International Trade Committee on April 17th, 2018

[Mitch Garber]

I think it is part of the mandate. When you look at it, our main objective is not to bring dollars into Canada that neither fuel the economy or create jobs. So mergers and acquisitions are not the priority, although we welcome them because they're an important part of world capitalism and trade. What's much more important to us is if we could bring in new construction plants, warehousing, that bring jobs to Canada and not just money.

[Tracey Ramsey, NDP, Essex, ON]

My concern with it is that a lot of the trade agreements—and I'll point to the TPP in particular—that we've signed now have provisions in them that would allow foreign labour to come in along with those jobs. It is something that Canadian workers are really watching closely to make sure that the jobs that come are offered to Canadians versus firms bringing in their own workers from their home countries.

[Mitch Garber]

I think it's a combination of both, but it's almost always going to be the case that there will be far more Canadian jobs created than foreign jobs created.

[Tracey Ramsey, NDP, Essex, ON]

I'm happy to hear that. You've mentioned that you're in the start-up phase. I'm wondering when you expect to be fully up and running, and what you anticipate your annual operating cost to be once that's achieved?

[Mitch Garber]

Let me answer the first part and then let Ian answer the second part.

We're quite fortunate in not having to worry about when we're fully operational. This week Ian was in Lima, Peru, with the Prime Minister's delegation. Last week I was in Quebec City at the B7 dinner ahead of the G7 summit coming up in June. I attended a dinner with all of the major CEOs from Scandinavia just the other day and started talking about the opportunities to invest in Canada. The infrastructure exists. We have all these regional offices and now we can consolidate the effort.

Ian can answer about how he expects to roll out the hiring of his staff, and when he considers himself to be fully operational. Of course, the budget is something that's been dictated by the federal government.

[Tracey Ramsey, NDP, Essex, ON]

It's definitely something we want to see a return on. There's a large amount of money that's being put towards this project, so I do think how quickly will we start to see those returns is of concern to Canadians.

[Mitch Garber]

I don't know if the speed of return should be of concern to Canadians. We are going to make a major investment to get a very large return on this investment, but I don't know of any business situation where you would invest $50 million and get an immediate return on your $50 million. I think you'll start seeing a return in terms of results and deals being formed. But if you take, for example, a company that was going to build a plant in Saskatchewan, it may take three years to build that plant. It may take 10 years to realize a return on that investment in that plant. I think it's unrealistic to expect an immediate return on investment. However, we should be increasing the amount of committed foreign direct investment in Canada, which we would count as being a return on our investment in the agency.

[The Chair, Liberal, Mark Eyking]

I'm sorry, Ms. Ramsey, your time is up, but you might have a couple of minutes later on in the second round to get another question in. We're going to go back to the Liberals and, Madam Ludwig, you have the floor.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Good morning, gentlemen. Thank you so much for your testimony here today.

We've heard a number of times at this committee that it's challenging for small to medium-sized businesses in Canada to understand the services that are offered across the country, and also the access to them. It's not that they're not able to get there. Most often a lot of them don't even know that the services exist or have time to get there.

Recently as a committee we travelled to Asia and were in Singapore, which was great. We saw great opportunities for Canadian companies, but certainly there wasn't the required awareness of all the work that Canadian companies do. So you're speaking to the choir, I think, in terms of the romantic view of Canada.

I'm honoured to represent a rural riding in New Brunswick, and I'm wondering if within your mandate you are looking at milestones, sectors, or particular regions to focus on. I say this because, one, we're looking for greater opportunities in the east, but we also have some challenges with the perception and concern about foreign ownership that if the market changes, foreign entities will leave and take everything with them? Could you respond to that.

Thank you.

[Ian McKay]

Thank you for your comments and your question.

In terms sectors and mandates in the sector, I think that rather than being prescriptive, we will be doing it based on research and data. Capital will flow where it makes sense for it to flow. Our job is to present to investors where we have strengths in Canada, and that will be the model we will follow. Fortunately, we have extraordinarily diverse economic strengths all across the country, in all the sectors that I referenced earlier, and more.

In terms of targets, the report that Dominic Barton submitted to the Prime Minister, which helped launch this agency, said that if we doubled our annual growth of FDI attraction, it would mean about an extra $45 billion.

Getting from 2% annual growth to 4% is a very achievable objective, given time. It's been a 20-year study of why we have been declining in Canada, so we're not going to fix it overnight. I expect it will be fully operational by the end of this calendar year and that we will have deals in the pipeline that we can assist with from early this spring right through the next several years.

[Mitch Garber]

Ms. Ramsey, this might answer part of your question, since you were cut off, unfortunately.

First of all, of course we don't want to make bad deals, and we don't want to attract hit-and-run investment. However, it's important to recognize that the Canadian economy would probably collapse if it weren't for the affiliates of foreign companies, which represent over 30% of all exports from Canada. We need to continue to attract foreign affiliates to open offices, factories, warehouses, and plants. If we can get head offices, it's even better.

We have a healthy economy of foreign affiliates in Canada. We have a model to take from. I think what we, and especially I, need to do is to travel to every province in Canada. I need to do that to understand what someone from New Brunswick, for example, might be looking for as a foreign investment in Canada. I'm a bit ignorant today, but armed with the right tools, if I'm able to sit in front of the right people in the right countries, whom I can incentivize along with some of your colleagues in New Brunswick, Prince Edward Island, or some of the smaller provinces, I would love to do that. Part of my own goal is to visit places I haven't visited, to meet people I haven't met, to understand what their economies look like and what they would like to see as foreign investment, and to see if we can be of some assistance in trying to generate that.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Thank you for that.

I have a question regarding skill sets. In terms of the element of coordination—I would say this as someone who came from over 20 years of teaching at the post-secondary level—one of the areas where we need coordination is between the business sector and education system. If we're preparing for the future, will you be working with the colleges and universities to better prepare Canadians for the work and the jobs of the future, and the skill sets that are required, which may also make this environment more attractive to foreign investors?

[The Chair, Liberal, Mark Eyking]

It has to be a quick answer.

[Ian McKay]

First of all, talent is one of Canada's greatest inherent resources. The reforms in the immigration department and fast-tracking of skilled labour into Canada are going to be enormous attributes for this organization and the entire country. Our ability to be prescriptive or directive toward some of the colleges and universities on skills training is limited, but we will absolutely be working with and sitting down with the colleges and universities to tell them what we're hearing that investors are looking for in terms of skills. That will be an important part of my narrative when I'm meeting with those folks across country. It's a very good point.

[The Chair, Liberal, Mark Eyking]

Thank you.

That ends the first round. It looks as if we have enough time for the second round. We're going to start with the Liberals for five minutes.

Madame Lapointe, you have the floor.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Thank you very much.

Hello and welcome. We are very pleased to see you here today.

Ten days ago, the Minister of International Trade, François-Philippe Champagne, visited my riding of Rivière-des-Mille-Îles, which includes Deux-Montagnes, Saint-Eustache, Boisbriand, and Rosemère. There are many large and successful businesses in my riding. For instance, I have visited the Canadian Electric Boat Company. The boats they make could very easily be sold to Venice. My riding also includes the company Kinova, which is participating in the current trade mission to Paris. It is an artificial intelligence company. In particular, it makes robotic arms. There are all kinds of companies like that.

We held a round table with SMEs that export their products or benefit under free trade agreements. We talked in particular about the accords with Asia and Europe and about NAFTA. Some people said it was difficult to coordinate to make sure Canada's brand is well-represented at large exhibitions and fairs. Canada's brand is promoted very well actually, but it is difficult to export it. That is what my colleague was saying earlier with regard to our experience in Asia. The goal is as much to attract capital as it is to export our products.

Does your action plan include coordination for these large shows? For example, if Quebec is represented and Canada is also represented a bit further along, people do not make the connection. The Canadian flag has to be displayed prominently to show that we are selling Canadian products.

[Mitch Garber]

Thank you very much for your question.

Actually, I play hockey every Sunday morning in Boisbriand so I spend a bit of time in your riding.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

At the Centre d'excellence Sports Rousseau?

[Mitch Garber]

Yes, that's right.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

It is beside Elopak, an outstanding Scandinavian company that has invested here in Canada.

[Mitch Garber]

Yes.

I also saw representatives of the Canadian Electric Boat company on the television show, Dans l'oeil du dragon. They just appeared on the show.

Ms. Ramsey asked about the budget. Honestly, the budget has not been decided on yet, but a big share will go to marketing. Why? Because Canada is not currently represented at large exhibitions. We have to identify the best places to spend our money and what the employees hired here will do. Yes, we have to hire people to secure agreements abroad. That said, Mr. McKay and I agree that we should be represented at all the major international exhibitions, such as the Mobile World Congress, the AI Expo, and manufacturing and mining exhibitions.

As Ms. Ludwig said, we have to identify the regions or sectors that need better representation. Will it be the fishing industry, the mining sector, or agriculture? We will have to choose because our budget is not unlimited.

That is exactly what you just said: our goal with our budget is to spend money on promoting Canada's trademark at international exhibitions.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Yes, we have to show what we are capable of. The romantic view is all well and good, but...

[Mitch Garber]

You can't make much money out of romance.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Indeed.

It was very interesting, the companies. If you saw the Canadian Electric Boat Company on Dans l'oeil du dragon, you saw that they got through to the next level. This company is important. It can do great things in my riding.

Earlier you mentioned that you attended the B7 Business Summit, where you met with CEOs from Scandinavian countries in particular. How did they react when you told them about the new organization you are heading up?

[Mitch Garber]

Those are two separate events. The B7 Business Summit was in Quebec City, and the Scandinavians came here, to Ottawa.

The Scandinavians are more involved in the finance and banking sectors. They are already in love with Canada. They are already used to doing business with Canadians. It will be easy for us to seek out partnerships and foreign investments from Sweden, Finland and even the Netherlands.

At the B7 Business Summit, there were more people from Japan and China. It is not the same at all. It is a bit more difficult with the Japanese. We have a lot of work to do to attract Japanese investments to Canada.

I can see that our organization will have to do more work initially, especially in terms of marketing and exhibitions. We have to reach out as much to Japan as to the Scandinavian countries. We also have to go meet our colleagues across the country.