International Trade Committee on Feb. 7th, 2022

[The Chair, Liberal, Judy Sgro]

Please make it a brief answer, Minister.

[Mary Ng, Liberal, Markham—Thornhill, ON]

I've met with the softwood lumber industry to work on exactly what we want all together, which is a settlement that is a good agreement—not any agreement; a good agreement.

With respect to this issue on the advocacy, we went down and met with the Americans, we met with the American home builders association, who also agree that these tariffs were too high and they actually hurt their affordable housing plans down in the U.S. But there's more work to do.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Miao, you have five minutes, please.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you, Madam Chair.

Thank you, Minister, for being here today, and thank you to everyone else as well.

I have a question regarding softwood lumber related to B.C. As you know, in British Columbia the forestry sector represents 100,000 workers and contributes $13 billion to the provincial economy. Last year the Canadian ambassador to the U.S. raised it at a forest industry conference that high lumber prices could affect the U.S. President's ability to fulfill his pandemic recovery goal, which [Technical difficulty—Editor] include affordable, environmentally friendly housing.

As the Americans are currently under a lumber supply shortage and record-high prices, what have you heard from the industry and U.S. lawmakers when raising the softwood lumber dispute with them?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you very much for that important question from my honourable colleague. This will give me an opportunity to maybe just pick up a little bit on his question but also the question prior.

Working with the Canadian softwood lumber industry is extremely important. They are significant employers here in Canada, particularly in B.C., given the importance of the forestry sector to B.C. As I said a little earlier, I was joined on my recent trip to Washington, D.C., by members from all sides of the House. We met with the National Association of Home Builders, and they echoed our concerns around the high tariffs contributing to the high cost for them to build their homes.

This is an issue that we will continue to work on, defending Canada's softwood lumber industry. I just had a meeting a few weeks ago, at the beginning of this year, with the industry to continue to work with them so that we are able to remain in a strong position with industry as we continue to work with the Americans.

Let me just also talk for a minute about what we have also been doing. Right from the beginning, our government has been committed to helping our exports diversify. The United States, of course, is our largest trading partner, and it's very important. We also say often—I certainly do, as the trade minister—that we're proud that we are the only G7 country that has a free trade agreement with every other G7 country. We have access to markets, to 60% of the world's economy, whether it is in Europe through CETA, or whether it's in the Asia-Pacific through the CPTPP, or here of course in North America through CUSMA. We are pursuing more opportunities to grow into new markets in the Asia-Pacific, like launching agreements with Indonesia or with the ASEAN countries.

Why is this important? It's important because diversification and creating greater market opportunities for our businesses, particularly in the forestry sector and for softwood lumber, are really important. I'll share a couple of numbers with you. Canadian softwood lumber exports have more than doubled in the last decade, going from $3.8 billion in 2009 to over $8 billion in 2019. There is an increase there. We are seeing lumber exports to countries in Asia booking strong growth, and this is because of our focus on diversification. We are seeing an increase in growth into markets like Japan, by 20%, to South Korea, by 25%, to the Philippines, an increase by 230%, to markets like China, a $491-million increase in softwood lumber exports.

This is the value of diversification. It is creating those additional markets for our Canadian exports so that while it is important to trade with our largest trading partner south of the border, it is equally important to support our softwood lumber industry, the workers they employ, through programs that also are helping them be innovative. I think about the softwood lumber action plan that our government put forward in 2017. In the 2019 budget we added $250 million to extend support to the sector.

Why is it important? It's important because it's helping them innovate. It's helping them create new products. It's helping them to contribute to sustainable solutions through their products which they're exporting.

If I had a lot more time, I'd be able to give you a list of companies that have benefited from exporting.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

We move on to Monsieur Savard-Tremblay for two and half minutes, please.

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

Thank you, Madam Chair.

Minister Ng, we'll be talking about lumber.

Unlike what happened with electric vehicles, the lumber industry hasn't received any letters threatening retaliation. You didn't threaten to list products. In short, the response wasn't the same in both cases.

As we know, the United States recently lowered its tariffs. In our opinion, these tariffs still seem illegitimate. We also know that prices have increased in the United States and that certain groups are taking action.

Couldn't we have the tariffs lifted completely? If so, how would you use those policy levers, the opportunities to lift the tariffs completely?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you for the question.

I want to say to you, to the industry across Canada and most certainly in Quebec.... Again, I apologize that I'm not able to deliver this answer completely in French, but I want to give you a better answer, so I'm doing it in English.

I want the industry and the workers, in Quebec in particular, to know how hard it is that we are working to defend this sector, the jobs that they create and the contributions that they make to the economy.

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

How are you doing this?

[Mary Ng, Liberal, Markham—Thornhill, ON]

We have initiated under CUSMA an appeal for the AR2, the administrative review tariffs. We've always said that the tariffs are unjustified. They're absolutely unjustified, and we need to defend that. Whether it is through CUSMA or through the WTO, we're going to keep defending the industry in that way.

At the same time, I continue to meet with the industry, with our partners there, so that we are in the best position possible from the industry standpoint to work and to defend the industry against the United States.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

We move on to Mr. Masse for two and a half minutes, please.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

We'll move to dairy with the dairy quota tariffs decision just recently. The way that I read it was that we lost on my side. I know you suggested, as well as the other minister, that we won.

Perhaps you can enlighten us on that decision. Also, too, I'm hearing from the industry that they're looking for direction right now and hearing nothing about what to do next, so I'll turn to you to explain that and see where we're at. When will the other partners learn what they have to do next to meet the decision that was made?

[Mary Ng, Liberal, Markham—Thornhill, ON]

It is a win for Canada. The supply-managed sector is really important, and it was very fundamental to what we negotiated in CUSMA. This decision preserved Canada's right to maintain our supply-managed sectors, of which dairy is one. That is good for Canada because it respects that which we negotiated.

Where they had won and.... It's one out of the four parts of the decision, and three agree with Canada, and the one part that we are working on right now is on the way in which the TRQs are allocated. We are very much working with the industry as well as with the Americans to find a way to implement the panel report. That's what's going on right now; that work is very much under way.

The preservation of Canada's right to defend our supply-managed sector is what this panel report essentially said.

[Brian Masse, NDP, Windsor West, ON]

We went into the deal with that intact, so I don't really see that as too much of a win. Will there be a timeline, and if there are injurious effects on the industry to meet that timeline or further problems...what are the timelines for those things? One of the concerns I have is anxiety from the industry trying to meet some of these new dates.

[The Chair, Liberal, Judy Sgro]

Can we have a short answer, Minister, please?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Yes.

What I would say is that work is very much going on. As you know, when panel decisions come out, you need to begin working on them. We are and have been working with the industry. Industry is very much part of the work. We've been working with them all the way along but also with the Americans. We want to find our way to a solution that can work and that can work certainly for our industry here.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

We move on to Mr. Patzer for five minutes, please.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Thank you very much, Madame Chair.

Thanks for joining us today, Minister.

I want to open by asking you this. When the provincial government of Saskatchewan and also the Government of Quebec were looking to set up trade offices in the U.K. at Canada House, they were met with all kinds of resistance and ended up having to set up offices elsewhere.

Why was that?

[Mary Ng, Liberal, Markham—Thornhill, ON]

The way I look at it is that we work very closely with the provinces along with all stakeholders, industry, small and medium-sized businesses and workers to facilitate greater trade.

I had an FPT with my provincial counterparts not that long ago where we talked about how we work together to help increase trade and work together because we only have one customer, and that's the Canadian exporter.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Then why exclude two provinces?

[Mary Ng, Liberal, Markham—Thornhill, ON]

That's not the way I look at it. The way I look at it is that what we do—

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

That's how it is.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Let me finish here for a moment.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Sure. Briefly, please.

[Mary Ng, Liberal, Markham—Thornhill, ON]

I am committed to working with all the provinces and territories—