—

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

We weren't protecting most of that in the first place, so frankly, if it was already open, we just signed an agreement for what we were doing anyways.

[Guy Caron]

That's correct, but once again, there were no shackles on local governments to actually do that process. If they wanted to use procurement for local development, they actually could do it.

Now, the problem with the 37 states—

[The Chair, Conservative, Lee Richardson]

I'm sorry, that's all your time, Mr. Trost.

Sorry, Mr. Caron. You're going to have to speed up those answers.

[Guy Caron]

Yes. Very quickly, the problem is that—

[The Chair, Conservative, Lee Richardson]

No, that one is over.

[Guy Caron]

Oh, sorry about that.

[The Chair, Conservative, Lee Richardson]

We're going to Mr. Guimond.

[Claude Guimond, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you, Mr. Chair. My first question goes to Mr. Shrybman.

Just now, you said that we needed political courage in order to negotiate with the Americans and to take a stand against an agreement like the one that is presently before us. Since we started our study, a number of witnesses have told us that some of the restrictions are unacceptable.

But the agreement conforms to standards of international law, including the same mechanisms and exemptions for Canada under the principle of reciprocity. In your opinion, what would the Americans say if we used the principle of reciprocity?

[Steven Shrybman]

Well, I don't think the Americans are going to make more commitments under the WTO than they have already. There's been repeated reference to the commitments made by 37 states in the United States, but those states have reserved a whole variety of local set-asides and offsets and local preferences. So I think the United States understands that spending public money to create public goods is also a reasonable way to make jobs. I don't think U.S. states are going to give up that prerogative.

So the only thing that we can do if we want to have a reciprocal arrangement with the United States is to hold on to our authority to do precisely what U.S. states do, which is to favour local businesses. Ontario did that when it procured green renewable energy technology, and Toronto did that when it bought rolling stock from a Canadian company rather than a European company.

You're not going to do it every time, but you want to maintain the option to favour local businesses, to favour local workers. When you spend taxpayers' money to stimulate the economy, maybe that should be your economy instead of China's economy.