Evidence of meeting #14 for International Trade in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was public.
A recording is available from Parliament.
11:30 a.m.
President and Chief Executive Officer, Sustainable Development Technology Canada
I'm trying to do the math in my head.
It's 1% of the market, which we have moved from $1 trillion to $3 trillion in that time space, so I'm having trouble answering you, though, specifically on that number. Obviously that's a share of a huge market, and the SMEs are small companies that don't have quite the same legs as the large companies, so some kind of arrangement that makes it easier for them to enter those international markets would be valued.
11:30 a.m.
Conservative
Ed Holder Conservative London West, ON
That would mean clearly tens of thousands of jobs as a result of that here in Canada.
11:30 a.m.
President and Chief Executive Officer, Sustainable Development Technology Canada
Oh, absolutely.
11:30 a.m.
Conservative
Ed Holder Conservative London West, ON
How do you convince the Government of Canada to make that kind of a commitment in terms of clean tech? I think that's very interesting from all of our standpoints. It's very significant that it would play that kind of a role, as you said, to cross the valley of death into opportunities with businesses.
How does that work, that you would be able to convince it to do such...?
11:30 a.m.
President and Chief Executive Officer, Sustainable Development Technology Canada
I think it's because the wonderful thing about clean technology is it is the nexus of the different systems, in that it is providing both an economic and environmental benefit and it does not have to degrade either of them. If you look at SMEs, which are the majority of the clean-tech companies, they provide economic opportunities in urban and rural communities across this country. They are the engines of 75% of the job growth, as I stated earlier.
If you look at that, the intent around improvement in the environment and the health of Canadians, health is linked to the quality of the environment. If that's distributed widely across the country, that is a direct benefit. The issue has been that with these clean-energy technologies--Canada is a clean-energy superior country--we have to be able to get a relatively high capital equipment expense of technologies into the market. That is not easy with an investment community that is used to more of the ICT side, which is a lower investment. So there's an absence of risk capital in Canada.
The government plays a policy role in addressing that risk capital. As you can see from my last slide, which I didn't speak to directly, we're already getting good investment from Europe. We'd like to get more of that money into our companies. It's a very logical combination.
11:35 a.m.
Liberal
Wayne Easter Liberal Malpeque, PE
Thank you, Mr. Chair.
Thank you both for your presentations.
Starting with you first, Ms. Sharpe, what are the current restrictions for the companies you represent in terms of getting into the European Union, and how do you see the CETA agreement improving that access?
I think a lot of European governments, probably even more than the Canadian government, lean more strenuously toward environmentally sustainable conditions. I think you have access to the Europeans with your clean technologies. What are the current restrictions, and where do you see the benefits?
11:35 a.m.
President and Chief Executive Officer, Sustainable Development Technology Canada
Thank you for that question.
One area is important for sure, which is that investments in small companies are somewhat complicated by the fragmented rules on deal structures and terms we have when we're trying to look at moneys moving between Canada and the EU. If at all possible, we'd like to see further standardization across Europe to make the flow of moneys easier, because none of these things gets money from just one jurisdiction. There's syndication on the investment side, and that means we have Canadian money going into our companies going into Europe. We'd like that to be a little bit easier.
In terms of the companies themselves, how can they tackle that market? It is a large market but a fragmented one. Anything in the CETA agreement that makes the arrangements between the different parts of the EU more standardized and more consistent is something that is of value to our companies. It's not like moving a multinational into those areas. It's hard for them to get the legs to deal with all that.
So I think one of the clear messages is consistency across the EU for the conditions they have. Obviously, relative to some of the jurisdictions, the intellectual property protection is pretty good in the EU, but anything there that would make it simpler and less costly for IP protection.... Again, it's important for companies to get that protection for the markets that they wish to enter and some of the processes are very expensive for SMEs in particular.
11:35 a.m.
Liberal
Wayne Easter Liberal Malpeque, PE
Thank you. I guess the bottom line would be more predictability.
Ms. McClenaghan, you made a lot of really good suggestions in your presentation, certainly based on experience in many of the trade agreements you've been involved in. You talked a number of times about the last draft you were working from. What draft are you working from? We as a committee have not seen any of the drafts other than what was leaked, which would seem rather strange, but we haven't. This is a very secretive government, as you know.
11:40 a.m.
Executive Director and Counsel, Canadian Environmental Law Association
We'd much rather that the debate was happening in a much more public way. We obtained a draft in the spring, and then we had another draft in the late summer, and that's the one we looked at to revise, and do this backgrounder. We have a more lengthy backgrounder. I don't know if there was time to have it translated, or if that's something the committee has resources to do. I provided it only in English to the clerk. I'm assuming that we've seen the same last version as you've seen, and that it's that language.
But it's for the reason that it may change as negotiations continue that I made the comments at the end about applying that kind of a lens to the overall agreement, as things may change, or as additional annexes or side agreements in some of the agreements.... We've seen different letters of interpretation or annexes that get added later, and then it's just important to look at all those pieces, and take that really strong environmental and health protection perspective, because I don't know if we'll see every draft or be able to comment on every draft.
11:40 a.m.
Liberal
Wayne Easter Liberal Malpeque, PE
I do think you made a very important point, that there needs to be a stringent evaluation of the entire CETA. I think that is extremely important.
But I might mention to you—and I hope that you would be given the same opportunity—that we had the Canada Pork International before the committee. They see a lot of potential in the market. But they did say that they would be given the opportunity to sit down with the negotiator, and go line-by-line in terms of the areas that affect them. I would hope that you're given the same opportunity, because your organization has a wealth of experience in these trade agreements in terms of the impact they could have on sustainability and environment. So I'd just suggest to you that it may be a request you'd want to make.
Two areas.... You mentioned that the U.S.-Australia agreement is better. Could you tell us what that agreement is? I believe that was relating to the topic of expropriation, but I might be wrong.
And the other area.... Could you expand on the concept of national treatment? In one case you felt the EU position was better; and in the other, ours.
Could you expand on those two areas?
11:40 a.m.
Conservative
The Chair Conservative Rob Merrifield
I'll ask for just a very short answer on those two, because his time has gone.
11:40 a.m.
Executive Director and Counsel, Canadian Environmental Law Association
Yes.
With the second one first, the common point in both cases was not to limit the wording to necessary measures, but to broaden it to those things intended to protect the environment and health.
On the first point, the U.S.-Australia agreement in 2004, it's the specific point on expropriation that we preferred, in that there was no ability of private companies to sue the government of either country for environmental regulation and claim damages. We've seen that happen under NAFTA. We don't like it happening. We think it's a problem, and we don't think it's necessary.
11:40 a.m.
Conservative
Ron Cannan Conservative Kelowna—Lake Country, BC
Thank you, Mr. Chair.
Thank you to our witnesses. I appreciate your being here this morning. Parliamentary committee meetings are very important to get this information out. We've had numerous meetings, and we'll continue to have debate in Parliament as well, as this process unfolds.
I'd also like to thank you, Ms. McClenaghan, for your comments about the importance of protecting the environment. That's been a strong objective of our government, and also creating jobs in a sustainable way. I think it's important to balance that with environmental preservation, something I've been very keen on. I appreciate your efforts, as well, to focus on that.
As Minister Fast has said in this room and in Parliament several times, this trade is a kitchen table item, an issue that is so important to Canada. One in five jobs is created from trade.
We need to continue to grow our economy in a sustainable way, but I also think it's important that we work together in harmony, without communicating mistruths or sometimes misinformation. So to clarify, one of the comments in your report—and I appreciate having had the opportunity to read through it—with regard specifically to water....
...in the case of the privatization of a public service for example (for example water management) it would be almost impossible for local governments to roll back liberalization policies and to re-municipalize such services for the well-being of the population.
Our government's position on water has been clear no matter how much misinformation or misunderstanding or hyperbole there has been by the NDP and other organizations. We had the Council of Canadians here last week. I think it's important that our position has not changed and it's clearly communicated. Our government has always stated that we prohibit removal of boundary waters from our basins, for any reason, including export.
Provinces also have measures in place to protect water within their jurisdictions. Nothing, in any way, in Canada's trade agreements prevents governments from setting standards to ensure Canadians have access to safe drinking water. Nothing in any of Canada's international trade agreements can force countries to privatize or deregulate their public services, and all companies operating in Canada must respect Canadian laws and regulations.
This is not affected by trade agreements. I think it needs to be reinforced that this does not affect water in our trade agreements.
The aspect of the state of water is a concern. I'm a father and a grandfather. I've got three children and a grandson. We're not selling off our water or privatizing it. Nothing is changing. Local governments today can incorporate a private user, if they want, for the operation of their utility. As a matter of fact, a B.C. municipality recently had a referendum and it was voted down.
To clarify, if I could ask a question to you, Ms. McClenaghan—and I'd like to share my time with Mr. Keddy—how does your organization get this information? Is it misinformation? Do you want to fearmonger over water, or is it a miscommunication of evidence that shows your claims are not true?
The evidence I have here—I just need you to clarify—is meant to be in a cooperative manner, to communicate the message, because I think it's important for all Canadians to realize that our government is protecting and preserving the environment and water.
Thank you.
11:45 a.m.
Executive Director and Counsel, Canadian Environmental Law Association
We argue for public ownership and governance, especially of drinking water and municipal waste water systems. That is what I said. We don't have a quarrel with provision of services to public utilities, for example. But with the access of the European Union to the provincial governments and the municipal sector, my understanding is that there are private corporations that would like to directly own and operate.... I'm not suggesting for a minute that any particular political party in Canada is advocating that, but there are companies that would like that to be the end result, and it's something we wanted to flag as a consequence to be avoided.
For example, when Ontario did the recent Water Opportunities Act, which we strongly endorsed, that government felt compelled to put in a statutory statement that it wasn't intended to privatize water. It's a constant pressure, and we saw in Walkerton that we need public governance.
I agree with much of what you said, but we are always very worried about this constant pressure for privatization that we see in the private sector. I'm not making any assertions politically.
11:45 a.m.
Conservative
Ron Cannan Conservative Kelowna—Lake Country, BC
I'll pass the floor over to my colleague.
And don't worry, be happy, we're here together. Thanks.
11:45 a.m.
Conservative
Gerald Keddy Conservative South Shore—St. Margaret's, NS
Welcome to our witnesses.
Ron, you were very generous leaving me two minutes. I appreciate that.
I have a couple of issues that I just want to try to get a bit of clarity on.
Ms. McClenaghan, you made the statement about public consultation, but I can tell you there's been a lot of consultation with stakeholders and with elected officials. Those are the groups that represent all Canadians, the same as we members of Parliament do here at the table today. We have certainly had in-depth discussions with the provinces and with the municipalities. Both the provinces across the country and the municipalities are supportive of the CETA.
I appreciate some of the comments that you made about environmental protection, and I think most of us at the table here are in agreement that we need to protect our environment, but we also have to be very clear and concise when we put our facts out. To say that there's been no public consultation is just incorrect. We've met with groups across the country, we've met with industry, and it has occurred, and we've met with elected officials, so both municipal nationally, municipally and provincially.
11:50 a.m.
Executive Director and Counsel, Canadian Environmental Law Association
If I may, I don't think I said there wasn't public consultation. I said that the draft text has not been out in the public for comment, and that's where I think it would be extremely valuable, and I presume not just on environmental matters that we can comment on and many others can comment on, but across a whole range of other topics. It would be hugely beneficial to the public in Europe and in Canada and to all kinds of different interests to comment on the exact text. It's great to talk about general interests, but we then need to see how they're going to actually be embodied in the agreement.
11:50 a.m.
Conservative
The Chair Conservative Rob Merrifield
Thank you very much.
Yes, he's out of time, but it was very interesting.
Madame Péclet.
11:50 a.m.
NDP
Ève Péclet NDP La Pointe-de-l'Île, QC
Thank you very much, Mr. Chair.
My question is for Ms. McClenaghan. If I am not mistaken, you said that you gave the clerk a draft of the agreement, with your analysis, but it was written in English only. Did I understand correctly?
But we would like to have this—
11:50 a.m.
Executive Director and Counsel, Canadian Environmental Law Association
The analysis was prepared several weeks ago, but that was only in English, so my apologies for that.
11:50 a.m.
Conservative
The Chair Conservative Rob Merrifield
Just for the committee's information, the clerk has informed me he got it Monday. We can have it translated. It's about 36 pages, so there wasn't time to do it for now.
11:50 a.m.
NDP
Ève Péclet NDP La Pointe-de-l'Île, QC
Thirty-six pages, that's not a lot.
My first question will concern the investor rights part of the agreement.
Those rights repeat what is in chapter 11 of the NAFTA treaty.
Up to 2010, actually, 29 of the 66…
investor-state disputes under the NAFTA have involved environmental regulation or natural resource management issues.
We know that regulations like that…
--investor rights regulations--
…prevent the government from passing environmental regulations, for fear of being taken to court by companies. We know, for example, that there was…
Ethyl v. Canada. The gasoline additive MMT was banned by Canada for health reasons.
Basically, investors sued Canada, which lost. Another similar case was…
SD Myers v. Canada, where a U.S. company successfully challenged a Canadian ban on the export of toxic PCB wastes.
Could you tell me what impact passing these kinds of environmental regulations, or deregulations, will have…
investor rights disputes
…on the free trade treaty?