Thank you, Madam Chair.
Good afternoon to you, to the vice-chairs and, of course, to all the members of the committee.
I'm thrilled that I'm here with my officials. It's a pleasure to be here and to assist the committee in its important work.
Let me start by saying that the Canada-U.S. relationship is one of the closest in the world, and at the end of last year, Canada-U.S. trade hit an all-time high. This is a testament to the strength of our relationship, of our shared values and of CUSMA.
We also share mutual goals of climate action, innovation and North American competitiveness. We're the best partners to help one another reach these shared goals, and this was clear in my visits to Washington, D.C., in December, and in November with the Prime Minister to meet with congressional leaders and stakeholders.
By working together to strengthen our deeply integrated supply chains, we'll generate growth and create jobs, while fighting climate change.
Few supply chains are more integrated across our shared border than our automotive sector supply chains. For over a hundred years, Canada and the United States have been building autos together, and for over 50 years together we have intentionally pursued policies to integrate these supply chains.
You have heard me say this before. A vehicle and its parts can cross the border between Canada and the United States several times before being completed.
Now, as our governments are both committed to fighting climate change, we know that the future of our automotive sector and its workers is an electric and a sustainable future. Canada has already committed to reaching 100% zero emissions passenger vehicle sales by 2035.
Advocating for that future is a priority for me and for the government.
In a recently proposed Build Back Better bill, the United States proposed tax credits to incentivize the purchase of electric vehicles, EVs. Unfortunately, in the last draft of this proposal, these tax credits would only be for those produced in the United States. These tax credits would threaten the future of Canada's automotive sector and ignore our deeply integrated supply chains.
Canada and the U.S. are each other's number one market for auto exports, and these tax credits would harm businesses and hundreds of thousands of jobs and workers on both sides of the border. Not only are these tax credits inconsistent with CUSMA and the WTO, they would be a barrier to reaching our shared goals to accelerate climate ambition, as outlined in the road map for a renewed Canada-U.S. partnership.
We've worked at all levels to resolve this issue. Our ongoing commitment to this issue is clearly part of Canada's position.
The Prime Minister has conveyed this message directly to the President, the vice-president, congressional leadership and cabinet secretaries. We're working closely with industry on a team Canada approach, working with U.S. congressional leaders to ensure an outcome that will allow the future of our shared industries to thrive. On December 10, the Deputy Prime Minister and I sent a letter urging the United States to ensure that any EV tax credits do not discriminate against Canada, be it through CUSMA dispute resolution or other trade levers. In the letter, we sent a clear message that, if we aren't able to reach a resolution, Canada will defend its national interests as we always have.
That we have an avenue to pursue resolution through CUSMA is a sign of the strength of our relationship. For example, we announced just a few weeks ago that Canada will be challenging the United States' unjustified duties on Canadian softwood lumber under CUSMA. We have trade levers and a process to follow because our countries negotiated a strong and fair trade agreement that supports workers, industry and communities across North America through CUSMA.
In any relationship as significant as the one between Canada and the United States, there will always be challenges.
We have many. We have worked together and resolved many of these in the past, and our government will continue to defend our businesses and our workers across Canada until we reach an outcome that is acceptable to them. We're working with our partners in the United States, with businesses, with unions and with policy-makers across our shared border to reach a solution that supports businesses and workers in both of our countries.
This is my goal and a priority for this government.
I look forward to answering your questions.
Thank you.