Evidence of meeting #3 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 rules.
A video is available from Parliament.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Thank you, Chair.
Mr. Harvey, if I might start with you, how is it you would suggest we defend market access in a world that's crumbling around us when it comes to rules-based trade?
Executive Director, Canadian Agri-Food Trade Alliance
It's different in every market. I would say that if we look at some of these emerging markets where we're putting a lot of emphasis—for instance, we've looked at the recent agreement with Indonesia or the discussions with ASEAN—we encourage a lot of emphasis on regulatory co-operation with those countries, because non-tariff barriers are often about misunderstandings about how Canadian regulatory systems work, or they are disingenuous misunderstandings about how Canadian regulatory systems work. In either case, the way through that is through engagement.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Can you comment on the pace that things are taking for negotiations with ASEAN partners and generally in the Indo-Pacific?
Executive Director, Canadian Agri-Food Trade Alliance
I think we expected the ASEAN negotiations to be slow. These are countries with varied levels of development and varied levels of capacity to manage trade negotiations. Mr. Fowler, who was just here, has kept us up to date all the time. It seems to be moving forward at about the pace that we expected.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Are you expecting to get some improvements on market access and resulting opportunities for trade diversification to come from that?
Executive Director, Canadian Agri-Food Trade Alliance
Yes, it's looking very interesting with a couple of countries, especially the Philippines, which is very interesting. Vietnam is very interesting.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Are these markets, in particular, for agri-food products?
Executive Director, Canadian Agri-Food Trade Alliance
These are markets that are getting richer, that have growing middle classes. Growing middle classes eat more meat. They eat higher-quality food, and Canada provides higher-quality food, so these markets are good for us.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Thank you very much.
Professor Lilly, can you comment on the value of energy exports paving the way for enhanced trading relationships with various trading partners around the world?
Full Professor and Simon Reisman Chair in International Economic Policy, Carleton University, As an Individual
In terms of economic value dollar figures, no, but in terms of the symbolic big-picture economic value, the world wants to buy Canadian energy. One of the realities, as we think about the importance of trade diversification, is that the world wants to buy what grows in Canada and what comes from the ground, frankly. If we're serious about trade diversification, we have to be serious about energy. We have to be serious about major infrastructure projects that get energy to market. That means nation-building projects, including things like pipelines.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
I represent a riding in Calgary, Alberta. In that part of the world, we like things like LNG. I take it your comments could be taken to support an increased ability for Canada to export liquefied natural gas.
Full Professor and Simon Reisman Chair in International Economic Policy, Carleton University, As an Individual
Yes, absolutely. We've seen progress with that. New LNG lines have come online and are beginning to export. That's fantastic. We need more of that.
We also need very clear messages from the Canadian government, and Canadian governments at all levels, that this is something we want. That is because both trade patterns and the infrastructure required to move energy require long-term commitments and not immediate changes. Investors need to know that current governments support this and that the next government is going to support this, and the next government after that. That has been a misstep in Canadian messaging over the last period of time. I genuinely hope that we can collectively, as a country, team Canada, send messages that we're here to do business.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Professor, some time ago, it was said by a former prime minister of this country that there was no business case for exporting liquefied natural gas. Certainly, there are many regulatory hurdles in order to be in a position to export liquefied natural gas.
Would you understand that there is indeed a business case? Our international trading partners, particularly in Europe, are quite open to buying Canadian energy, if we can get over ourselves here in Canada.
Full Professor and Simon Reisman Chair in International Economic Policy, Carleton University, As an Individual
Yes, absolutely. European and Asian countries want to buy Canadian LNG. If they're not buying it from us, they'll buy it elsewhere.
We have strong environmental standards. We work with affected populations. We're making great progress in working with indigenous communities to ensure profit-sharing. We have a good story to tell. Other economies that want to export LNG don't have as good a story to tell. If the world is going to buy it, we should sell it.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
Thank you very much.
I'm short on time, Mr. Herman, but if you're still with us, what do you see as our best options for diversification? What would your priorities be if you were calling all the shots?
Counsel, Cassidy Levy Kent LLP, As an Individual
We have free trade agreements with Europe and the Asia-Pacific countries, but we could do a hell of a lot better, Mr. McKenzie.
I look at the data. I see that our trade has increased, but it has not increased as much as it should. That is a dual challenge for the government and for the business community. The government and the business community have to do a better job, as many other countries do, of working together to exploit those opportunities. We talk about diversification, but we often forget that we have market-opening agreements with major economies other than the United States. We have to do a better job of exploiting those opportunities.
That's my short answer.
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Thank you, Madam Chair, and thank you to the witnesses for joining us.
I'm going to follow up on MP McKenzie's questioning. He was asking Mr. Herman about what he would do or what he would emphasize in terms of our trade.
We set a stretch goal in 2018 of expanding our trade outside of our U.S. trade by 50%. We achieved that. We had set it for 2025; it was achieved in 2024. What would you say would be the next stretch goal for Canada for trade outside of the United States?
Counsel, Cassidy Levy Kent LLP, As an Individual
Well, I think it's obvious. I mean, just look at the data. We could expand our trading relations through serious, clear-eyed business objectives in specific markets.
The problem has been that the business community, and I'm speaking generally, has found it easy to trade with the United States. We have avoided making serious, sustained efforts in opening foreign markets and doing a much better job in Europe and the Asia-Pacific countries. Mr. Harvey knows that the agri-food sectors have great opportunities in Asia-Pacific. We need to do a better job of working together, with sustained business and government efforts.
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Thank you, Mr. Herman.
We often use sports or hockey metaphors here at this committee and throughout government. We talk about the players, the goalies and the fans, etc., but you, Mr. Herman, talked about the referee. You emphasized the need for Canadian businesses to be more actively involved in trade policy and you stated, “Business Needs to Help Push Global Trade Referee Back into the Game”.
How can Canada better facilitate this engagement to strengthen its position in a rules-based international trade and investment system?
Counsel, Cassidy Levy Kent LLP, As an Individual
I don't quite understand the question. In my view, there's very little left of the rules-based international trading system. It's being run by the United States out of the president's office, and that's the problem we have.
Professor Lilly gave us some very good ideas about how we, in our dealings with foreign partners, use rules as much as we can and value those rules in our separate trade agreements, and we have to do that. However, I think that when it comes to the U.S. and China, we have two parties—the major players in the global economy—who just don't buy those rules.
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Thank you, Mr. Herman.
Professor Lilly, as part of a C.D. Howe press release, you said, “it is the duty of every Canadian prime minister to find a way to work constructively and productively with whoever occupies the White House”. What would you say about Prime Minister Carney and how he's been doing in his engagement with the White House?
Full Professor and Simon Reisman Chair in International Economic Policy, Carleton University, As an Individual
I'm not a close watcher of the dealings with the White House specifically, but I think the initial indications, early meetings and hosting at the G7 were all very businesslike.
It is important for any Canadian prime minister to work constructively with the president to find common ground and find solutions. Insofar as he's doing that, I would say those are good things.
Liberal
Peter Fonseca Liberal Mississauga East—Cooksville, ON
Thank you, Professor Lilly.
Mr. Harvey, you represented Canada as a diplomat for 15 years. You had postings in the UN, Brazil, Colombia and Venezuela. When it comes to trade and expanding our economic relations, can you tell us what you took away from the work you did in all those locations abroad?
