International Trade Committee on May 8th, 2023

[The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)), Liberal, Judy Sgro]

I call the meeting to order.

This is meeting number 63 of the Standing Committee on International Trade. Today's meeting is taking place in a hybrid format, pursuant to the House order of June 23, 2022. Therefore, members are attending in person in the room and remotely using the Zoom application.

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Pursuant to Standing Order 108(2) and the motion adopted by the committee on Friday, November 25, 2022, the committee is resuming its study of non-tariff barriers in Canada's existing and potential international trade agreements.

We have with us today Ian Laird, a lawyer, as an individual, by video conference; Jeff Nankivell, president and chief executive officer, Asia Pacific Foundation of Canada, by video conference; and Brian Kingston, president and chief executive officer, Canadian Vehicle Manufacturers' Association.

Welcome, Mr. Kingston. It's especially nice to have you in person.

From the National Cattle Feeders' Association, we have Janice Tranberg, president and chief executive officer, and William Lowe, chair of the board of directors, by video conference. From Pulse Canada, we have Mac Ross, director, market access and trade policy, by video conference.

Welcome to all of you. If you want to intervene on a question, raise your hand. Sometimes you'll have to raise it twice in order to get my attention, but we'll make sure you get your opportunity.

Again, welcome to everyone.

Mr. Laird, I invite you to make an opening statement of up to five minutes, please.

[Ian Laird, Lawyer, As an Individual]

Good morning.

Thank you very much for the invitation today. I very much appreciate it.

My name is Ian Laird, as Madam Chair mentioned. I'm a Canadian lawyer, but I'm also a partner at the international law firm of Crowell & Moring LLP in Washington, D.C. I've been practising international trade and investment law for over 25 years now and have been resident in Washington for 17 of those years.

It's indeed an honour to be able to speak to the committee this morning. In particular, it is a pleasure to see you again, Madam Chair, addressing this topic that is very important to the work of this committee and for Canada.

I have to add one disclaimer. I wish to mention that I'm speaking here in my personal capacity and not on behalf of any other person or organization. In particular, I'm not speaking on behalf of my law firm or any of my clients.

The topic is of particular interest, and when I heard that the committee was dealing in particular with the review of other irritants and concerns within existing trade deals, I felt that I could add to the discussion in light of my personal involvement with these treaties, and treaties like them, as both a practitioner and an academic.

I wanted to focus on two elements: in particular, the international investment law and dispute resolution provisions we find in these trade agreements, as well as with respect to investment by Canada's international resource and extractive industry abroad, another area that I've worked very closely with over the time that I've been working on investment and trade issues.

Now, it really goes without saying—and I don't really have to tell this committee—that investment and trade go hand in hand. There are certain types of international business, like mining and extractive industries, which by necessity can only occur where the resources are located, and that's abroad and in foreign jurisdictions.

It's a fact that many of these jurisdictions have developing legal systems and challenging environments legally speaking. That's where international law and our free trade agreements come into place. They help to protect our investors abroad and provide mechanisms for dispute resolution. We find these types of provisions in our foreign investment promotion and protection agreements, which, as you know, are FIPAs, and our free trade agreements.

Why am I focusing on natural resources and mining? The stats—this is from 2019 from Global Affairs' office of the chief economist—show that 44% of our foreign direct investment from Canada in Central and South America relates to the extractive industry. In Africa, the figure is over 50%.

MAC has stated in its material that Canadian mining companies operate in more than 100 countries around the world and, according to NRCan, 650 Canadian companies held mining assets abroad valued at $174.4 billion in 2018. That's the most recent year for this data.

Let me put this briefly. Canadian miners are some of the best in the world and some of the most active. They represent a large proportion of the international extractive industry abroad. Seventy-five per cent of international mining companies are headquartered in Canada—in particular, in Toronto and Vancouver—and a great deal of the financing from Canada comes through the Toronto Stock Exchange.

What this means is that Canada and Canadians expend significant amounts of sweat and equity to supply the world with the essential materials to support the modern and future economy, including what is needed for the climate change transition. We have a natural competitive advantage in the world, and we should support it in our trade and investment agreements.

This is where we get to the “irritants” part. There is a concern—and I think it's one worth examining— that our investment agreements and related FTA provisions have become too defensive and don't support our industry abroad in the way that they could. We've seen recent examples of where the protections under these agreements have been diminished and in some cases even eliminated. If we are going to do what's necessary in the future to support the world economy, this is going in the wrong direction.

The final summary point on that is that Canada really needs to up its game in the investment area and engage more deeply with trading partners and the lead industries abroad in supporting these types of international investment protections.

To give you a couple of examples—I know my time is coming up very shortly—Canada is, in fact, behind in signing these types of treaties, these FIPAs and free trade agreements. If you look at other countries, like the U.K. or Italy, or even China, they have significantly more such agreements. We can see a starker example in the recent signing of the USMCA. In fact, the protections for foreign investors were withdrawn in that treaty for Canada vis-à-vis the United States, so a Canadian mining investor can no longer seek investor-state dispute resolutions in the United States as it could under the previous NAFTA.

There are other worrying signs, which I think warrant some questioning. I imagine the minister will address this when she appears, but the pace of the negotiation of free trade agreements and foreign investment promotion and protection agreements has decreased dramatically over the last few years. There are significant gaps in Canada's treaty practice that should be addressed and could be addressed.

I'm going to stop at this point. I'm open to further questions, and I look forward to the discussion with the committee.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Laird.

We'll go to Mr. Nankivell, please, for up to five minutes.

[Jeff Nankivell, President and Chief Executive Officer, Asia Pacific Foundation of Canada]

Good morning, everyone.

Greetings from the head office of the Asia Pacific Foundation of Canada in Vancouver, on the traditional ancestral and unceded territories of the Squamish, Musqueam and Tsleil-Waututh peoples.

The Asia Pacific Foundation of Canada was created through an act of Parliament in 1984, with a mandate to promote Canada's engagement in the region.

Today, as we urgently seek to diversify our export markets and our sources of supply for imports, this mandate to promote engagement for Canadians is more relevant than ever.

At APF Canada, we can supply lots of quantitative and qualitative data about the Asia-Pacific. There is rich material available on our website, asiapacific.ca, which I commend to the committee. Today I will focus my opening remarks on the impact of NTBs—non-tariff barriers—in the Asia-Pacific region and situate their importance in free trade agreements.

I should preface the rest of my remarks by saying that while I have had.... I joined the Asia Pacific Foundation of Canada as president and CEO in September 2021, after a 33-year career as a diplomat for Canada, mostly in Asia. At times, it was with responsibility for all of Asia. At other times, I was on postings in China and Hong Kong. I have never done so in the capacity of a trade negotiator, but I think I am in a position to provide an overview on the situation in Asia, and I look forward to engaging with the committee.

I know that the committee has already heard from numerous witnesses about non-tariff barriers—I'll say “NTBs” from now on—in general. Here is a snapshot of the situation in Asia.

Asia-Pacific economies have reported over 14,000 technical barriers to trade—we call those TBTs—and sanitary and phytosanitary, or SPS, measures to the World Trade Organization in the last 23 years. China has the highest number of NTBs in the region, followed by Japan and South Korea. The number of reported non-tariff barriers in the region has been growing.

At the same time, most Asian economies are seeking to reduce trade barriers and harmonize standards, which has manifested in a steady rise in trade agreements over the last decade. These include various agreements that the Association of Southeast Asian Nations has negotiated with groupings in Asia—we call them “ASEAN plus” agreements—that culminated in the Regional Comprehensive Economic Partnership, or RCEP, which consists of ASEAN plus China, Japan, South Korea, Australia and New Zealand.

I know that the committee has already heard much about the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP. Recent years have also seen various new bilateral FTAs. For example, Canada, as you know, is currently negotiating trade agreements bilaterally with ASEAN, India and Indonesia.

Chapters dealing with NTBs in regional free trade agreements have expanded over time, with the CPTPP today regarded as the global benchmark for regulating NTBs. The CPTPP goes further than other regional trade agreements in regulating these barriers. One study showed that NTB harmonization under CPTPP was found to reduce the prices of goods and increase GDP. NTBs are expected to remain an important feature of trade agreement negotiations in the region and will be important for our allies and partners in the Asia-Pacific.

While the incorporation of NTBs into FTAs restricts policy space—in other words, countries will find it harder to impose NTBs, as they will need to be consistent with their FTA obligations—it can improve trade access by aligning NTBs in these agreements across regulatory policies. This makes it easier for exporters to create products that can be sold in economies with aligned NTBs, due to a similarity of standards. This, in fact, is one of the big payoffs of ambitious regional trade agreements.

The 10 economies of ASEAN in Southeast Asia have recognized the need to streamline NTBs and have signed an ASEAN Trade in Goods Agreement with a chapter dedicated to NTBs. Australia also studies NTBs closely and published an NTB action plan in 2018.

It's important for Canada to get NTBs in trade agreements right and to help its partners in the region by building their technical capacities to implement and understand NTBs. Canada's FTAs under negotiations with ASEAN, India and Indonesia include provisions on NTBs, with Canada pushing for an ambitious agenda, while our negotiating partners are looking for policy flexibility on NTBs.

Canada should continue to provide technical assistance through initiatives such as the expert deployment mechanism for trade and development to help developing country trade partners understand Canada's trade clauses in comprehensive FTAs.

APF Canada has contributed to technical assistance training for ASEAN trade officials to understand and learn from the Canadian approach to the participation of micro, small and medium-sized enterprises, or MSMEs, in trade. We have provided technical information, for example, on the Canadian approach to FTAs to ASEAN policy-makers in areas such as rules of origin, customs and trade facilitation, and TBT and SPS measures.

In conclusion, NTBs are prevalent in Asia. They can have a distorting impact on trade. That being said, there are NTBs that protect public health and the environment, as well as societal goals in areas such as languages, diversity and inclusion. Canada should continue to negotiate NTB clauses in FTAs to increase the transparent and scientific use of these measures, balancing the legitimate use of NTBs with concerns about their use as a protectionist measure.

We should also support micro, small and medium-sized enterprises, both in Canada and in Asia, that are interested in exporting, as they often lack the resources to comply with NTBs. This discourages them from entering new markets, such as Asia for Canadians.

APF Canada has done detailed work in some of these areas. We're happy to share that with the committee.

Thank you for inviting me, and I look forward to our discussion.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Kingston, you have up to five minutes, please.

[Brian Kingston, President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association]

Great. Thank you.

Good morning, Madam Chair and committee members. Thank you for the invitation to take part in your study today on non-tariff barriers in Canada's existing and potential trade agreements. It's a pleasure to be here in person this morning.

The Canadian Vehicle Manufacturers' Association, or CVMA, is the industry association that represents Canada's leading manufacturers of light and heavy-duty motor vehicles. Our membership includes Ford Motor Company of Canada, General Motors of Canada Company and Stellantis, FCA Canada. In 2022 more than 1.2 million vehicles were produced in Canada. The industry directly employs approximately 136,000 Canadians, with another half a million employed in the aftermarket services and dealership networks.

CVMA members are at the forefront of new automotive investment in Canada. Over the past three years, Ford, General Motors and Stellantis have announced over $13.5 billion in investment, which will create 6,000 direct jobs and tens of thousands throughout the auto supply chain. Most of this investment is dedicated to EV assembly and the battery supply chain to serve the North American marketplace.

These investments are all part of an unprecedented technological transformation that's taking place in the industry right now to fight climate change. Automaker investments into electrification are estimated at $1.2 trillion U.S. through 2030.

Due to the highly integrated nature of the North American auto sector, the CVMA and our member companies support policies that align with and enhance North American integration. With over 90% of Canadian production exported to the United States, CUSMA is what underpins the success of this industry. The consistency of automotive regulations across the larger North American market has never been more important than today, when our companies are prioritizing investments of billions of dollars required to fund this shift to EVs, batteries and the associated supply chain.

It's for this reason that our top priorities are ensuring that CUSMA remains in force and every effort is made to align our automotive regulations with the United States. We recommend a number of actions.

First, prepare for the CUSMA review. Business investment thrives on certainty. CUSMA provides companies with the certainty required to invest in Canada knowing that they can access the U.S. market. In 2026 parties to CUSMA must renew the agreement or it will be sunset in 2036, pending an annual review process. A non-renewal would constitute a major non-tariff barrier, as it would remove the certainty required to enable new investment in Canada. We call on the federal government to launch a team Canada approach to building support for renewal of this agreement in 2026. This initiative should include governments at all levels, businesses and Canada’s network of consulates across the U.S.

Second, maintain regulatory alignment with the United States. Canada’s seat at the North American automotive table and the hundreds of thousands of jobs the industry provides depend on continued regulatory alignment of vehicle safety and emissions standards. The federal government is currently advancing a regulated zero-emission vehicle sales mandate that constitutes a significant non-tariff barrier by micromanaging vehicle sales across Canada. This is a direct challenge to Canada’s long-standing integration with the United States through CUSMA and our competitiveness as a zero-emission vehicle manufacturing jurisdiction. I would also note that it's a direct challenge to Canada's recently implemented interprovincial trade agreement, the Canadian Free Trade Agreement, which aims to create a common market across Canada.

Finally, we must ensure reciprocity in all our trade agreements. This will allow domestic companies to receive, on an equivalent basis, the same opportunities to compete fairly in foreign markets as non-Canadian companies have coming into our domestic market. When non-tariff barriers do arise, dispute settlement mechanisms in free trade agreements are an indispensable tool to address them. It's critical that these mechanisms be functional in all our existing trade agreements and future trade agreements that we negotiate.

I look forward to answering any questions.

Thank you again.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Kingston.

Ms. Tranberg, you have up to five minutes, please.

[Janice Tranberg, President and Chief Executive Officer, National Cattle Feeders' Association]

Good morning. My name is Janice Tranberg. I'm the president and CEO of the National Cattle Feeders' Association. I'm joined today by Will Lowe, the chair of NCFA and a feedlot operator in Kyle, Saskatchewan.

NCFA is the national voice for cattle feeders. As a critical component of the beef value chain, feedlots effectively and efficiently produce consistent, high-quality beef in quantities that are required for both domestic and export markets year-round.

Canada's beef industry contributes $21.8 billion to the national GDP annually. It's highly export-dependent. Each year Canada exports about half of the beef we produce. The United States counts for about 75% of these exports. Japan, China, Mexico and Korea are other key markets.

I'll turn it over to Will.

[Will Lowe, Chair of Board of Directors, National Cattle Feeders' Association]

Canada's recent BSE negligible risk status helps position Canada in export markets as a provider of world-class beef products at a competitive price point. Over the last 10 years, our Canadian live cattle exports have seen tremendous growth, from $1.4 billion to $4.5 billion. Not surprisingly, demand from the United States is behind much of that growth.

While this is a good news story for our industry, there is concern about Canada's dependence on the American market and our need to diversify our trade. Thus, our concerns on trade barriers fall into two categories: long-standing trade irritants with the United States, and persistent non-tariff trade barriers with our free trade agreements around the globe.

The cattle industry is a tremendously integrated North American market. Significant numbers of live cattle cross the border back and forth every day, destined to fill either a feedlot in the United States or Canada, or go into a finished market in both countries. In 2021, over 375,000 head of U.S. feeder cattle were brought into Canada from the United States. That's an increase of 247% since 2017.

However, there are multiple requirements at the border that negatively impact commerce as well as the welfare of live cattle. For example, cattle moving across the border in either direction need to be inspected by a certified vet at the country of origin and destination. Once the vet has inspected the cattle, the inspection reports then need to be sent up to CFIA and USDA. That can often take a week or more. This appears to be a duplication in the system. If we trust our certified veterinarians who provide inspection reports when the cattle are loaded onto trucks and sealed, why do these reports need to go up for further inspection before they can be moved?

In addition, the USDA has been reducing the time and location of certified veterinarians at the border crossings, causing significant issues with trucks crossing the border. We're now concerned with potential voluntary country of origin labelling again in the United States. A change in the “Product of USA” labelling regulations could result in higher costs for consumers at the grocery store. We need to advocate that together we are stronger and more resilient.

[Janice Tranberg]

Canada still requires the removal of specified risk material. Even though we've received BSE negligible risk status, the average cost for this disposal is around $167 per metric ton. This is putting Canada at quite a significant disadvantage to the U.S.

When it comes to global trade of our beef, there are some additional concerning examples where it seems politics is trumping science. While new free trade agreements are exciting, in reality, it often takes months or years before Canadians are actually seeing the benefit. For our sector, this is especially true with CETA, as a non-tariff barrier on cattle carcass washing is leaving us with little to no access for our beef. With the U.K. accession to the CPTPP, we are extremely concerned that this imparity will continue.

For example, in 2021, the U.K. exported beef to Canada at a value of about $16.3 million. In 2022, the U.K. exported beef to Canada, and it grew to $33.2 million. In contrast, Canada exported beef to the U.K. at a value of only $7.6 million in 2021, and none in 2022. Free trade agreements must not put the Canadian market at a disadvantage.

Another example is that our beef has been locked out of China since 2021 due to an atypical case of BSE. China has opened trade for other countries, including Brazil, which had the same finding of an atypical BSE case just this year, yet trade has already resumed.

We call upon the government to increase its efforts with the U.S. to create a seamless border that reflects an integrated North American commerce for cattle. We ask that the government deliver urgent resolution to non-tariff trade barriers that are presently impacting the agriculture sector, and proactively examine Canada's current free trade agreements to determine how to maximize the potential that lives within these agreements.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Next, we have Mr. Ross for five and a half minutes, please.

[Mac Ross, Director, Market Access & Trade Policy, Pulse Canada]

Thank you, Madam Chair and members of the committee, for the invitation to be here. It's a pleasure to speak with you today on a very important topic for Canada's growing pulse industry. My name is Mac Ross, and I'm the director of market access and trade policy at Pulse Canada.

Pulse Canada is the national association representing growers, traders and processors of Canadian pulses, which include dry peas, lentils, beans, chickpeas and fava beans. On behalf of our members, we're proudly leading the future of healthy, sustainable food through the growth of Canada's pulse industry.

The success of our sector, like many agri-food sectors in Canada, relies heavily on free and open trade with the global market. Our competitiveness in each of these markets is dependent on predictable rules-based trade.

Canada is the world's largest exporter of pulses. Roughly 85% of pulses grown in Canada are exported to some 120 markets around the world. At Pulse Canada, we believe that pulses can pave the way to a healthier and more sustainable future, providing solutions for every link in the value chain. Achieving this directly relies on our ability to advance trade opportunities and eliminate barriers. When given a chance to compete, our industry is a Canadian success story. We see tremendous opportunity to grow and diversify Canadian pulse exports in markets like the EU, North America and the fast-growing Indo-Pacific region.

However, the increasing prevalence of market access issues, mainly in the form of non-tariff barriers or NTBs, continues to be the biggest roadblock to our industry's ability to compete and achieve market growth. Our success relies on strong trade agreements that ensure predictable access, but in Canada, it relies on a level playing field with our competitors. It also requires a responsive, flexible government with on-the-ground technical expertise to ensure that these free trade agreements are not hampered by the rise of NTBs.

Canada has done a good job signing free trade agreements. We've seen significant tariff reduction for exports in many of our key markets, but this has been met with an increasing level of NTBs in markets of key importance.

While many of these non-tariff barriers can be regulations and technical measures designed to address legitimate health and safety objectives, others, we know, are deliberately imposed to thwart competition and protect domestic producers. To complicate matters even further, this is all happening in the context of a weakened WTO and a clear shift away from multilateralism and the rules-based trading system. The nexus of trade and climate, while important, may also present new challenges by way of NTBs.

From a pulse industry perspective, we continue to face long-standing barriers with large pulse-importing markets like India. These include unpredictable and technically unjustified SPS requirements and India's unjustified imposition of a quantitative import restriction on peas, which has effectively closed off what was once our largest pea market. Over the past five years, we've also seen other markets increasingly introduce NTBs that impede trade. These range from fumigation requirements in Pakistan and unjustified wheat seed requirements in Vietnam to abrupt import bans in markets like Sri Lanka and Nepal.

The common feature among all these issues is that Canada has had no advance warning. These barriers only became apparent once shipments were denied entry at port or en route at the time of the measure's implementation, leaving both industry and government reacting.

These issues have occurred in markets where Canada has existing free trade agreements, like the CPTPP, and in several cases in markets where Canada is currently negotiating an agreement, like India. It really underscores the importance of focusing on addressing NTBs for those negotiating and implementing Canada's trade agreements. We feel that this can be done by ensuring that we have strong trade rules and effective dispute settlement mechanisms within these agreements, but also by increasing our capacity in these markets to proactively address NTBs before they arise.

We rely on our government partners to address and resolve these barriers. Quite frankly, we've really struggled in successfully addressing these issues before the point at which they're having real commercial impact. Pulse Canada continues to support strengthening Canada's advocacy capacity within the trade and diplomatic network to address NTBs. That's why we were very pleased to see the inclusion of a Canadian Indo-Pacific agriculture and agri-food office in the government's Indo-Pacific strategy. This is a great first step and something Canada needs to do more of. In-country resources to tackle NTBs in a strategic, coordinated manner with industry will help maintain and build market access for Canadian agri-food exports.

This will be a very important study for our sector. We really look forward to playing an active role as it takes shape. We thank all the members in advance for taking this important work seriously.

Thank you. I look forward to any questions.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Ross.

Now we move to Mr. Seeback for six minutes, please.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Thank you, Madam Chair.

Mr. Kingston, I just want to start with you. At one of our committee hearings, I put to Mr. Volpe something that you had said with respect to decoupling regulations with respect to autos in the United States. Mr. Volpe said:

While it may be attractive to create a bit of an island so that you can provide a narrative in Canada—a leadership narrative, noble as it is—it does put Canadian manufacturing at a disadvantage, because what will happen, which we've seen happen specifically, is that companies will either have to create a “subnational jurisdiction only” product or they'll pull the product.

You mentioned this—how we seem to be decoupling with the United States on zero-emission vehicle targets. How significant a problem is it if we do that? How many Canadian autos are exported to the United States and, therefore, how much would that be in effect if this decoupling continues?

[Brian Kingston]

Thank you.

It's a significant problem. Over 90% of what we produce in this country goes to the United States. That is the market. The reason manufacturers locate here is to access that market.

What we're seeing is a very concerning trend of decoupling, particularly on the ZEV file. The reason this industry has succeeded in Canada is that, since the Auto Pact, there's been recognition by government that we must align our regulations for things like vehicle safety and emission standards and also our trade policies with the United States to be part of that integrated market. That was reinforced in the NAFTA agreement and most recently reinforced in the CUSMA, the USMCA. We have always aligned our regulations across the board but specifically on emissions.

We just recently saw the Biden administration come forward with very stringent vehicle emissions targets. Canada, instead of taking the approach of aligning with the U.S., is now pursuing it's own zero-emission vehicle sales mandate, which is a totally new regulation. It's frankly redundant and unnecessary in the context of what the Biden administration is doing. It's very concerning, and it's very problematic for industry.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Thanks very much.

I wanted to speak with Mr. Laird. You've been talking a little about NTBs, and my question is this: We heard from the Asia Pacific Foundation about 14,000 NTBs now coming up mostly from China, Japan and South Korea. We also know issues with respect to sanitary and phytosanitary measures and NTBs are coming up increasingly at the WTO. What I keep hearing though is that things are not getting resolved at the WTO in any kind of a rapid manner, if at all.

I wonder if you could comment on how important it is to have extraordinarily robust mechanisms within FTAs to deal with NTBs. I know that was a lot of acronyms.

[Ian Laird]

I think you raised a really important point about dispute resolution, indirectly, which is one of the areas I specialize in.

The WTO has been experiencing, for the last many years, real difficulties in dealing with its dispute resolution mechanism, which is really marginalizing it in many ways and is increasingly unfortunate.

What that does is it forces countries to take the bull by the horns, so to speak, and address those types of issues in free trade agreements. I think our trade associations have been very mindful of that, and the focus has been on developing free trade agreements like the ASEAN agreement, which is obviously an absolutely critical region for Canadian trade and investment.

From my perspective and what I wanted to speak about today on investment is that, although not called a non-tariff barrier, it is an impediment to Canadian activities in regions like ASEAN if international protections, not only trade protections but also investment protections, are provided for investors.

Part of it is that international trade isn't just about sending stuff abroad. Our companies work abroad. They have operations abroad. To have that complete business model, many of them operate a large percentage of their business abroad. The types of protections you can see in investment agreements and in investment provisions of these types of treaties are absolutely critical, again, to provide that environment where, whether you call them non-tariff barriers or not, you must have the top-quality provisions.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Canada has a host of new agreements that they're looking to negotiate—FTAs. Where you would put the dispute mechanisms dealing with non-tariff barriers on the scale of importance in negotiating those agreements: the absolute top or very near the top? That's my question.

[Ian Laird]

Those types of non-tariff barriers end up being the types of irritants that lead to these types of disputes. Those treaties absolutely need dispute resolution provisions. To not have those types of provisions incredibly hampers our traders and investors because there's no impact for breaches of those treaties. I'd put a very high priority on having those types of provisions.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go to Mr. Virani for six minutes, please.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Thank you very much, Madam Chair.

Thank you to all the witnesses here and online for joining us for this very important study.

I'd like to make a comment before I start my questions. I think one of the witnesses said earlier that we've had a sort of slowdown in the negotiation of FTAs. I would respectfully beg to differ. In the last seven years, Canada has actually concluded agreements on CETA, CPTPP and CUSMA. We remain the only member of the G7 that has a free trading relationship with every other member of the G7. As one of the later witnesses pointed out, we're actively pursuing agreements with ASEAN, India and Indonesia, and also the U.K.

For my first question, I'd like to turn to the folks from Pulse Canada.

Mr. Ross, you pointed out the prevalence, unfortunately, notwithstanding our being the world's largest pulse exporter to over a hundred countries around the planet, of the issue of sanitary and phytosanitary standards continuing to rear its ugly head, sometimes in less than ideal or less than good-faith ways. You touched on this fact. You know that the Indo-Pacific strategy we launched last fall includes an agricultural office in situ or on site in the region. It's funded to the tune of almost $32 million.

Can you tell the committee what that kind of office represents in terms of an opportunity to be there on the ground and to ideally ward off issues before they arise, but secondly to deal with issues once they come up? How does that affect your work?

[Mac Ross]

That was something that Pulse Canada along with a number of our other counterparts at ag commodity associations in Canada supported very much. As I mentioned, it's very important that, in addition to having these mechanisms within trade agreements, we have a sustained and long-term presence and relationship-building initiatives by both industry and government in the regions that we trade with.

We know that while some of the barriers we face are put in place deliberately for protectionist reasons, many of these barriers are also often due to the importing country's lack of resources, time or expertise to implement proper risk assessment systems for incoming commodities. We know that, specifically in the Indo-Pacific, many of these economies could benefit from regulatory and technical capacity-building work. We hope to see a major focus on that through this office. We're very happy to see this as a first step towards that.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Thank you, Mr. Ross.

You'll know that Minister Goyal from India, the minister of commerce who is Mary Ng's analogue, is actually in Ottawa these next couple of days. There are some events and discussions happening in relation to the early progress agreement that's being pursued. You can rest assured—I've heard you on the peas issue—that it will be raised, but in terms of the opportunity of working toward that agreement with India, are there specific issues or matters that you would like us to be raising with Minister Goyal, given this momentous opportunity of having him here on the ground in Ottawa as we speak?

[Mac Ross]

For sure. We very much support the government's efforts to conclude an early progress trade agreement with India. An EPTA that creates predictable and transparent policy in general for the trade in pulses between Canada, the world's largest pulse-exporting country, and India, the world's largest pulse consumer, would really be a major win for Canadian farm businesses and the entire pulse value chain in Canada.

We've also found, through our continued engagement with India stakeholders, that an EPTA that includes strong provisions regarding the trade in pulses would also be a win for India in ensuring the availability of pulses in an environment of increasing consumption. The minister will know that the projected demand for pulses in India is expected to rise to around 39 million tonnes by 2050, from the current demand of around 23 million tonnes. This presents an important opportunity for the Canadian pulse sector, which has been India's largest and most reliable pulse supplier.

It's really about how we can support their food security needs moving forward, and what type of predictable and transparent framework we can put in place to do so.

[Arif Virani, Liberal, Parkdale—High Park, ON]

Thank you, Mr. Ross.

I want to turn my focus to you, Mr. Nankivell, with respect to what you were talking about on the Asia Pacific Foundation. I found you very much in the weeds in terms of details, but I actually thoroughly enjoyed it.

In November of last year, the Prime Minister was actually on the ground at ASEAN. There was a public announcement about the agreement between ASEAN and Canada to change Canada's status and move toward elevating Canada's status to that of a strategic partner. You know—you noted it in your comments—that we are working towards a free trade deal with ASEAN.

Can you tell us about what that kind of announcement last November means in terms of elevating Canada to strategic partner status? How does that help the process of getting an FTA concluded?

It's over to you, Mr. Nankivell.