Mr. Chair and committee members, thank you for inviting me to participate in your consultations.
Let me introduce myself. My name is Alain Lavoie, and I'm the president of an SME that publishes software in the information and communication technology field, or ICT field.
First, I want to narrow the scope of my presentation by saying that I'm not an expert on the Canada-European Union Comprehensive Economic and Trade Agreement. However, I'm a very active entrepreneur in Quebec's ICT ecosystem. I'll speak only for myself. I'll provide my personal view of the situation in my sector. Obviously, I consulted other entrepreneurs and organizations before my appearance today.
The ICT ecosystem includes a number of fields and expertise, such as telecommunications and equipment. It also includes consulting services, customized IT solutions and software, and I'll focus more specifically on these things in my presentation.
In Quebec, the gross domestic product of the ICT sector was $14.5 billion in 2013. From 1997 to 2013, the sector's GDP grew at an average annual rate of 4.4%. It grew twice as quickly as Quebec's total GDP, which increased at an annualized rate of 2.1%.
Overall, Quebec's ICT sector generated $31.4 billion in revenue in 2012, which amounts to an 11% increase since 2008. Three industry sectors are responsible for this growth, specifically IT services, telecommunications and software publishing.
In Quebec, the ICT industry employees 150,000 people, which is more than a number of other economic sectors. It also mainly consists of SMEs. In fact, SMEs amount to 96% of telecommunications companies. According to a recent survey conducted by the Quebec Technology Association, 78% of SMEs in the ICT sector sell on the international market. That proportion is only 11% for the SMEs in all the other sectors combined. The export of Quebec's ICTs amounts to 34% of the sales figures for the sector's companies. This provides potential for export growth.
That said, how is the Canada-European Union Comprehensive Economic and Trade Agreement being received by Quebec's ICT industry? I'll exclude telecommunications and equipment, because I'm not familiar enough with their issues to talk about them properly. The agreement is being quite well received by the IT industry. However, some comments and nuances must be mentioned.
Since we spoke a great deal about the agreement as a way to eliminate tariffs and tariff lines, and since IT is not generally subject to those things, we feel less involved. We did business before the agreement's implementation, and we'll continue doing business afterward. Our SMEs should be well informed and most importantly helped, in order to fully benefit from this agreement.
In terms of labour mobility, if this agreement can help our businesses hire people from foreign countries more quickly, we would be delighted.
The issue of government contracts in Quebec is causing some concerns because IT contracts are currently being awarded at a slower rate. Suppliers feel insecure when it comes to the opening of government contracts. Therefore, SMEs must be told that the access to larger markets should compensate for this. The opening of government contracts will force businesses to become more competitive.
Lastly, cloud computing and privacy, which are special cases in our sector, should also be discussed because they may lead to a virtual tariff barrier.
ICT is a predominant sector that can make a strong contribution to the growth of wealth and the entry of new money into Canada. Our IT and communications SMEs are likely to fully benefit from this agreement. Our governments should help them and should try to make the agreement understandable for Canadian and Quebec businesses, especially SMEs. Our governments should explain how the agreement will affect them, particularly in terms of the opportunities it will provide. These aspects aren't always clear for an SME.
What can our governments do? They can create programs to help SMEs market and export their products. They can also give SMEs information and work with industry organizations, such as the Quebec Technology Association and the Information Technology Association of Canada, or ITAC, to raise awareness of the agreement and explain how to benefit from it.
In conclusion, I hope my presentation has given you a better understanding of the issues faced by one of the finest or even the finest industrial activity sector in Canada.
Thank you again for inviting me to appear today.