International Trade Committee on Nov. 8th, 2017

[The Chair, Liberal, Mark Eyking]

Good afternoon, everyone, and welcome to Wednesday.

Today is our third and last meeting on a very important study that is becoming very interesting, on multiculturalism and international trade. We've gained a lot of knowledge over the last few meetings.

The Portuguese delegation are going to be at the table with us in a few moments. By video conference we have the Canadian German Chamber of Industry and Commerce, all the way from the wonderful city of Toronto. We have the president, Mr. Beck, and he has a delegation.

Welcome, folks.

If this is your first time in a committee, if you can do your presentation around five minutes or less, we appreciate it because we want lots of time for dialogue with MPs.

Without further ado, you have the floor for five minutes.

[Thomas Beck, President and Chief Executive Officer, Canadian German Chamber of Industry and Commerce Inc.]

Thank you very much, Mr. Chair.

Thank you for giving us the opportunity to introduce the Canadian German Chamber of Industry and Commerce and its services and projects to you.

Very quickly, for your general understanding, we belong to the worldwide German Chambers of Commerce Abroad system. We have 130 offices in over 90 countries. The turnover is about 200 million euros, and we have subsidies of 40 million euros from the federal ministry of economics.

Germany has three official foreign institutions worldwide. There's the political representation, through the embassies and consulates; the cultural representation, which is the Goethe-Institut; and the representation for industry and trade, which is done by the German Chambers of Commerce Abroad. We are one part of this chambers abroad system. You can best compare this with a trade commissioner in other countries like England and France.

Our head office is the Association of German Chambers of Industry and Commerce in Berlin, and we are closely tied to 80 chambers of industry and commerce in Germany. In Germany we have compulsory membership, so we are connected to most German companies through the chambers of commerce.

We have basically three functions. One is the official representation of Germany's industry and trade. We are also a membership organization for Canadian and German companies, and we are a service provider for companies from both countries—we offer consulting services and we do projects. I'll come to this a bit later.

Our chamber here in Canada was founded in 1986, in Montreal, so next year we will be 50 years old. We are an officially recognized German chamber in Canada. “Officially recognized” means through the federal ministry of economics in Germany. We are a private non-profit organization according to Canadian federal law. In 1985, we moved to Toronto, where we have our headquarters today.

Our board of directors consists of representatives of well-known Canadian and German companies, for example Siemens, BMW, Mercedes, and others. We have 25 employees and a budget slightly exceeding $4 million Canadian. Our main sources of revenue come from selling services to German and Canadian companies entering the respective markets, doing projects for the federal German government, membership dues, events, and a subsidy that we receive from the German government, which is about 20% of our annual budget.

To give you a little overview about our services, we offer consulting services, mainly to German companies entering the Canadian market. We do business partner searches, market research, and trade show participation. We inform members about import regulations, tariff duties, and product certifications. In addition—and this has become very important—we help German companies get settled into Canada with our business support services. We offer Canadian bookkeeping and payroll services. We offer Canadian recruitment and HR services, and we have visa and immigration services for German companies that want to bring their employees to Canada. We do incorporation and set-up of a company in Canada, as well as a virtual office and any administrative support these companies need. This has become one of our most important lines of business here. We also take care of some companies from other European countries—from Switzerland, from Austria, and I think from Sweden—but it's a small number.

For Canadian companies, we are offering trade fair participation. For example, we represent the MEDICA trade fair company in Düsseldorf, and right now there should be more than 70 Canadian companies on their way to Düsseldorf to participate in MEDICA. This is one of the highest rates of trade fair participation for Canadian companies in Germany. In March it's ProWein, and we will be glad to welcome in Düsseldorf almost 40 Canadian companies displaying their wines in Germany.

We do a lot of projects for the German government in the areas of wind energy, solar energy, smart grid, and storage seminars. We have a booth at the PDAC convention in Toronto.

We do things for the food industry. We also help Germany Trade and Invest, which is the official German investment arm of the federal government to acquire Canadian companies that are interested in doing business in Germany.

Besides that, we don't do any investment activities, but we work closely with the Canadian embassy in Berlin when it comes to German companies that want to come to Canada, and we work together with GTAI, Germany Trade and Invest, when it comes to Canadian companies that want to come to Germany. We have about 350 business members. These are mostly German and Canadian companies in Canada. We have a couple of chambers of industry and commerce in Germany as our members and they are all over Canada. We offer our services for the whole country, not only for Toronto or Ontario. We are also active in B.C., Alberta, New Brunswick, and all the provinces where German companies go.

[The Chair, Liberal, Mark Eyking]

Thank you.

[Thomas Beck]

As the last word, we have a competence centre for mining and mineral results, established in 2012, that helps the German government to come into contact with Canadian companies in this respect.

Thank you very much.

[The Chair, Liberal, Mark Eyking]

Thank you, sir. Your organization has a very impressive network and resources that you offer to Canadian and German relationships in business.

We have with us the Portuguese delegation, Mr. Correia, Ms. Jorge, and Mr. Pereira. Welcome.

As you know, this is our committee's final segment. We've had three meetings so far on multiculturalism and trade, and this was suggested by Mr. Fonseca. We appreciate that. There has been a lot of information and it has been very fulfilling.

You have the floor.

[Michelle Jorge, President, Federation of Portuguese Canadian Business & Professionals]

Thank you all for having us here today. We're truly honoured to be with you this afternoon.

I'll share a little bit about the Federation of Portuguese Canadian Business & Professionals. We've been around since December 7, 1981. I share a birthday with the federation, though I won't tell you if I was born before or after 1981. We are a volunteer-driven, not-for-profit organization. Our membership consists of a number of Portuguese professionals and businesses throughout Canada.

We have done many projects with different communities. We have a keen interest in the development and advancement of higher education within our community. That's really one of our main focuses. We have various networking functions that we do throughout the year. We have a gala that takes place every year, at which we give scholarships. These are supported by businesses, both here and in Portugal.

Recently, Matthew Correia and I were in the Azores. We were able to secure a scholarship from the University of the Azores. For a number of years now we have obtained scholarships from Universidade NOVA in mainland Portugal. We also support and encourage academic excellence in any way possible.

We do a number of events surrounding youth. Mr. Correia was the first leader of the student advisory committee, which began last year. We've started doing networking events to try to advance the opportunities for students to network in our community and outside of our community as well.

We have about 250 members with a roster of over 500 businesses in the Luso-Canadian community. Throughout its history, the federation has always partnered with different organizations. We are members of the Greater Toronto Business Alliance, which was formed in 2008. Within that group is the Italian Chamber of Commerce of Ontario, the Toronto Chinese Business Association, the Indo-Canada Chamber of Commerce, and of course the federation. In the past year, we have also begun networking and partnering with the British Chamber of Commerce and various Latin American chambers of commerce. We did an event last year. We are looking to do another event so that we can expand our networking opportunities and the support that we can give to professionals and businesses within our community and outside of our community.

With regard to our scholarship program, as of this year we have grown our numbers to 40 scholarships that we were able to present at our gala, which I hope you will all attend on March 24. We have donated over $1 million through the generosity of the businesses in our community.

In the most recent year, we have also been very active in developing and enhancing our networking opportunities internationally. We had a group come in from Santarém, Portugal, the NERSANT Group. We signed a protocol with them in order to be able to support them to advance and enhance their opportunities for business development here. They're willing to provide the same support for our membership in Portugal. We had a group come from Aveiro as well, with the same mission. We are in talks about signing a protocol with them as well.

More recently, Mr. Correia and I met with SDEA, a society for business development in the Azores, with the same incentives. We have definitely taken a lot of steps, even more so in recent times, to try to expand and develop the opportunities for business development.

I wanted to try to bring one of our members who is running a business involved in international trade, but unfortunately we were not able to do that. I run a business, but I'm a lawyer, and we don't do international trade.

There are a couple of things that we thought we could bring as suggestions. I noticed that in CETA you have now made the rules a lot easier for certain professionals as far as accreditation is concerned. I think that's a huge step in the right direction. I think more advancements need to be made in that regard. Speaking from personal experience, I can say that the education in Europe is absolutely superb. I know that first-hand, because as I child I studied in Europe for a number of years.

I also returned as an adult to do one of my years of law school in Europe. The programs there are fantastic.

With regard to exports to Europe, I noticed—

[The Chair, Liberal, Mark Eyking]

Do you mind wrapping up a bit?

[Michelle Jorge]

With regard to exporting products to Portugal, I noticed there's a lot more coming this way as opposed to going in that direction. One idea is maple syrup. I spoke to the regional secretary of the Azores this morning, who brought home six bottles that he absolutely loves it. It's very popular there. He said he likes to have it with his panquecas. I think that's something to consider.

The other thing is that there could now be a lot of opportunities for Canadian lumber to be sent over there. They're beginning to build wood frame houses, which was not the case before but has now become the new thing in Portugal. I think there are huge opportunities for Canada in that area.

Given the fact that Portugal is no longer getting the majority of its beef from Brazil, that might also be another opportunity for Canada.

I've stolen all the time. Now Mr. Correia doesn't have time, so I apologize.

[The Chair, Liberal, Mark Eyking]

Thank you. Your time is up, but Mr. Correia will have opportunities when we're having dialogue with the MPs to interject any thoughts he has.

We're going to start off with the Conservatives. We have Mr. Colin Carrie for five minutes.

[Colin Carrie, Conservative, Oshawa, ON]

I want to thank the witnesses for being here. Maybe we can start with the Portuguese group.

In Oshawa, we have quite a large Portuguese community. They always participate in Fiesta Week, and I have to tell you the dancing and the food are fantastic.

You mentioned CETA and the accreditation issues, and you said that more advancements need to be made. I was wondering if we could explore that. Maybe Mr. Pereira, too, could talk about the students and the visa situation going back and forth between the countries. How easy is that and could there be improvements?

[Michelle Jorge]

Personally, I did not have any issues coming back. I did only one year of law school away, and I transferred right into Osgoode Hall, but I'm noticing with other lawyers who have studied abroad that it takes a significantly longer period for them to be able to enter the market as lawyers. I know that law is on the list of professions for which things should now be a bit easier. I think that when you're doing that, you're delaying their entry into the workforce and delaying their ability to contribute to the Canadian market in a much more prosperous manner, versus coming in and having to spend a couple more years to do accreditation.

We're basically deterring a lot of immigrants who are highly qualified from coming here and working and producing and providing for our economy at that level. They come in highly qualified and they're working at jobs for which they're completely overqualified. I've heard stories about doctors working as taxi drivers. We are losing out on that talent. How do you go about doing that? I think what you've done with CETA is definitely an advancement, and you're going in the right direction, but probably that needs to be looked at more carefully and how that can be expanded to other professions and other sectors.

[Colin Carrie, Conservative, Oshawa, ON]

Mr. Pereira, I know you didn't get a chance to speak to the committee, but I am wondering if you could add some comments as far as the students' visas back and forth go. How difficult is it for Canada?

[Lucas Pereira, Secretary, Federation of Portuguese Canadian Business & Professionals]

I haven't done too much research with regard to the visas and transferring back and forth. I know that each school, individually, has some very good programs for studying abroad, depending on where the schooling is more specialized for their type of program, but I believe we do need more options.

We need to connect more schools together and have transferrable credits. I know it is difficult, a lot of times, to have credits transferred from university to university. A lot of students have problems since they've gone to university, studied, and gotten credits, and those have become useless because they're not transferrable to these other schools. They have the knowledge; it's just not being recognized. I feel that we need to create a stronger bond between the universities for credit transferring.

[Colin Carrie, Conservative, Oshawa, ON]

Okay, very good.

To the German group, how helpful do you think CETA will be to helping organize Canada's ethnocultural communities, as far as trading around the world goes? Do you think additional free trade agreements should be pursued, and if so, with which countries?

[Thomas Beck]

From our point of view, CETA is a milestone. We expect much more business from Germany and from Europe coming over to Canada, but it will take some time. It doesn't happen right now.

The general opinion in Germany about CETA is it's very well taken. Companies are very eager to come to Canada. The only obstacle is more in the technical standards area. That's why we have to do something very soon because that's a real obstacle. I'm in Germany quite often and talk to our companies. They say it costs them too much money and it takes too much time to adopt technical standards from Canada and vice versa.

That's one of the biggest issues with CETA that we have to solve very soon, and I think CETA is a raw model for any other free trade agreement to come. Canada has access to 500 million consumers. If we take the British out, we still have 420 million to 430 million consumers. However, we don't have that many Canadian companies in Europe so far, so it's also up to our Canadian trade commissioners to help Canadian companies get into Europe: Germany, France, Portugal, and the other countries. That will take some time. As far as we know, 80% of the exports from Ontario go to the United States, and that has to change a little. We hope it will change and that we will see more Canadian consumer goods and technical goods in Europe. There's a good chance for Canadian products to come into the European market, but we should push it a little.

We also try to help Canadian companies with trade participation. For example, we have groups going to Hamburg in the area of wind energy. We'll take a group next year to the WindEnergy trade fair in Hamburg. It takes energy and effort to bring Canadian businesses to Europe and vice versa.

[The Chair, Liberal, Mark Eyking]

Thank you.

We're going to move over to the Liberals.

Mr. Fonseca, you have the floor for five minutes.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Ms. Jorge and Mr. Beck, thank you and your teams for presenting here today. It's great to hear how you feel about CETA. It was a long time in the works, 10 years working across Canada and I'm sure across Europe so that we could find ourselves on the same page. Now this is the opportunity for the European community as well as for Canada.

Ms. Jorge, you brought up a number of products, be it maple syrup or wood, and I know you've spoken to me about beef. How do you see our developing those opportunities now? Would that be through taking trade missions to Portugal to showcase our products and familiarize the Portuguese community with the types of products that Canada could offer and get that trade going? Or would it be through having the Portuguese come this way, as you've had a number of delegations come, to be able to explore our market here?

[Michelle Jorge]

I think you need to do quite a bit of both. I spoke very recently with the regional secretary for the Azores with regard to this specific issue and he said that the regional secretary of trade there would be willing to come here to do what you are describing. I think that is so important, and I can speak of it from personal experience. Mr. Correia and I went there this summer for our organization. We were able to accomplish so much more because we were doing face-to-face meetings. There's a value, a benefit, that cannot be equated in any other form other than doing that. You have to develop the knowledge base and understand the culture, and you do that by going there and developing real partnerships with the organizations and companies there.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Thank you.

Mr. Beck, you represent a very mature organization. You have 25 employees, a substantial number of resources to be able to develop the market over here. Do you tap into CanExport or look at our trade commissioner offices? Do you use any of the resources available to you through the Canadian government?

[Thomas Beck]

Absolutely. We work very close together with, for example, the Canadian embassy in Berlin when it comes to investment in Canada. We think a good instrument for Canadian companies is to participate in, in our case, German trade fairs. In Munich and Düsseldorf we have some of the best and largest trade fairs are in the world. If you take MEDICA and others I mentioned, 70 Canadian companies are there already. We have huge trade delegations from Ottawa; I think there were over 100 Canadian companies planning at the end of January to come to Munich, hopefully together with the premier. That's also a great opportunity to get in touch with German companies, but they can also come to us on a single basis and get our help. We can connect some German companies with German chambers of industry and commerce and others. But, again, the best way is trade fairs, trade delegations and others. As my colleague from Portugal said, they have to get used to the European market, to a continental market. There are huge chances, but you have to understand the market and get the right ideas about it.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

What does it mean that 98% of the tariff lines of those companies have come off their products and services? What does that mean economically? What kind of a boost do you see in terms of business?

[Thomas Beck]

I think the tariffs don't mean that much because since March 2015 we have had no tariffs on machinery and other goods. For most of our German companies in Canada that doesn't play a crucial role. It's more the technical standards. On the one hand it's a CE and on the other hand it's a CSA. To get that done, to come to a mutual recognition of technical standards, that's the main issue. For a Canadian company exporting, let's say, beef or medical goods to Germany they don't pay a lot of tariffs. It's more difficult for them to find the right distribution partner in that country and to adapt their products more to the German or European market. These are the real difficulties. When my colleagues here see German companies coming to Canada, the real big issue for them is the legal system in Canada. They all don't know the tax issues, how to set up a company here, how to do the tax and legal set-up and these kinds of things. That's why we offer our services. You can get everything here in the German language. They come at nine and when they leave at one they have founded their company and they're happy to go and everything is taken care of. That's what they need, and that is what we have set up in the last couple of years here, very successfully. We have about 30 customers, great medium-sized companies from Germany, high-tech companies we take care of in this respect. They can call us anytime with no charges.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

We're going to move over to the NDP. We have the member from Vancouver Kingsway for five minutes.

Mr. Davies, welcome to our exciting committee.

[Don Davies, NDP, Vancouver Kingsway, BC]

Thank you, Mr. Chair, and thank you to the witnesses for being here.

Mr. Beck, I'll go first to you. With CETA in its early infancy, what do you see as some of the most promising business possibilities for Canadian businesses in Germany?

[Thomas Beck]

Again, I think medical technology, for example, is very strong. The whole part of food, and also a little bit the wine industry, are not really tapped. I talked to a lot of Canadian large food producers and they didn't have food in Europe so far. It can be also machinery. I see it more for Canadian companies, let's say, in the electrical, electronics, machinery, and medical part. That's where I see the biggest chances for Canadian companies. A little bit of food but food is difficult in Europe, as we know. It's not easy to get into that market; it would cost you a lot of money. Canadian companies in the medical area are very successful. Also, transportation is a big issue for Canadian companies in Europe. We have Bombardier in Berlin, and I think there are 8,000 employees. This is strictly from a German point of view.