Good morning. Thank you for giving us the opportunity to offer our input into the Trans-Pacific Partnership agreement. Before doing that, I would like, first of all, to provide you with some historical context of the aerospace and defence industry on Prince Edward Island, which I hope will give you all a sense of the importance of the sector to the province's economy.
Our industry itself is only 25 years old, dating back to a 1989 federal government announcement of the closing of CFB Summerside, which had housed 413 Transport and Rescue Squadron. One of the solutions used as an economic adjustment strategy was the privatization of the base facilities and the employment of those assets to pursue aerospace and training development initiatives.
In 1991 the base assets were turned over to a new entity, Slemon Park Corporation, and shortly after two firms moved into what is known as Hangar 8: Atlantic Turbines International, a gas turbine engine maintenance, repair, and overhaul company initially employing 20 people, in year one, and Bendix-Avelex, a gas turbine engine and fuel control maintenance repair and overhaul company employing 16 people in year one. Today Atlantic Turbines is now Vector Aerospace and employs over 450 people, and Bendix-Avelex has evolved into Honeywell Aerospace, Summerside and employs close to 100 people.
A number of other companies have since established operations in either Slemon Park or other areas of Prince Edward Island, including Summerside and Charlottetown. As for the dynamics of the industry in this province, it is centred in the commercial maintenance, repair, and overhaul space as well as manufacturing, but also includes a number of marine-based companies that are active in pursuing opportunities in the national shipbuilding strategy.
Since those early days, growth has been very attractive. First year annual sales for the initial two companies of $45,000 have grown to 11 companies in 2015 generating close to $430 million, 75% of which is export-related, and employment is more than 950 people. From its origins to today, it is clear that the aerospace and defence sector in Prince Edward Island is very important to the economy of the province for not only the export sales, payroll, and taxes it generates, but for diversifying the economy as well.
Aerospace and defence is now the third-largest industry in the province and holds itself well against the country. In fact, a recent economic impact study concluded that, among the 10 provinces, the aerospace and defence sector in P.E.I. is second only to Quebec in per capita value of international exports.
With that historical context serving as a backdrop, the aerospace and defence sector of P.E.I. is reliant on export-driven revenues. By extension, we welcome efforts in achieving access to export markets. In general, we support the Trans-Pacific Trade agreement; however, we will also say that we are not aware of the overall effect the agreement would have on our sector here in Prince Edward Island. We understand that tariffs will be removed on aerospace parts, but we are not sure of the effect on maintenance, repair, and overhaul services.
As well, we are unclear as to how well defined the efforts in standardization have become to this point, particularly as they relate to adopting AS9100 and ISO 9000 under the Asia-Pacific aerospace quality group and ISO.
In closing, we generally support the TPP. We don't see it as a major game-changer to our industry; however, we look forward to monitoring the progress and defining standardization such as technical regulations and conformity assessment procedures that include testing, inspection, and verification.
Thank you very much.