Evidence of meeting #61 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 china.
A recording is available from Parliament.
Conservative
National Director for Canada, National Office, United Steelworkers
Those are the kinds of things we're involved in. So the Buy America, I always argued with.... I sent a letter to the Prime Minister, saying we should also be looking, in Canada, at “buy Canadian”. That's something that makes a lot of sense.
We're very much involved in that, from both sides of the border, fighting to make sure we're not going to be carved out.
Liberal
The Chair Liberal Mark Eyking
Thank you, sir.
Before we go to the Liberals, I have a quick question for you, Mr. Lee. When you talk about that duty going into Europe, is that for raw steel, ingot steel or whatever, or would it be also on components?
Associate Professor, Carleton University, and Representative, Macdonald-Laurier Institute
I'm just reading off my report here, “Chinese stainless steel sheet and strip should be subject to anti-dumping duties from 63.86% to 76.64%”.
Associate Professor, Carleton University, and Representative, Macdonald-Laurier Institute
That's the stainless steel sheet.
Liberal
The Chair Liberal Mark Eyking
Okay. Thank you.
We're going to go to the Liberals.
Mr. Sheehan, you have the floor.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Thank you very much.
Gerry asked Mr. Neumann two of the questions I was going to ask, so I'm going to move over to Mr. Galimberti.
In your wish list for 2017, you mentioned a few measures that you wanted to see in there. In budget 2016, on page 128, there was “Canada's response to unfair trade”.
Could you please explain how the changes in 2016 benefit the steel industry in Canada? I think it's important to highlight and underline things that are implemented that do work, and how that works.
President, Canadian Steel Producers Association
Yes, the changes that were implemented as part of the 2016 budget extended timelines for reinvestigation. Functionally, judgments in place lasted another 10 months. It was largely an administrative streamlining that extended judgments once they had been made, so it was certainly consequential in keeping judgments in place for an extended period of time.
Also included in budget 2016 was a commitment to undertake a consultation on further modernization to SIMA. The government did undertake that consultation and it closed in June. I know that the union has also made a substantive submission to that process, highlighting what additional steps we feel need to be taken to modernize the system.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Thank you.
United Steelworkers, steel producers, and others have mentioned Canadian steel and how the production here in Canada creates less of a carbon footprint. Do you guys want to expand on that? I think it's really important that we understand that the Canadian steel we produce here creates much less of a carbon footprint than Chinese steel, for instance.
Maybe Mr. Neumann can begin.
National Director for Canada, National Office, United Steelworkers
Our submission deals with the issue of the carbon footprint, and I think Joe raised in his submission that it's very significant in regard to steel coming from China versus the steel we produce here in Canada.
As a young adult, I worked in the steel industry, and I know that it used to be referred to as a smokestack industry. It's a different industry today. It's modern, high-tech, and environmentally friendly. That's a win-win. That's something we need to pursue and make sure it's going to survive in North America.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
I'm on the industry committee as well, and I know that both of you have made presentations there. The manufacturing study you presented on is coming forward, and perhaps you'd like to take the opportunity to talk about and expand on the need for investments in advanced manufacturing in the steel industry and how important that is going forward.
National Director for Canada, National Office, United Steelworkers
I think, Joe, you want to....
President, Canadian Steel Producers Association
The competition for investment in steel for our producers [Inaudible—Editor] is quite intense. Anything that can be done to attract that is certainly appreciated. Steel is a facilitator industry. Having local, domestic steel supply is demonstrable as a key to the larger value-added manufacturing chain. As a support for automotive and additional high-value manufacturing in Canada, steel is a fundamental. We'd view any attraction of investment in steel as a multiplier through the economy.
Liberal
Terry Sheehan Liberal Sault Ste. Marie, ON
Going back to working with the United States going forward, the new administration.... Back in June, when the three amigos were here—President Obama, Trudeau, and the Mexican president—they signed a trilateral agreement to work together in sharing information against dumping and that. Perhaps your comments.... Mr. Duvall is here, and we're on the steel caucus together. We'll be going down to Washington to talk about working with the United States, because 50% of our steel is exported.
Do you have any advice or comments on going forward and trying to strengthen our response together against dumped steel?
President, Canadian Steel Producers Association
I mentioned it in my remarks briefly, and I'll expand on it. We've had, from the previous administration through to the Trump administration, a tremendous ongoing dialogue with the U.S. around how to effectively identify and prevent dumping and subsidy behaviour. We know that this is the number one trade irritant for the United States. This is why I say that we have to be very careful about being perceived as a back door for dumped and subsidized product.
We are supportive of efforts like the G20 global forum on overcapacity, which was initiated at the last G20 meeting and I understand will present an interim report at the coming one. We have a formal North American dialogue with our Mexican and American partners in industry and government to discuss things like joint enforcement and identifying common bad actors. We do a lot of work in the NAFTA context to preserve the integrity of the market, and certainly, we have a great interest in continuing that work going forward.
Liberal
The Chair Liberal Mark Eyking
Thank you.
My riding is Sidney—Victoria, and we used to have the second-largest steel centre in Canada. We lost it 20 years ago, and it was a big economic driver. It is a very important part of the economy, and there are always a lot of industries around it.
We're going to move over to the NDP.
Go ahead, Ms. Ramsey.
NDP
Tracey Ramsey NDP Essex, ON
Thank you so much for being here and for your presentations. I think it's clear that the Canadian steel industry is in crisis, and we know there's nothing fair about what's happening right now. We have to modernize our trade remedies. We're way out of sync. We're becoming this target. You all reflected that in your speeches to us.
However, there is one issue that Mr. Neumann touched on, which I'd like to touch on, because I think it's especially pertinent when we're looking at the deal we're looking at with China. We're at this moment in time when we have an opportunity to address this issue with China, but we have to talk about the market economy status that it is seeking. We have to talk about the fact that on December 11 of this past year, a provision in the protocol of accession indicating that other WTO members could treat China as a non-market economy in anti-dumping investigations expired, and that has resulted in a legal obligation to grant it market economy status. China is saying that because this has expired, we now have to give it market economy status.
This is critical. If we grant China market economy status, how will that impact not only the dumping but the steel industry as a whole?
National Director for Canada, National Office, United Steelworkers
I can start. I think it would be a disaster to give China the market economy status. Just as my colleague here said he's travelled to China, so have I. I have visited the steel mills there. I've been to Baosteel. Baosteel at one facility makes more steel than all the operations in Canada.
You've heard the evidence. If you look at the submissions we've put in with regard to the largest steel companies, 11 of the largest steel companies are from Asia, and eight of them are state-owned. That speaks for itself. You heard the gentleman talk about how 11 million people are moving into the cities. If you look at the overcapacity that's currently taking place, they produce in excess of 300 million tonnes more than they need, and the fact is that they need to look for a home. They have inefficient mills that continue to operate. They're not going to have their people unemployed. I think there's just no way we can grant market economy status to China. It would be disastrous for our country.
President, Canadian Steel Producers Association
I would highlight that China has initiated WTO proceedings against the United States and Europe, and Canada has registered itself as sort of a participant to that process. It's important that Canada show a tremendous solidarity with the United States and the European Union as we move through this.
The way Canada applies non-market economy status, broadly, to China and anyone else who would be deemed a non-market economy is through something called a section 20 investigation, under SIMA. That means, on an individualized basis, the CBSA goes out and does an investigation and gets to the bottom of whether this is behaving as a non-market economy. We think that's a very strong approach, entirely defensible at the WTO. Should it come time that the Chinese also seek to challenge that ability for us to understand how their economy is working, we would certainly expect the government to defend that strongly.
NDP
Scott Duvall NDP Hamilton Mountain, ON
Thank you, gentleman. I appreciate everybody coming here. I am a former steelworker. I worked in the mills for 34 years, and I've seen our jobs in the steel industry being depleted unbelievably since foreign ownership has taken us over. One of the problems we're facing, I know especially in Hamilton and in the Soo, is that some of the dumping that's happening here has caused us to go into bankruptcy protection many times.
Mr. Neumann, in your report you stated that other countries have trade remedy laws that allow the trade unions to file trade remedy complaints, and they participate fully in the procedures before their domestic trade regulators. If this were allowed in Canada—and I don't know why it's not allowed in Canada, so maybe you can answer that one—how would this help the Canadian steel industry?
National Director for Canada, National Office, United Steelworkers
I think it would help greatly. The fact is that if you look around the world, at the United States, at Australia, at the U.K., the unions there do have access to that procedure. That's exactly what I outlined in my short presentation today, that we want to have that same right. We're an international union. We have that access in the U.S., and I can tell you that we're very active working along with the steel industry.
I should also tell you that a few years ago, with the CSPA, with whom we have a very good working relationship, with respect to the rebar case that was held in Vancouver, we were there not as participants. They asked us to come and testify, and jointly we were able to be convincing that those tariffs should not be removed. To me, it's about giving the opportunity for the workers who work in the industry, and for the communities we represent, to have a say with respect to what's taking place.
Look, there's been a lot of discussion—I think it was one of the questions asked—that we no longer have a Canadian steel industry, we no longer have the luxury of decisions being made in the Soo or being made in Hamilton or being made in Regina. Those decisions are now made offshore. It's for that reason that we have the high-skilled workforce, we're very efficient, we're environmentally friendly, and it's a clean environment. It's the opposite that puts us in a tough situation. It's the dumping of steel.
You talked about being a steelworker in the Hamilton region. We've been involved in numerous bankruptcies. We've been in one for 24 months at the Soo, and we're now fighting for the one in Hamilton. We have 3,200 jobs on the line. But I'll tell you what, in my entire career in the steel industry, when those 20,000 retirees lost their benefits, I heard the phone calls left on the answering machines from the sons, from the mothers, in tears because they felt they'd had that protection. When you listen to that time and time again, you know we have failed them as a country.
If you want to talk about what's happening in Hamilton, if you want to talk about the Canada investment act.... We're still fighting to this day to try to get that secret deal that was signed back with U.S. Steel. Where was the net benefit to Canada? We've had three labour disputes and basically tried to wrench it back.
That's what the importance is. This is a steel industry that's viable. We can be competitive. It's environmentally friendly. That's where we need to step up. That's why I say that we as workers in the communities need to have access to that.
Liberal
The Chair Liberal Mark Eyking
Thank you, sir. The time is well over, but those were good comments.
We'll now go to Madame Lapointe.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
Thank you, Chair.
I'll speak in French because it's easier for me to ask specific questions.
Mr. Miller, you talked about this earlier. Do you process steel? No, that is not what you do?
Do you import steel?
President and Chief Executive Officer, Amalgamated Trading Ltd.
Yes. We import, warehouse, and distribute it.
