Evidence of meeting #17 for International Trade in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.
A recording is available from Parliament.
Co-President, Garaga
I’m not very sure. Either there are tariffs or there are none. I’m tempted to say, make up your mind and then we’ll get organized. We need to know where we stand.
As I told our Canadian and American teams, when you’re playing a new sport, you have to play by the rules. I just want to know the rules. Once we know those rules, we’ll get organized to make things work.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot—Acton, QC
The ideal situation is for it to work well. In your case, your business is in Quebec and it exports to the U.S.
When you look at what can be done specifically for manufacturers, what message would you have for the negotiators?
Co-President, Garaga
It would be perfect if we could go back to the way things were. I didn’t go through all of that in vain.
Conservative
Jacob Mantle Conservative York—Durham, ON
Thank you, Madam Chair.
Thank you to our witnesses for appearing and providing us valuable testimony on this issue.
I want to start with the Ontario Chamber of Commerce.
You spoke in your opening statement about sectoral tariffs. In Ontario, the primary sectoral tariffs affecting our industries are on steel, aluminum and automotive. As I understand it, those tariffs were instituted under the authority in section 232 in the United States on so-called national security grounds. There's been some discussion about the upcoming Supreme Court case that may be decided in the United States in respect of the IEEPA tariffs or these emergency reciprocal tariffs imposed on Canada in respect of fentanyl and other issues.
If the Supreme Court in the United States rules against the administration, will that have any effect on those most punishing tariffs in Ontario?
President and Chief Executive Officer, Ontario Chamber of Commerce
It may have a positive impact, but that doesn't mean we have to let our guard down, and that certainly does not mean the administration, especially under this president, won't look for every other alternative to imposing tariffs on Canada.
Conservative
Jacob Mantle Conservative York—Durham, ON
How would it have a positive impact, in your view? I understand there are different authorities. The steel and automotive tariffs under section 232 are not at issue in the Supreme Court case, whereas the IEEPA tariffs are. If those are struck down, will that change anything for Ontario automakers or steel producers?
President and Chief Executive Officer, Ontario Chamber of Commerce
I see what you mean. No, I don't believe it would. I'm sorry; I was referring in general to the relief from certain types of tariffs and their effect on Canada.
There's no question that while we would obviously welcome a Supreme Court decision of that order, the number one thing I hear from Ontario businesses, actually, is we never want to be in this position again in the future. We don't want to be this vulnerable. We need to build our own economy. We need to reinvest in Canada. We need to make it easier to buy from other Canadians by bringing down interprovincial trade barriers, building the infrastructure for trade and ensuring that we can look after our own destiny and control what we can and never be in a position where we have such an incredible dependence on even our largest trading partner.
The work of diversification and the work of this committee, I think, will become even more important regardless of the Supreme Court decision.
Conservative
Jacob Mantle Conservative York—Durham, ON
Thank you.
I have a similar question for the BC Lumber Trade Council. My understanding is that the tariffs affecting our lumber industry are twofold. One, under U.S. section 232, under the so-called national security tariffs, and two, the ongoing, ever-present anti-dumping and countervailing duties on Canadian softwood lumber. I have the same question for the Lumber Trade Council.
If the Supreme Court strikes down the IEEPA tariffs in the United States, will that have any effect on those other tariffs?
President, BC Lumber Trade Council
I don't think it would have any effect. It would sort of be a moral victory. Those IEEPA tariffs are not currently affecting our sector because, to my understanding, anything that was CUSMA compliant was exempt from that act, and that included softwood lumber.
Conservative
Jacob Mantle Conservative York—Durham, ON
Thank you.
In your remarks you spoke about the need for what I think you called "a durable resolution to the softwood lumber dispute", and that the best way to get a durable resolution would be through a negotiated settlement.
In your view, do you see that happening in the near term?
President, BC Lumber Trade Council
I think it's possible. The challenge has been getting interest from the U.S. From what I understand, there have been engagements where softwood lumber has often been raised. Originally the U.S. just wanted to talk about steel, aluminum and energy, but in this latest sort of engagement I think they made that sort of conditional on having a conversation about softwood lumber later. We think it needs to be a priority and we need to continue to press the U.S. administration on coming to the negotiating table and getting a resolution. As I said, the CUSMA review may be that opportunity to pull them in.
Conservative
Jacob Mantle Conservative York—Durham, ON
Thank you.
Just in the last 20 seconds, I have one final question for you, sir. In your response to some of the government's new measures, you mentioned the absence of firm timelines for some of the support.
Have you received any firm timeline from the government on those supports?
President, BC Lumber Trade Council
Yes, we're getting guidance now. The BDC program was originally announced in August. It took a little bit of time for them to design that program. Now companies are starting to make their application. The timelines, from what we understand, are all going to depend on each applicant and how they're going through the process with their banks. The BDC has been very good and very responsive. Now with these latest measures, they are basically just expanding that program.
We've been in conversations with the BDC and the federal government about making some tweaks to that program as well.
We think that things are starting to head in the right direction for sure.
Liberal
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Thank you, Madam Chair.
What I'm hearing here is that we are all in agreement that the section 232 tariffs are completely unjustified.
Mr. Gendreau, you have an opportunity here to share with this committee. You've been through this before, as we went through NAFTA 1.0 and were renegotiating NAFTA. I don't know if the structure of your business was exactly the same then, but at that time how did you respond in addressing the section 232 tariffs?
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Yes, the first Trump administration—Trump 1.0.
Co-President, Garaga
—of the administration, the tariffs were only on raw materials, so they had no impact on our product that we were exporting.
Liberal
Co-President, Garaga
No, because we were buying our steel from Canada and we were exporting a finished product to the U.S. that was not tariffed, but now it is this time.
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Okay, so now the section 232 tariffs have come in, and that's a shock to your business. You are in both Canada and the United States. You have all of your inputs, such as aluminum and steel, etc., coming in—
Liberal
The Chair Liberal Judy Sgro
Mr. Fonseca, I'm sorry to interrupt.
Are we having an interpretation problem?