International Trade Committee on Feb. 18th, 2016

[Kirsten Hillman]

Yes, we are undertaking an assessment. We have an office of a chief economist at Global Affairs Canada. We're undertaking that assessment. It's not completed yet. We're working on it. We will keep you posted.

[Tracey Ramsey, NDP, Essex, ON]

Thank you.

My second question is in regard to a Tufts University study which found that the TPP will lead to a net loss of 58,000 Canadian jobs and negligible economic growth, while deepening income inequality in Canada.

Has the department analyzed this study? Do you agree with its findings?

[Kirsten Hillman]

There are lots of studies coming out in the area of jobs, economic impacts on GDP, and impacts on various sectors. We're looking at all of them. As I was saying in my opening comments, we are doing internal assessments, but we are looking at all of the assessments that are out there, and that's one of them, for sure.

[Tracey Ramsey, NDP, Essex, ON]

You mentioned the mandate letter. In accordance with the mandate letter, Canada's Minister of International Trade is expected to consult on Canada's potential participation in the Trans-Pacific Partnership. What happens with the emails that are submitted to the public consultation email address?

[Kirsten Hillman]

There are different kinds of emails that we get. We get many emails that ask very specific questions. I'm making this up, but this is an example. One email could say, “I am a fisher from Atlantic Canada, and I'd like to know when my snow crab will be duty-free into Japan”, which is a big request in that region. We answer that question. We say, okay, under the tariff schedule, Alison and her team will go through the 100,000 lines and give them very precise information. There are a lot of those.

There are views expressed and opinions expressed, such as “we like this”, or “we don't like that”. If there are questions in them, we answer the questions. If there aren't questions in them, then we continue to advise the minister about the information that's coming in. We give her a weekly roll-up of the information that's coming in.

[Tracey Ramsey, NDP, Essex, ON]

Okay.

I received an email from a gentleman in Windsor who, like many Canadians I think, submitted the feedback on the TPP through that mechanism. He suggested that as part of an open and transparent process, it would be helpful to know how many citizens were generally in favour of the TPP and how many were opposed. He asked what the general categories were of the concerns raised, how they ranked in terms of numbers, and who raised them.

I think this is a really reasonable suggestion. I'm curious to know if you would agree with that.

[Kirsten Hillman]

I think once these consultations have progressed some more, a sense of where Canadians are coming out....

Canadians who used this mailbox, the now close to 300 individuals, and the minister, Parliamentary Secretary Lametti, and a number of other ministers who've met—those have to go into the mix. I mean, there's a whole range. That's one tool we're using, but there are many tools.

In terms of a general sense of that, yes, I think that's precisely the purpose of the consultations, to get that overall sense of things.

[Tracey Ramsey, NDP, Essex, ON]

Okay.

My next question has to do with the auto sector. Will the federal government provide financial assistance to manufacturers in the auto sector if the TPP enters into force?

[Kirsten Hillman]

That's not really a question I can answer. I'm here really to provide you with technical information on the TPP.

I think it's clear that, as part of these discussions, different sectors and individuals are giving their information and feedback to the government on what the TPP is and what they believe would be its positive effects, or perhaps not positive effects.

[Tracey Ramsey, NDP, Essex, ON]

Just to be clear, the previous government had offered some funding availability, so we're curious as to whether or not that still exits. But thank you for your answer.

The other concern around auto is that it's clear to us that the U.S. has a better deal—the tariff phase-outs, the years that are involved. I wonder if you could speak to us on how it came about that the U.S. was able to broker a better deal in the TPP for auto than Canada.

[Kirsten Hillman]

I think the answer to your question is that everything in this agreement represents a balance or a bargain that was struck, a negotiated outcome. The outcomes that are there are the outcomes that were deemed to be the ones that would work for Canada overall. I think that's the only way I can answer that question for you.

An important thing to recognize with respect to the tariff difference, or the tariff, is that the Canadian automotive sector exports 85% of its production. So the tariff into Canada is relevant for competition for sales in Canada. We have, under the Canada-EU agreement, under the Canada-Korea agreement, also agreed to tariff elimination for automotive tariff. That's one fact. The other fact is that, as I say, we export 85% of our production. Almost all of that is to the United States, and we export duty-free into the United States. In some respects, the tariff that's on imports into the U.S. by our competitors is also important to us.

[Tracey Ramsey, NDP, Essex, ON]

Okay.

Under the TPP, Canada would grant TPP countries additional market access through a phased-in quota to the Canadian market for supply-managed goods.

Does the federal government intend to implement the income guarantee program, the quota value guarantee program, the processor modernization program, and the market development initiative announced in the first half of October 2015?

[The Chair, Liberal, Mark Eyking]

Ms. Ramsey, your time is up. She can answer the question, but you might want to save it for the next round, because it might be a long answer. If it's a short answer, we can take it. Do you want to wait for that?

[Tracey Ramsey, NDP, Essex, ON]

It's up to you.

[Kirsten Hillman]

I'm happy to answer many times.

The government has made a clear commitment to the supply-managed sector. As to what that will be in terms of specifics, those decisions, as far as I know, have not been made. Again, that's partly my minister, Minister Freeland, but that's very much a whole-of-government conversation, I would assume, involving other ministers.

[Tracey Ramsey, NDP, Essex, ON]

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you.

We'll move back to the Liberals, to Madame Lapointe, for six minutes.

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

Thank you, Mr. Chair.

Good morning, and I thank the witnesses very much for being here with us this morning.

Ms. Hillman, you said in your introduction that the agreement was signed during the election campaign in Canada. We all know that at this time the nomination races for the presidential election are taking place in the United States.

In your opinion, what is the impact of this electoral period in the United States?

[Kirsten Hillman]

I would like to begin by clarifying that the agreement was not signed, but concluded. In other words, myself, my counterparts and the Minister of International Trade at that time, Mr. Fast, as well as his counterparts, stated that the negotiations had come to a close. This is what happened during the negotiations. The agreement was signed a few weeks ago.

As for the American elections, the Obama administration has made the TPP an economic priority. Since we began these negotiations, the United States has really seen this agreement as its key initiative in international trade and perhaps also in terms of business. Consequently, there is an enormous desire on the part of the American administration to have the TPP accepted before the president leaves his post. Will the Americans be able to do that? That is another matter. In order to achieve that, the TPP has to be accepted by Congress. However, there is a Republican majority in Congress, and not a Democratic one. Generally, there has been strong support for the TPP, but the closer we get to the electoral campaign, the more complicated things become, because the issues are more complicated in the political arena.

As to your question regarding whether this could complicate things, I would say that the answer is yes. Could this delay things? Yes. Is the administration really focused on the agreement? The answer is yes.

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

So you feel that the current administration is very interested in having the accord signed, but the closer we get to autumn, the more difficult it will be to have the TPP accepted in the United States.

Do you feel that there is a good chance that the TPP will be accepted by the United State before the elections?

[Kirsten Hillman]

It is impossible to know that at this point.

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

You said earlier that 12 countries had signed the agreement and that other countries may be interested in joining. What are those countries?

[Kirsten Hillman]

I am looking for my list. Some countries have made direct representations to Canada, including Korea, Taiwan and the Philippines. Sometime ago there was also Thailand, but now that country is experiencing some internal difficulties. There are also some Latin American countries such as Colombia and Costa Rica. They have not made representations to Canada, but to some of our TPP partners.

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

Fine. Thank you.

A bit earlier, when you gave us a list, you referred to Canadian business and industry associations, and you said that the TPP agreement could facilitate trade in this era of electronic commerce.

I believe that there are many people in Canada who use electronic trade. There is often a taxation problem if people purchase goods abroad rather than in Canada. I would like to hear your opinion on that.

[Kirsten Hillman]

There are many different obligations under the TPP. I will review them.

First of all, regarding all electronic transactions, for instance involving musical products, books, and so on, there is an agreement according to which there will be no customs tariff. In addition, there is an obligation to not discriminate among the electronic products of one country or another. The rules for Canada have to be the same as for other TPP member countries. There is also a provision obliging countries to have rules that allow for the free circulation of data.

I am going to switch to English because it is a little easier for me.

That's fine.

In our consultations with companies, one thing we learned during the course of the negotiations was that it's not only companies involved in electronic commerce that are selling electronic products, but all companies that seek to work internationally. It is very important for them to have the free flow of information between them and their customers, between them and their partners, between them and their subsidiaries.

In certain countries there are restrictions on data flow, so data flow was a primary objective in that chapter. We have obligations requiring free data flow, but there is also the flip side. We have no tariff duties on e-commerce products. We have no discrimination on e-commerce products. We have free flow of data. But on the other side, there are also rules around permissible controls for the protection of privacy, for the protection of any information held by the government regarding its citizens. That would cover health information, obviously, tax information and these kinds of things, and security purposes. There is a balancing in that chapter between important obligations for the conduct of business in today's global economy and the protection of important, sensitive information—personal, government, or security information.