International Trade Committee on Nov. 23rd, 2020

[Claire Citeau]

It certainly has not come up in those terms, and because we are under a confidentiality agreement, I will not comment on this. However, I will echo those remarks that have been made earlier on the sunset clause, speaking about the importance of stability and predictability of trade.

I'll remind the committee, though, that we are not describing this interim agreement as duty-free access or a symbol of free and open trade. Much work remains ahead to get real access for our Canadian agri-food exporters.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

If I'm to understand correctly from what you're saying, the government has not given you any details or any confirmation on the timelines whatsoever, whether in regard to signing this agreement or whether in regard to a sunset clause or any other conditions that could be of protection to our future negotiations.

[Claire Citeau]

What we understand is that there are commitments to return to the negotiating table, and we've heard leaders speak to that. What further details might be in the text, we have yet to see. Overall, on the consultations, though, we've been engaged. We never see any of the text. Remember that this has happened in a very short amount of time over recent weeks and months.

It has been difficult for some of our members to really grasp, from the outset, what was happening. We had to pull them in. We remain closely engaged with the negotiators and we look forward to continuing to work very closely with them in the future. This is very important. It's a two-way street. They negotiate with the policy framework, but our members are looking at it from the market, the industry perspective. This is what some of the discussions are more focused on, rather than the sunset clause per se, which I spoke about earlier.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll move on to Mr. Arya, for five minutes.

[Chandra Arya, Liberal, Nepean, ON]

Thank you, Madam Chair.

My question is for Ms. Campbell of the Canadian Association of Importers and Exporters.

You mentioned two key things: transparency and predictability. Is there something specific in either the CETA or in the new transitional agreement with the U.K. that you'd like to highlight that might be different from the predictability and transparency issues related to CUSMA?

[Kim Campbell]

Thank you very much for that great question.

For us, because we're so close to a drop-dead date here, our request or recommendation was to adopt the existing way that you qualify for duty-free status at the border. That's an additional complication. When goods come across, you actually have to qualify and there's a whole bunch of rigour in terms of a document that you have to give to the customs officials.

With very few weeks to go, we have zero understanding of what that requirement would be. That's why we're asking for continuity of the existing CETA framework.

What we learned with CUSMA was that we had only a couple of weeks to come up with certification, with no guidance. We had to go through the text, figure it out on our own, take our best guess and go.

[Chandra Arya, Liberal, Nepean, ON]

Some of these are more what I would consider teething problems.

I think CUSMA has almost settled own, and once this transitional agreement has settled down, are there any transparency or predictability issues that you see?

[Kim Campbell]

I would say, from an importer and exporter perspective, it would only be how the regulator then deals with them after the fact.

[Chandra Arya, Liberal, Nepean, ON]

Okay. Thank you.

Amongst your members, if I am not wrong, the majority of the trade is within North America. What is your organization doing to look beyond North America for exports from Canada?

[Kim Campbell]

That's a very fair statement. I think that would be applicable to any of our businesses. As you know, we still trade heavily with the North American space.

I feel as though a lot of times we follow the markets where our importers want to go in terms of ease of use. Again, we have lost a lot of transparency and predictability over the last year where, all of a sudden, exporters are not getting their goods through. That's where the geopolitical tea-leaf-reader part comes in as well, just trying to understand what's going on in the world and looking for markets where there's more predictability and won't be any surprises.

Does that make sense?

[Chandra Arya, Liberal, Nepean, ON]

How is your organization working with trade commissioners in different parts of the world?

We have signed so many new agreements. I think we have signed enough free trade agreements. Don't you think it is now time to focus on how we can leverage those agreements into exporting more from Canada?

[Kim Campbell]

That's a really great point.

I have to be honest with you: Our association probably could do better in partnering with that great network. We find, though, really still the complication is in the technical pieces of this stuff.

You're right. That would be a very smart way for us not only as an association, but to partner with the government as well, and look at these trade agreements and then figure out why people aren't getting in the market.

[Chandra Arya, Liberal, Nepean, ON]

Thank you.

My next question is for Ms. Citeau of CAFTA.

You mentioned the non-tariff barriers and subsidies as an issue for Canadian exporters to the European Union. I know that non-tariff barriers are a factor in so many trade agreements. We know that when we want export to countries such as India, South South Korea or Japan, we always find these non-tariff barriers.

Is there anything specific to the European Union or the U.K. that you need us to look into further?

[Claire Citeau]

Absolutely, we have encouraged the committee to do a competitiveness study of Canada's recent free trade agreements, namely the CETA and the CPTPP, in large part to identify opportunities where we're not maximizing the agreement, and certainly the non-tariff barriers with respect to the CETA is a key piece of that.

We would really encourage Parliament as a whole, but the committee, to start the study to review where free trade agreements are not being honoured by trading partners. This is especially important if our agri-food sector is to continue to feed Canadians here, but also families around the world as well, and deliver on growth opportunities across the country. That's non-tariff barriers in the CETA context with respect to the EU, but perhaps I can take this opportunity to also flag the fact that the EU is not the only country that is using non-tariff barriers to block access of agri-food exports, agri-food trade. With Peru, Colombia, Vietnam and a number of countries around the world, there isn't a week that goes by where our members are not faced with non-tariff barriers. This is really a creeping problem.

[The Chair, Liberal, Judy Sgro]

Thank you.

[Claire Citeau]

Tariffs come down, but non-tariff barriers come up when we have free trade agreements.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Ms. Citeau.

We'll move on to Mr. Savard-Tremblay for two and a half minutes.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Thank you, Madam Chair.

I now want to turn to Mr. Closner and Ms. Sider from Livingston International.

Based on your work as a group, what do you think are the main benefits of this market access? We know that the British market, for example, is very keen on financial services and is very strong in this area. We also know that, in the post-Brexit environment, an infrastructure program will likely be put in place that could benefit engineering companies.

Is there anything else that we should spontaneously consider?

[Candace Sider]

It's an interesting time in our industry and really also in world growth and the economy in terms of predictability and stability in our environment, especially as we move through COVID. Some of the challenges will definitely be as we adapt to this new agreement. The devil is in the details and how we manage and implement that for the future.

Exporting for Canada and trade relationships are critical for our growth and for stabilizing our economy. In our particular industry, we deal with importers and exporters every day who are looking at new sources and opportunities to go to new and emerging markets to do business. The financial complexity, depending on whether goods are duty-free or dutiable does in fact carry some level of risk for importers and exporters, as well as brokers who are facilitating trade.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

I'm checking the time here.

We'll move on to Mr. Blaikie for two and a half minutes.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

When parliamentarians are looking at a trade deal and the enacting legislation, beyond the interest of the businesses that are going to do business under the agreement, of course, there are public interest questions. Trying to digest that and make a decision takes time. The government has left this for a long time. They suspended negotiations between March 2019 and August 2020.

I'd like to start with our witnesses from Livingston International.

In the event that the enabling legislation for this deal doesn't make it through Parliament by December 31, what kinds of things do you think might be of service to Canadian importers and exporters in order to help them through a period of time where Canada and the U.K. are not covered by a trade agreement?

[Candace Sider]

That's a great question.

We often find that as new trade agreements are being negotiated, companies come to us for guidance on how they can leverage their business and how they can leverage the opportunity to be able to do trade with a particular country or a new country. They're always looking at those preferential duty rates and how they would qualify.

Ms. Campbell made reference earlier to some of those rules of origin and how companies qualify. That was a huge issue under CUSMA. Again, it was at the eleventh hour and trying to facilitate, educate and counsel importers on the best way forward when there were a lot of grey areas.

The more we can provide that granular level of detail...it provides much more certainty for those importers and exporters who are looking to do business and take benefit of those new agreements.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Ms. Campbell—

[The Chair, Liberal, Judy Sgro]

Mr. Blaikie, you have half a minute, so please be quick with it.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Sure.

Ms. Campbell, can you provide a bit of an answer to the same question?