International Trade Committee on June 26th, 2018

[Joseph Galimberti]

This is something that Secretary Ross raised in the Senate hearing last week. We have welcomed things like steps to strengthen trade remedy modernization, and we welcome the additional resourcing at CBSA, and the changes to the stencilling regime. I think the Government of Canada continues to look at things like government-initiated safeguard action.

We certainly see significant diversion of steel to Canada as a result of section 232. I think it's in Canada's interests, as good domestic policy, to protect steelworkers and steel manufacturers to make sure that this activity continues. But I also think that will encourage the United States to.... Looking at exemptions is one thing. I think ultimately we want to live in a world where there are no tariffs between the two countries—

[Tracey Ramsey, NDP, Essex, ON]

Very much so....

[Joseph Galimberti]

—and I think that is another concrete step that we can take, and that is justifiable as good domestic policy as well.

[Conrad Winkler]

What I would say is that we're really actively working on this exclusion process, and so we have submitted hundreds. Our customers in the United States, of course, have been really terrific to work with on that process. Both our customers and the legislators in our districts in Portland and our state of Colorado have really worked very closely with us to approach Secretary Ross, as well as many others in the U.S. government, on the exclusion process and the exclusions themselves.

In addition I would say that within the Canadian government it's been all hands on deck in terms of the exclusion process, but also in approaching Secretary Ross. That also includes folks like Premier Moe, who has been very active and went down to D.C. on behalf of those who have been impacted by section 232. I know that he spent time with Secretary Ross' team, as well as with many others in D.C., to push for some specific proposals not only around exclusion processes around our particular products, but also more generally for exempting Canada from section 232.

[Tracey Ramsey, NDP, Essex, ON]

[Inaudible--Editor]

[The Chair, Liberal, Mark Eyking]

There's only eight seconds left, so we're not going to be able to squeeze that in.

We'll move over to the Liberals with Mr. Sheehan.

You have the floor.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Thank you very much for the excellent testimony. There certainly are some very important ideas that you brought forward for us, such as the idea of a rapid response working group by the Canadian Labour Congress. I used to work for the Ministry of Training, Colleges and Universities in Ontario, and there was a very similar model, which can be very successful. Thank you for that and also for your support for the various modernizing trade measures that we put in place in 2016, 2017, and again this year. It was rhetorical when I said that if we did not have those in place, we probably wouldn't have a steel and aluminum industry here. I do agree that more can be done. We should never rest on our laurels. We should always be nimble and continue to look at various supports.

One of the things that I talked about was our trip to Washington and various states to talk to different people. It was very effective because we're now seeing a lot of those Congress people and senators approaching the administration and saying that what it's doing is wrong. The reason I bring this up is that last week the chamber of commerce—and I must add that the local chambers of commerce in the Soo, Hamilton, and Windsor, have been very proactive in supporting this.... It made me very proud to see that we have labour, the chambers, the steel industry, the mayors, and the community standing strong in the Soo and across this nation.

One of the suggestions brought forward by Warren Beatty and all the presidents of the chambers of commerce across Ontario is that we go down to, and redouble our efforts, in the United States. They're saying that they also need to engage their American counterparts.

Do you feel that is a good suggestion by the chambers across this great nation?

[Joseph Galimberti]

I think any advocacy that can be done in the United States to continue advancing the principle of open and mutually beneficial trade between Canada and the United States is time well spent. I think there are a lot of good points there.

I'd also say, and this speaks a little bit more to the tariffs, that I do know that this committee was in Washington recently and met with the AISI and heard unequivocally from its leadership that they were not willing to talk about us as an industry to get an exemption for Canada. I think we have to be resolute in taking action like tariffs and not allowing for exemptions, or sort of a Swiss cheese enforcement system, otherwise those efforts that we expend in having chambers of commerce go down to talk about fair trade will ultimately be undermined by domestic forces in the U.S. who believe they can act against Canada with relative impunity. I think what we're doing with the tariffs is critically important to also supporting those efforts by the chambers of commerce.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

I agree with that.

It's Perrin Beatty. I correct myself. I've met him a few times.

[Voices]

Oh, oh!

[Dean Allison, Conservative, Niagara West, ON]

Warren's his brother.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Does anybody else wish to comment that we need to redouble our effort, especially as they're talking in this letter about the tariffs on steel and aluminum? They're also talking about the tariffs on the solar panels produced here in Canada, including in the Soo, and the fact that the auto sector is being talked about as next. Really, in the summer we should be spending our time down there with unions, business, chambers, and the steel industry. That's one of the things I think we really need to focus on, as well as taking up your excellent ideas as we prepare for July 1, which is coming up.

Conrad.

[Conrad Winkler]

I really agree with your comments on redoubling those efforts.

If you think about section 232 in the United States, of course the world is impacted in various ways. If you think about how people feel in the United States, I really think there is a general feeling that Canada is not the right target. I think the more that people have that awareness and the more time legislators and others spend in D.C. and with the administration reminding them how really different Canada is, the closeness of the relationship is so unique that the time is really well-spent. We definitely encourage it and are thankful for all the efforts people have put in so far.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

I agree with that comment.

Every time I wake up in the morning in the Soo and open my window, I see the United States. It's undefended, it's a friendly border, and they don't get it.

Conrad, since you are in the business, how important is the TMX project in light of the tariffs we're facing right now?

[The Chair, Liberal, Mark Eyking]

Mr. Sheehan, you're getting into uncharted water there, and I'll have to cut you off.

We're going to move over to the member of Parliament for Ottawa—Vanier.

Welcome to our committee, Madam Fortier. You have the floor.

[Mona Fortier, Liberal, Ottawa—Vanier, ON]

Thank you, Mr. Chair.

Thank you very much for being here today.

I understand the complexity of the situation. As an alternate member of the committee, I see that we really have to focus on finding solutions. You suggested several possibilities. I believe I understood that the decisions we make have consequences on the Canadian economy as a whole, and not just on one sector. There will be a ripple effect all over the country.

What I am trying to understand—and you gave some examples—are the measures we must examine and put in place in order to protect businesses and workers. That is really where the government has to concentrate its efforts, in both the short and long term.

Mr. Winkler, you made some very generous comments, and you mentioned that we need significant measures. In your opinion, which measures should the government prioritize, together with the provinces, the territories, and all partners concerned?

[Conrad Winkler]

Yes. From a prioritization standpoint, I think the safeguards are the one really critically important area from our perspective, and obviously a really high priority, of course. The highest priority would be to get on the other side of this issue altogether. For us that is probably the number one priority, and, of course, it's already fully going on. The retaliatory tariffs are also probably a close second. Then of course, what everyone else has talked about as well are some options for some kind of support within current frameworks for the industries that are most impacted, like us, especially in the short term, but then also looking at the longer term.

[Mona Fortier, Liberal, Ottawa—Vanier, ON]

Mr. Young, on the same issue, you proposed a very clear solution, which was that the funds collected from the Canadian tariffs be made available to companies here in order to support them.

Are there any other measures you would like to propose today?

[Stephen Young]

I don't think we've really lived in this long enough to think more about how there can be solutions. What's really important is to get something on the record today and to have people come together and just talk about something like what we've proposed. By no means hear us say that we think we have this figured out, but understand that you are hearing from a company that's in the ground, that is going to have to deal with your constituents, who are going to have to find other work—and that is not a threat.

I don't know where else this can go. I know that when we hear from people from Evraz and from ArcelorMittal, this is not saying that money be given to Janco Steel. This is to say, let's share this money with our entire industry, with verified tariff payments. We are not asking for handouts. We are asking to keep us in the game until, maybe, cooler heads prevail. This will actually then push back a little at the bully that Mr. Trump has been to this industry and to our country to a degree.

I've heard “Team Canada” a few times today, and it's been, actually, really wonderful to hear. Let's keep our industry in the game, find some ways to figure out how to do that with money, and let's have verified payments. Let's do that as a team and find a way to stay until something else happens.

I do trust that NAFTA will be negotiated. I don't think there's anyone at the table who doesn't think something—maybe not three—is going to happen with the NAFTA deal, but when is that? Until then, absolutely irreparable damage will be done, not just to our company but to the entire industry.

[Mona Fortier, Liberal, Ottawa—Vanier, ON]

How much time do I have?

[The Chair, Liberal, Mark Eyking]

You have about a half-minute or so.

[Mona Fortier, Liberal, Ottawa—Vanier, ON]

Mr. Rousseau, I would like to give you the opportunity to answer that question from the workers' point of view.

[Larry Rousseau]

Of course.

In addition to the measures that must be put in place to ensure the viability of the industry and enterprises, there must also be specific measures for workers. I am thinking of employment insurance, specifically.

At this time there are work-sharing agreements in place, for maximum periods of 38 weeks. We would like that to be extended to 76 weeks, for instance. That would give people more time. Eligibility for employment insurance could also be extended by 20 weeks. You could also introduce measures to support worker mobility. When workers have to move to find jobs elsewhere, they need help. There could be allowances to help them move. We could also prioritize skills development for workers.

So, those measures could be put in place.

There is a great expression that we've had for years and years about Dofasco: “Our product is steel. Our strength is people.” When we talk about that, let's make sure we don't weaken the strength of the industry by one iota. That's where we're coming from.

[The Chair, Liberal, Mark Eyking]

Thank you, Mr. Rousseau.

We have time for one more MP, and Mr. Hoback, you have the slot. Go ahead, sir.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, witnesses, for being here this morning.

As we have been listening to witnesses from this and the last round, some things have been very clear. We must move forward on NAFTA or some sort of deal with the U.S. That needs to be done. We need to figure out a way in the meantime to deal with two situations: the situation you have, Mr. Winkler, in which you have customers to whom you have already committed at a certain price and now you're going across the border with a 25% tariff. How do you deal with that? How do you negotiate that? That's not small dollars; that's big dollars in your case.

Mr. Young, you have the same scenario but you're also telling us you're losing customers.