International Trade Committee on Nov. 7th, 2023

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you, Madam Chair.

Minister, thank you for being here today to discuss this important legislation alongside your impressive group of officials from Global Affairs.

I've been following this debate in the House very closely. It was my honour to speak to Bill C-57 during the second reading. I'm quite troubled to hear that the Conservative member for Cumberland-Colchester suggested that Canada was taking advantage of Ukraine by working with them on negotiating this so-called “woke” free trade agreement.

You've served as the minister responsible for international trade since 2019, and you have been around the table and shown leadership as part of these negotiations. I'd like to know, based on your experience, if you could respond further to the suggestion made by the Conservative member.

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

I want to thank my honourable colleague for that question.

I too was troubled by the comments, because it simply hasn't matched anything I heard at every step of the negotiation. Time and again, Ukraine signalled that they were committed to seeing these discussions through to the point where we could land a modernized agreement.

I heard from my Ukrainian counterparts but also directly from President Zelenskyy, when he was here, that the free trade agreement will help form the basis for the reconstruction of Ukraine, following Russia's illegal invasion. I've also heard from business leaders and community leaders in Canada that they want to play an important role in the rebuilding of Ukraine, once they have won this illegal war, and how important a modernized trade agreement will be in helping them to do exactly that.

I'm proud of the fact that this legislation is both comprehensive and ambitious. If Conservatives want to throw around terms like “woke” to try to undermine the relationship with Ukraine, they might want to explain to Canadians why they want to do that.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you.

To your point, Minister, I believe our Ukrainian counterparts have signalled how beneficial this free trade agreement will be for Ukraine as well as in their trade discussions with other countries. Do I have that right?

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

It's absolutely true. Ukraine has told us that this comprehensive trade agreement, which has what they call in trade circles “high standards”, will really serve as a model for them as they pursue agreements with other countries.

This isn't new. Canada has taken a lead on supporting Ukraine right from the get-go. When we say we're going to stand shoulder to shoulder with Ukraine, it isn't just in humanitarian assistance or supporting their military efforts. It really is also supporting the economic reconstruction when that is able to happen.

I hope we can really demonstrate a team Canada approach. As I said in my opening remarks, I think we can rise to this challenge and collaborate in support of Ukraine. It would be terrific if we work very hard to get this bill through the House and into the Senate for ratification.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you, Minister.

You just mentioned in your comment the trade circle talking about CUFTA as a “high-quality” agreement. What factors have helped to make this the case, from your perspective?

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

This agreement is comparable to the agreements we have with the United States and Mexico in CUSMA, with the European Union in CETA, and with countries along the Pacific Rim in CPTPP. It has some best practice provisions in there to protect the environment, to have standards to protect workers and to allow small and medium-sized businesses to benefit from the trade agreement. I think it's an agreement that Canadians and Ukrainians can really be proud of.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you very much, Minister.

Through the chair, I'd like to ask my next question to Mr. Christie.

You have served as a Canada's chief trade negotiator for other trade agreements, and I thank you and your team for that important work. Could you provide our committee with an overview of how the process was different from past negotiations and how you worked with your Ukrainian counterpart to advance this treaty to where it is today?

[Bruce Christie, Assistant Deputy Minister and Chief Trade Negotiator, Department of Foreign Affairs, Trade and Development]

Thank you very much for your question.

In this case, compared to other free trade negotiations, which tend to be more labour intensive and drag on for a longer period of time, first of all, when Ukraine approached us somewhat surprisingly in May of last year indicating that they were ready to launch modernization negotiations, we of course were dealing with the after-effects of the COVID-19 pandemic but also with a negotiating partner who found themselves in situations where they often didn't have electricity or power.

They didn't have access to the Internet. This was a negotiation where we had to be very creative in how we could engage with our opposite numbers. I remember having a call with my Ukrainian counterpart who was taking the call from his car because he felt that was the most secure place for him to be at the time. It was one where we kind of threw out the rule book, and we engaged with a very formidable partner who was committed to the process. We put forward options in terms of negotiating templates, and Ukraine continued to advise us that they wanted to meet Canada's high standards. We pursued that avenue. It was a different experience, but I have to tell you I walked away from the experience feeling very inspired from dealing with my Ukrainian counterparts.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

It's on to Mr. Savard-Tremblay for six minutes please.

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

Thank you, Madam Chair.

Do not blame me, Minister, for asking questions.

Like any agreement, it has its positive sides and some less positive. Some agreements are good while others are not. I think it is also part of the opposition's job to talk about it.

Overall, unlike some colleagues, I welcome several elements of this agreement that could be described as progressive. We seem to have turned the corner and left behind the free trade agreements from the triumphant neoliberalism era, when negotiations were much more aggressive.

However, I find it hard to understand why, after a health crisis and after removing such provisions from the Canada-United States-Mexico Agreement, an investor-state dispute settlement mechanism, or ISDS, is part of the proposed agreement with Ukraine.

Why was this mechanism revived, after it was excluded from the agreement with the United States and Mexico? It is especially difficult to understand after we experienced a health crisis that showed us the importance of public services.

Why should this mechanism that puts multinationals and states on an equal footing be used again?

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

Thank you very much for the question.

Let me begin by saying how much I respect the work that you and the committee do, particularly around this agreement. You may remember that last year, on a couple of occasions, officials appeared here at the committee just as we were launching the process for negotiations. That, indeed, provided opportunities for our colleagues to ask questions of each other as Parliamentarians and for officials to provide answers.

Maybe I can ask for clarification, because I'm not sure I understood the question fully around the provisions that are there. We undertook to modernize it because there were just some provisions that weren't in this agreement, which was what it needed for modernization. We had a really terrific goods agreement with Ukraine, but it didn't have provisions for services, for investments—

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

Let me clarify my question to avoid using up all my time.

There is an investor-state dispute settlement mechanism in this agreement. There was none in the Canada-United States-Mexico Agreement. We could hope that such a mechanism would never be back in future agreements.

Why did you negotiate the inclusion of such a provision?

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

Through the course of negotiations.... I think you heard the chief negotiator talk about the approach that we took with Ukraine, which really, on the one hand, protects and, in fact, I would say, even improves upon the agreements we already have. This agreement has some of the strongest environmental protections of any of the agreements that Canada has with any other country right now. There's also, for the first time, an indigenous chapter. The course of improving agreements is very much what we do—

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

Why include provisions that allow foreign companies and foreign investors to sue the state?

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

On the question around ISDS, which I think is the question—and thank you very much for asking it—it was indeed the Ukrainians who actually asked for that. The reason is that, at this juncture, they realize how important it is for Ukraine to be able to attract investment.

I know, certainly, that in the Canadian business community, it's an investor community. They do want to make investments in Ukraine. They're looking for a chapter like this around investor protection so that they can have the certainty they want, and they will have, in order to incentivize that investment.

That's actually the reason. The Ukrainians actually asked for it because they understood that it would help, but I want to also assure you that we—Canada—have retained the right to regulate and to maintain our policy flexibility, particularly around issues around the environment, around labour and around indigenous rights. We've protected that piece, but we also responded because the situation here for Ukraine, particularly at this time, is to create assurances for investors who wish to invest in Ukraine. They believed that having this chapter was actually going to be helpful.

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

Let us use an example that goes beyond intentions. I do not know if the idea came from Ukrainians or from Canada, since I was not at the negotiating table. So let us talk about facts and actual consequences.

The ISDS mechanism protects foreign investors from expropriation or, as formerly provided for in the North American Free Trade Agreement, or NAFTA, it protects investors from measures equivalent to expropriation. For example, the Ukrainian regime has sanctioned several of its own citizens and in some cases seized their property. It expropriated their assets because they collaborated with Russia.

If these Ukrainian citizens also had investments in Canada, could their assets be seized by Canada? Could these investors invoke the ISDS mechanism?

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

The goal always is to negotiate agreements in the best interests of Canadians—always. That's certainly our job. In fact, if there are any tensions around the negotiating table, it's always because we're pushing for what is the best for Canadians.

You talked about CUSMA and when we renegotiated that. In that instance, it made perfect sense—

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

Back to my question.

Let us look at the case of a Ukrainian citizen who would have investments in Canada, but who would be collaborating with Russia.

Could the Government of Canada seize their assets, as Ukraine did on its territory?

Could these Ukrainian citizens, who would have investments in Canada, use this mechanism against the Government of Canada?

[The Chair, Liberal, Judy Sgro]

Is it possible to have a brief answer? I gave Mr. Savard-Tremblay the extra time to repeat his question.

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

Yes.

Let me take the opportunity to get better information and return to you on your question. I think that's the best thing to do.

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

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you.

Mr. Cannings, you have six minutes, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

Thank you, Minister and everyone else, for being here.

We're doing this prestudy because we're told that this is a “hurry up” situation. We want to get this done before Christmas or something.

I think Mr. Foster described this as a brick or something. It's a thousand-page document. It's very difficult for us to quickly assess what's in these agreements when we're told this is a “hurry up” situation.

We have policies that help us with that. First of all, there's a policy regarding parliamentary oversight before starting negotiations that stems from a letter the NDP got from Chrystia Freeland back in 2020, when we were doing CUSMA. It said that there was going to be a new government policy that there should be a notice of intent to start negotiations sent out 90 days before those negotiations start. That notice should come to this committee. There should be a notice of the objectives for negotiations, which should be sent out 30 days before negotiations start. That should come to this committee. There should be an economic assessment tabled with the implementing legislation. I don't think any of that was done for this. I can't find any record of this committee receiving these notices.

There's also a policy in writing on tabling treaties in Parliament, under which “the Minister...will table all agreements [with an] Explanatory Memorandum...twenty-one sitting days before taking any action to bring the agreement into force” or otherwise implement legislation.

The explanatory memo I have here was apparently written on September 22, but it was tabled in Parliament on October 17, when the treaty was tabled as well. We had no heads-up and no way of assessing the treaty before—boom—the implementing legislation was tabled. This is what we're debating here today.

I'm just wondering if you can comment. If you wanted this to be hurried up, there were stakeholder consultations back in 2020, but this committee wasn't involved in those at all. If it's so important to have real feedback from the opposition, then give them time to prepare for something as big as this. I'm just wondering why this was not done.

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

Thank you very much.

I always appreciate the member's good feedback and comments to me and the government on this and on other matters. I want to thank you and your party for supporting this FTA in the House.

On this agreement in particular—particularly since the negotiations—Global Affairs and the officials were here in February 2022 and April 2022 to have full and ample conversations and discussions, giving colleagues an opportunity to ask the officials any questions they would like to on this particular agreement, in addition to the regular consultative processes that it has with stakeholders and others. I agree with you that the work parliamentarians do is utterly important.

With respect to the obligation to provide the notice, there is a provision that allows for some ability to not do that in some instances. In this case—I'll be candid—we elected to do that because my Ukrainian colleagues asked for the expedited method for this trade agreement because they wanted to take it through their legislative process. That's what we did in this instance. The officials came here.

I would also say that, with respect to the economic impact assessment, it's not required unless it's a new agreement. This one is not a new agreement. This is an existing agreement that's been modernized. What we did do—and this has been published fully—is in-depth environmental and gender-based analysis, GBA+, assessments. Those were both conducted and published for this agreement.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Okay, but again, I just wondered.... One of the main things in this policy says that there should be 21 working days—that's a month or more—between the tabling of the text of the treaty and the enabling legislation. We got those on the same day. Ukraine wanted to speed this up, you said, so you would think that would speed it up. I just want to express my disappointment, I guess, that you're making it difficult for us here.