International Trade Committee on June 6th, 2022

[Shawn Steil]

Madam Chair, I can jump in on that one, if you like.

Vietnam is unique for the region in having two points of service for trade commissioners given the size of the market and variance. The embassy in Hanoi has five trade commissioners. The commercial capital of the country, of course, is in the south in Ho Chi Minh City, where we have, I believe, eight trade commissioners. Those two teams work seamlessly. That is fundamental from a resource-efficiency perspective. You might find your aerospace expert based in Hanoi, where government advocacy and information is key. You might find your agriculture and agri-food expert based in Ho Chi Minh City, where most of the buyers are .

We're coming out of a pandemic where I think business as usual wasn't usual. We're seeing a huge uptick right now of Canadian companies and institutions coming back into the market, but we're ready for them.

Thanks.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you for that.

Again, just to build on what my colleague mentioned earlier and some of the testimony we've heard from other witnesses particularly on the agricultural side, there is a need to create something such as an Indo-Pacific diversification office to handle and look at issues like non-tariff barriers. Is that something you think would be beneficial, or is that something you believe could be handled by the officials within your offices currently?

[Peter MacArthur]

Perhaps I could speak to that. Here in the Philippines in an embassy of 200 people, we have 15 to 20 people focused on trade commissioner service work, so on-the-ground knowledge and networks, Philippine and Canadian staff who have been able to matchmake based on identified opportunities for the priority sectors we had laid out.

In direct answer to your question, we've had, over the past year, four or five blockages to Canadian poultry, pork and beef exports as well as potatoes, for that matter, and our trade commissioners, through our relationships with local government here, have solved those issues quite delicately but in all cases we've been able to intervene, supported by Agriculture Canada, Canadian Food Inspection Agency, Canada Beef and Canada Pork. We have experts in the field with veterinarians in the region, so this seems to be operating quite well.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Madam Chair, in my remaining time I want to bring forward, for the committee's consideration, my motion, which I provided by way of notice to the committee to consider up to two studies on the impact of the ArriveCAN application. If you'd like, I could read it into the record.

[The Chair, Liberal, Judy Sgro]

Perhaps you could do that so everyone will be clear as to the motion.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

The notice of motion was provided on May 26, 2022:

That, pursuant to Standing Order 108(2), the committee prioritize its agenda in order to undertake a study of no less than two meetings before the 2022 summer adjournment of the House to study and learn more about the impacts the ArriveCAN application is having on travellers at Canadian international ports of entry, including land borders, bridge crossings and airports, and how this application is currently impacting not only Canada’s tourism industry but other sectors of the Canadian economy which have come to rely on the efficient operation and facilitation of cross-border travel and trade to ensure their economic recovery from the COVID-19 pandemic, and that the committee report its findings and recommendations to the House.

I have copies in both English and French, should members need them.

[The Chair, Liberal, Judy Sgro]

Thank you, Mr. Baldinelli.

I have Mr. Virani.

Given the fact that we have our heads of mission heads, for whom it is four o'clock in the morning, could I make a suggestion that we deal with this at the end of our meeting and that we continue with a bit more testimony?

[Tony Baldinelli, Conservative, Niagara Falls, ON]

I'd be pleased to do that. I just wanted to be sure to bring that to your attention in my last round.

[The Chair, Liberal, Judy Sgro]

It's there, and so if we could deal with it at 5:15, that would give us another 20 minutes of questions with our committee members.

Is everybody okay with that?

All right. Thank you.

Ms. Dhillon, go ahead, please, for five minutes.

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

Thank you, Madam Chair.

My first question will be for His Excellency Peter MacArthur.

Can you please speak to us a little bit about the state of COVID-19 in the Philippines currently?

Thank you.

[Peter MacArthur]

Thank you, Madam Chair.

The Philippines, after more than two years of economic lockdown—one of the most severe in the world—is doing very well. Approximately 70 million people have been vaccinated. There was a time last year when there was a shortage of vaccines, but this country has taken masking and physical distancing very seriously, and through the Holy Week here, which brought many people together in churches, through the major political rallies and election day when 70 million people voted, there has not been an uptick in the pandemic. The last time I looked there were 200 cases in a population of 110 million, so the country is bouncing out of the pandemic relatively well compared to how many other countries are doing.

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

How have the consular and trade commissioner services for Canadians been affected thus far and currently?

[Peter MacArthur]

Thank you for the question, Madam Chair.

Our embassy never closed. All through the pandemic period it has continued to offer pandemic and visa services and indeed evacuated almost 2,000 Canadian tourists in 2020 at the height of the pandemic. We have continued to operate, and currently most of our staff is in the office on a typical business day.

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

Thank you, sir, for your responses.

My next question is for His Excellency Shawn Steil.

Can you tell us a little bit about the current political stability and the state of human rights in Vietnam and what the short and long-term outlooks are for both?

[Shawn Steil]

Yes, absolutely.

Vietnam, as I mentioned, is a single-party state and has been relatively stable in its political situation. We have seen, I think, over the last couple of years—some of it perhaps opportunistically because of the pandemic—a closure in digital spaces and thus an increase in censorship, and a lower level of tolerance for political opposition. In response to political activism, human rights activism, we've been seeing an uptick in arrests for that. These are reasons for concern, concerns that we do let the Vietnamese know that we have. At the same time, there has been increased opening and progress on things like gender rights and gender equality and ethnic minority rights in the country, so there's reason for optimism.

Coming from where I did, working on China, we're always monitoring political developments to see the extent to which, even in a one-party state, there is division of and limits to power, and in the Vietnamese system, you still have a very strong sense of collective leadership where power is diffuse. In fact, some would say it's almost too diffuse; provinces have an enormous amount of influence over decision-making, which can sometimes make things slow for business. But we haven't seen a very overt crackdown or consolidation of power the way that we had seen, for example, in China, but it's certainly something that we watch for.

Right now, Vietnam is in the midst of an anti-corruption campaign, and whether or not this is going to change the political landscape significantly is yet to be seen, but that's something we're also watching.

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

Thank you so very much for your comprehensive responses.

My final questions are going to be for His Excellency Jean-Dominique Ieraci.

Can you tell us a little bit about the current business climate for Canadian businesses in Singapore? Thank you.

[Jean-Dominique Ieraci]

Madam Chair, the business climate in Singapore is very good. The only caveat I would say is that this is a very active city and our competitors are also here, so one has to make a pretty good pitch and show that you are willing to come often and to develop the relationships needed to do business. By and large, this is why we get a lot of visitors, because Singapore is known as being one of the easiest places in the world to do business. I think they were in the top five last year again.

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

Perfect.

Do you see increased or potential opportunities for businesses to grow or expand into Singapore? If so, what sectors would most likely see this?

[Jean-Dominique Ieraci]

We do see more opportunities and more interest, considering the ripples that are happening in the region. Certainly in the financial sector, we see a lot more interest in growing their presence in Singapore. We see it in the agriculture sector as well. The sectors of priority that I named were picked, by and large, because we see growth in them, and what we especially we want to do is to find leads for Canadian companies and see whether they're willing to service them here, and attract them to the region in our effort to diversify trade.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We go now to Mr. Savard-Tremblay for two and a half minutes, please.

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

To the Canadian ambassador to Vietnam: you said the current regime is a one-party state which openly calls itself socialist. Since we are talking about trade relationships today, in 2022, would you call the system in Vietnam a market economy?

[Shawn Steil]

Madam Chair, as I mentioned before, the market is pretty stable, perhaps in part because of the stability of the government.

Where the challenges come is in the lack of transparency in the regulatory environment. Laws, as they are passed, tend to be quite vague, including those that govern trade. The government has a practice of issuing circulars. If you're a company operating a business in Vietnam, you really have to watch these circulars coming out and actively interpret what those are going to mean for your business. Of course, that is part of the service we provide. Given that constant flow of changing regulations, or articulation of regulations, and implementation of regulations, it's important to really follow.

Vietnam has staked its future on being open for business, and it has successfully managed to take some of the investment in manufacturing that's moving out of China and it's determined to protect that. We're following closely the developments in the market, but the indicators are positive for now.

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

In other words, you are saying that Vietnam does have a market economy. Given that just a few years ago it was still a planned and state-controlled economic system, by any chance, do you have statistics or information on the private sector’s share?

[Shawn Steil]

I do not have statistics on the proportion that's private sector. The state-owned enterprises remain fairly significant, particularly in major industries.

One example is the power grid. Vietnam has privatized in the area of power generation, so they are welcoming private investment. That may take the form of joint ventures, and there may be a requirement for a state-owned partner, but they do allow private investment. Where they haven't allowed it has been in the grid itself. That's creating a bit of a bottleneck because, as I mentioned before, they have renewables coming on stream but a grid that can't handle renewables. They need to open that up in order to fully adapt to a new energy source.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

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