Evidence of meeting #64 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 chile.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

4:05 p.m.

Liberal

The Chair Liberal Mark Eyking

Good afternoon, everyone.

Before I start with the minister, I would just like to let the rest of the committee know we had a very successful trip to the western United States, and I have to thank the clerk and the analysts here for pulling that trip together. It was a very busy, active, productive trip, and I have to thank committee members for keeping up with the pace.

We definitely had the Canadian flag flown down there for us. It was a good interaction, and I hope that continues when we travel to the rest of the United States. So thank you, everybody, for being co-operative, and again, thanks to the people who organized it.

Minister, welcome.

Thank you for taking the time to come here. As I told you, this is the most vibrant, hard-working, influential, and handsome committee on the Hill.

4:05 p.m.

Saint-Maurice—Champlain Québec

Liberal

François-Philippe Champagne LiberalMinister of International Trade

You're taking words from my speech, Mr. Chair.

4:05 p.m.

Liberal

The Chair Liberal Mark Eyking

Anyway, welcome, Minister.

Also, Minister, I'd like to comment on the great work your parliamentary secretary is doing to keep us informed of what you're doing and keeping us all together here too. So thank you, and without further ado, because we're starting late today—

April 11th, 2017 / 4:05 p.m.

Liberal

Sukh Dhaliwal Liberal Surrey—Newton, BC

We're starting right after the bells.

4:05 p.m.

Liberal

The Chair Liberal Mark Eyking

Okay, we're good to go.

So, Minister, thank you for coming. Thank you for all the work you're doing, and the floor is yours, sir.

4:05 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

Thank you very much, Mr. Chair.

Honourable members, I'm happy to be here with you for the first time.

This is my first of, I hope, many such appearances before your committee. I think, when it comes to trade, we have to act as one team, and I really want to thank the committee for the tremendous work you've been doing over the last 13 months. Really, I have heard from different members of this committee, Mr. Chair, of all the work you've been doing on behalf of Canadians, and I really want to commend you. You've travelled and you've listened to Canadians, and I very much look forward to reading the report.

In particular, I want to thank you for the extensive consultations the committee undertook during your study on the Trans-Pacific partnership, and I'll be happy, dear colleagues, to answer any questions following the meeting we had in Chile, as I mentioned today in question period. I look forward to reading your full report on this study. I commend you for undertaking that. It's important to hear the views of Canadians, and I hope that we will continue to engage together in this endeavour. Your diligent work on that important file will no doubt inform and guide the government's trade efforts in the Asia-Pacific region in our pursuit of a truly progressive trade agenda in the years to come.

Clearly, if I may say, Mr. Chair, Asia-Pacific is and will remain a key pillar of our trading relationship. I want say that to each and every one of you who took time away, probably also from your families and your other travels, to have undertaken that.

Given what's happening in the world, the work we're doing on behalf of Canadians is more important than ever. Canada's participation in international trade is vital to the entire nation's prosperity. Canada has always been a trading nation.

Exports are key to our economy. They contribute to growth and productivity, and they help create jobs across the country and in each of our constituencies.

Overall, exports represent about 30% of Canada's GDP. Approximately one in six Canadian jobs depends directly or indirectly on our export activities.

Mr. Chair, this is to say that Canada represents about 0.5% of the world's population and about 2.2% of world trade, so we are a nation dependent on trade, and that's why the work of this committee and our officials.... I'd like to thank the deputy minister, the parliamentary secretary, all members of this House, and this committee. What we're doing is extremely important in the lives of Canadians.

This is why we believe that trade and investment means growth for our businesses and the economy, and growth in turn means well-paying jobs for the middle class and those obviously working hard to join it.

We know this is true, as a result of the dramatic improvement in standards of living since the Second World War, in both developed and developing countries. Free and open trade in recent decades have played an important role in this regard.

We also know these advantages haven't benefited everybody to the same extent, and we're seeing the results today. With this in mind, we need to take the legitimate concerns of our citizens seriously, and take concrete action.

As Prime Minister Trudeau said in Hamburg recently, “it’s time to realize that this anger and anxiety we see washing over the world is coming from a very real place. And it’s not going away.”

We need to do everything we can to ensure that the benefits of trade are more widely and equitably shared. Failure to do so will only strengthen the forces of protectionism and embolden those opposed to freer and more open trade.

That's why Canada is establishing a progressive trade program with its partners in the country and abroad.

What does “progressive trade” mean?

Progressive trade means ensuring that all segments of society can take advantage of opportunities flowing from trade and investment, while focusing in particular on women, indigenous peoples, youth and SMEs.

Progressive trade means codifying these principles in dedicated chapters with trade agreements or the modernization of existing ones. For example, it means adding a chapter on gender, including parity, pay equity, and gender-based risk assessments. These are concrete and real steps we can take to put our trade agenda on a more progressive footing.

This is not just the right thing to do; it's also essential for economic growth and prosperity. SMEs, including those owned by women, youth, and indigenous peoples, are the dynamos of our economies and the lifeblood of our communities.

In Canada, for example, SMEs account for virtually all Canadian businesses, and employ 90% of our private sector workforce. But only a small percentage of these businesses export. Under our progressive or middle-class trade agenda, we are putting their needs and aspirations and those of all non-traditional business owners and entrepreneurs front and centre, to help them reach their full export potential.

In addition, progressive trade means showing openness and transparency, and maintaining an ongoing dialogue with civil society and a wide range of stakeholders.

It also means ensuring that trade agreements include strong provisions in important areas such as workers' rights, gender equality and environmental protection, and reinforce the continued right of governments to regulate in the public interest.

In short, it's about efforts that help ensure international trade works for businesses and citizens alike—that it works for people.

Our government stands for these progressive values, and is promoting them in the Commonwealth, at the G7, the G20, the WTO, and elsewhere.

I may add that everywhere I go, I talk about our progressive trade agenda, and I can tell you, it does make a difference. Canada is recognized around the world as a leader in rules-based, principled trade, and that's what makes Canada so special.

An example of the implementation of progressive trade is the recent entry into force of the WTO's Trade Facilitation Agreement, or TFA. The benefits of this agreement are expected to be the most significant for developing countries and SMEs, for which trade costs are excessive.

The WTO estimates that the full implementation of this agreement could reduce trade costs by an average of over 14%, and boost the value of global merchandise exports by up to $1 trillion. Up to $730 billion of that amount would benefit developing countries.

According to the World Bank, up to 10 million women business owners in the developing world could benefit from efforts to allow SMEs to become more competitive from an export perspective.

These are the accomplishments that we must share and the results we should try to achieve together.

Canada looks forward to working with the developing countries to fully implement their commitments under the TFA, including through the Global Alliance for Trade Facilitation. Canada is a co-founder of the alliance, which was launched in December 2015. As a platform for leveraging public and private sector expertise, leadership, and resources, the alliance helps developing country members of the WTO implement commercially meaningful TFA-related reforms.

Canada also looks forward to the provisional application of our modern, progressive free trade agreement with the EU, otherwise referred to as CETA. This agreement represents a landmark initiative towards ensuring our country's prosperity. We have negotiated market access and improved conditions for trade that go beyond NAFTA. But more importantly, we have done so in a progressive and responsible manner. This agreement will help to generate much needed growth in jobs, while fully upholding Canada's and Europe's standards in areas like food safety, environmental protection, and workers' rights.

I think, Mr. Chair, this is something we should all be proud of as Canadians. This was an agreement that was crafted more than 10 years ago; many people have worked on making this a reality for Canadians. As I've said, of the many places in the world, this is the right deal at the right time for the world.

Also, CETA will open opportunities for Canadian businesses in the European Union's $3.3 trillion government procurement market. Let me add, Mr. Chair, that it will also provide access to a market of over 510 million consumers.

Once the agreement enters into force, Canadian businesses will be able to supply goods and select services to all levels of the European Union government, including the European Union's 28 member states and thousands of regional and local government entities.

CETA will also offer consumers lower prices and more choices. It will benefit workers by helping to create better quality jobs related to exports. It will also benefit our businesses, regardless of their size, by helping to reduce costs resulting from the elimination of tariff and non-tariff trade barriers.

The Canada-Ukraine Free Trade Agreement that was just completed also included several key progressive elements. These elements will help ensure that as we deepen our trade relationship with Ukraine, the economic gains are achieved while promoting Canadian values and priorities. For example, the agreement includes comprehensive commitments on labour and environment in dedicated chapters. These chapters are high standard and provide strong protections, including mechanisms for any citizen to raise trade-related concerns in either of these areas and, if necessary, a dispute resolution process.

The agreement also includes anti-corruption provisions that oblige Canada and Ukraine to adopt or maintain legislation on anti-corruption, and these are also subject to dispute settlement mechanisms for use in the event of a perceived violation.

CETA—

4:15 p.m.

Liberal

The Chair Liberal Mark Eyking

I don't want to interrupt you. Do you have much left, because we're concerned about getting our questions in?

4:15 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

Mr. Chair, if you want me to stop there, but I'd like—

4:15 p.m.

Liberal

The Chair Liberal Mark Eyking

Just round it up—

4:15 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

If you leave me about another three to five minutes, I'm willing to extend the time so that every member can ask their questions. The last part is talking about Asia and what we've been doing. If the committee, obviously....

4:15 p.m.

Liberal

The Chair Liberal Mark Eyking

Okay, if you're going to stay longer, go ahead, sir.

4:15 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

I'm happy to stay another five minutes if I take five minutes more. I'd like to share with the committee what we've been doing in the last 100 days.

4:15 p.m.

Liberal

The Chair Liberal Mark Eyking

That's good. Go ahead.

4:15 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

CETA, the Canada-Ukraine Free Trade Agreement and the WTO's TFA show that progressive trade agreements can be secured on both a bilateral and multilateral basis. Canada is proud to participate in these agreements, which place the middle class and those working hard to join it at the heart of the trade program.

In other words, we need to make trade real for people, consumers, workers, and exporters across our country, because we all know that trade means growth and growth means jobs. In the coming months, I will continue to pursue my mandate on two important fronts that I'd like to share with the committee.

First, I will continue my work on trade negotiations. None of the benefits of trade that we celebrate will be available to Canadians in the absence of a rules-based approach to trade. Second, but no less important, I will continue to promote trade. Canadian businesses are among the best in the world, and it is my task to promote them across the globe. I know that a number of members of the committee have done likewise, and I'd like to thank them for that.

As the chief marketing officer of Canada, I will continue to push Canadian talents to buyers and investors abroad. I will also work to ensure that Canadians know what opportunities are available to them. I'm engaged constantly with our trade commissioner service to ensure that Canadian companies both small and large get the assistance they need to get their products to market.

By the end of next week, it will have been 100 days since I was appointed Minister of International Trade. It has been a busy and exciting journey so far. I have travelled to India to advance the case for Canadian pulps. I met with key ministers in Qatar to explore new opportunities for commercial investment in Canada. In Dubai, I promoted Canada as a strategic destination for investment and financial growth. I met with the minister of youth, and invited her to meet with the youth council of our Prime Minister to make sure that we start building these relationships between our two countries.

In Sydney, Australia, I reiterated and expanded on our commitment to support more women entrepreneurs in trade. In Chile, I reaffirmed my desire to have free trade and preferential access for Canadian exporters throughout the Asia-Pacific region. In Mexico, I met with my trade counterpart to explore the opportunities that Canada and Mexico can foster through working together.

These are just to name a few. In the interest of time, I'm happy to finish there, and engage with the members of the committee in what we have done in the last 100 days. Let me just finish by saying that I am grateful for the invitation, grateful to be working with all of you. I think that together we can achieve a lot. Trade is something that touches every Canadian, touches every region of our country, touches every riding in our nation. I'm pleased to see the work you've done because when we are out there, we are Team Canada.

Thank you, Chair.

4:20 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, Minister.

I've got six slots, three Liberals, two Conservatives, and an NDP member. If we can, we'll keep going as long as the minister can.

We'll try to keep to five minutes to keep it tight. We're going to start off with the Conservatives and Mr. Hoback.

4:20 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

Thank you, and thank you, Chair, and Minister, great to see you here.

You'll find that this committee is a very well-functioning committee, well-behaved. We work well together, and we plan to continue doing that.

I do have some concerns in regard to NAFTA, to the renegotiated NAFTA that's coming forward. I know that the U.S. isn't your file, but Mexico is your file. I also have concerns in China, because there seems to be a progression to renew a trade deal with China at the same time as trying to do NAFTA. Because of the delink between you not being involved in the U.S. file, the understanding is that moving forward into China could actually have negative implications with our number one trading partner, the U.S. Have you taken that into consideration?

The other thing I want to draw to your attention is an article that came out in The Globe and Mail today. Robert Fife and Steven Chase are talking about a survey they have done where 88% of Canadians aren't comfortable with the prospects of deeper economic ties with China. They're talking specifically about state trading enterprises and giving them unfettered access to the Canadian market. The other concerns of course are democracy and human rights.

When we did a trade deal with Honduras, for example, democracy and human rights were front and centre. That was a big part of that trade deal. Then to hear our new ambassador basically saying that it's not clear whether human rights per se will be part of any trade agreement is very concerning.

Can you shed a little light on that aspect of it, because as you go down that road, I have a lot of concerns of us doing a trade agreement with China, and actually doing more harm with our existing trading partners by going down that avenue?

4:20 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

First of all, what I would like to say is thank you for the question and thank you for your work on the committee.

The Minister of Foreign Affairs, as you rightly said, has the lead on the file with respect to the U.S. negotiations; however, as you will appreciate, this is a whole-of-government approach. When I was in Chile, even when the U.S. was represented at the table, Canada was asked to be the first to speak to set the stage. In my remarks, I welcomed the presence of the U.S. at that table.

With respect to China, I would say that Canada will follow its own process. For me, what we've said is that we owe it to Canadian workers, Canadian families, and Canadian exporters to look carefully at this market. What we've said is that the essential first step, as I call it, is to have exploratory talks to see in which industry there would be a net benefit to Canadians. That's why we are going step by step, engaging with the officials to have meetings, and engaging with Canadians. I've already had round tables; I think one was in Winnipeg.

We want to hear from Canadians, and I want to hear from you as well. It reminds me a bit of when we engaged on the CETA deal. Those who crafted that a decade ago could not necessarily have anticipated at the time the impact this would have on the economy, but I think you would appreciate, having met a number of Canadian businesses, and Mr. Ritz would know.... We were just having a discussion about CAFTA, for example, which is obviously very keen on us engaging. I would call it a step-by-step engagement. We want to hear from Canadians. We want to hear from you. I want to hear from industry. We're looking at that very carefully.

One other step I'm taking as Minister of International Trade is that I have been engaging with our Australian colleagues to take up the lessons learned. You would expect a minister to engage with them, and we're doing that regularly to make sure we understand what has been their experience in having a free trade agreement with China.

4:20 p.m.

Conservative

Randy Hoback Conservative Prince Albert, SK

When I look at China—and China is an important market—it sounds like you're going to tread very lightly and that it's going to take a period of time before this moves forward.

What about Japan? Wouldn't it be better to be looking at Japan more seriously at this point and to be making sure that we have key market access into Japan for our beef and manufacturing? The reason I say this is that the U.S. is proceeding on a bilateral agreement with Japan, so that means our beef sector and our grain sector are going to be left out of that market. Wouldn't our resources be better utilized at this time in exploring a bilateral agreement with Japan if we can't do it through some sort of TPP multilateral facet?

4:25 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

When we were in Chile, Canada and Japan were very close in that discussion. Like I said, we are the largest customer to the United States.... They are a very large economy.

I had a number of discussions with my Japanese counterpart. When we were in Chile, that meeting was about purpose, action, and ambition. The “purpose” was that people recommitted to free trade and rules-based trade in the Asia-Pacific region, namely Japan, but all the other countries. For “action”, we have agreed to task our officials to come back with options for when we meet at the next summit, which is at APEC in Vietnam. We also agreed that we should maintain a level of “ambition” and progressive elements. I was pleased to see other delegations taking words from the Canadian comments to include in their own comments in saying that “progressive” needs to be part of that.

I am in very close contact with Japan. I have proposed this to our Japanese counterpart. I said that we might as well work together on the track of increasing trade on a multilateral level in the Asia-Pacific region. I've already offered to our Japanese colleagues that I would very much be interested if they want to start the bilateral discussion again. As you know, we had one. It was put on hold at their request because they wanted to focus on TPP.

I have indicated to various ministers—because they came with three ministers and other ones—at every opportunity the wish of Canada to work co-operatively with them with respect to the Asia-Pacific, but also in a bilateral nature, because just as you've said, I think they would be interested. I'm waiting to hear from them. Perhaps when we come back from Vietnam, we'll have.... I think this is under consideration on their side, but this is something that we obviously would be interested in doing.

4:25 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, Minister.

We're going to move over to the Liberals.

I hear you're going to split some time. Go ahead, Mr. Dhaliwal.

4:25 p.m.

Liberal

Sukh Dhaliwal Liberal Surrey—Newton, BC

Mr. Minister, thank you for coming. I would like to echo Mr. Hoback's comments that we are working together very well. When we were in the U.S., we were Team Canada.

Minister, more and more on the international scene we see protectionism coming forward. How do you envision Canada's role while proceeding with these trade agreements? If we do that, how are they going to help the middle class?

4:25 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

I've had the chance to attend the Commonwealth meeting, the bilateral relations with Australia, and also the discussions in Chile. Oftentimes I have reflected on how in a world of uncertainty, where there's a level of unpredictability, Canada stands out as a beacon of stability and predictability with its rules-based laws and very strong financial system. It's also a nation that is both inclusive and diverse, which is very much attracting investment and interest in our country.

The progressive trade that has been put forward—one that would obviously favour women in business, that would consider youth and indigenous people, under-represented people, and that would focus on SMEs—is making a real difference. I cannot state enough to this committee how much the views of Canada are respected in the world. People see us, as I said, as a beacon of stability in the world, but the world is looking at Canada and at CETA, which is the most progressive trade agreement ever negotiated by either Canada or the European Union. At most meetings I've been at, people refer to CETA as the most progressive deal and are looking at this agreement as the gold standard in the world. I heard that time and time again as I was travelling.

Definitely, in my view, the way to push against protectionism is for Canada to continue to engage as we're doing, whether it's with CETA, whether it's in the Asia-Pacific region, whether it's with the Pacific Alliance, or whether it's with Mercosur, always promoting a rules-based system and one that contains progressive elements. That's what distinguishes Canada in the world today. That's why people want to do trade with Canada.

4:25 p.m.

Liberal

Sukh Dhaliwal Liberal Surrey—Newton, BC

Thank you.

Madame Lapointe.

4:25 p.m.

Liberal

Linda Lapointe Liberal Rivière-des-Mille-Îles, QC

Thank you, Mr. Chair.

Mr. Champagne, thank you for being here.

Earlier, you said that you visited a number of countries, including Australia. You heard about businesses run by women and owned by women. Here, in Canada, only 5% of women-owned businesses successfully export.

What measures will the government take to boost women in business when it comes to international trade?

4:30 p.m.

Liberal

François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC

Thank you for the question, Ms. Lapointe.

I did indeed hold a round table with women entrepreneurs in Australia. We did the same thing in the different countries we visited. I think that, essentially, relationships between people are very important. During my discussions, in both Chile and Australia, I worked on developing networks. I'll give you the example of Chile. We were joined by a group of entrepreneurs from Toronto, whose name escapes me, that had established a relationship with businesswomen in Chile. We tried to do the same thing in Australia. It's in our best interest to share experiences and knowledge, but also to establish this type of relationship with countries with which we already have important trading relationships.

You're talking about a very important matter. I'll give you an example. There's an international association that represents the first nations when it comes to exports. The president of this association is a Canadian from Winnipeg. We met with her while we were in Winnipeg. This association's next summit will take place in South America. In a concrete way, we want to use this summit to join forces with her. I'll probably go with her to the summit. This summit will help women in aboriginal communities and first nations from different countries find business opportunities with foreign buyers. We know that major fairs of this type are held in different countries. Companies increasingly want to support women, youth or the under-represented communities in the business world. Various associations have this mandate. We want to join forces with these associations, to place them at the forefront.

My first meeting in Chile, my first as a minister, was held with UN Women, an organization based in Chile that advocates for women from first nations in the business world.

When Canada joins forces with a partner, we can focus on specific activities that shed a positive light on women in business. We try to establish networks between these businesswomen and the businesswomen at home to create growth.