Thank you, Mr. Chairman. Thank you for allowing me the opportunity to speak to the committee about the Canada–Jordan Economic Growth and Prosperity Act, which implements the Canada-Jordan free trade agreement and the related agreements on the environment and labour cooperation.
As you may know, I was Canada's chief negotiator for these negotiations, and today I'll highlight briefly Canada's trade negotiations agenda more generally. We'll note some key benefits of the Canada-Jordan FTA, as well as discuss generally Canada's relationship with Jordan.
Mr. Chairman, permit me at the beginning of my remarks to introduce my colleagues joining me at the table here today. To my left is Ton Zuijdwijk, general counsel with Foreign Affairs and International Trade. To my right is Pierre Bouchard, director of bilateral and regional labour affairs, Human Resources and Skills Development Canada. Also joining me is Denis Landreville, lead negotiator, trade negotiations division, Agriculture and Agri-Food Canada. To my far right is Barbara Martin, director general, Middle East and Maghreb bureau at Foreign Affairs and International Trade.
Following my remarks, we will be available to respond to your questions.
First of all, let's talk about the government's pro-trade plan.
Consistent with government priorities as set out in the Speech from the Throne and the Global Commerce Strategy, the government is pursuing a robust pro-trade plan, which is an essential contributor to Canada's future prosperity, productivity and growth.
A key component of the government's strategy is the ambitious pursuit of regional and bilateral free trade agreements.
As highlighted in both the Speech from the Throne as well as Budget 2011, free trade agreements open doors for Canadian businesses by providing improved market access and other preferences to an increasing number of foreign markets, which in turn helps to make Canada stronger in an increasingly competitive global economy.
To this end, we are conducting free trade negotiations with two major global economic powers, the European Union and India. Trade negotiations are also already underway with a number of smaller partners, including Ukraine, Morocco and the Caribbean Community, CARICOM.
Canada is also exploring opportunities to deepen trade and economic cooperation with other major economic partners, including Japan, China, the nine-member Trans-Pacific Partnership and MERCOSUR—Argentina, Brazil, Paraguay and Uruguay.
To date, Canada has implemented free trade agreements with 11 countries, including with our North American Free Trade Agreement partners, Mexico and the United States; Israel; Chile; Costa Rica; Peru; Columbia; and the member states of the European Free Trade Association—Iceland, Norway, Switzerland and Liechtenstein.
In August 2011, Canada concluded a free trade agreement with Honduras, which is currently ongoing detailed legal review. Implementing legislation for our Agreement with Panama was tabled in Parliament in mid-November 2011, at the same time as Bill C-23.
Regarding the Canada–Jordan free trade agreement, in particular, we still face a measure of global economic uncertainty, Mr. Chairman. In a growing number of countries, Canadian companies are at a competitive disadvantage because their foreign competitors have preferential market access under some form of free trade agreement. The Canada–Jordan free trade agreement addresses these concerns by levelling the playing field with key competitors in the Jordanian market, namely those from the United States and the European Union.
Over the years, Canada and Jordan have built a strong, mutually beneficial relationship. Despite a small decline in our bilateral trade with Jordan in 2009 with the impact of the global economic slowdown, Canada's 2011 merchandise exports of $70 million were more than double the $31 million total in 2003. This free trade agreement provides an opportunity to further enhance this growing relationship.
Jordan's current average applied tariff is 10%, with peaks up to 30% on some products of Canadian export interest, such as certain forest products and articles of machinery. Upon implementation, this agreement will eliminate Jordanian tariffs on the vast majority of current Canadian exports to Jordan, with remaining tariffs phased out over three to five years. There are only a small number of exclusions in the areas of tobacco, alcohol, and some poultry products.
This agreement provides Canadian companies with benefits in a variety of sectors, including agriculture and agrifood, with products such as pulses, frozen potato products, beef, animal feeds, and various prepared foods. Forest products such as paper and wood building products, industrial and electrical machinery, construction equipment, and vehicles and parts are also included.
The Canada–Jordan free trade agreement's focus is primarily goods market access. The context is that our services interests via-à-vis Jordan are being adequately addressed in the World Trade Organization. Canada's investment-related interests are addressed in the Canada–Jordan foreign investment promotion and protection agreement, which was signed at the same time as the free trade agreement and implemented in December 2009.
As Canada's first-ever free trade agreement with an Arab country, the Canada–Jordan free trade agreement will not only help improve market access to Jordan's growing market, but will also provide a platform for expanding commercial ties and raising Canada's profile in the broader Middle East. This FTA will also benefit Jordan, ensuring access to Canadian products at more competitive rates and increasing access to the Canadian market for Jordanian goods.
In fact, Mr. Chair, upon the coming into force of this agreement, Canada will eliminate all tariffs on Jordanian exports to Canada, with the exception of over-quota supply-managed dairy, poultry, and eggs, which are excluded from tariff reduction.
The Canada–Jordan FTA is not about goods market access alone, however. The agreement also contains principle-based chapters on the environment and on labour cooperation, and high-quality side agreements with strong binding obligations, which were negotiated in parallel with the free trade agreement.
The Canada–Jordan FTA is a concrete demonstration of Canada's commitment to enhancing regional peace and security by helping to improve economic conditions in the region.
This agreement also shows Canada's support for Jordan as a moderate Arab state that promotes peace and security in the Middle East, as well as Canada's support for the commitment of His Majesty King Abdullah II and his government to implement comprehensive political and economic reforms in Jordan. Such reforms include measures to enhance accountability and political participation, as well as economic measures to liberalize the Jordanian market and provide support for small and medium-sized enterprises.
Regarding the next steps, Jordan has already notified Canada that it has completed all of its internal steps to allow the agreements to come into force. Should Parliament elect to pass this implementing legislation, officials will then work with their Jordanian counterparts to bring the Free Trade Agreement and the related Agreements on the Environment and Labour Cooperation into force on a neutrally agreed-to date as soon as possible.
Mr. Chair, this concludes my presentation. We would be happy to respond to questions the committee may have on the Canada–Jordan Economic Growth and Prosperity Act.