That is correct, sir.
Evidence of meeting #5 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 infrastructure.
A video is available from Parliament.
Evidence of meeting #5 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 infrastructure.
A video is available from Parliament.
President and Chief Executive Officer, QSL International Ltd.
That is correct, sir.
Conservative
David McKenzie Conservative Calgary Signal Hill, AB
I appreciate your interest in that and your commitment and participation in expanding those facilities and the critical infrastructure that we're going to need to make those things happen.
Thank you very much.
Ms. Tronnes, I would like to ask about rules of origin. It seems to me to be quite a quagmire, quite frankly.
Do you feel that we have a clear strategy through our government here in Canada to understand what trade irritants there are around rules of origin, particularly with our important trading partner the United States?
Executive Director, Center for North American Prosperity and Security
Rules of origin are a significant issue. Mr. Volpe was correct to name them as something that we need to absolutely be on. I think that there are other ways we can look at them in terms of the trade agreement. We could make them part of a joint enforcement, and we could allow for inspection of rules of origin compliance across the three countries as part of CUSMA. I think that would go a long way in terms of satisfying the curiosity of the Americans, but also, for our Canadian friends in the auto sector as well and in other sectors, they make sure that our friends to the very far south in Mexico are also doing their part on rules of origin.
Earlier there was a question about what kind of promises we need to make and what three things we would recommend. I would agree with Mr. Volpe when he answered that rules of origin, enforcement and compliance are important, but you need to build certainty, move fast and keep your promises. I think keeping your promises is important not just for Canada, but also for the United States and Mexico.
Liberal
The Chair Liberal Judy Sgro
Thank you very much.
I'm sorry, Mr. McKenzie. Your time is up.
Mr. Lavoie has the floor, please, for five minutes.
Liberal
Steeve Lavoie Liberal Beauport—Limoilou, QC
Thank you, Madam Chair.
I'll continue with Mr. Bellisle.
Mr. Bellisle, you made some interesting comments earlier regarding the supply chain. You spoke of investments.
What would happen if Canada didn't invest to keep up with what the United States and others are doing?
How do you see that? What would the future look like without these investments?
President and Chief Executive Officer, QSL International Ltd.
It is essential to invest in infrastructure. It's the heart of our economies.
The IT sector has become a lot more appealing in the last few years than traditional economies. When countries change course to improve their prosperity, they use industrial chains to do so. Without infrastructure, there is no industrial chain. It's that simple.
We need to invest in industrial chains, but for that, things need to be able to flow smoothly at a logistical level. As I mentioned, 80% of everything that's produced and everything that's consumed travels by ship. Without the proper infrastructure, we can't compete. It's like trying to play hockey without skates.
Liberal
Steeve Lavoie Liberal Beauport—Limoilou, QC
I like that. It's a concrete example.
What infrastructure should we develop, or reinvest in? Give us an example for the average person watching at home.
President and Chief Executive Officer, QSL International Ltd.
I'll give you an example that affects our daily life. Ships sail to Montreal with reduced loads, because of the draft restrictions on the river. The Société des alcools du Québec is one of the Port of Montreal's biggest clients. We all love a glass of wine on Friday evening. Wine bottles are unloaded in Montreal, and then transported to a distribution centre in Quebec City.
If we could unload ships here, we could reduce costs and the carbon footprint, which would naturally lower prices for consumers. By improving logistical chains, we could reduce the carbon footprint, which is important for not just environmental sustainability, but also costs, while increasing the competitiveness of our businesses to the benefit of consumers.
Liberal
Steeve Lavoie Liberal Beauport—Limoilou, QC
What are the three biggest challenges facing global and North American supply chains today, and what will the three biggest challenges be in the coming years?
President and Chief Executive Officer, QSL International Ltd.
To understand what's happening with logistical chains, you just have to look at the water-level issues in the Panama Canal, the blockade in the Suez Canal or the risks of piracy on the open seas, just to name a few. A very important first step is to ensure the flow of trade. That's why we need to keep investing in infrastructure. We saw all the disruptions caused by the ship that hit a bridge in Baltimore.
The second major thing, especially for Canada, is reducing the administrative burden. I mentioned Ireland earlier. It now ranks 15th in the world in manufacturing. How did they do it? Well, they went from 20th in the world in administrative burden to 3rd or 5th. Canada ranks 20th at best in administrative burden.
That means we need to reduce the administrative burden to move projects forward. I mentioned the Quebec City project, but there's also one in Sorel. We are seeing efforts to make progress in Nova Scotia and New Brunswick. Obviously, the main issue concerns the administrative burden. We're talking years of delays. Meanwhile, the impact of tariffs can be felt in days, weeks and months.
Liberal
Steeve Lavoie Liberal Beauport—Limoilou, QC
Are you speaking with your American counterparts? What do they think of the tariff war?
President and Chief Executive Officer, QSL International Ltd.
It's quite interesting. This week, Quebec City is hosting the American Association of Port Authorities convention. As we know, the premiers and governors are meeting at the same time.
What's interesting is that it's almost unanimous. People are talking about the global economy and the importance of maintaining trade flows. All the states that have a good understanding of the maritime elements understand how important these flows are. Provincial governments are starting to realize that they need to talk to one another a lot more and drop interprovincial barriers. It's odd to tell another country to drop its trade barriers when we have barriers between our own provinces. As another witness mentioned earlier, it's time to stop talking about it and make it happen.
Liberal
Conservative
Adam Chambers Conservative Simcoe North, ON
Thank you, Madam Chair.
Ms. Tronnes, I want to follow up on a couple of points.
Isn't it true that President Biden's administration warned the Canadian government not to proceed with things such as the digital services tax and the online streaming tax?
Executive Director, Center for North American Prosperity and Security
That's correct.
Conservative
Adam Chambers Conservative Simcoe North, ON
There are a number of trade irritants or perceived trade irritants no matter who occupies the White House. Is that a fair assessment?
Executive Director, Center for North American Prosperity and Security
Yes, I would say that's a fair assessment.
Conservative
Adam Chambers Conservative Simcoe North, ON
Do you think it's worth the Canadian government, the general public and members of Parliament being self-reflective about how we got here instead of just blaming one individual? Isn't it worth questioning how it is possible that both major parties in the U.S. have had significant challenges with Canada over the last decade?
Executive Director, Center for North American Prosperity and Security
To that point, the reason the Macdonald-Laurier Institute decided to do what no other Canadian think tank has done and set up an office in the United States was that we realized back in 2023 the relationship had major problems—problems that Canadians weren't seeing and problems that even some Americans weren't seeing. A lot of it had to do with the fact that Canadians just weren't listening. We were going in, flying down, coming in and out and having meetings. Just because we watch American news, we tend to feel that we understand the country. It is a foreign country. Likewise, Canada is a foreign country to Americans. We are all learning that now.
We recognize that well before Trump was in power, the relationship had challenges and Canadians needed to listen. That was the whole reason we set up the Center for North American Prosperity and Security.
Conservative
Adam Chambers Conservative Simcoe North, ON
Thank you.
Do you think it's helpful for Canadians to go to America and tell Americans what's good for them?
Executive Director, Center for North American Prosperity and Security
I think that would depend on which Canadian and who you were talking to. That might be a tricky question.
Conservative
Adam Chambers Conservative Simcoe North, ON
I'm asking partially because we've heard from a lot of people on both sides of the aisle. We've had some conversations. I've had conversations with both Democrats and Republicans.
Do you think the notion that there will be tariff-free access to the U.S. is fading away before our eyes? There are not that many U.S. politicians who are full-throatedly defending free trade in the United States. I can think of only one senator, Senator Paul. He's quite lonely.
Executive Director, Center for North American Prosperity and Security
I can tell you I have many conversations on Capitol Hill. Behind closed doors, there are a lot of allies. There are a lot of congressmen and there are senators who are extremely concerned and who are hearing it from their constituents. As we get closer to the midterms, it will get more difficult for them to resist some of the problems and the pressures. Particularly, we are already seeing it from the farmers in the soybean agriculture sector. The Trump administration likes to do things quietly behind closed doors. They don't like it when you pop your head up and start criticizing them, so a lot of our allies are doing it quietly, but they're not doing it because it's what's right for Canada. They are doing it because it's what's right for their constituents and their manufacturing sector and because tariffs are going to be expensive.
However, just a few months ago here in Ottawa I had a conversation with Robert Lighthizer, of all people, the grandfather of tariffs. He said the first rule of tariffs is you should not tariff your inputs and that, in his mind, the idea of the tariff regime with the United States doesn't work if the CUSMA goes away. There are so many inputs into the American manufacturing sector across the board that it just wouldn't work. Now he's on the outside of the administration—he's retired now—so I don't know how far his voice would carry on that, but it is worth remembering that this is something that is negotiable.
I would love very much for the tariffs to be a thing of the past, but the president has been very clear that “tariffs” is the most beautiful word in the dictionary, and he has a goal of getting tariff revenue.
Conservative
Adam Chambers Conservative Simcoe North, ON
I'm 25 seconds over. Well, Madam Chair, thank you for your indulgence.