International Trade Committee on June 5th, 2018

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

There are two parts to your question.

First, on the CETA, there is only one Minister of International Trade, but there are over 300 of us in the House of Commons. I invite all my colleagues to promote this agreement. This isn't a partisan or political issue. All our ridings have small and medium-sized businesses that can benefit from this agreement. Obviously, there is always a duty to inform. I have spoken at almost every chamber of commerce to encourage people to take advantage of this opportunity and to seize the opportunities that are available to them. For example, in order to promote trade, a website displays all calls for tenders from the EU.

On the second part of your question, I would say that it is important to open up markets within Mercosur, which is the fifth largest economic bloc in the world. I can assure you, Mr. Paul-Hus, that the progressive aspects are part of the equation. Even the countries in that region have asked that this be part of the agreement. The 21st-century agreements take into account the environment and labour law. In my opinion, this is a step forward. People want to ensure that the level is raised so that we can compete on an equal footing. The last thing we want is lower standards with other countries to make competition more difficult. By signing such agreements, we raise the bar for everyone. Under these conditions, Canada is very competitive.

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

In our current trade of $8.9 billion, Canadian exports represent $2.3 billion and Canadian imports, $6.6 billion.

If we had a free trade agreement with Mercosur, what difference would there be in terms of exports?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

This will certainly help Canadian exports. Canada imposes most-favoured-nation tariffs, or MFN. On average, Canadian tariffs are 4.1%, while Mercosur tariffs are 13.7%.

Like me, you come from Quebec. The rates charged for our forest products are 35%. This is also the case for the automotive sector. It goes without saying that eliminating or reducing these rates would make us more competitive. I think the reason we're seeing some imbalance today is that the rates are so high that it makes it difficult for our products and services to compete in local markets.

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, Minister.

We're going to the NDP.

Go ahead, Mr. Blaikie, for a couple of minutes.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much.

We've heard from a number of stakeholders. Actually, I believe the Canadian Agri-Food Trade Alliance has been at this committee to say that a trade agreement with Mercosur is not a priority right now and that they're more concerned about NAFTA and getting NAFTA right.

What's the real justification for diverting your attention away from the NAFTA file? Is it an ideological commitment to getting another trade agreement, or is it busy work for a junior trade minister who's not on the most important file, which is NAFTA right now? We had an important announcement last week on the new tariffs, and of course it wasn't you at the podium. It was the Minister of Foreign Affairs.

Is the Mercosur agreement just partly for the government to be able to say that our trade minister isn't on the most important file because he's off somewhere else? What exactly is this sense of urgency for the Mercosur deal, when there is so much else going on with the trade file that you're not involved in?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I think I'll quote you. If you think CETA is not important, with 500 million consumers, and if you think CPTPP is not important—

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

That was negotiated before you became the minister, so it was actually—

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

If you don't think it's important, CPTPP is 14% of the world economy and 500 million people—

[The Chair, Liberal, Mark Eyking]

Mr. Blaikie, let him answer the question.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I will just say that we'll quote you on that when we refer to it.

What I can say is that, with respect to agricultural products, we heard from stakeholders who want us to open markets, for example, the pork industry. If I look at cereals and grains and animal feed, people want to export. We know that the tariffs are high. Our job is to make sure we open markets.

To your point, people understand that when you have a team, different people on the team work on different things. As for my goal, it's not about me; it's about Canadians, about your constituents. When we say we have preferential market access to 1.2 billion consumers, that's what makes the difference.

I agree with you. It may not be the largest trade bloc, but it's the fifth largest in the world. Somehow, I think, for Canadians...either we stay home and say we're satisfied with what we have...but you can't blame me for being ambitious and always trying to find a new market for Canadians. If I look at people in your riding, in particular, whether it's machinery or equipment, whether it's auto parts, whether it's forestry we're talking about...I come from a rural background. If you were to say this to the guys in the forestry sector, they would probably take exception to that because they want to expand markets.

It's not about me; it's about us. It's about Canadians. My job is to make sure we open as many markets as possible. With the deputy minister, and Ana, I think we have enough people to do all that at the same time, and I think we should all cherish that. It's not a political statement. As I said, we represent 0.5% of the world population.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Is it good for Canada, though, if people at the table with our trade minister feel that you're not the final decision-maker?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

In a government—

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Don't people want to feel that they're actually negotiating with the person who makes the decisions?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

With respect, it's not about being the final decision-maker. This is not a badge on my wall.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

No, it's not about you. It's about how Canada is being represented in—

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

It's about making sure that Canada remains competitive.

[The Chair, Liberal, Mark Eyking]

Gentlemen, we have time for one more question from the Liberals.

Mr. Samson, my colleague from Nova Scotia, I'm glad to see you here.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Thank you very much.

[The Chair, Liberal, Mark Eyking]

You say you have one question. That will tidy us up for this morning.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Thank you very much, Mr. Chair.

Mr. Minister, I want to begin by congratulating you on your presentation and the work you're doing. This is exceptional for Canada, but is also essential for Canadian businesses and for Canadians.

As you clearly pointed out, beyond the free trade agreement itself, it is the influence that such an agreement can have on other countries and the values that it can transmit on a global scale that are of great importance.

The Comprehensive Economic and Trade Agreement between Canada and the EU has been very beneficial, with the EU eliminating tariffs on 98% of its tariff lines. This was felt especially in the fisheries sector. Nova Scotia fishers, especially lobster fishers, are very happy with that.

If we now turn to the Mercosur bloc, how would a free trade agreement benefit Nova Scotia's fishing industry? This agreement could also be very beneficial to the province.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

First of all, thank you for your kind words.

With respect to CETA, you're quite right. In terms of lobster, we were faced with a 25% tariff. Whether transformed or frozen, it came down to zero over three years. You can see that this is really making a difference in the lives of families, workers, and fishers.

Some of the Mercosur countries are big exporters of fish and seafood. I think the reduction of tariffs should allow them to gain access to a market that today is not really accessible, to come back to Mr. Blaikie's comment. Every time you reduce tariffs and try to make Canada more competitive, you provide an opportunity. That's what we've done in Europe. That's what we're doing in Asia-Pacific. That's what we're doing in South America. I can say in front of this committee that we'll always look for opportunities to expand markets.

I keep coming back to this. If you're 0.5% of the world population and 2.5% of global trade, you need open markets. That's why, at the WTO this week, we were leaders. To your point, Mr. Blaikie, Canada was a leader in talking about reform and modernization of the world trade order. We depend on open markets for our current and future prosperity. I think we have the wherewithal. We have the civil service. We have all the experts needed to do all these negotiations at the same time and make sure we open markets.

With respect to fish and seafood, I think you will see positive news coming. The officials were telling me that the tariff we're facing currently is about 16%. So you start saying that if we can reduce or eliminate these tariffs, somehow we will become competitive. To Mr. Blaikie's point, you see that in the CETA on the fishery sector in Atlantic Canada. I think you know that better than I do, Darrell. It's really making a difference in the lives of families in this season and for the future.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, Mr. Samson.

That pretty well wraps up our time, Minister. Thank you for coming, and especially our officials. When we travel we always hear that we have some of the best negotiators in the world. We appreciate them, and we appreciate everybody who is back here in Ottawa making the snowballs for us as best they can. You always try to make it here for us, and you're open to any questions on the floor also. Good luck.

Committee members, Thursday we're going to review the report of the ASEAN trip so we can get it into the House in the coming week.

The meeting is adjourned.