International Trade Committee on Feb. 29th, 2024

[Chandra Arya, Liberal, Nepean, ON]

I'm sorry to interrupt you. I have limited time.

You mentioned that the free trade agreement should go beyond just tariff reduction. I completely agree with those sentiments. Of course, we are building in the dispute settlement mechanisms.

I have to say that agricultural producers and agri-food exporters are the most active group that we have in free trade negotiations or in the free trade agreements we have with other countries. I'm sure you are giving your input into other free trade agreements too. Are there any particular mechanisms or clauses we should be focusing on when it comes to non-tariff barriers?

We all know that once we have a free trade agreement, then there is a bit of toughness among most importers or in the importing country. They resort to non-tariff barriers. Is there anything we need to consider at this stage that we can build into the free trade agreement? If you could explain that in the next 45 seconds, good. Otherwise, you could always provide us some input in writing that we could consider.

[Jeff English]

Certainly. As I mentioned in my remarks, we have seen in previous agreements that have been signed that when the rubber hits the road, sometimes in the implementation phase, they become difficult. I think the Government of Canada has a pretty good track record right now of signing modern trade deals, so I would look to examples such as the CPTPP and others, which include pretty robust chapters around them as a good baseline from which to start.

[Chandra Arya, Liberal, Nepean, ON]

Mr. Roy, is there anything we need to specifically focus on when we have this free trade agreement with Ecuador? Is there anything on the non-tariff barriers or any other thing that is not usually seen in other agreements?

[The Vice-Chair, Conservative, Kyle Seeback]

Answer in five seconds.

[René Roy]

Dispute settlement mechanisms are really important.

I did it.

[The Vice-Chair, Conservative, Kyle Seeback]

That was excellent. We need you here all the time.

Mr. Savard‑Tremblay, you now have the floor for six minutes.

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

Thank you, Mr. Chair.

[Voices]

[Inaudible—Editor]

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

May I have the attention of the committee members, Mr. Chair?

[The Vice-Chair, Conservative, Kyle Seeback]

Order.

Monsieur Savard-Tremblay, I'm going to reset your time.

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

Thank you, Mr. Chair.

Mr. English, you spoke about a dispute settlement mechanism. Were you talking about state‑state or investor‑state dispute settlement?

Please give a brief answer.

[Jeff English]

I'm sorry. I'm not sure I caught the question entirely.

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

You spoke about a dispute settlement mechanism. Were you talking about a mechanism for settling disputes between states, or a mechanism for settling disputes between private investors and states?

[Jeff English]

It would be between businesses exporting.

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

So you were talking about investor‑state dispute settlement. That's fine, thank you.

Mr. Chiasson‑LeBel, we heard enthusiastic testimony from public servants and government members. They're certain that the agreement will contribute to Canada's development, of course, but also to Ecuador's development. You seem to have some reservations in this area.

Could you tell us why?

[Thomas Chiasson-LeBel]

I'll give the example of the mining sector. If we invest in a very small sector, we export the minerals and generate profits. Very little remains in the area. To make investments profitable, the processing must take place locally. However, I don't think that recent mining investments are headed in this direction.

There's also a reaction to some of these investments. For investment to lead to development, it must enable the country to move up the value chain. Today, I have been listening to the comments made by the other witnesses. I'm impressed by the efficiency of their companies and producers. I wonder whether Ecuador's farmers can survive their efficiency. I think that complementary agreements are needed to ensure that Ecuadorians can protect the economic sectors where they want to prioritize farmer production.

Ecuadorian producers aren't asking to protect food security, as other witnesses suggest. Instead, they want to strive for food sovereignty, meaning the ability to decide what to produce locally. As part of this type of measure, a free trade agreement could limit this food sovereignty.

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

The public servants who came to an earlier meeting also seemed enthusiastic about how the agreement would affect the participation of women and indigenous people in the Ecuadorian economy and in trade with Canada.

Do you share this enthusiasm?

[Thomas Chiasson-LeBel]

I acknowledge the efforts to include provisions in trade agreements that take into account women and indigenous people. I think that the goal is commendable. However, we must ask whether indigenous organizations and women's organizations in Ecuador really want to be integrated into international trade. If we want to try to integrate them into international trade, we should ask them whether they want this.

According to the political and economic agendas of these organizations, they don't want to move in the direction of free trade at the moment. Instead, they want to strive for food sovereignty. They want to be able to maintain more environmentally friendly agro‑ecological farmer production. This would enable local communities to retain control over what they eat.

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

How much time do I have left, Mr. Chair?

[The Vice-Chair, Conservative, Kyle Seeback]

You have two minutes.

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

Okay.

At a previous meeting, we spoke with Mr. Trew from the Canadian Centre for Policy Alternatives. He wondered how the government could claim to have a progressive agenda. Of course, many chapters cover women's rights, the environment and human rights. However, the agenda isn't often worth more than the paper it's written on, since it doesn't include any binding mechanisms.

How can anyone claim to have a progressive agenda for labour and the environment, while championing the notorious ISDS, which protects the interests of private companies against democratic and political will? This undermines the ability to legislate. It also threatens a government's ability to address threats to workers' rights, public health, social justice and so on.

Witnesses also spoke of violations made by Canadian mining companies on site.

Could you comment on this statement?

[Thomas Chiasson-LeBel]

I share your concerns about investor‑state dispute settlement mechanisms. These mechanisms tend to limit the ability of governments to take measures to protect local communities when foreign investment is involved. In particular, we saw in the old NAFTA that mechanisms to protect workers or the environment always depended on generating a trade advantage.

Environmental protection becomes dependent on trade advantages between states, and that's a real issue. I think that this makes it difficult to establish investor‑state dispute settlement mechanisms that avoid undermining the protection of the rights of workers, women and indigenous people.

On the subject of mining, I read in the Ecuadorian papers today that the Shuar Arutam people filed a complaint in British Columbia against the Warintza copper mining project in the Morona‑Santiago province. They claim that the company misinformed its shareholders by saying that the indigenous communities were in agreement when this wasn't the case.

If we were to protect investments in the mining sector, particularly at this time, we would be forced to defend companies that are giving us a bad name on the international stage. So I think that we need to really think about asking ourselves, as Canadians, what we have—

[The Vice-Chair, Conservative, Kyle Seeback]

I'm going to have to interrupt. I let you go about 45 seconds over.

Thanks very much. If you have anything else, you can come back to that answer with another member.

Mr. Cannings, please go ahead for six minutes.

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

Thank you, and thank you to all the witnesses for being here.

I'm going to continue where Monsieur Savard-Tremblay left off with Monsieur Chiasson-LeBel, to give him more time on that, because I'm concerned about the same issues he was raising.

We've heard that Ecuador seems to want ISDS provisions in a free trade agreement, yet that seems at odds with some of the political ramifications you were talking about. I just wanted to clarify this. You seemed to mention that the policies of the president were different from the policies of the legislature in Ecuador regarding this. Is that the case?

[Dr. Thomas Chiasson-LeBel]

There is actually a very strong debate in Ecuador about exactly this topic. The president has been elected in a very murky context, with the prior president having abandoned the presidency by a process known as “crossed death”. Being elected, he had to face a security crisis. Through the security crisis that he's managing right now, he's trying to push forward a referendum that would suspend article 422 of the constitution, which actually says that Ecuador cannot subscribe to a trade agreement that contains ISDS dispositions.

It's a very tough situation in which an agro-export elite that is now in government is trying to push through, in a very short period, a situation in which the main forces in the legislature, which is not majoritarian—they have 51 seats—are actually the ones who pushed forth this constitution 15 years ago.

It's really a tough debate in which Canada, by exerting pressure on this trade agreement, is really siding with one side here.