International Trade Committee on Oct. 2nd, 2025

[The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)), Liberal, Judy Sgro]

Welcome to meeting number four of the Standing Committee on International Trade.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, September 18, the committee is commencing its study of Canada and the forthcoming CUSMA review.

We have with us today, in person, the Honourable Dominic LeBlanc, Minister responsible for Canada-U.S. Trade, Intergovernmental Affairs and One Canadian Economy, and the Honourable Maninder Sidhu, Minister of International Trade. From the department officials, we have Rob Stewart, deputy minister, international trade; Martin Moen, associate assistant deputy minister, trade policy and negotiations; David Hutchison, director general, trade strategy bureau; and Mary-Catherine Speirs, director general, trade negotiations bureau.

Welcome to all of you. We very much appreciate your being with us.

I understand that Minister LeBlanc has a very tight time frame and must exit here by 2:27, to be exact.

[Dominic LeBlanc, Liberal, Minister responsible for Canada-U.S. Trade]

Madam Chair, I am seeing my boss and some other people an hour and five minutes from now, so I will leave in an hour. Thank you.

[The Chair, Liberal, Judy Sgro]

Okay. Thank you very much.

Welcome to you all.

We will start with Minister LeBlanc's opening remarks for up to five minutes and not any longer, please. Then we will go on to questions and Minister Sidhu.

We now go to Minister LeBlanc to start off.

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Thank you, Madam Chair.

Thank you for the opportunity to be before the committee today to discuss Canada's trade relationship with the United States, and obviously with our Mexican partners as well, and our preparations for the upcoming joint review of the Canada—United States—Mexico agreement.

Madam Chair, this is a hinge moment in Canadian history. For decades, the United States has been our closest economic partner in almost every venture. Predictability, collaboration and mutual benefit were the hallmarks of this relationship, but now the old model, one of deepened integration grounded in assumed stability, can no longer be counted on. We must chart a new approach that reflects the realities of today's global economy. We must obviously recognize and accept the importance of the United States market but also take actions to seize opportunities that come from further diversification with other partners as well. Most importantly, we must build on the economic potential we have here at home in Canada.

As the Prime Minister pointed out last week, the United States' economic strategy has clearly shifted from supporting the multilateral system to a more transactional and controlled approach to bilateral trade and investment. U.S. tariffs of up to 50%, particularly on steel and aluminum, automobiles, and Canadian lumber, are destabilizing and have a real impact on thousands of workers and their families. They disrupt supply chains, increase costs and weaken our collective ability to overcome the major challenge currently facing global trade.

This moment, Madam Chair, calls for resolve. Our government worked with Parliament—and I thank colleagues here—to adopt the One Canadian Economy Act, unlocking, we hope, up to $500 billion in strategic investments, clean energy projects, infrastructure, critical minerals, advanced manufacturing and other energy infrastructure as well. These investments will strengthen our domestic capacity and create new opportunities for Canadian businesses.

As the Prime Minister also announced in September, the government will soon be launching a new trade diversification strategy. I understand that my colleague will be discussing this with you in the next few minutes.

At the same time, renewing our partnership with our North American partners remains a central part of our approach. We are working with the U.S. administration to find a solution to reduce tariffs, provide predictability for our industries and promote a collective North American approach to the challenge we face together.

We are also working to strengthen and deepen our relationship with Mexico, which offers significant trade opportunities for Canada. Mexico's Secretary of Economy, Marcelo Ebrard, and I agreed a few weeks ago, and in previous conversations, to work closely together as we prepare for the joint review of CUSMA.

In the coming weeks, I will be heading to Mexico on a trade mission with a group of Canadian companies, business leaders and leaders of civil society. We hope to work together to further develop this bilateral commercial relationship as well.

To prepare for the joint review of the Canada-United States-Mexico Agreement, or CUSMA, we have launched a second round of consultations with stakeholders across the country, including industry, labour unions, provinces, territories, indigenous nations, and civil society.

Canada fundamentally believes that the CUSMA provides a stable and predictable foundation for growth. Our goal is to make it better, smarter and more responsive to today's challenge. Obviously, that's always with a view to securing opportunities for Canadians. We'll continue to defend Canada's interests and pursue a trade policy that represents the strength and the independence of our country.

With that, I look forward to the comments of my colleague, but most particularly to the questions, suggestions and helpful advice from colleagues at the table.

Thank you, Madam Chair.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

Minister Sidhu, go ahead, please.

[Maninder Sidhu, Liberal, Minister of International Trade]

Thank you, Madam Chair.

It's good to be back here to appear before this committee. I spent over a year with many of these committee members, so there are many familiar faces.

I want to thank the analysts for their hard work when I was here and for their hard work now as well.

I am pleased to be back with you today before the committee, whose rigorous and important work I am well aware of.

Before becoming Canada's Minister of International Trade, I had the privilege of serving on this very committee. I know first-hand how seriously you take your work and how deeply committed you are to ensuring that Canadian trade policy reflects the realities facing our workers, our businesses and our communities. I look forward to the important work you'll continue to do, especially on the study of the upcoming CUSMA review and Canada's broader trade strategy.

CUSMA is central to our economy, but as the economic and political landscape in North America continues to evolve, so too must our approach. That's why I welcome the committee's decision to study the review alongside the government's trade diversification efforts. We're approaching this work from a position of strength, armed with facts, guided by evidence, collaborating closely with stakeholders and united in our commitment to protect and advance Canadian interests.

I believe this committee will play a vital role in shaping that foundation. At the same time, we recognize that Canada cannot put all of its eggs in one basket.

Trade diversification is not just a goal, it is a strategic necessity.

It's a goal I understand all too well. Since becoming minister a few months ago, I've been working to advance this file fully and meaningfully. It has been a busy 150 days. I've criss-crossed the country, meeting with boards of trade, business leaders and entrepreneurs. The message is clear: There is tremendous opportunity, energy and optimism about strengthening our economic ties with communities right across Canada.

Prime Minister Carney has given me a clear mandate to diversify our trading relationships. In just a short time, we've made tremendous progress.

Earlier this year, I travelled to Quito, Ecuador, to officially conclude negotiations on the Canada-Ecuador Free Trade Agreement, which is a modern, ambitious deal that will deepen our economic partnership with one of South America's fastest-growing economies and create new opportunities for Canadian exporters, especially in clean technology and agriculture.

We've reinvigorated our trade and investment dialogue with the United Arab Emirates, advancing discussions toward the conclusion of a FIPA and deepening commercial co-operation.

In Brazil, a few weeks ago, we agreed to launch talks with Mercosur, bringing new momentum to a complex but important regional partnership that includes Brazil, Argentina, Paraguay and Uruguay.

We've tabled legislation in Parliament to bring the United Kingdom into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, also known as the CPTPP. This is a major step toward formally welcoming a G7 partner into a trade pact representing over 500 million consumers across the Asia-Pacific.

As Canada takes steps to forge stronger ties around the world, thanks to the leadership of our Prime Minister and this new government, other countries are doing the same with Canada. Ireland has announced that it will formally ratify the Canada-European Union Comprehensive Economic and Trade Agreement, or CETA, which is a strong vote of confidence in our trans-Atlantic partnership. In fact, Ireland's Prime Minister called it an “obvious choice” to align more closely with Canada, and we couldn't agree more.

Finally, I'm proud to share that, just last week, Canada and Indonesia signed a trade agreement. It's an important milestone that sets the stage for deeper economic engagement with one of the world's largest and most dynamic emerging markets.

This is real, tangible progress. It's part of a broader trade diversification agenda that this government has championed from day one.

We're not just signing agreements; we're backing them up with strong implementation plans. We're empowering our incredible trade commissioner service to support businesses across Canada in expanding to new markets. We're working with the chambers of commerce and boards of trade to ensure that Canadian businesses are using the agreements we already have to their fullest potential.

Our trade agenda must reflect the complexity of the world we're operating in. Yes, we will defend and strengthen our relationship in North America, but we will also continue opening doors in regions around the world. That's the dual track we're on, defending and deepening the trade partnerships we have while building bold new ones for the future.

I know this committee's insights will be invaluable as we move forward on both fronts.

Thank you so much, and I look forward to your questions today.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

We will now open it up for questions.

Mr. Chambers, you have the floor.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you, Madam Chair.

Welcome, Ministers. It's a pleasure to have you here. You both have important jobs at this time. I know that Canadians want you to succeed. Conservatives want you to succeed as well and want to help you get a deal. We said that we'd be willing to do that.

Minister LeBlanc, you're in a really tough spot. You're negotiating with a country that seems to keep moving the goalposts, and your boss keeps making promises that he seems not to be able to deliver on, or you can't deliver on.

I take from your testimony this morning at the Senate that we're not any closer to a deal with the Americans on the sectoral tariffs than we were just a few weeks ago. Is that what I heard correctly this morning at the Senate?

[Dominic LeBlanc, Liberal, Beauséjour, NB]

I hope that's not exactly what you heard. I learned a hard lesson from saying, “Oh, I think we're going to have progress in the next three weeks. I think we might have a deal by August”, so I have lost the illusion that we should predict in precise time when we might get to an agreement.

An agreement can take many different forms. My view is that an agreement is something that would improve the circumstance we're in today. I continue to be optimistic. The conversations I've had with Secretary Lutnick have been encouraging. There have been a myriad of discussions with Ambassador Hillman and other senior officials. I remain optimistic. I think that, like you and like everybody, I accept the urgency of the moment and wish that these agreements had been concluded weeks ago, but it doesn't mean we don't need to continue to do the work and get the best agreement possible.

[Adam Chambers, Conservative, Simcoe North, ON]

In terms of advancing the discussions, we've made a number of concessions. Canada has made a number of concessions, such as getting rid of the DST and quietly removing some tariffs during the election and only disclosing it afterwards. Just a couple of weeks ago, we got rid of additional tariffs. I've heard some complaints about softwood lumber. We've made a number of concessions to the Americans.

Can you point to one concession that the Americans have given to us?

[Dominic LeBlanc, Liberal, Beauséjour, NB]

I understand that you refer to these as concessions. I think it's part of an active negotiating conversation.

[Adam Chambers, Conservative, Simcoe North, ON]

I don't think anyone has ever considered them anything other than concessions. No one has called them anything but concessions.

[Dominic LeBlanc, Liberal, Beauséjour, NB]

I wouldn't be as absolute as that. I don't think I've called them concessions. I've called them decisions that we make in the best interest of continuing a discussion with the United States that will hopefully get to the agreement you referred to in your first question.

[Adam Chambers, Conservative, Simcoe North, ON]

Has the United States made any movements similar to those we have made to support the discussions?

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Yes.

[Adam Chambers, Conservative, Simcoe North, ON]

Just one, as an example, would be helpful.

[Dominic LeBlanc, Liberal, Beauséjour, NB]

I appreciate the question, but I want to be careful. In ongoing conversations that go back months, there are different scenarios that various American officials advance, and we talk about different scenarios that we think might lead us to an agreement. At the end of the day, the CUSMA exemption, which was not part of the original announcement, has changed so many times over the last number of months. Sometimes it's useful—

[Adam Chambers, Conservative, Simcoe North, ON]

You're taking a long time to say there hasn't been—

[Dominic LeBlanc, Liberal, Beauséjour, NB]

I'm going to give you one right now: the fact that 97% of our exports benefit from an exemption under CUSMA, save and except the section 232 tariffs that they've applied across the world. That night in February when they said they were applying a 25% across-the-board tariff to the Canadian economy in fact applies to a very small segment of Canadian exports. That is a massive advantage that Canada has, but it's not enough. It doesn't put us in the position we were in a year ago.

[Adam Chambers, Conservative, Simcoe North, ON]

It's not much of an advantage if you're in one of those sectors that we described.

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Agreed.

[Adam Chambers, Conservative, Simcoe North, ON]

You said you were open to some suggestions, so I'll leave you with one. On the electric vehicle mandate, it's been disclosed now that Canadian auto manufacturers have committed $1 billion cash to Tesla to purchase credits from an American auto manufacturer that has zero manufacturing capabilities in Canada and no intention of manufacturing capabilities in Canada. In fact, hundreds of millions of dollars have already gone to Tesla to purchase these credits. Automakers are having a hard time dealing with the tariffs, and now they are financially strained for electric vehicles with this mandate. Hundreds of millions of dollars have already been paid to an American company with no commitment to Canada. Are you open to scrapping the EV mandate?

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Thank you for the question. I understand, and I certainly have heard discussions concerning the EV mandate. I've had those conversations with Premier Ford and a number of others. In terms of the specific payments and so on, I'm not familiar with those numbers. I'm not disagreeing with them. Perhaps the deputy can address this. He says he has some precision that he can offer, if that would be helpful.

[Adam Chambers, Conservative, Simcoe North, ON]

The policy is enriching Tesla shareholders. Is the reason we're not scrapping it that the Prime Minister disclosed he owns Tesla shares?

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Well, obviously you know that's not the reason, but—