International Trade Committee on March 23rd, 2022

[Anju Dhillon, Liberal, Dorval—Lachine—LaSalle, QC]

Would you say Canadian firms and workers in the sector are feeling the repercussions?

[Jean-François Samray]

There is no doubt that companies are feeling the repercussions. As mentioned, more than $6 billion is being held in trust at the border, and soon that figure will hit $7 billion. That is money that cannot be spent on equipment or new technologies, but equipment and new technologies are essential for companies not only to be competitive, but also to develop new workforces and attract new workers to the industry.

It is clear that workers are feeling the repercussions of the situation. A solution has to be found so that that money can support the economic recovery.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go on to Mr. Savard-Tremblay for two minutes.

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

Thank you, Madam Chair.

Mr. Nighbor, correct me if I'm misinterpreting your remarks. Earlier, you said that there were a lot of initiatives at the provincial level, but that a little extra support—a boost—from Global Affairs Canada was lacking, specifically through the trade commissioner service.

What would you like to see, in tangible terms?

[Derek Nighbor]

The first thing I'd like to see is for Global Affairs Canada to support by doing a legal review on both bills currently on the floors of the legislatures in Albany and Sacramento. That's the first thing, which will confirm our belief that these bills would violate trade agreements.

Secondly, through diplomacy and working with stateside governments, partners in the U.S. and our customers in the U.S., we need to continue to share with them and have those meetings to talk about how our forests are actually managed here in Canada. There's a lot of misinformation. I think a lot of people forget that more than half of our forested areas in Canada are actually unmanaged. They might be managed by local communities in the far north, but 48% of our forests are managed. Out of that managed forest, half of that forest is under some kind of conservation measure today because forestry in Canada is inherently about conservation, local values and managing for multiple values, from species at risk to flood and fire risk mitigation.

A lot of work goes into the planning in forestry in Canada. It can't be simplified, which is what's being done in terms of the some of the terminology we're seeing stateside.

[The Chair, Liberal, Judy Sgro]

You have 50 seconds.

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

I don't think 50 seconds is enough time to discuss another topic.

I'll simply thank the witnesses.

[The Chair, Liberal, Judy Sgro]

Ms. Zarrillo, you have two minutes, please.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you. I'm going to take your 50 seconds.

I just wanted to say thank you to all the witnesses today for that look into the future, with the talk about transformation and about value-add potentially coming back more strongly in Canada. That's very interesting.

There were also a number of comments about the changing global dynamic, just based on what we're dealing with regarding the COVID vaccine and what was happening with Ukraine.

This will be for Mr. Krips.

Thinking about that, I was wondering if there have been changes in language and thinking about future planning, even in regard to lack of containers and not having the drivers in the industry. If so, if there has been a change in that language, in future planning and in how your groups are thinking about it, what does the Canadian government need to know and consider in order to support industry workers now and for your future?

[Jason Krips]

I'll just jump in on some of the things my colleagues have flagged, such as real supply chain issues and costs, and cost structures. We're seeing a huge issue with respect to rail service in northern Alberta in particular and, by extension, in other provinces. I know Susan has lots of issues in her jurisdiction because of floods, fires and the like.

The Canadian government can really look at infrastructure from a logistics perspective and from a rail company perspective to ensure that the rail companies are providing services that I believe they are fiduciarily charged to provide to northern communities. Most of our members in Alberta are actually only served by one of the rail companies. That has resulted in increased costs due to the lack of service on railcars this year. It seems to be an annual issue.

I think a real focus on our logistics and infrastructure needs across Canada and on rail in particular would be really helpful. It's not directly related to softwood lumber, but it's absolutely directly related to the cost of our industry. Reducing the costs will actually help viable forestry companies continue.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Fast, you're the last commenter on that side today.

[Ed Fast, Conservative, Abbotsford, BC]

Thank you very much.

My questions are to Mr. Nighbor and Ms. Yurkovich. It's nice to see you both again. It's been a while.

I listened carefully to your testimony and I just wanted to quote back to you. Ms. Yurkovich, you said that with these types of disputes, “the leader of Canada and the leader of the U.S....get together” and resolve it. You said, “We just haven't seen that yet.”

Mr. Nighbor, you said something similar. You said that “top-to-top diplomacy” would stop the lunacy.

Are you both suggesting that there hasn't been top-to-top diplomacy over the last few years since the softwood lumber agreement expired?

[Susan Yurkovich]

Maybe I'll kick that off.

I think what I said before was about the conditions we've seen in the past and indeed when the last deal was done. You have a few conditions in place—I talked about some litigation water under the bridge, some money held up that the U.S. industry has its eye on and then some levers, which are some other things that are not lumber-related.

When you have those conditions, it then becomes a leader-to-leader conversation to try to push. The industry in the U.S. must be brought to the table and that's something only the leader of the United States can do.

That's the context of what I said. Yes, it will absolutely require the Prime Minister and the President, but the President has to get the U.S. coalition to come to the table and engage, or there's nothing we can do to get this thing resolved with the way the trade laws are in the U.S.

[Derek Nighbor]

Mr. Fast, can you imagine if one of our provinces said that it's not going to have any American wine here any more because they're concerned that it's just not sustainable? Just think about that.

For us, we have the provincial government engagement. We have labour, indigenous and other partners engaging. We have the foreign public service and our diplomatic core in the U.S. engaging. I do think with this situation being critical—this is a multi-billion dollar problem in the making—we're going to need more political support in the weeks and months ahead.

[Ed Fast, Conservative, Abbotsford, BC]

In the lead-up to the CUSMA negotiations, was your industry actually approached to see whether softwood lumber could be included in those negotiations? Quite frankly, I would have liked to have seen that because of the additional leverage that would have provided in terms of a larger negotiation.

Was that discussion ever on the table?

[Susan Yurkovich]

There were conversations about that. Given your history, I think you know better than probably most people around the table how difficult this file is and how contentious and political it has been.

From a B.C. perspective, the one thing we were absolutely mission-critical on was that we have the dispute resolution mechanism. We got that. It's essentially similar to what we had in the previous agreement. That's critically important because with any trade agreement, as with any relationship, you're going to come up with disputes. If there was one thing we were absolutely dead set that we had to have, it was that and we got that.

[The Chair, Liberal, Judy Sgro]

Thank you very much to the witnesses for the very valuable information. I appreciated it.

To the committee members, we need the witnesses for the Canada-Ukraine study submitted, please. If there are any other witnesses for the clean technology, please submit them as soon as possible to the clerk.

Thank you to my colleagues and thank you to the witnesses again.