Chair Sgro and members of the committee, thank you for the opportunity to be with you today.
The Canola Council of Canada encompasses all links in the canola value chain. Our members include canola growers, life science companies, exporters, processors and others. With over 90% of Canadian canola exported to as many as 50 different markets, the canola industry depends on ambitious, fair, science- and rules-based trade.
Historically, Canada has benefited from a business environment focused on globalization and multilateralism. Free trade agreements developed over past years have helped Canada become a leading agricultural exporter. However, some countries use protectionism as a way to promote security and access to critical goods and services. The effects of the global COVID-19 pandemic have certainly heightened protectionist policies as countries look to secure control of critical goods and also their food supplies.
By way of example, I'll refer to a report commissioned by the council, together with Cereals Canada and Pulse Canada, and referenced at this very committee in June 2022, during the committee's study of trade opportunities in the Indo-Pacific. The report documented broad use of non-tariff barriers in the agricultural sector in Indo-Pacific countries, which it said was, in part, reflective of more sustained efforts towards greater self-sufficiency and local value-add opportunities. However, this has been accompanied by protectionism and the use of NTBs to modulate imports, even as free trade agreements transform the landscape.
As international trade has increased, countries have become more concerned about protecting their domestic agriculture production. At the same time, consumers are concerned about practices and exporting countries that they perceive are affecting food safety. As a result, governments are adopting measures designed to address the food safety concerns and fears of constituents—some of which may not be grounded in science. Moving away from science-based measures generates greater trade unpredictability.
Such sanitary and phytosanitary measures are intended to protect human, animal and plant health. They include import requirements around insects, food-borne pathogens, plant diseases and weed seeds. Done properly, these measures are based on international standards or are scientifically justified. Such measures should also be the least trade-restrictive possible.
The number of SPS measures continues to expand as more countries, including many developing countries, adopt their own domestic regulatory systems. While in the past some countries may have recognized regulatory decisions from other jurisdictions, many now prefer to adopt their own measures. The result is a proliferation of SPS measures, as well as an increase in misaligned requirements, all leading to a riskier trade environment.
Access to innovation and technology—or lack thereof—represents another category of non-tariff barriers. While innovation and technology in areas such as biotechnology, gene editing and crop protection keep moving forward at a rapid pace, government regulations, globally, have become more fragmented and complex. The growing divergence of regulations will only increase disparity in technology access and market advantage for competitors and create greater risks for agricultural trade.
Current and recent examples that the Canadian canola industry has had to navigate in this regard include Mexico, which was recently the subject of technical consultations under the SPS chapter of CUSMA, and Pakistan, which took action last fall to halt the import of GM crops, reportedly as a result of domestic economic issues.
The risks created by misaligned regulatory processes are pernicious when it comes to a globally traded commodity like canola. There is significant misalignment, globally, for traditional biotechnology traits, and many countries have yet to clarify the regulatory status of varieties developed using gene editing or other new breeding techniques.
Finally, the environmentally sustainable practices used by Canadian canola farmers, which are world leading in many regards, also represent another potential risk. This is based on the fact that not all markets measure agricultural sustainability with the same metrics, and there is a risk that markets may be closed off if the practices of Canadian farmers are not recognized.
In conclusion, let me say that Canada has traditionally been a vocal advocate for science-based decision-making, as evidenced in trade agreement negotiations and in statements made at international bodies. Maintaining this posture is critical to the continued market success of Canadian canola. Similarly, the canola industry consistently advocates for Canadian regulations to be grounded in science rather than politics. Exporting science-based policy ideals is critical to advancing market access opportunities for Canadian canola and, indeed, for all of Canadian agriculture and agri-food.
Accordingly, as the committee continues its study of non-tariff barriers and as Canada continues to pursue trade agreements with several countries and markets at this time, we encourage actions that both promote and ensure science-based trade rules to provide a predictable trade environment without unnecessary restrictions; enable access to technology through science-based and predictable regulations and policies, both here in Canada and in export markets; and enable growth, increased value and trade diversification through the recognition of sustainability practices.
Thank you, again, for your time today.