International Trade Committee on Nov. 30th, 2020

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Okay, so, if we look at when CETA went into effect and roll it back, we're talking many, many years ago that those engagements would have taken place. Do you feel that whatever information was gained back then—say, five years ago, six years ago—during that entire time period...? Do you feel that there were no issues in this ever-changing environment and that whatever information was gathered way back then suffices for today?

[Mary Ng, Liberal, Markham—Thornhill, ON]

I also heard a lot from Canadian businesses about how important it is to ensure that the provisions of CETA are maintained. That's what this continuity agreement is. CETA was ratified three years ago. We are celebrating the third-year anniversary. I am speaking with businesses and workers this week on the effects and on even more opportunities under CETA. However, we heard also very, very clearly from businesses and workers that it was important to get a continuity agreement, to get an agreement with the United Kingdom as it leaves the EU so that those businesses that work in the EU have the continuity and the predictability that they need in their businesses with the U.K.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Ms. Gray.

Thank you, Minister.

Now we'll go on to Mr. Arya for five minutes.

[Chandra Arya, Liberal, Nepean, ON]

Thank you, Madam Chair.

Minister, welcome to the committee again.

I would like to ask you about manufactured products exported to the U.K. and Europe. Before that, let me state that I'm a bit concerned about the value-added manufacturing exports from Canada, which I believe are declining. I think that we should focus more on that. That is very important for the Canadian economy, Canadian jobs and our long-term prosperity.

Now, my understanding is that a lot of Canadian manufacturers' exports to the U.K. are actually destined for other parts of the European Union, that is, to other parts of Europe. If, due to Brexit, the U.K. and the European Union don't come to an agreement by December 31, there will be problems for Canadian companies exporting their goods to different parts of the European Union. Are you aware of this? If so, are you taking any measures to mitigate this?

[Mary Ng, Liberal, Markham—Thornhill, ON]

CETA applies, and Canadian businesses that are exporting to the European Union have CETA. What wasn't in place until we reached this continuity agreement was a similar set of predictabilities for businesses that are exporting to the U.K. With this continuity trade agreement, we now have CETA, and the terms of CETA apply to the U.K. context for those businesses to export into the U.K.

[Chandra Arya, Liberal, Nepean, ON]

Let me understand as well. The Canadian companies can export their goods to the U.K. Once they land in the U.K., they can go to different parts of the European Union even if the U.K. doesn't get into any sort of agreement with the European Union. Is my understanding correct?

[Mary Ng, Liberal, Markham—Thornhill, ON]

I think a different way of explaining this is that CETA absolutely applies tot all of Canada's exports into the European Union, and the U.K. continuity agreement applies to all businesses exporting into the U.K.

[Chandra Arya, Liberal, Nepean, ON]

Okay.

One other thing is that one of the witnesses we had before this committee was from Canadian Manufacturers & Exporters. He was concerned that many Canadian businesses, especially small businesses, are not fully aware of the various support programs available. I did tell him of the availability of the Canada Business app.

I just want to confirm with you that the Canada Business app keeps updated funding and other supports that are available to Canadian small exporters.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Yes, absolutely, MP Arya. It is at the very core of my mandate to help our Canadian small businesses start up, scale up, and access new markets and in doing so understand the range of tools that are available. Yes, the Canada Business app continues to be updated, ensuring that the range of information, including information that will support our small businesses exporting, is there.

[Chandra Arya, Liberal, Nepean, ON]

The bulk of the funding that is available—say, through EDC—is still going to very few large companies in Canada that are exporting. Though the number of small businesses supported by EDC is quite high, the amount actually lent to them is quite small.

During the last four years, one thing I have noticed is that the industry lobby groups, especially those who are focused only on exports to North America but not beyond, seem to have been very vocal. They take up all of the bandwidth. That leaves out a lot of small businesses who are actually growing and whom we should support in exporting to different parts of the world. All of the agreements that we need we have onboard already. What are you doing to help these small Canadian companies export to different parts of the world?

[The Chair, Liberal, Judy Sgro]

You have time for a brief answer, Minister.

[Mary Ng, Liberal, Markham—Thornhill, ON]

It's the Canada trade toolbox. I am the minister of both small business and international trade, so it's at the core of my job to make sure that our tools are working in support of that exact growth, that of our small and medium-sized businesses.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We will move on to Mr. Hoback for five minutes.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

Minister, I am just summarizing in my head this whole process. You started off negotiating with the U.K. while they were still part of the EU, early back in 2017-18. You saw the tariff schedules and said there was no advantage, so you broke the negotiations off. You didn't consult with anybody before you did that; you just did it. You didn't think about digital, you didn't think about non-tariff trade barriers, you didn't think about regulatory harmonization and you didn't think about paperwork. You just said, oh, we don't need it.

Then all of a sudden the new tariffs—which the U.K. had basically telegraphed were going to be coming—came out, and we realized, oh, my God, this is horrible. We went back to the table. But because we broke it off and all the other countries stayed on, realizing that there was still more to gain there, we ended up at the back of the line.

Now, we asked you again in January and then December...or, pardon me; well, last year we talked about this. Then we talked about it in February and March. We asked you a series of questions in the House. Then we find out it wasn't until August that you engaged.

What puzzles me even more is that when we asked Mr. Forsyth what his deadline was, he was told December 31. He wasn't even given a deadline that would have allowed Parliament to actually look at the agreement in a timely process.

You said that you have protected supply management. I'm glad to hear that, because Conservative governments in the past have protected supply management and done a great job at it. We did offer compensation, and it's nice to see you finally come through for chicken and eggs and some of the other supply-managed sectors that you didn't before, but at what cost? What was sitting there at the table so that you said we were going to defend supply management at all costs? Did we lose access for beef? Did we lose access for manufacturing? Did we lose access for anything else? Was there a negotiation where we were saying, well, we can maybe allow some access with compensation, or was that talk happening....?

Wait a minute: You didn't consult with anybody. So it's hard for us to understand what we're actually getting into. We have a negotiated agreement, supposedly. It's not through legal scrum. It's not signed. It's not introduced to the House. The House leaders haven't set aside time for it. The Senate isn't even aware of it. How do you tell Canadian businesses that you're serious on this file and that you actually have things under control?

[Mary Ng, Liberal, Markham—Thornhill, ON]

That's a really terrific question and, Mr. Hoback, I think I need to correct you on a couple of areas here.

The United Kingdom, while they are a part of the European Union, was not negotiating comprehensive free trade agreements. They were negotiating—

[Randy Hoback, Conservative, Prince Albert, SK]

Yes, they were talking to all sorts of people about what it could possibly look like—

[Mary Ng, Liberal, Markham—Thornhill, ON]

I think I get to answer the question.

[Randy Hoback, Conservative, Prince Albert, SK]

It's my five minutes. I can push back and I'm not going to—

[The Chair, Liberal, Judy Sgro]

Can you give the minister a minute to answer?

[Mary Ng, Liberal, Markham—Thornhill, ON]

I'm happy if the member wants to keep asking questions and not letting me answer.

Go ahead.

[Randy Hoback, Conservative, Prince Albert, SK]

Well, you haven't answered anything yet.

[The Chair, Liberal, Judy Sgro]

Let's continue for your time.

[Randy Hoback, Conservative, Prince Albert, SK]

Minister, let's go back to this again. I laid out the map, and it's a very true map, and if you talk to anybody in the U.K., they would agree with my assertions on this. If you talk to the business community, they also agree with my assertions on this.

We need answers. Let's go back to mitigation. You said that on December 31 Canadian companies won't have to worry going into the new year because they will be able to continue selling and buying goods out of the U.K. as they have before.

What does that look like? If it's not legislated by Parliament, how are you doing it?

[Mary Ng, Liberal, Markham—Thornhill, ON]

We have a continuity agreement. The continuity agreement largely replicates the CETA for business.

[Randy Hoback, Conservative, Prince Albert, SK]

You don't have a continuity agreement that's approved by either the Parliament in U.K. or in Canada by December 31. The odds of that happening are very small.

What does plan B looks like?