Natural Resources Committee on Feb. 26th, 2021

[The Chair, Liberal, James Maloney]

Is the interpretation working, Mr. Simard?

What do you have your setting on, Bob?

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

I'm set on English. We checked it before. I can hear that it's on.

[Mario Simard, Bloc, Jonquière, QC]

I selected the French channel. The issue is that the interpreter can't fully understand what's being said.

[The Chair, Liberal, James Maloney]

We can hear you in English without any difficulty. It's the translation, apparently, that's the challenge.

Okay, we're getting the thumbs up now. Carry on. I won't take away from your time.

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

Minister, you referred to talking about softwood lumber. Did you specifically talk about a softwood lumber agreement and that being renewed?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Let me assure the honourable member that Canada firmly believes that a negotiated settlement to this dispute is in the best interests of Canadians and the Americans. We know that the duties are hurting businesses on the Canadian side as well as on the U.S. side. I'm looking forward to speaking to the U.S. trade representative—

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

Was the softwood lumber agreement specifically discussed in that bilateral meeting?

[Mary Ng, Liberal, Markham—Thornhill, ON]

I'm looking forward to speaking with the new U.S. trade representative upon her confirmation, and this will be an item that is a priority for me to raise. There are synergies between our two countries, as all have seen in the road map for a renewed U.S.-Canada partnership.

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

Thank you, Minister.

It sounds great that you're working in this direction, because frankly, we haven't seen much support for the forest sector from this government. We saw the promises of a softwood lumber agreement within the first 100 days, but again, since then, crickets. We hear just more talk and no specific commitments from you to get a softwood lumber agreement across the table and signed by both countries. I've heard no commitment in what you just said.

My other concern is there are over $4 billion in softwood duties that are being held currently. This is money that's been held from Canadian producers. I'm going to ask you another question. Has there been a discussion about when this money will be returned to Canadian producers?

[Mary Ng, Liberal, Markham—Thornhill, ON]

As I said to the honourable member, I intend to work with my U.S. counterpart to find a solution to this issue. I am hopeful that we can reach a mutually accepted outcome.

I would point out, in response to his question, that the Canadian government has provided tremendous support to the sector. It is incredibly important. Helping the sector innovate, diversify and find access to markets so that we can create terrific jobs across the country is something that we are absolutely doing hand in hand with working with the Americans on what we think a negotiated settlement would be in our best interests.

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

Let me just finish, because my time is probably done after my comments.

Again, a lot of that is a great word salad. It sounds great that you're working with our counterparts to the south. It's all talk until we see actual commitments to renewing that particular agreement. When we were in government—

[The Chair, Liberal, James Maloney]

Thank you, Mr. Zimmer. That's all your time.

[Bob Zimmer, Conservative, Prince George—Peace River—Northern Rockies, BC]

—we saw the agreement renewed and we're looking at—

[The Chair, Liberal, James Maloney]

Mr. Zimmer, thank you. Your time is up.

Mr. Weiler, you have the floor for six minutes.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Mr. Chair.

Thank you, Minister, for taking the time out of your busy schedule to join your former committee, the natural resources committee, today to discuss an issue that's of critical importance not only to Canada's economy but also, as we just talked about, for B.C.'s economy.

As you mentioned, the U.S. regrettably has continued down a path of punitive and unfair tariffs on this critical export. Canadians are frustrated that our neighbours are continuing down this path, in spite of the sound case I know you're making and our government's been making for some time about the mutual economic cost in going down this path. We're forced to challenge these rulings in different fora to get the relief that we're entitled to, where we've been successful just about every step of the way.

With this in mind, I was hoping you could outline at a very high level what the next steps are legally that we can take to get such relief from these tariffs if we're not able to come to a negotiated solution.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you so much to the honourable member for that important question.

All the way along, our government has been absolutely steadfast at standing up for the softwood lumber industry. It is a positive result that we have seen where consistently it's been reaffirmed that Canada is trade compliant. We will need to continue to vigorously defend the industry, but at the same time, we also want to create the right conditions to support, to invest and to attract investment to this important sector and many of the new small and medium-sized businesses that absolutely are being created.

Through the trade commissioner service, we're working with business certainly in British Columbia and across the country, where they're finding markets to export into. We are finding some really promising opportunities in countries where we already have trade agreements, like in Japan or in Vietnam through the CPTPP, in Germany though CETA, as well as South Korea, where we have a bilateral agreement with that country for our extraordinary wood products, for our innovative forestry products.

We're going to continue doing that work in investing in our Canadian businesses so that we can help them diversify and help them grow, anchored with jobs in Canada so that we can have that continued vibrant forestry sector, while at the same time, defending them through the other channels, whether it be through the dispute settlement mechanisms or at the WTO.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you for that. Maybe I'll pick up on your comments there.

You mentioned in your earlier testimony that our government has invested $290 million into the trade commissioner service. Personally, I had the pleasure of working with and receiving excellent help from the Vancouver office in my prior professional capacity before becoming an MP. I want to give a specific shout-out to Mylan Savjord and Warren Senkowski, who help in the mining and forestry sector respectively. It's important that all sectors be able to take advantage of Canada's trade agreements and to scale up and export to new markets. It's also important for them to know about this great service that we offer.

Minister, I was hoping you could explain how the trade commissioner service assists our forest sector businesses in their efforts to export to new markets.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Absolutely, I'm happy to.

They are Canada's best business development and sales force all around the world, operating in a total of 1,100 offices. For this sector in particular, let me just share with you some of the activities they've already pursued in an effort to open up markets for Canadian businesses in the forestry sector.

They have had to pivot, just as many businesses and industries have, and have gone virtual. The trade commissioner service has taken businesses to Spain, actually attending the wood-building and bioeconomy webinar and showcasing Canadian low-carbon energy-friendly wood-building solutions and bioproduct development. We've also gone virtually into Brazil, attending the international workshop on a bioeconomy. This is helping some of the most advanced and promising bioproducts and bioprocessing technologies—Canadian innovations, Canadian forestry and wood product innovations—into commercialization and deployment in Brazil and elsewhere in South America. We are also going to Japan in March of this year to promote the use of wood-building systems in hotel construction in that country.

These are but a few things. If I had more time, I would keep talking about the terrific work that our trade Canada team is doing to help Canadian businesses start up, scale up and access those new markets.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

That's really great to hear.

I'm curious about that. What does a virtual trade mission look like in this day and age? How can the forestry sector participate in that to help expand their market?

[Mary Ng, Liberal, Markham—Thornhill, ON]

We're absolutely reaching out. The trade commissioner service, through its SME program, through its innovation program, and through its core programs reaches out to the sector and has a very close working relationship with it. I will speak about just two of the virtual trade missions that I, as the minister, have led.

Typically you have about 35 companies physically going with the minister. In the virtual trade mission to South Korea, we had over 200 companies, and to the three-day business summit in the European Union, celebrating the three-year anniversary of CETA, we had over 1,100 businesses.

Looking at how we can continue to do business and support Canadian businesses looking to grow and export is what we are committed to do and what this government is committed to, and I want to thank the trade commissioner service for all of its terrific work.

[The Chair, Liberal, James Maloney]

That's perfect.

Thank you, Minister.

Thank you, Mr. Weiler.

Mr. Simard, we go over to you now, sir, for six minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Mr. Chair.

Thank you, Minister Ng, for your presentation.

Honestly, I get the impression that softwood lumber is often used as a bargaining chip in trade agreement negotiations. I'll tell you why I get that impression.

Not too long ago, as part of the Canada-U.S.-Mexico agreement, or CUSMA, Canada's chief negotiator appeared before our committee. I asked him why the softwood lumber issue hadn't been addressed. He told us that it wasn't a priority for them at that time. Canada's chief negotiator told us this.

Also not too long ago, when I was talking to him about softwood lumber, the Parliamentary Secretary to the Leader of the Government in the House of Commons, as part of the study of Bill C-18, told me personally that trade agreements involve compromises. This leads me to believe that, when Canada negotiates trade agreements with the United States, compromises are often made with regard to softwood lumber.

I get the impression that you've never really fought to ensure that our American neighbours respect this industry. I'd like you to tell us more about this.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you to the honourable member for that question.

I know how important this industry is to Quebec and how important it is to the families, the workers and the many sawmills and businesses that this industry supports, so I want to be clear about our commitment to those workers and to this sector of how important they are. I want to be on the record to indicate that absolute priority.

We absolutely agree that the best way forward would be a negotiated settlement with the Americans. I'm looking forward to working with the new administration on this. It will be an issue that I will absolutely raise in my very first meeting with the new U.S. trade representative after she is confirmed.

The dispute really is hurting industries on both sides of the border. We have common interests around helping our workers and this sector recover after coming out of COVID-19. If you take a look at the construction sector as one, and the need for affordable housing in both countries, I mean, this is really, really important.

I want to assure the honourable member that we will work very hard on this.

[Mario Simard, Bloc, Jonquière, QC]

Thank you, Minister Ng.

I want you to express your wishes. However, I don't want wishes, I want measures. Measures can be introduced immediately.

In 2006, there was a completely unacceptable ransom demand, where $1 billion in the agreement with the United States was left on the table. This $1 billion was paid by Quebec's forest industries.

However, the forestry sector is now calling for a better liquidity program. Unfortunately, right now, the major players must be close to technical bankruptcy to access the program in place. All the forest industry representatives that I've met with have told me that this program is almost obsolete.

Without getting into negotiations with the United States, you can implement measures right now. I'm wondering why you aren't doing this.

The forestry sector is legitimately calling for a proper liquidity system. Why aren't you getting this done?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you for that question.

During the pandemic, we know that the forestry sector has been hit, just like others. The broad-based programs have been available. Certainly, the liquidity program in the business credit availability program is available to the sector. The wage subsidy program, which is saving hundreds of thousands of jobs—well, millions of jobs—across the country, certainly including the forestry sector, is there and available.

I would also point out that this government is absolutely supporting the forestry sector in Quebec with, this year alone, almost $13 million for the forest innovation program, almost a million dollars for the strategic partnerships initiative and more than $2.3 million through the expanding market opportunities. We are supporting the Quebec sector, and we continue to support Quebec's workers—very, very important.

As I said earlier, our commitment, my commitment, to raise this with the U.S. interlocutor will be done once my counterpart is confirmed. I'm looking forward to that conversation.