International Trade Committee on Jan. 28th, 2014

[Randy Hoback, Conservative, Prince Albert, SK]

I'm done, Chair.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Mr. Pacetti, the floor is yours.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Thank you, Mr. Chair.

Thank you to the witnesses for coming in today.

Mr. Rice, I don't have your brief. This is not your first time here, but your second time. If you send a brief ahead of time, even though it's in one language, we get it translated, and then we get to see it, so you should send it to us ahead of time. You're experienced, so....

You were mentioning that there's an approval process still required for meat processing, but were there other examples as well? Are there certain areas that still need approval or where the technicalities or details have not been worked out?

[Martin Rice]

I think the biotech sector or the grain sector is still looking for further clarification on how the issue of low-level presence in residue monitoring is going to be addressed. Certainly in the case of meat, there are still some details to be worked out on testing protocols and on being sure that we will be able to have the plant approval systems in place.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Will that have any impact on the final outcome of the free trade agreement? Will you still be in favour of it, no matter what?

[Martin Rice]

I'd say our position in terms of the deal in principle that we've seen at this point is unreserved, but those issues have to be addressed as well.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Those are two major issues.

[Martin Rice]

Those are two major issues. We don't see them, though, as deal breakers or deal preventers.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

It's just going to mean how much money we have to invest. Is that what I understand?

[Martin Rice]

I don't think it necessarily involves more investment. I think it's more a matter of acceptance of reasonable levels of risk, practical levels of risk, in terms of how sensitive testing technologies are. Say you find one in 50 trillion residues in a container ship, for example. There's something still residing there in terms of a residue of a soybean variety that has been found completely safe from the exporting country's point of view, but if that's going to put at risk having this shipment allowed in because of zero tolerance, then that's a policy issue. That's not a—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

I'm not a farmer. When we talk about residue, can we find residue in any of the products you can export, or are there certain products that have more of a tendency to have residues?

[Martin Rice]

I guess it's a matter of the different crop varieties and whether or not they have the technology to detect that. I think if there's something that you want to monitor, you can test for it, and find some means of doing it, but there would be no point—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

How does Europe not have these residues? How are they able to guarantee 100% non-residue?

[Martin Rice]

In those cases, those are provisory. They're not producing themselves. They haven't approved them for their own use yet. That's why they—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Is it reciprocal? Will the Europeans have to maintain the same standards as in Canada? I would assume so.

[Martin Rice]

I think what we will do is look at these things on a risk basis, hopefully. Europe has boxed itself in on a number of areas, including some of the products we use that are considered, from their point of view, ineligible, even though there's no food safety issue. By saying, “We won't accept that class of products, that class of inputs,” they close themselves off to some valuable inputs.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Okay.

Ms. Leonard, you have an interesting brief, but it's funny that you state that the country where we do have a free trade agreement is actually the country where your industry has decreased its revenues, whereas in other countries where we don't have an agreement, your revenues have increased.

Will this agreement with Europe be counterproductive? Will it actually reduce our revenues? We seem to have an open market without the free trade agreement.

[Lynda Leonard]

No, I think the fact that we have an ICT industry at all is an outcome of our liberalized agreements with the United States and in North America.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

So it's just the economic cycle.

[Lynda Leonard]

It's just the economic cycle. I think seeing that uptick in European markets, and knowing that there are similar upticks in the Pacific Rim and in Asia—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

My understanding, from listening to your brief, is that the regulatory environment is what will help with the agreement. Is that one of the benefits?

[Lynda Leonard]

Mr. Rice talked about the non-tariff aspects of this in his brief. I mean, this is what's appealing to us as well. I don't spend a lot of time talking to my members about tariffs and tariff implications, but the non-tariff-related barriers to trade are certainly what preoccupy us.

Having fora, having opportunities to be—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

There are tariffs in IT?

[Lynda Leonard]

Oh, there are tariffs in IT, but as I said, we're fundamentally dependent on the export market, so they're not obstacles. They don't emerge in discussions about—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Sorry, they're cutting my time. They're bad people, bad people.