International Trade Committee on Feb. 15th, 2024

[Doug Forsyth]

I'll answer your broader question and then turn to my colleague on ISDS.

From a Canadian government perspective, to the point made with respect to broadening and deepening our trading relationship with as many countries as possible, that's part of the government's trade diversification strategy. Whether that's looking to negotiate with larger countries like Indonesia, groups in Indonesia or paused negotiations like India and the U.K., I think it's all part and parcel of that program. Of course, most of our trade is with the United States, and it is certainly in Canada's best interest to broaden that as much as possible. Especially for the smaller countries in the region, it also helps integrate them with other countries and in other supply chains, and I think, again, it provides Canadian companies and exporters with new markets, but also with sources of supply, so I totally agree with the statement.

Maybe I'll—

[Chandra Arya, Liberal, Nepean, ON]

I just want to make sure that you agree that if we don't negotiate, thinking that the market is small, our competitors will come in and Canada may lose its advantage. For example, in Ecuador we have potential to export wheat, and if we are not there, if other countries that have advantages in wheat production and export have free trade agreements, we'll lose our advantage.

[Doug Forsyth]

You're 100% correct. I think that's exactly it. We're not only trying to open up markets for our exporters, but, at the same time, we're competing against other countries that are also doing the same for their exporters, so you're exactly right.

[Chandra Arya, Liberal, Nepean, ON]

Go ahead, Mr. East.

[Reuben East, Deputy Director, Investment Trade Policy, Department of Foreign Affairs, Trade and Development]

In terms of why we like to include the investor-state dispute settlement in our model, I'll cite a few reasons. This is not an exhaustive list but a few of them.

The first is that an investment chapter with investor-state dispute settlement provisions has proven to be an investment attraction vehicle because it provides a combination of things. It provides a stable, predictable environment for Canadian investors when they invest abroad. We've heard from stakeholders that it's quite important to carry on doing that.

Another reason is that, if we're to have a set of obligations in an investment chapter, which is the way we approach things, we feel that it's also important to have a means to enforce those obligations, and investor-state dispute settlement is a means to do that. It's quite important to have the two. Again, our stakeholders have said quite clearly to us that, if we're going to have a set of obligations, it's important to have a means to enforce those obligations.

A third reason is that, for the set of obligations you would find in an investment chapter, the only means to enforce them is through the treaty-based mechanism. I'll take an example in an existing agreement, the CETA, our agreement with the European Union. In the future, if a Canadian investor were to attempt to invoke the obligations under that treaty before a court in one of the European Union countries, it couldn't do that, because the treaty itself states that that's the mechanism to use, and those domestic courts don't have the legal competence to hear those claims. But for that mechanism, there would be no means to enforce those obligations.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We now have Monsieur Savard-Tremblay for six minutes.

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

Thank you, Madam Chair.

I would like to welcome the witnesses.

You spoke briefly about Canadian sectors that would benefit if markets in Ecuador were opened up. You mentioned wheat and pulses, among others.

What sectors would export their products here if an agreement were signed? In other words, what is Ecuador seeking in the negotiations?

[Doug Forsyth]

In any free trade agreement negotiations, each side has interests. In this case, we both have agriculture interests and, as the member noted, our key agriculture interests are on wheat, lentils and oats.

From Ecuador's interest, they are a large producer of cut flowers, many different kinds of cut flowers like roses, carnations, etc. Our MFN tariff on that is, depending on the type of flower, about 10%. We do have FTAs with some other cut flower producers in South America, for example, Colombia, although Colombian flowers come in duty free, they're grown in the country, and flowers from Ecuador are currently subject to a tariff, so that's their key interest.

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

In a number of sectors, obviously, Ecuador has goods that we don't produce here. There are others, however, that we do produce, and that will no doubt cause competition between our sectors and theirs.

Has there been any consultation with producers here, so that they know what products are coming?

[Doug Forsyth]

During the consultation?

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

Now I'm not getting the French interpretation.

[The Chair, Liberal, Judy Sgro]

We continue to have problems.

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

Ms. Fortier will provide an interpretation service.

[The Chair, Liberal, Judy Sgro]

Okay, keep going please.

[Doug Forsyth]

During the consultations we heard from most export interests. We didn't hear from any Canadian companies that had an interest in importing.

If I understood correctly, your question has to do with the links between...

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

You mentioned agriculture, for example. We have an agricultural sector here as well. Obviously, our countries might now produce the same products, given the different conditions, but some products might be the same. So there will be competition for local products.

Were the sectors that might possibly be affected by this specifically consulted?

[Doug Forsyth]

In fact I've had broad consultation, everyone with an export interest and a import interest, of course, was consulted. We did not hear any concerns about the competition from any producers or exporters in Ecuador.

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

Could you tell us what has been done? What was the nature of the consultation? How many days did it last? Who was contacted? What was the process?

[Doug Forsyth]

Our consultation process is one that we usually use, as was mentioned earlier. The minister made the announcement of a notice of intent in Parliament, and then we launched the consultation process, I think it was on for 30 days through the Canada Gazette process.

As I mentioned previously, we received a number of emails and letters from interested parties. We continue to be open to hearing from other parties. If they were missed during the consultative process, they can get in touch with Global Affairs through our general email address.

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

How many viewpoints did you receive in the course of your consultation? How many positions and expressions of interest have you received?

[Doug Forsyth]

I don't have the exact number in front of me.

[Dean Foster, Director, Trade Policy and Negotiations, Department of Foreign Affairs, Trade and Development]

We received around 30 submissions in total. Some would be aggregated industry associations that would have many members, some would be individuals and some would be provinces and territories that consulted their own stakeholders within their own jurisdictional areas. It's a bit difficult to say exactly how many stakeholders were reached, but more or less 30 submissions, which is what we would normally expect for a negotiation of this scale.

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

We know that Ecuador is a country in real crisis, a bloody and brutal security crisis.

Does Canada, which prides itself on being a defender of human rights, have a human rights strategy for these negotiations?

[Doug Forsyth]

It's unfortunate that the ambassador isn't able to answer this question, but maybe he can elaborate next time when he is online. I would say from an economic point of view, and from a negotiating point of view, we're cognizant of what is happening in Ecuador. We're in close communication, with our embassy to see how things are moving, and we have close contact with our counterparts in the Government of Ecuador as well. So, all of these pieces we take into account as we're looking to move forward to ensure that there is an economic benefit for Canada. As we commence the negotiations and continue on with those negotiations, those are pieces of the puzzle, absolutely.

[The Chair, Liberal, Judy Sgro]

You have 20 seconds left.