Evidence of meeting #5 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was chicken.
A recording is available from Parliament.
9:10 a.m.
President and Chief Executive Officer, Canadian Vintners Association
We had 50% market share in 1988 and now we've dropped down to 32% and our goal is to grow the industry back to that 50% market share.
9:15 a.m.
NDP
Tracey Ramsey NDP Essex, ON
Okay.
Madame Citeau, you spoke about potentials in the market, but I wonder if you could let us know specifically if you have any studies.
We know the government doesn't have an economic impact study around the TPP so a question that I'm asking people who are coming forward is if they have commissioned their own studies. Do you have any studies that you've been basing your position on the TPP upon?
9:15 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
The numbers I provided, and there's a bit more provided in the reference document that was sent yesterday.... Members do their own studies and my role is to roll it up, but they've individually conducted their own studies to come up with these numbers.
9:15 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
I'm sure if you ask them they will be happy to do so, yes.
9:15 a.m.
NDP
9:15 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
I'm happy to facilitate that.
9:15 a.m.
NDP
Tracey Ramsey NDP Essex, ON
Thank you.
I want to speak a little about the consultation process.
We know the previous government mainly negotiated this in secret—some partners were involved—but I'd like to ask you about the consultation process under our current government.
Could you describe to us what consultations you've had potentially with the minister or possibly the parliamentary secretary?
9:15 a.m.
President and Chief Executive Officer, Canadian Vintners Association
We were involved with the previous government from the front end. We did have officials participate at our board meetings, providing us with updates. I was sworn to secrecy and participated in the discussions as well. There were conference calls with the chief negotiator monthly or every two months.
Since the new government has come into place we have written letters identifying our concerns, and this is my first opportunity to address the TPP.
9:15 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
As for us we've been engaged and consulted throughout the negotiation. CAFTA has advocated for Canada's participation in the TPP and was present in Auckland when Canada first joined the negotiations in 2012. We were also in Auckland earlier this month for the signing of this historic deal.
Since I joined the organization, I have been going to every round, starting with the Ottawa round, and typically at every round we're able to meet at least once with the negotiator and with the chief negotiator as well every time in between rounds.
9:15 a.m.
NDP
Tracey Ramsey NDP Essex, ON
Since the election have you met with the current government? Have you had a consultation?
9:15 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
Since the election I have met with the chief of staff, as a group we've also met with Minister Freeland and earlier last week with David Lametti, her parliamentary secretary, and we've also made sure that the government as well as this committee and the agriculture committee has received our letters.
9:15 a.m.
Liberal
9:15 a.m.
Liberal
9:15 a.m.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
Thank you, Chair.
Mr. Paszkowski and Ms. Citeau, welcome.
B.C. is the best wine producer in the world.
Dan, can you describe to me how British Columbia will benefit from the TPP and how it will negatively affect British Columbia and what we have to do to mitigate those provincial barriers you mentioned earlier?
9:15 a.m.
President and Chief Executive Officer, Canadian Vintners Association
I can't disagree with you. British Columbia does make some fantastic wines.
We'll be holding our first wine caucus, non-partisan wine caucus, on March 7. I'm sure all of you will be invited to participate, and there's always a reception at the end of our caucus meeting. I think British Columbia has great opportunities from the TPP in terms of its location in the world and Asia-Pacific. Japan is our seventh largest trading partner for wine. There are great opportunities in Japan, Singapore, Malaysia, and Vietnam with the reduction of tariffs. I did mention that the tariffs in Canada ranged between 2¢ and 5¢ per litre. They are significantly higher in those countries. Vietnam has a 50% ad valorem tariff and in Japan it's 15%. The elimination of those tariffs will allow us to compete with, as was mentioned, Chile and Australia, which already have free trade agreements with Japan, and allow us to get greater access into a market where wine consumption is continuing to grow.
As I mentioned, from a negative perspective for British Columbia, if more Australian and New Zealand wines enter into that marketplace at a faster pace than we can grow our own domestic share, that will continue to reduce market share in Canada.
I did mention that we went from 50% to 32%, but over that period of time, from 2000 to 2015, we also increased our production of quality wines in Canada by five times. Market share is lower, but production is higher, and we believe we can grow that to the benefit of the Canadian economy.
From an Agreement on Internal Trade perspective, three out of the 10 provinces have opened up their borders, two of which are wine-producing jurisdictions. We believe that if ministers, who are supposed to be meeting on the Agreement on Internal Trade in March, could focus in on wine, even if it was as a pilot project, to continue to open up borders would be extremely helpful. As we grow our market share domestically, we'll be able to take greater advantage of the TPP.
I'll give you an example from the United States. Small wine producers in the U.S. represent 5% of production. In 2005 in the United States, the Supreme Court ruled that it was unconstitutional to allow a winery to ship directly to a consumer within the same state but not to allow a winery out of state to ship to that consumer. Since that time small wineries have represented 51% of direct consumer delivery in the U.S. They will continue to become more profitable because they're getting more margin for their products. As they continue to become more profitable, they're going to start exporting to the most attractive wine market in the world, which is Canada, which is going to put us at a competitive disadvantage.
It's extremely important that we do make progress in opening up our borders so that we can take advantage of the export opportunities we have but also to protect ourselves from those other wine producers that are growing because they don't have two hands tied behind their back.
9:20 a.m.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
In your opinion, what is it that is not letting those borders open up right now? What are the hurdles we face and how can a minister intervene to help open up those barriers?
9:20 a.m.
President and Chief Executive Officer, Canadian Vintners Association
We thought that amending a piece of legislation that existed from 1928 would do the trick. That eliminated the criminal element from moving alcohol across provincial borders, but it put in the hands of the provinces the requirement for them to amend their regulations to allow for that to happen. Once the wine crosses a border, it's within provincial jurisdiction, so they have to open up their borders. Really, all it's going to require is for each of the remaining provinces to amend their regulations to allow for some form of direct delivery to take place. We have provided legislative examples of how that could take place. To date those jurisdictions haven't listened.
9:20 a.m.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
Thank you.
To Ms Citeau, you have said that all your stakeholders have expressed that TPP is going to help when it comes to northern and western Canada—Manitoba, Saskatchewan, Alberta, and British Columbia. From a Canadian agricultural perspective, will there be any sector that will be negatively affected by the TPP?
9:20 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
I can only speak to those we represent, and those we represent have all been united—
9:20 a.m.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
You said that earlier. I know you are focusing on those ones. My particular question is whether you see any particular sectors in northern and western Canada that will be negatively affected or are there positive benefits for northern and western Canada?
9:20 a.m.
Executive Director, Canadian Agri-Food Trade Alliance
In agriculture and for the sectors I represent, no.
