International Trade Committee on Dec. 11th, 2017

[Ana Renart]

I mentioned some of the areas earlier. I can go through some specifics again. Fish and seafood is one area where tariffs are particularly high. Also, there are chemicals, plastics, autos, and auto parts. Machinery and equipment is another sector. Tariffs on aluminum are up to 16%. In terms of ICT—information and communications technologies—they have tariffs of up to 20%. Tariffs on forest products and automobiles are up to 35%. There are a number of areas where we have strengths, where there are huge opportunities.

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

On another note, and with regard to the trade in services agreement, the TSA, Quebec is well recognized for the export of its expertise in engineering.

Where are we with this?

[Darren Smith]

It's still part of the negotiations. Definitely one of our priorities is to promote Canadian engineering services as opportunities in TISA. Hopefully, we'll have an agreement one day that sees that realized.

[The Chair, Liberal, Mark Eyking]

Thank you, Madam Lapointe.

We're going to go over to the Conservatives. Mr. Dreeshen, you have the floor.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much, Mr. Chair.

Thank you to our guests for being here today and for some of the discussions that have been going on around the table as we deal with our progressive agenda—gender, labour, environmental concerns, and so on.

As you mentioned, these have been in the deals we've been talking about for the last number of years. We've seen some progress in certain areas. You were talking about the Uruguay and Chile discussions, and how that became part of what we were able to build upon. As we continue to build upon it, we have had that in the discussion points with every trade deal we've had.

The point right now, unfortunately, is that it seems as though we're simply focusing on certain areas but not getting down to the point that when you are talking trade deals, you should be talking about trade. When I have people coming to my office to discuss it, that's where their fear is at this point in time. We have a Prime Minister who walks out on discussions. We talk about Australia and how we're going to deal with that with the TISA. It's Australia, the U.S., and Japan. There seems to be so much confusion and frustration right now with the countries we're dealing with.

When it comes to the TISA agreement specifically, are some of these issues that we see at the present moment likely to end up becoming problems in that area?

[Darren Smith]

If the question relates to what the government is doing in terms of progressive trade elements in TISA, yes, there are actually some of those features in our approach. In fact, we were one of the first to operationalize something with respect to work on domestic regulations. In the services area, we address licensing and certification requirements and procedures. We try to promote transparency and predictability in these areas.

One of the things that came across to us through a World Bank study from 2015 or 2016, I believe, was that unfortunately there are a multitude of jurisdictions that actually have, as part of their legal and regulatory regime, discriminatory practices related to gender. For instance, women cannot participate in the economy by being able to receive a licence to participate in a certain sector or obtain a bank account and things of that type. We did introduce work in this regard.

In fact, that is a trade barrier. Any Canadian exporter, if the individual is a woman, could face a barrier in a foreign market based on the fact that they have potential barriers related to gender itself on their books. It could be something that prevents them from participating.

Beyond that, it also has an impact on those markets of interest to us in developing greater participation of all elements of their societies in their economy. When there are limitations in that regard, they can have a detrimental impact in terms of our trade relationship with that country.

Services are one area where we have been able to identify, at least in this regard, a specific barrier related to gender, and it does fit under this progressive trade umbrella. This is something we have advanced, and it is now also featuring as part of our broader WTO work.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

You mentioned the WTO discussions in 2013. Are these points that you would have been working on at that point in time? Obviously there is an awareness that this has existed. Would that have been part of the WTO framework that was worked with among countries?

[Darren Smith]

It has really fallen under the broader development framework. What we are finding now is that the literature and the analysis related to these issues are catching up to the interests in these areas. It's kind of an interesting time, because now we have facts and statistics to work from, and information on the different legal regimes of our different trading partners to bring to the table. Unfortunately, that didn't exist in its entirety in 2013. I suspect that in 2020 there will be even more for us to work with in terms of these issues.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

On the other question, I wonder to what extent TISA would likely increase the ability of foreign service suppliers to access our Canadian market. Would that have an impact on our service suppliers and our consumers?

[The Chair, Liberal, Mark Eyking]

Give a quick answer, please.

[Darren Smith]

TISA will certainly give some of our non-FTA partners improved understanding of and access to the Canadian marketplace, but in services all we are really talking about is increasing transparency in our existing regime. It's not going to have the same kind of effect as eliminating a tariff; it's a bit different. It works reciprocally, so we get the same benefits in those other markets.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

Thank you, Mr. Dreeshen.

We're going to move over to the Liberals now. Mr. Peterson, you have the floor.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Thank you, Mr. Chair.

Thank you for being with us today. It's very informative, as always.

I want to compare Mercosur with the Pacific Alliance. As they stand now, are they both basically free trade blocs, or does one allow more access to the counterparties than the other?

[Ana Renart]

That's a good question. There isn't a straight black-and-white answer. Both are customs unions. The Pacific Alliance is a regional integration initiative, so it goes beyond trade; it's free movement of goods and people. They also have a number of other things they work on together. They co-operate in particular areas, promoting democracy, environmental projects, etc., so it is a bit more.

As well as being a customs union, Mercosur is working toward increasing collaboration within those four countries and other areas as well. They are not quite at the same place as Pacific Alliance. I mentioned the free movement of people within the Pacific Alliance; Mercosur is now talking about some residency liberalization, such as allowing citizens to stay in one another's countries for up to two years and things like that. They are not exactly the same, but similar.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Okay. Adding to the confusion, if you want to call it that, I believe Chile, Colombia, and Peru are associate members of Mercosur currently, or are they striving to be so?

[Ana Renart]

Let me make sure I get that right. They are talking to Mercosur. If you give me a moment, I will tell you.

I'm sorry. I don't want to take up your time. I'll come back to you on the details.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Yes.

[The Chair, Liberal, Mark Eyking]

Maybe at the end of the meeting we can come back for an answer from you.

Mr. Peterson, go ahead.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Okay. We'll leave that on the back burner for now.

You mentioned the three other countries—Australia, New Zealand, and Singapore, I think—that are also associated states in the Pacific Alliance right now.

Are we all negotiating at the same...? Is everyone around the same table right now? I think the next round is in Australia in January 2018.

[Ana Renart]

Yes.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Are all three of those countries with us at that round?

[Ana Renart]

Yes. We're all candidates to become associated states with the Pacific Alliance, so right now there are eight countries in a room negotiating, but it's what we call “a hub and spokes”, in the sense that we're all negotiating with the Pacific Alliance and not with each other.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Right, but is there only going to be one of those four asked to join, or could all four potentially be asked to join?

[Ana Renart]

All four could potentially.... If you're able to close an FTA with the bloc, then you would join as an associated state, not as a full member.