International Trade Committee on Jan. 30th, 2018

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

Thank you very much for that insight.

I have lots of questions but very limited time, so I will ask a general question and everybody may have a comment on this. We talked a little about trade infrastructure in Canada and that goods obviously have to get to market for us to benefit from these trade agreements. I want to take a look at another type of infrastructure, things like the Trade Commissioner Service, BDC, EDC, these government organizations that are meant to promote trade. A trade deal is really a door, but if no one goes through it, what's the point?

Do you think this infrastructure, these organizations, are doing an adequate job? Do enough Canadian small and medium-sized enterprises even know about them? Is there something we can do to make sure that trade is encouraged through these vehicles?

Whoever wants to pipe up, please do so, and hopefully we will have enough time for about 30 seconds from each of you.

[Alex Neve]

You may not be surprised to hear me say this. Obviously we don't have much to say about the trade-related aspects of their work, but we have repeatedly said with all of those of trade infrastructure arms of government, there's a need for greater attention to human rights in how they do their work. The fact that the proposed Canadian ombudsperson for responsible enterprise, amongst his or her powers, is going have the ability to make recommendations as to whether human rights concerns would mean losing entitlement to some of that assistance is an important step forward.

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

Thank you.

[Martha Hall Findlay]

In every case, can those organizations be more efficient? Can they be more effective? I think yes. It's always an opportunity to improve.

The challenge also lies not just in what they do, but in our overall education about the opportunities. You're absolutely right: there are an awful lot of larger businesses even that either don't know about the opportunities, or don't have the confidence to actually embrace them. It's a continuing effort in Canada.

We don't do nearly a good enough job at it, oddly enough, given that we're such a strong trading country. We're actually doing specific case studies at the Canada West Foundation for smaller businesses. For example, we're looking at NAFTA. We're looking at Pacific Alliance. We're looking at all of these trade agreements, and most of the stats come out in terms of GDP or overall trade, overall imports, and overall exports. That doesn't mean anything to a small or medium-sized business. The opportunity is there for us to do much more in educating them about the specifics. For example, with NAFTA, what happens when NAFTA goes, or if it does go? What does that mean for the actual products that I sell or I import? We're not getting that information to businesses. It's still much too macro.

What the answer to that is, I'm not sure. I do think that some of those organizations could do more in that regard. You're absolutely right. It's really important. Open the door but people need to be able to go through.

[Daniel Richard]

I made the same comment earlier in the hearing. I believe they do great work, frankly. Could they be better? They probably could, but in our experience, they're great partners and they do help access foreign markets. But really, I don't see a lot of people who could use them using them. I don't know how well known their services are.

[Colin Robertson]

I'd flip it around the other way. I'd say that for a lot of the small and medium-sized enterprises, the biggest challenge is just getting through the regulatory stuff and the burdensome paperwork that they see, particularly in dealing with the Canada-U.S. border. If they can make it for Canada-U.S., then they're much more inclined to look elsewhere, but I think we need to redouble the efforts on working with the U.S. These are not the NAFTA negotiations, but we need regulatory co-operation and Beyond the Border to make that single portal. This is the biggest complaint you'll hear from trucking associations and from a lot of the small and medium-sized enterprises we're trying to encourage. I think that the CCC, BDC, and EDC are well aware and you'll find that they have all sorts of programs in place to deal with small and medium-sized enterprises. The bigger challenge is to get the small and medium-sized enterprises to feel that it's worthwhile to use their services. I think part of that comes down to the grunt work of dealing with our biggest trading partner, because if they can deal with them, then they're much more inclined, as we've found, to deal with the rest of the world.

I also think we need to make some more investments in our Trade Commissioner Service. I think the government does a tremendous job talking up trade, and I think there's commitment and there seems to be all-party agreement, but I do think that some of the resources on the trade commissioner's side probably need some bolstering. Not here at headquarters but particularly in the field, in the provinces, we used to have teams in each capital city across the country to work with the SMEs, because these are people who had actually worked in these foreign countries abroad. They would actually develop links, but we've really retrenched on that, and it's like having one person out there holding down the fort, and we need more.

[The Chair, Liberal, Mark Eyking]

Thank you, sir. Those are good comments and good suggestions.

Those were good questions, Mr. Peterson.

We're going to move over to the Conservatives.

Mr. Hoback, you have the floor.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

First of all, I'd like to welcome all four witnesses here today. I wish I could have you all at a round table for about two hours, because I have lots of questions for each of you, but I have only five minutes.

Alex, you gave a good report.

I hope you don't mind me being informal, panellists, but I'll just go by your first names.

[Alex Neve]

Absolutely.

[Randy Hoback, Conservative, Prince Albert, SK]

You talked about your report, and you gave a good report on each of the countries, but you didn't give a report on Canada. Quickly, what would Canada look like in Amnesty International's report in the same context that you used to identify issues in other countries?

[Alex Neve]

We do regularly highlight human rights concerns in Canada. In fact, next week, on February 6, we'll be releasing our annual “Human Rights Agenda for Canada”, which does raise serious concerns—

[Randy Hoback, Conservative, Prince Albert, SK]

Be very quick.

[Alex Neve]

—on a number of issues. Right at the top of the list, of course, would be indigenous rights, especially if we're thinking about an area where there is an implication around commercial activities, etc.

[Randy Hoback, Conservative, Prince Albert, SK]

A lot of issues you identified with regard to indigenous rights in all of these other countries are also problems we have here at home. Is that fair to say?

[Alex Neve]

Absolutely. The scale is obviously different, particularly with some countries, such as Colombia, where indigenous peoples are, in some instances, on the brink of extinction, but I also want to highlight here that when we talk about the need for human rights impact assessments of these trade deals, that is a two-way process. It isn't only about us assessing the other country. This is about opening dialogue around human rights issues.

[Randy Hoback, Conservative, Prince Albert, SK]

That's why I'd love to have you for about an hour, to talk about the Colombia agreement, because I think there are improvements we could learn about from that to build into other agreements. But I don't want to dwell on this issue.

The other issue I want to talk about is that when you look at countries like those in the Pacific Alliance, when they set out the harmonization of regulations, by default countries that aren't in the Pacific Alliance take on those regulations. How important is that to Canadian businesses when they are part of developing those regulations as they sell their products in Central and South America?

Maybe I'll start off with Colin and then move on to you, Daniel, and then just talk about the importance of us being at the table because of that scenario.

[Colin Robertson]

I would just say that the fact that we will be in early—and I do think we'll get in—and will be in with like-minded partners, and most of us are already members of the now CPTPP, and we do have the free trade agreements with these countries.... One of the things they are trying to do, exactly as you described, is to come up with a common set of regulations, a high standard of regulations. The great advantage of us being there at the table and being the biggest player and having had a lot of experience because of the work we've been doing in these other trade agreements is that we can take that and apply it within, and it will be welcomed, I think.

That, then, becomes the standard by which other Latin American countries.... My sense is that Argentina will shift out of Mercosur at some point and will look to the Pacific Alliance. Other countries within Latin America will start to look to the Pacific Alliance as the high standard trade agreement because doing so will be in their interests. Similarly, we're seeing the same effect now in Asia with the signature of the CPTPP, which stands in contrast to the Chinese-inspired RCEP of Korea and Indonesia. They're going to come into that as well. From a Canadian perspective, if we're there, and we're able to take our values and our principles and the experience we have, these will become the regulations that we're already comfortable with. Again, this is the argument for being the first mover and being there.

[Randy Hoback, Conservative, Prince Albert, SK]

Again, I apologize. Dan, I'm going to you. In regard to your investment in Lethbridge, I remember we were talking about the border adjustment tax at the time and what that did to your investment. Tell us the importance of having bankability and stability in your trade agreements as you make investments here in Canada.

[Daniel Richard]

That's right, and it goes even to the question of marijuana. We need a clearly defined set of rules that we know we can count on in the future. For example, there was speculation—this is the case you were alluding to—or concern for some months that the U.S. might be considering a border adjustment tax. Frankly, this was at a time when we were deciding whether to build this plant in Lethbridge or elsewhere, north or south of the border. This was crucial to us. We eventually did decide that we had some stability in the future, but we need to know the ground rules going forward.

To the extent that you're also asking what's the benefit of being at the table early, the question almost answers itself. To the extent that we can influence how the bloc is going to regulate industries that we care about, that our standards are adopted so they align with the way we do business already—

[Randy Hoback, Conservative, Prince Albert, SK]

It's gives you an edge on your American competitors.

[Daniel Richard]

It's does give us an edge.

[Randy Hoback, Conservative, Prince Albert, SK]

That would lead into the TPP.

Martha, you talked about the financial advantage to Canada in not having the Americans there. In that same scenario with regulatory developments within the Asia-Pacific region and the trading rules there, what does that mean for Canadian business?

[The Chair, Liberal, Mark Eyking]

That will have to be left as a comment, not a question, Mr. Hoback.

[Randy Hoback, Conservative, Prince Albert, SK]

Chair, don't you want to hear the answer?

[Martha Hall Findlay]

I would be more than happy to say that I agree with the comment of the honourable member.