Thank you very much, Mark, and I'd really like to thank the whole committee for being here. As Mark said, a Monday in the middle of August is not generally a time when intense committee hearings are held, and the fact that you've brought us together here I take as a sign of your really hard work and the real commitment that every member of this committee has to a great outcome for your constituents and Canadians in these talks. It's a privilege and an honour for me to be here to speak to you, and I want to thank everyone who is here. As Mark has pointed out, it's a pretty full room for a summertime committee meeting, which I also think speaks to how consequential these talks are for Canadians.
I'd like to make some opening remarks, and then I'd be happy to answer your questions.
I'd like to start by acknowledging that we're gathered on the traditional territory of the Algonquin.
Trade is about people. It's about creating the best possible conditions for growth, jobs, and prosperity for individuals and working families. That is why we are modernizing the North American Free Trade Agreement, known as NAFTA. That is why we are seizing this opportunity to make what is already a good agreement, even better. The North American free trade area is now the biggest economic zone in the world. Together, Canada, the United States, and Mexico account for a quarter of the world's GDP, with just 7% of its population.
Since 1994, trade among NAFTA partners has roughly tripled, making this a $19-trillion regional market representing 470 million consumers. Thanks to NAFTA, Canada's economy is 2.5% larger than it would otherwise be. It's as though Canada has been receiving a $20-billion cheque every year since NAFTA was ratified. Thanks to NAFTA, North America's economy is highly integrated, making our companies more competitive in the global marketplace and creating more jobs on our continent.
These historic NAFTA negotiations are to begin in two days. We're keen to get to work, not least because we know that uncertainty is never good for our economy.
At every opportunity we've explained to our southern friends—and many of you have been part of that effort—that Canada is the largest export market for two-thirds of U.S. states, and America's biggest overall customer by far. Indeed, Canada buys more from the U.S. than China, the U.K., and Japan combined. I think quite a few of us have uttered that sentence in recent months.
Our American partners have been listening. Today they understand, as we do, that our relationship, the greatest economic partnership in the world, is balanced and mutually beneficial. To wit, in 2016 Canada and the United States traded $635.1 billion U.S. in goods and services. That exchange was almost perfectly reciprocal. In fact, the United States ran a slight surplus with us of $8.1 billion U.S.—less than 1.5% of our total trade. So it's very, very balanced.
We've also been working energetically with our Mexican friends. I'd like to welcome the Mexican ambassador, my friend Dionisio, whose birthday we celebrated at lunch in Mexico City, together with the foreign minister and Minister of Economy and trade. The relationship has, of course, also included regular conversations between Prime Minister Trudeau and Mexican President Enrique Peña Nieto.
Most importantly, we have been listening to Canadians. As of today, we have sought and received more than 21,000 submissions of Canadians' views and concerns about NAFTA. That includes contributions from 16 academics and think tanks, 158 associations, and 55 businesses and corporations.
The Canadian objectives I will now outline are built on these extensive consultations. This process is just beginning. Our negotiations with our NAFTA partners will be informed by continuous consultations with Canadians.
Here are some of Canada's core objectives.
First, we aim to modernize NAFTA. The agreement is 23 years old. The global, North American, and Canadian economies have been transformed in that time by the technology revolution. NAFTA needs to address this in a way that will ensures that we will continue to have a vibrant and internationally competitive technology sector and that all sectors of our economy can reap the full benefits of the digital revolution.
Second, NAFTA should be made more progressive. We will be informed here by the ideas in CETA, the most progressive trade deal in history, launched by Conservatives and completed, proudly, by our government.
In particular, we can make NAFTA more progressive, first, by bringing strong labour safeguards into the core of the agreement; second, by integrating enhanced environmental provisions to ensure no NAFTA country weakens environmental protection to attract investment, for example, and to fully support efforts to address climate change; third, by adding a new chapter on gender rights, in keeping with our commitment to gender equality; fourth, by adding an indigenous chapter, in line with our commitment to improving our relationship with indigenous peoples; and, finally, by reforming the investor-state dispute settlement process, to ensure that governments have an unassailable right to regulate in the public interest.
One reason that these progressive elements are so important, in particular with respect to the environment and labour, is that they are how we guarantee that the modernized NAFTA will be not only an exemplary free trade deal, but also a fair trade deal. Canadians broadly support free trade. Their enthusiasm wavers, however, when trade agreements put our workers at an unfair disadvantage because of the high standards that we rightly demand. Instead, we must pursue progressive trade agreements that benefit all sides and help workers both at home and abroad enjoy higher wages and better conditions.
Third, this negotiation is a valuable opportunity to make life easier for business people on both sides of the border by cutting red tape and harmonizing regulations. We share the U.S. administration's desire to free our companies from needless bureaucracy, and this negotiation is a welcome chance to act on that goal.
Fourth, Canada will seek a freer market for government procurement, a significant accomplishment in CETA. Local-content provisions for major government contracts are political junk food, superficially appetizing, but unhealthy in the long run. Procurement liberalization can go hand in hand with further regulatory harmonization.
Fifth, we want to make the movement of professionals easier, which is increasingly critical to companies' ability to innovate across blended supply chains. NAFTA's chapter 16, which addresses temporary entry for business people, should be renewed and expanded to reflect the needs of our businesses. Here again, CETA provides a model.
Sixth, Canada will uphold and preserve elements in NAFTA that Canadians deem key to our national interest, including a process to ensure that anti-dumping and countervailing duties are only applied fairly when truly warranted; the exception in the agreement to preserve Canadian culture; and Canada's system of supply management.
In all of these discussions, we will come to the table with goodwill and Canada's characteristic ability and willingness to seek compromise and find win-win solutions. But we are committed to a good deal, not just any deal.
So, I would like to say to Canadians today what I will say to our negotiating partners on Wednesday: Our approach in these talks will be in keeping with our national character, hard-working, fact-based, cordial, and guided by the spirit of goodwill and the pursuit of compromise. We also know that there is no contradiction between being polite and being strong. It is no accident that hockey is our national sport.
These negotiations are a deeply serious and profoundly consequential moment for all of us. Trade deals always matter. Done right, they are a vehicle for helping to create more well-paid jobs for the middle class.
Preparing for these negotiations has already united us as a country. I've been astounded and moved by the extremely high level of support and collaboration I and my team have received from business, from labour, from civil society, from every level of government, and from many of you around this table even though we are not all members of the same political party. Time and again Canadians across the country have told me how proud they are to be Canadian at this moment in time and how committed they are to doing everything they can do to help in these consequential negotiations.
Our bipartisan NAFTA Council is evidence of this, and all Canadians are truly fortunate that in these talks we will be represented by the best trade negotiators in the world. Canada's trade officials are internationally renowned for their prowess, and it is a privilege for me to work with this outstanding team of Canadian public servants. Let me take this moment to acknowledge the great Canadians who are sitting alongside me and with whom the committee will have a chance to speak directly later on: Tim Sargent, our deputy minister for trade; Steve Verheul, our chief negotiator for CETA, who is very familiar to many people in this room; and Martin Moen, who is also working very hard on the softwood file in his spare time.
As I said, these talks are profoundly consequential. There may be some dramatic moments ahead, yet I am deeply optimistic about the final outcome.
That is due to this fundamental reality: the Canada-U.S. economic relationship is the most significant, mutually beneficial, and effective anywhere in the world. We know that, and our American neighbours know it too.
Based on those very strong economic fundamentals, I am essentially optimistic going into these negotiations. Together with this fantastic team of trade negotiators, we're going to work very hard and we're going to get a great deal for Canadians.
Thank you, and I'm happy now to take your questions.