Thank you.
Good afternoon, Madam Chair and members of the committee. I'm grateful for the invitation to speak to you today.
I'm Elizabeth Kwan. I am a senior researcher for the Canadian Labour Congress and the policy lead on trade.
The CLC is Canada's largest central labour body and speaks on issues of national importance for more than three million unionized workers across Canada.
The very substantial funding of the Inflation Reduction Act—$369 billion in energy, security and climate change programs—has reshaped the climate policy world, pressuring Canada to be more ambitious and to accelerate its own climate actions.
Overall, the IRA provides certain opportunities for Canada, including the production of EVs, EV batteries and battery parts, and low-carbon construction materials. The IRA could give Canadian producers a boost as they are, on average, 15% to 74% less CO2-intensive than even U.S. producers. At the same time, the Canadian steel sector, and manufacturing in general, will face challenges due to the 100% U.S. iron and steel requirement for domestic energy projects and the sizable domestically manufactured components requirement.
The IRA can provide other opportunities for Canada to develop upstream activities, such as the mining of critical minerals for EV batteries. Canada is one of the few nations with most of the critical metals and minerals required for EV battery production and the capacity to produce refined battery materials with a low carbon footprint because of our clean electricity grid. However, the timeline to fully develop this potential for Canada is still many years away and may be a challenge in terms of optimizing for the IRA. Therefore, Canada needs to act right now.
Overall, the IRA climate and energy measures aimed to cut greenhouse gas emissions by 40% by 2030, in line with Canada's own target. The IRA could mean even more good Canadian jobs, hopefully many of them being union jobs, which is important in transitioning workers to a low-carbon economy.
On the international front, the IRA has also come to the attention of South Korea and the EU. The EU has listed at least nine points in the IRA that they allege are in breach of international trade rules. The EU and the U.S. have set up a task force to discuss how to address the EU's concerns.
There are also many questions from Canadian stakeholders regarding the interpretation and implementation of parts of the IRA. Perhaps an in-depth study of the impact of the IRA on Canada is worth embarking on. However, make no mistake; the IRA puts America first. It's about protectionism that advances U.S. interests. It offers certainty, a clear path forward for an ambitious industrial strategy that maximizes growth and good jobs and transitions workers into a low-carbon economy.
Canada has to offer this policy certainty as well. Canada needs to put the different commitments and actions from the last federal budget and the fall economic statement into a comprehensive strategic framework that articulates a clear vision. Unions must be at each and every table as equal partners to develop policies and the strategic framework. The Canadian framework should strengthen existing policies, be strategically selective in its priorities and build on strength. The IRA further invests in Americans by providing better pricing for prescription medication and access to health care, for instance.
Canada must build on its existing policy advantages that will support workers and encourage business investments, such as building up our public health care and bringing in universal pharmacare.
The IRA increases important supports for people, aggressively deals with climate change, lifts up workers and creates good-paying union jobs. As such, the Canadian framework, at the very least, must have the same objectives.
Thank you very much for your time. I look forward to your questions.