Thank you, Mr. Chairman, mesdames et messieurs.
I'm delighted to be here. Mr. Chairman. You've made me sound as if I'm from Toronto, in fact, I'm from Vancouver in permanent exile in Ottawa. I can always get a crowd from Winnipeg west when I'm quite clear. I shouldn't say that in front of Mr. O'Connor, of course, as a local boy, but I still get mileage from about Winnipeg west. The other thing I might mention is that I'm a graduate of the federal public service, having served for 35 years in various departments of government. So I continue to follow trade and financial matters internationally, and teach it as well as an ongoing retirement project, if I could put it in those terms.
I'm delighted to have the opportunity to share some of my views with you on what at the moment is a political agreement announced on October 18 between the Prime Minister and the President of the European Commission, Monsieur Barroso. The multilateral negotiations will take months. I know this from my own experience with the Canada-United States Free Trade Agreement and the NAFTA and the Uruguay Round. I was part of all those teams.
It'll take many months to complete the technical agreement, legal texts, and indeed, to solve some final, outstanding issues between ourselves and the European Union. So it's not a fully done deal except for the political aspect of it, which is very important. But it does mean that one has to be a little careful in assessing the agreement in detail, because we don't have the detail. What we do have—and I'm sure all members here will have seen the statement from the Prime Minister's Office, of course, the document released shortly thereafter, and also the knowledge that we've gained through the media.
One thing I would stress to members here that might reflect the fact that I'm from one of the provinces of Canada—I always have to remind my federal colleagues and did throughout my career, that Canada consists of both the federal government as well as 10 provinces and three territories. In fact, I think an important outcome of this agreement is the fact that within 24 hours, October 18-19, every provincial premier and all three of the territorial leaders supported the agreement in principle.
Some of them said, with good reason, that depending on the particular sectors or the particular interests of their jurisdiction, the province or the territory, they had some issues they were concerned about and would want to deal with either with the federal government or internally. But it does reflect a federal-provincial-territorial agreement, which I think is almost unprecedented in Canada in the trade file. I think it's really important and is to the current government's credit that they involved provincial and territorial officials throughout the process.
That meant an awful lot of revenue to Air Canada and the various other airlines serving both western and eastern Canada as the officials went back and forth to Brussels. The negotiators tell me it was almost unwieldy at times, but they were all there and that's an interesting, if I can call it that, Canadian experiment. We'll have to see if it's duplicated.
I might add that has not happened so far with the Trans-Pacific Partnership negotiations that are under way. Lower-level officials have been involved to some extent, but my observation in dealing with several provincial governments is that they don't know a great deal about this other major, almost what I'd call a mega-regional, agreement, as is CETA, under way now. That's something I think the government will want to consider as it proceeds.
I say that only as a bit of a detour, although I think it's important, partly because in the Trans-Pacific negotiations under way, Mr. Chair, we're dealing in a comprehensive way with the United States for the first time in 20 years. People tend to forget that. The United States is leading the Trans-Pacific, for better or for worse, but we're dealing with them across the board and this makes it very important. It has implications even for the European agreement.
As a general matter, a policy matter, and a practical matter, I would point out that whenever domestic regulations or international relations change—and trade agreements and investment agreements ultimately are changes in regulation—there are always gainers and losers. This is true of any change in regulation—telecoms, agriculture, international trade. This is important for governments, and for all of us involved in public policy from whatever aspect. We need to ensure that the gainers over time can compensate the losers. Broadly speaking, one can make the case that gainers, who are generally consumers, tend to gain overall over particular producer interests, which are at times negatively affected, sometimes seriously.
I think it's incumbent on all governments, and indeed all of us dealing in public policy, to accommodate the losers and recognize that people get hurt, as they do when there is technological change. Not many people drive a horse and buggy anymore. When the automobile came along, there were losers. As technology goes on, there are always losers in our society. But the thing is, those who gain should be in a position to compensate those who don't.
I'll make the further point that this is natural to trade. It's natural within your own family, within a community, within a region, a province, a country, and across borders. It is natural to trade. That doesn't mean it's unambiguously good, but it does mean that it's the natural state of things. That's always the premise that I start with. We have to balance interests. We have to encourage goods and services, people, and investment in technology to cross borders. This is a natural thing, and it leads to the benefit of everybody over time.
In that context, I could say that I think CETA on balance is good. No question: it is good for Canada. It's a new-generation trade agreement and will move both Canada and the European Union into closer cooperation in many areas of domestic and international regulation. The regulation will not necessarily be the same, but it will be more closely aligned. There will be fewer differences between us. From what I have read, it is breaking new ground in areas such as recognition of professional services. That's architecture, law, engineering, and many more. It will also mean more cooperation in temporary-entry provisions, movement of skilled labour, including CEOs. It's beginning to chip away at things that are going on in trade. It will affect, for example, how we regulate electronic commerce, which is such a major part of our economy in today's world. The younger generation would think it's unbelievable that trade agreements don't cover the Internet, that they don't cover trade in electronic commerce. But that's a fact. This agreement is beginning to eat away at that and to open up areas for regulation and harmonizing—or at least aligning regulations in those areas.
I'll summarize by saying the agreement is getting at some of the European Union tariffs that we've been trying for 50 years to get rid of—in fisheries, forestry, automotive products, and aluminum. I can remember negotiating aluminum through the Uruguay Round, the multilateral round, and the Europeans wouldn't budge on aluminum. These tariffs will be eliminated as CETA takes effect.
I've read, and perhaps you've heard in the committee, that most Canadian producers say there will be at least $1 billion of increase in pork and beef products over time, and it will open up government procurement on both sides, leading to some worries from municipalities and for locals. But again, it means that as taxpayers, as consumers, we'll benefit and so will European Union customers.
We are opening up some of our market for European specialty cheeses and we appear to have acceded, or be in the process of acceding, to European Union demand with respect to pharma patents—I gather this committee has already addressed that to some extent—and geographic indications, where the Europeans had quite a long list of basically trademark-like things.
Lastly, I'd say the investor-state provisions trouble me, not only in this agreement but in general. I'm not sure that previous Canadian governments were right in NAFTA proceeding in that way, but we've now brought this into the European agreement as well. Others will know more about it than I, but it makes me a little uneasy. I know why we got into it originally: we didn't trust the Mexicans when we got into NAFTA. But in fact there's been a huge bite back and it's not clear to me that it's in Canadian national interests to have these provisions, but we can discuss that, or perhaps you'll discuss it with others.
Finally, I would say that this agreement is really the first agreement that the EU has with a G-7 country, and that makes it unprecedented. It's going to help the Europeans—and I hope us as well—in their opening and continuing negotiations between Europe and the United States. And we've got a stake in both sides of the Atlantic. I think on balance I'd suggest to the committee that this is good for Canada.
Thank you, Chair.
