International Trade Committee on Feb. 13th, 2024

[Mark Walker]

Of course, trade diversification is of critical importance to our industry. We are exporting to over 84 countries around the world. We are working very closely, hand in glove, with our Canadian trade commissioners, who do fantastic work every day.

In terms of roles for government, we've also seen fantastic work done here domestically in terms of supports for Canadian agriculture, whether that's enabling regulations for pest control products or whether that's investments in innovative technologies like zero tillage and minimum tillage. Those collaborative efforts with government really are insulating our industry against the impacts of climate change.

[Wilson Miao, Liberal, Richmond Centre, BC]

Mark, do you think a free trade agreement with Ecuador will help with diversification?

[Mark Walker]

Absolutely. I mentioned the 5% tariff on oats. Seeing that removed through these negotiations will certainly help diversify our oat markets. Canada is the largest oat exporter to the Americas. Securing that market for further exports will certainly be very beneficial.

[Wilson Miao, Liberal, Richmond Centre, BC]

In terms of the increase in extreme climate events that's happening right now throughout Canada, and continually taking place in the Prairies and across Canada, will trade diversification help the cereals sector have more choices of export destinations and generate more revenue, which can be reinvested into the sector to help it recover from extreme climate events?

[Mark Walker]

Looking at extreme climate events in Canada, we regularly experience in the western prairie provinces cyclical droughts. We had one a few years ago. Certainly, trade diversification is very helpful to increase the value-add for our products. As I mentioned, they compete at a premium.

On the investment that's needed and the reinvestment that's needed, we are seeing that our sector has become increasingly resilient. Whereas droughts would have crippled it some 40 years ago, due to some of the innovations I mentioned previously we were able to bounce back and not lose the yields we would have previously because of the innovation in our sector.

[Wilson Miao, Liberal, Richmond Centre, BC]

Would this free trade agreement with Equador help with that?

[Mark Walker]

Yes, unquestionably. We're very supportive of the free trade negotiations.

[Wilson Miao, Liberal, Richmond Centre, BC]

The next question I have is with regard to our Global Affairs trade commissioner service that has identified agriculture export as a key growth sector for the future of Canada-Ecuador bilateral trade.

Has your organization done any analysis on how opening access to the Ecuadorean market will impact your association and your numbers?

[Mark Walker]

Our group travels to Ecuador every year to meet with our customers there in the milling industry and to work with them on the functional characteristics of the harvest each year, which can vary from year to year. Wheat is not wheat. We know this, so improved and deepened ties with that country will certainly allow us to work more efficiently with our customers and market.

[Wilson Miao, Liberal, Richmond Centre, BC]

Can you share a little bit more on how we can advance this free trade agreement to make sure not just that the agriculture sector is looked after but that all other sectors across Canada can benefit from this trade agreement?

[Mark Walker]

I'm trying to maintain my agriculture hat as much as I can. Unquestionably, there are spillover benefits for a strong agriculture sector in Canada. I mentioned the 370,000 jobs that are supported directly and indirectly by our industry. We would, of course, expect spillover effects to other areas of the economy from a strong agriculture sector.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you for sharing that with me.

[The Chair, Liberal, Judy Sgro]

We'll move on to Mr. Savard-Tremblay for six minutes.

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

Thank you, Madam Chair.

Thank you to the witnesses for their presentations.

Three of the presentations were fairly complementary. Mr. Walker focused purely on the trade side of things and the issue of harmonized standards. His comments were duly noted. However, I think the three other presentations were a good reminder that the building of trade relationships can't disregard the human element and human rights. Trade relationships are a good thing, but not at any cost, of course.

My first question is for Ms. Price.

In your presentation, Ms. Price, you gave us an overview of the situation in Ecuador. It's quite troubling, and I'd like to hear your recommendations.

What do you think we should keep an eye on? Above all, what would you like to see—or not see—in a future agreement?

[Kathy Price]

Yes, thank you for the observation that, yes, indeed, it is a very worrying panorama in Ecuador at this moment in time, a panorama that, in many ways, is becoming more acute. From the perspective of my organization, Amnesty International Canada, I come to this hearing with a number of recommendations.

The first is that Canada guarantee that no free trade agreement with Ecuador will advance without broad, transparent, meaningful consultation with affected indigenous peoples in Ecuador, creating conditions for and ensuring the participation of indigenous women and their organizations, including Amazonian Women Defending the Forest and other indigenous organizations, in this consultation. It's that no agreement advance without their free, prior and informed consent. This recommendation comes from compliance with Canada's human rights obligations in ensuring that trade and investment are not taking precedence over human rights and undermining human rights.

The second recommendation is for Canada to comply with the recommendations of the UN working group on the issue of human rights and transnational corporations, which I referenced in my comments. This means ensuring that there are no investor-state dispute settlement provisions, as my colleague has really spelled out. This is a recommendation of the UN working group on the issue of human rights and transnational corporations. This is to ensure ex ante and ex post human rights impact assessments in line with UN guidelines, paying particular attention to the impact on indigenous peoples, racialized people, and women and girls.

The third recommendation is to ensure that there is mandatory human rights and environment due diligence through a legal framework enshrined in legislation and that, along with that, there is access to remedy when rights are breached by Canadian companies operating in Ecuador or, really, anywhere around the world.

Our recommendation is that you not proceed without any of these conditions that I have presented to you.

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

The government often says that most of the agreements it has signed in recent years contain chapters on human rights. However, those chapters are never binding. They are merely statements of principle. Actual binding mechanisms are never put in place, although Bill C-57 was successfully amended recently to add more binding provisions. The bill seeks to implement the trade agreement with Ukraine.

It's probably better to have the chapters than not to, since they do set out sound principles. Nevertheless, do the chapters give you any reassurance, seeing as they don't include binding mechanisms to implement the principles?

[Kathy Price]

No, there has to be implementation, and there has to be carry-through. This is also why we are recommending that there be human rights impact assessments before and after at regular intervals. This is a recommendation of the UN working group on the issue of human rights and transnational corporations. It's also a recommendation of the UN rapporteur on the right to food, for example. We do not have that at present with our free trade agreements. This has to be a necessary component in a free trade agreement. Without it, we should not be moving ahead.

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

Before we can negotiate those kinds of provisions with other countries, I think we need to have our own binding legislation.

Are you satisfied with the laws in place in Canada when it comes to goods made from forced labour, the monitoring of human rights abroad and the way Canadian corporations conduct themselves?

Do you think we could do a bit more, so we could at least say that we have a starting point?

[Kathy Price]

We're not satisfied with the status quo, absolutely not. That's why we have been advocating for strengthened powers for the ombudsperson's office and for binding legislation, binding human rights and environment due diligence, which we lack.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

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

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

Thank you.

Thank you all for being here today. It's been very interesting. I wish we had all day to speak to you.

I'm going to start with Mr. Trew. You had some strong words about what Canada's role should be here and what Canada's direction should be in these negotiations—literally to stop them. A lot of this centres around the combination of these ISDS mechanisms in free trade agreements along with the track record on human rights in many countries, especially in Latin America.

You mentioned that Ecuador had tried to get out of all its free trade agreements in 2017, after it was hit with a $2-billion claim through an ISDS process, I think from Occidental Petroleum.

I'm wondering if you could dive into this whole thing and why we can't get this right. Why do ISDS provisions always end up badly for countries, and especially for the people who are being affected by these Canadian investments in them and vice versa? Even in Canada, we are getting hit with ISDS claims by other companies. Could you dive into why we can't get it right and what you would suggest we do?

[Stuart Trew]

I don't know why we can't get it right. I mean, I think we did get it right in the Canada-U.S.-Mexico agreement. We simply agreed to get rid of ISDS in that new agreement. We made a big deal out of it when the deal was announced, because ISDS undermines our ability to pass environmental policies.

There are a lot of lawsuits and, across Latin America, ISDS is a major issue. A number of corporate cases involve public services and certainly involve Canadian mining companies abroad. Canada is the 12th biggest economy in the world, but we're the fourth most litigious country when it comes to companies using ISDS to challenge environmental decisions in other countries, challenges with respect to mining permits and whatnot.

For all the reasons I think this committee has talked about before, it's a pretty lopsided system. Voices of people who would be impacted by investments are really not considered. You know, you can put amici curiae submissions into these cases, but they're frequently turned down. When they are accepted, they're frequently ignored by the tribunal. There is simply no way to get into the discussion of issues other than the investors' desires to make a profit and the state's responsibilities in the treaty to that investor.

It's problematic for a number of other reasons, but those are the basics.

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

You mentioned how we got out of it in the CUSMA. Chrystia Freeland said, “ISDS elevates the rights of corporations over those of sovereign governments. In removing it, we have strengthened our government's right to regulate in the public interest”.

Why we don't do that every time is my question. Lately, we've been putting other language into FTAs to say that nothing in the agreement affects either party's right to bring in legislation in its own public interest, environmental interests, human rights, whatever, but it doesn't seem to work.

Can you maybe mention some of the cases there and what the problem is?

[Stuart Trew]

Yes. I think the language you are referring to is maybe some of the right to regulate clauses that Canada has started to put into agreements like the CETA and its model investment treaty from 2021. Those, I would say, are completely untested. We haven't seen cases under those agreements because they're not in force yet.

There is a book that came out a few years ago now that looked into modern language in some of the more modern treaties that Canada has been pursuing in other countries as well that tries to strengthen right to regulate provisions. It has not been highly effective. In ISDS, panels will use older treaties as a basis for the standards that these investors have in other countries. That's one of the reasons. You get these new treaties, but the decisions are being based on older reasoning.

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

I'm going to turn to Ms. Herrera with MiningWatch.

I'll ask you, Ms. Herrera, to comment on these issues in a real Ecuadorian context. What has been the history with Canadian companies or other companies in an Ecuadorian context? We have Ecuadorian communities that have really expressed their concerns about activities, yet they have been ignored by Canadian companies.