International Trade Committee on May 13th, 2016

[Mark Hennessy]

Well, it came from our members originally, especially the poultry members, so—

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

Have you polled your members, though?

[Mark Hennessy]

Yes. It came through our steward bodies, and those folks who started to bring it out wanted an analysis done on it, so we started the work. They raised concerns. We also had concerns, as I mentioned before and as the poultry sector had mentioned, that should the TPP go forward, they would seriously have to consider whether to remain here, whether they need to remain here to maintain or expand their bottom lines and that sort of thing.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

As a nation, we know this, we have studied this, and it's not something for which we've come to a conclusion recently. We know that we are a trading nation. We know that we produce much more than what we consume, and we need those markets.

What other alternative would you have? What would you offer your people if we didn't have those markets, if we couldn't expand those markets, and if we couldn't encourage people like Mr. Stronach to endeavour on an enterprise that would hire more people and would expand those possibilities? What would you tell them? What would your alternative be?

[Mark Hennessy]

Right now we would say it's status quo at this point. We understand we do have to have trade. We understand we have to be competitive in other markets. We understand we would work with those employers to help that.

We're looking for more fair trade and an approach where there's a commitment to keeping the work here in Canada, keeping our members' jobs in place, and keeping those communities viable. That's where we are.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

I'll go back to you, Mr. Johns. It's been asked whether or not this would expand to more possibilities on this continent, specifically here in Canada. What opportunities are you seeing? When Magna started there were just a few components you were creating. What other possibilities...where are you moving as a corporation? What's on the horizon?

[Sean Johns]

I'm not sure we still use this, but historically we've been the most diversified automotive parts supplier. We cover pretty much the entire value chain aside from a few small sectors like tires, windshield glass, and so on. Today we're in a position where we're looking at how to optimize the businesses we're in. We are seeing that electronics are an enormous opportunity for us moving forward. A high percentage of our employees relatively are focused on our production operations, but we have an engineering staff of approximately 10,000 people, and so the complexity of things is moving upwards. Our opportunities are not just in parts, but we've moved heavily into modules and big systems. Electrification is what's driving a lot of things across all of our products today.

[The Chair, Liberal, Mark Eyking]

Thank you, sir. That wraps up the time.

We have time for two slots of three minutes each, and we're going to Madam Lapointe for three minutes and then Mr. Hoback for three minutes.

Go ahead, Madam Lapointe.

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

Good morning and welcome. Thank you for joining us this morning. I find your contribution very useful.

Ms. De Silva, a little earlier, you mentioned something very interesting. You talked about the accelerator program for exporters. My colleague talked about it a little. Would you like to add anything so that we can include it in our recorded information? You talked about a national program. If possible, could you elaborate on that a little?

[Jan De Silva]

We're currently in discussions with the corporate partners who have helped us build this program about taking this nationally. What that would look like is we would continue to operate it using the platform we have created, which is this 90-day program, plus we have a former member of our Canadian trade commissioner service who works in our office and who does hand-holding support with the companies to get them through their planning process. The intention would be to run some pilots at different cities across Canada with that same platform, and see if we can then help those boards of trade or chambers get staffed to be able to support it as an ongoing program.

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

Thank you.

During the consultations, we have repeatedly heard that the SMEs are limited and that they don't know how to establish themselves on the export market. The chambers of commerce have no idea what to do. They need training. The businesses need training as much as the chambers of commerce need support.

If a new round of negotiations were to be held, what would you like to see changed in the TPP?

[Jan De Silva]

I would say, from a change perspective, there is nothing we have identified. I would tap more of the industry sector expertise on that. We're focusing more at looking at it from the business community perspective, and how do we take advantage of all these growth markets. I wouldn't be able to comment specifically on a change in TPP.

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

That's good.

Ms. Nott, do you have something to suggest? You said that we absolutely must participate. If we were able to renegotiate, what changes would you like to see?

[Joy Nott]

I would have to agree with what Ms. De Silva was saying in that we look at it from more of a macro sampling, from that perspective. We represent so many different industry sectors. We know at one point in time there was definitely concern in the automotive sector, and we worked closely with our automotive partners during the negotiations when that was raised as a concern.

Earlier I heard some of the concerns when it comes to food, but our members tell us a positive story. They're very much hoping that TPP comes through, because when you start talking about food, the Canadian brand is extremely valuable.

Globally when you start talking about Canadian food, it's perceived as being healthy, nutritious, and high quality. Whether or not we deserve that reputation is a different story, but that's the perception, and our food members, who make up a large percentage of our membership, are hopeful this deal goes through. I don't have any specific points where we need to renegotiate.

[The Chair, Liberal, Mark Eyking]

Thank you.

That ended at three minutes, and we're going to wrap it up here.

Mr. Hoback, three minutes, go ahead, sir.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair, and thank you, witnesses, here this morning.

Ms. Nott, you talked about the fact that during the negotiations you're consulting with your members about things that are coming forward. For example, auto parts manufacturers said you talked to them, tried to explain it, and worked with them as this agreement moved forward.

Can you talk quickly about that process? Do you feel you're involved in the process?

[Joy Nott]

I would defer to the industry trade sectors that were in that. We were consulted and conferred with relative to some of the rules, specific things, and what our thoughts were, and we gave those thoughts to our members.

One sector we also consulted with, aside from automotive, was oil and gas. The oil and gas industry sector is pleased with the rules of origin that are in TPP, which are different from the rules of origin for their sector that are in NAFTA.

It's one of those things. NAFTA was a great agreement. It's 20-odd years old now, and it's a different world. TPP addresses and corrects some of those issues, so I know the oil and gas industry is very much keeping its fingers crossed that TPP goes through.

[Randy Hoback, Conservative, Prince Albert, SK]

Okay.

You made a comment that concerns me. Eighteen months ago, you polled your members, and they thought this was a done deal. They knew this was going forward, they were starting to bank on it, and now they're questioning things. I understand what's going on across the line and the rhetoric that's there.

I'm curious, are they also concerned because there's no leadership being shown on this side of the border on TPP?

[Joy Nott]

I don't think so.

What I'm about to say is going to sound un-Canadian, and I don't mean it to sound that way.

For the most part in Canada, my members feel—specifically, because those are the only ones I can speak to—when we're sitting at the table that we're not one of the most powerful players. We're not Japan, and we're not the United States. A perfect example of that would be there are sidebar negotiations that happen, such as the automotive deal, where Canada finds out about post discussion.

We know that we're not the biggest hammer at the table. That being said, in the TPP we're also not the smallest hammer at the table. There's definitely a feeling that—which leads to the comments I was making—we need to be there. No matter what, we need to be there.

[Randy Hoback, Conservative, Prince Albert, SK]

You need that multilateral strength to have the leverage with some of these big players. Is that fair to say?

[Joy Nott]

That is correct about being left out. If the United States and Mexico were part of the deal, and Canada steps aside for any reason, that's when you start to hear pessimism as to what the potential future is. NAFTA does not equal TPP, and TPP does not equal NAFTA. They are not interchangeable.

[Randy Hoback, Conservative, Prince Albert, SK]

Ms. De Silva, I'll give you a bouquet, because that's interesting what you're doing here in Toronto. Half a billion dollars in sales is what, 5,000 jobs in the Toronto region? It's huge. It's a major factor.

If you don't have market access, is it worth doing?

[Jan De Silva]

I think there are two ways to answer that.

Number one, there are gross markets out there that are not just the U.S., and I think the important thing about these agreements is that they give us preferential access.

Number two, it raises awareness when businesses are hearing about TPP. What does that mean for them? What are the markets that matter? Is that a good fit for my sector? There's that piece of it as well.

It's the preferential access that's important, and the fact there are tremendous growth markets out there that are not just the U.S.

[The Chair, Liberal, Mark Eyking]

Thank you.

Sorry, Mr. Hoback, I know you were on a roll there, but your time is up.

Those are good questions. It's a great panel here for the first panel and great witnesses. Thank you for coming, and for your comments, and for the good dialogue you had with the MPs. When we get our report done, you will get a copy of it. It'll take us a little while yet, because we still have a lot of interaction to do.

Thank you very much.

We're going to break for 10 minutes, folks, and we'll get back at it with the second panel.

[The Chair, Liberal, Mark Eyking]

Welcome, everybody.

This is our second panel this morning of our dialogue on the TPP.

With us on our second panel we have three panellists and three different groups. The first one is from the Canadian Environmental Law Association. We also have the Canadian Music Publishers Association and UPS Canada.

Without further ado, we're going to start, and maybe we can start with Ms. Wilson. Do you want to speak for five minutes?