International Trade Committee on Dec. 11th, 2024

[Chandra Arya, Liberal, Nepean, ON]

It is not EnviroMix.

[Dave Sawyer]

No.

[Chandra Arya, Liberal, Nepean, ON]

Thanks. I'll come back to you.

Ms. Kwan, as to your recommendations one and three—I can't repeat them—are there any countries that have implemented those recommendations?

[Elizabeth Kwan]

In terms of the industrial strategy, if you look at Europe, for instance, it has strategies around that. It also also has strategies around emissions and strategies around deforestation—all of that stuff.

As to number three, yes, many governments are active in the realm of shifting towards a low-carbon economy. It provides—

[Chandra Arya, Liberal, Nepean, ON]

I know various governments are doing it. Sometimes it is easier for us to know if somebody else has done it. We can look at how their model works, and we can try to copy it. There's nothing wrong with copying good things.

Mr. Simard, I have a quick question, a short question. What percentage of aluminum products from Canada are exported outside of North America?

[Jean Simard]

It's a very small proportion—perhaps 3% or 5%, depending on the year. The rest goes to the U.S.

[Chandra Arya, Liberal, Nepean, ON]

Basically, your concern here is about imports into Canada.

[Jean Simard]

I'm sorry. Can you repeat the question?

[Chandra Arya, Liberal, Nepean, ON]

On this particular issue, your major concern is about imports into Canada. Am I right?

[Jean Simard]

We don't have an issue with imports into Canada. It's not an issue for us.

[Chandra Arya, Liberal, Nepean, ON]

Thank you.

Mr. Sawyer, I'll come back to you.

You said there is a proposed bipartisan bill pending in the U.S. Do you think it will pass under the Trump administration?

[Dave Sawyer]

I cannot speculate on that.

[Chandra Arya, Liberal, Nepean, ON]

Obviously, if a bill like that is passed, it will increase costs for carbon-intensive industries. With business lobbies being strong there, I'm wondering whether it will be done.

You said 30% of our product exports will be covered under it. Correct me if I'm wrong.

[Dave Sawyer]

Yes. It's a big number.

[Chandra Arya, Liberal, Nepean, ON]

Is it to our advantage if the bill passes? I'd say certainly not.

[Dave Sawyer]

It depends on what happens. It really depends on the final rules.

[Chandra Arya, Liberal, Nepean, ON]

You mentioned the federal and provincial systems and how they help reduce emissions and maintain competitiveness. Is that not a problem for some of our sectors?

[Dave Sawyer]

Do you mean the CBAM?

[Chandra Arya, Liberal, Nepean, ON]

Yes.

[Dave Sawyer]

Well, it is a problem for our exporters to the extent that they get levied. It increases costs, which reduces their market share in foreign markets. It will be a problem in Europe.

[Chandra Arya, Liberal, Nepean, ON]

It will, especially for the agriculture sector, which has made Canada the fifth-largest exporter of agri-food products in the world.

How do you think they are coping with this?

[Dave Sawyer]

The fertilizer sector would be the only sector covered under the CBAM. They would see an increase in costs. To the extent that our Canadian carbon prices are misaligned with EU carbon prices, they would face a charge.

[Chandra Arya, Liberal, Nepean, ON]

Trading with the European Union is not a problem, because our objectives align, but when it comes to Canada trading with the global south, don't you think our companies and products will be under competitive pressure?

[Dave Sawyer]

I don't have a view on that.

[Chandra Arya, Liberal, Nepean, ON]

Is there any risk that our stringent climate policies will be considered protectionist by the countries that want to trade with us?