International Trade Committee on June 13th, 2024

[Tony Baldinelli, Conservative, Niagara Falls, ON]

The witnesses are here. As long as we have the agreement of my colleagues that we'll continue on after they're finished—

[The Chair, Liberal, Judy Sgro]

Can we leave the motion until 5:15 so that we can get a few more questions answered from the officials?

[An hon. member]

Sure.

[The Chair, Liberal, Judy Sgro]

That's agreed? Okay. We'll deal with the motion at 5:15.

I guess you've had your time now.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Madam Chair, just to inform you, I also have a motion to put forward. Do you want me to wait until the end of the meeting? Is that the agreement we have among colleagues?

[The Chair, Liberal, Judy Sgro]

Well, I'd prefer to wait until 5:15. We have a couple of people who would like to ask some questions of our witnesses.

Mr. Cannings, the floor is yours for six minutes, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you. My apologies for that computer glitch. I had to reboot everything.

Thank you to the witnesses for being here.

I'm going to go back to some of my earlier questions of the minister and perhaps get a little more detail and a little different perspective.

The first one, obviously, is about the investor-state dispute mechanism that we've managed to remove from the Canada-U.S. part of this trade deal. We've just finished this study on the Canada-Ecuador free trade negotiations, and Canada seems to be taking a pretty hard-line stance on ISDS there, I would say, despite Ecuador's clear intention of not allowing that.

ISDS seems to be going out of favour in many parts of the world in terms of free trade agreements. We have side letters between Australia and New Zealand and the U.K. when it comes to CPTPP. We see the EU changing its views on ISDS.

I'm just wondering what Canada's policy on ISDS is, because we seem to be celebrating its being removed from CUSMA and yet pushing it hard in new trade agreements. I'm just wondering if someone could perhaps fill me in on where we are with investor-state dispute mechanisms, which many Canadians think are very deleterious to Canadians and, really, Canadian sovereignty.

[Aaron Fowler]

I think it is an important question, because the government tries to take a nuanced view of investor-state dispute settlement in the context of our trade agreements.

It's obvious that clear and balanced rules and an effective dispute settlement mechanism are key to creating a predictable investment climate for Canadian investors abroad. We try to take an approach that balances investor protection with the country's right to regulate in the public interest.

In so doing, we look at the domestic legal regime of the country. We assess whether Canadian investors in that country would be able to rely upon the domestic legal regime to swiftly and effectively deal with any issues that might arise in that context, and then we make a determination of whether it feels appropriate in the context of a particular negotiation to seek additional disciplines that Canadian investors may have recourse to.

I don't want to speak specifically to any ongoing negotiations so I won't say what Canada is discussing with Ecuador, but we are certainly aware of the issues the member asked about in his earlier question of the minister with respect to the Supreme Court ruling in Ecuador, and all of that very much informs Canada's position at the negotiating table.

Thank you.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Just to be clear, to use the CPTPP as an example and the U.K. trying to gain accession to that agreement, Australia and New Zealand signed side letters with the U.K. removing ISDS from those bilateral agreements within that agreement, yet Canada didn't. Does that mean Canada doesn't trust the U.K.'s legal system?

[Aaron Fowler]

No, that is not how I would characterize the basis for the decision that was taken with respect to the United Kingdom. The United Kingdom was acceding to an existing agreement. The rules of that agreement were already in place. Those rules included access and recourse to an investor-state dispute settlement mechanism. At the time of its accession and in our negotiations with them, at no point did the United Kingdom approach Canada about suspending the application of ISDS between us. Consequently, the basis upon which the U.K. acceded was the rules that had been previously negotiated in that agreement, and that included ISDS. It wasn't a judgment specific to the United Kingdom.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

I was just curious why Australia and New Zealand took a different approach.

Again, I'll move on to a question I asked the minister about some of the parts of the labour chapter and the environment chapter with regard to the rapid response mechanism. I'm just wondering if you might comment on how you think those chapters have worked. Are they doing what they're supposed to do and can they be strengthened?

[Aaron Fowler]

Our view is that the rapid response labour mechanism is working very well. It is working exactly as intended. It has provided a platform for the parties to work together to address specific issues that are brought to our attention, often by labour organizations in one of the three countries. This mechanism has provided a means to consider the labour situation in a variety of specific facilities in Mexico. Our view is that, in the vast majority of cases, resolutions reached through the RRLM are key to strengthening union democracy and promoting labour rights in Mexico.

Our view is that there is every possibility—we are quite confident of this—to continue to collaborate effectively with Mexico in this space, and with respect to labour issues more broadly. If there is an opportunity to further strengthen the mechanism down the road, that is a conversation Canada would be pleased to take part in.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Next on my list I have Mr. Sidhu.

[Maninder Sidhu, Liberal, Brampton East, ON]

Thank you, Madam Chair.

My question is for Deputy Stewart.

Could you share with the committee how Global Affairs collaborates and works with other federal government departments like agriculture when it comes to trade negotiations? Let's say that agriculture has an issue. Do you pull in agriculture? A new agriculture office opened up in Manila, Philippines. How did that come to be? How is that going?

[Rob Stewart]

As is often the case, the lead negotiator in a trade negotiation works very closely with other government departments that have an interest in the matter, including, in particular, the agriculture department. There are others, as well.

For this purpose, there are a variety of committees and fora in which that collaboration occurs. Indeed, when trade negotiations occur, groups of officials from various parts of the government go and participate. In the ongoing administration of agreements, this is also a shared responsibility. Under CUSMA, the CPTPP or CETA, it will depend on what the subject of the committee is and where the chair is best placed.

The trade office in the Philippines is actually a separate issue. It was a result of the Indo-Pacific strategy that was launched 18 months ago. It's part of the broader effort to deepen our trade relationship in the region and deal with agriculture issues that may arise.

[Maninder Sidhu, Liberal, Brampton East, ON]

Part of our government's approach is to expand trade and our trade footprint. Minister Ng was recently in Arizona and Texas to open a new trade office in the Grand Canyon State region.

Could you share more details about this announcement and how this office will further support Canadian interests in the region?

[Rob Stewart]

Happily, I was with the minister in Phoenix when we announced the opening of the office. It is, according to people who live there, the fourth-largest urban area in the United States now. A vast number of companies are headquartered in the region. We reallocated resources we had currently deployed elsewhere—from California to Phoenix—in order to deepen our ability to cover trade relationships in that area. We aren't really in the business of constantly making sure the allocation of our trade commissioner service is yielding the maximum benefit.

[Maninder Sidhu, Liberal, Brampton East, ON]

Thanks to the witnesses for taking the time today.

[The Chair, Liberal, Judy Sgro]

Let me thank you very much, witnesses, for coming again to spend some time with the trade committee. You are excused to go on and complete the rest of your day.

We are going to deal with a couple of motions.

Mr. Kmiec moved a motion that everybody is aware of.

I have Mr. Drouin down to speak on it.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I'm not a regular member of this committee, but I've seen a pattern develop over other committees where I've been.

It's requesting five meetings. I heard it verbally. I think it's probably from July 8 to September 13.

[The Chair, Liberal, Judy Sgro]

Yes.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I can tell that none of them wrote the motion. It came from upstairs in the leader's office.

I salute the effort, but I know what they're up to. I've been around this place for a long time. They're trying to say that the Liberals or whoever won't support this motion—that we don't want to work this summer. I respect that the other side can do whatever they want.

They mentioned national security and how it's important. I will recall to this committee that the leader of the official opposition still hasn't gotten briefed. I salute Elizabeth May. I salute Jagmeet Singh. They've done their job.

Back to the motion, it's a nice play. It just doesn't have the effect they think it will have.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Baldinelli.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you, Madam Chair.

I'd like to thank my colleague for his comments, but the last I looked, it was a gentleman right back there who wrote this motion for us.

It's about a situation that we think is critical for us to examine during the summer period. It doesn't have to be five meetings. We're amenable to discussing that.

We're looking at a system that will limit emissions in Canada's oil and gas sector. It's a situation for western Canada.

One article reads:

The Canadian Association of Petroleum Producers said in a media statement that adding emissions cap regulations to existing carbon pricing and methane policies creates a layer of complexity that could hamper investments in clean energy projects.

CAPP also said the “unintended consequences” of the framework “could result in significant curtailments—making this draft framework effectively a cap on production.”

There are reports out there now that this could be a $600-billion hit to Canada's economy. This is a major situation that's developing, and rightly so.

We thought it was something we would want to bring forward for consideration by this committee during the summer period, because I know our agenda is quite full. Again, it doesn't have to be five meetings. We're open to discussing that.

My hope is that my colleagues will give this fair consideration. Let's vote on it and see where we stand.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Everybody is fully aware of what the motion says. Of course, it would be exciting to be back here in July and see you all again.

(Motion negatived: nays 7; yeas 4)

I'm terribly disappointed.

Would you like to speak to your motion very quickly, sir?