Thank you, Mr. Chair.
I'll keep it under five minutes. I'm originally from Newfoundland, so I'll try not to speed up too much.
On behalf of 3.3 million members of the Canadian Labour Congress, we want to thank you for giving us the opportunity to present our views on the impacts to Canada of a possible trans-Pacific partnership agreement.
I want to begin by expressing our sincere appreciation of your willingness and that of Minister Freeland and your government to sustain an open and frank dialogue regarding this agreement negotiated under the previous administration.
It is a deeply flawed agreement, and our view is that the costs of this agreement outweigh the benefits that might arise from the deal. Proponents of the deal only expect it to boost Canada's GDP by 0.5%, and that is certainly 10 years down the road. That's about as much as the previous administration promised to pay the dairy industry in compensation for TPP losses.
This leaves nothing to cover losses to the auto sector and other areas. A key study from Tufts University predicts that workers in all 12 TPP countries would lose out, because the TPP would increase income inequality. This flawed agreement is about protecting multinational corporations' rights; it does nothing to help workers or the environment. The two sectors with the most to lose certainly are the auto sector and the dairy sector, but I also want to touch on our concerns with the provision of public services, rising drug costs, and investor challenges to environmental regulations.
The automotive sector is centrally important to Canada's research and development, high value-added production, and to manufacturing exports. In 2014 approximately 40,000 Canadians worked in motor vehicle manufacturing and another 70,000 in parts manufacturing. The five-year phase-out of tariffs on Canadian imports of Japanese vehicles will quickly eliminate the incentive to manufacture in Canada and will encourage Japanese assemblers to import vehicles. Unifor, who will speak shortly, has estimated the TPP could lead to the loss of 20,000 jobs in the auto sector alone.
The dairy sector provides high-quality, locally produced food while supporting small family farms and rural communities. Under this agreement, foreign dairy producers would be able to access an additional 3.25% of Canada's 2015 dairy milk production. This comes at a time when the dairy industry is already under considerable stress, and 250 million litres of milk and subsequent production jobs are at risk annually.
Concerning the investor state dispute settlement, we have many concerns. By now the problems with this model of dispute settlement are well known: the unaccountable and ad hoc nature of the arbitration panels, their expansive definition of what constitutes an investment, the fact they do not operate in subsidiary to national court systems but above them, and the apparent lack of deference to the prerogatives of governments or even to national jurisprudence on any given issue.
On our public services, the TPP chapter on public services locks in the current level of privatization with so-called ratchet and stand-still clauses. This makes it more difficult for governments to introduce new public services such as pharmacare or child care without subjecting themselves to an ISDS claim. Canada already has the second-highest per capita drug cost in the entire world. The TPP will further constrain efforts to reform prescription drug purchasing and provision in Canada.
On the environment, the TPP also contains broad prohibitions on economic or environmental performance requirements, such as requiring technology transfer or local sourcing to foster green industry. Such restrictions will serve as a chill on governments contemplating steps required to make the transition toward a low-carbon and climate-resilient economy.
It's time to come back to more reasonable forms of investor protection, protections that should be subsidiary to national judicial processes, should privilege state-to-state settlements, and should emphasize investor responsibilities just as much as the protection of their assets.
In conclusion, given the high economic and political stakes, Canadians deserve no less than a full and substantive discussion on the potential consequences of this draft agreement.
Thank you.