Debates of May 17th, 2017

Foreign Affairs, Trade and Development—Main Estimates, 2016-17

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Is the Chair also able to answer on my behalf? That would keep you busy, Mr. Chair.

With respect to timelines, what Canada has said from day one is that we are ready to come to the table at any time. Something we can all agree on is Canada has the best trade negotiators in the world, and it will be a terrific team that goes to the table with us. We had a little back chat across the aisles. I do not know how allowed that is, but a question was asked about where Steve Verheul was. He is here and is working very hard, together with a great team at trade, on this issue.

As the member opposite knows, and I think all Canadians, as part of this process, are becoming real experts in the U.S. congressional system and TPA, the U.S. is bound by the TPA, which stipulates that negotiations can only begin after the 90-day notice has been given. I was in Washington on Monday and Tuesday and met with Secretary Ross and Ambassador Lighthizer. I was the first foreign official with whom Ambassador Lighthizer met. He said that was quite intentional. He wanted to show the importance of the key accords to Canada.

Although no one has a crystal ball when it comes to the world or the United States, now that Ambassador Lighthizer has been confirmed, I would expect the process will start to move forward.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, I was in New Brunswick when the announcement came out on countervail duties. I actually was meeting with forestry producers there. They have a few questions they had asked me to maybe pass along to the minister.

One of their first questions is this. How many offers did the United States make to Canada to secure a new softwood lumber agreement after November 2015.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, when it comes to softwood lumber, the United States has made no offers that any Canadian would consider to be acceptable. I am absolutely certain of this. Where the U.S. right now is a level at which no member of the House, no Canadian province, no Canadian company, and no worker in the softwood industry would consider acceptable. We absolutely believe a negotiated deal is possible and desirable, but we want a good deal not just any deal.

I want to remind the hon. member that we have won at every trade tribunal, we have a strong hand, and we will not be reluctant to play it.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, what conversations has Canada had with the United States in regard to softwood lumber since November 2015?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, the best way to characterize our conversations, both with Ambassador Froman and with Secretary Ross, are very extensive conversations around softwood lumber. I do not feel that any of those conversations from the U.S. side have yielded a sufficiently good basis for a really meaningful negotiation to take place. I want Canadians to know that we will never negotiate against ourselves.

[The Assistant Deputy Chair, Liberal, Anthony Rota]

I want to remind the hon. minister what the rules are. I am afraid I have to quasi-inform, to the best I can, that the answers can only be as long as the question is.

The hon. member for Prince Albert.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, a report in the media from the former U.S. treasurer, Michael Froman, talked about how a deal was on the table and you walked away from it. Could you maybe highlight if that actually was true and what did we walk away from?

[The Assistant Deputy Chair, Liberal, Anthony Rota]

I just want to assure the hon. member that I did not walk away from anything. I am sure he meant the hon. minister

The hon. minister.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, I apologize for talking for too long. I am very passionate when it comes to softwood lumber.

I believe the hon. member is referring to Ambassador Mike Froman who was the previous U.S. TR. Let me just put it this way. I have the highest respect for Ambassador Froman as a person. I actually knew him in my previous life as a journalist. However, when it comes to how different countries characterize negotiations, each country talks its own book. I will reiterate that we have not received, neither from Ambassador Froman nor from Secretary Ross, an offer sufficient for Canada to consider. I know the member opposite would agree with me.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, in Atlantic Canada, Irving has a 3% tariff and it did a volunteer submission. I talked to some of the producers there. They said that they were under the impression they could not do a voluntary submission, and then they were told afterwards.

Did Irving receive receive financial assistance from the government to do a voluntary submission? To the credit of Irving, by it doing the voluntary submission and getting that low rate, is there any way we can take that submission and apply it to the other companies in the Atlantic region?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, as the member opposite knows well, it is up to the Department of Commerce how it chooses to make its assessments. The Department of Commerce chooses which companies to assess and also chooses which companies' requests for a voluntary submission to accept.

I am pleased the Department of Commerce accepted Irving's request for a voluntary submission. As the member opposite suggests, the very low rate at which commerce has assessed Irving is an argument that I absolutely have been using in pointing out that even by the judgment of commerce, there is really no fare there for the U.S. to protest.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, I am sorry I am running out of time. I had more softwood lumber questions. However, I definitely want to talk about excise tax on beer, wine, and alcohol.

In the budget, we have an excise tax that has been increased, but we also have an escalator that kicks in every year, which increases the excise tax. How that relates to trade is in wine. For domestically produced wine, that excise tax is not collected. When we put the escalator in there, countries out of Europe are saying that if we are putting an escalator in there, we are going to create a scenario where Canadian wine now has an advantage over wines coming from other countries, Europe, U.S., whatever.

We had peace on that file before, but now that we have put the escalator in there, they are talking about coming after us and looking for some sort of compensation or some changes in that.

Has the finance department talked to you about this escalator, and have you done an evaluation on what the implications could be for trade?

[The Assistant Deputy Chair, Liberal, Anthony Rota]

Once again, I want to remind the hon. member to speak through the Chair and not directly across the floor. I know it is very comfortable.

The hon. minister.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, the member for Prince Albert and I are friends and share a great interest in many things, including agriculture of the prairie provinces. I do not mind at all if he addresses me directly. I know those are not the rules.

I am, though, a bit surprised that the member opposite, particularly in the presence of his colleague, the member for Niagara West, some great wine country, would seem to be arguing the case for foreign wine producers against our own domestic industry.

Canada is a very open market when it comes to the sale of imported wines here. We are a terrific market for the United States. With CETA, we will be an even better market than we are today for Europe. Our foreign partners have no cause for complaint.

I am very proud of the great wines produced in Canada, and those are the ones I prefer to drink.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Chair, maybe the member did not understand. I apologize. I want to clarify what I said before. The reality is because we have peace in the wine sector right now, with the excise tax not being collected, everything is okay. However, now that we have put the escalator onto the wines coming into Canada, that peace has been disrupted. Now we will be be facing trade actions, and the vineyards that had this advantage will now lose it, and that is unfortunate.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Mr. Chair, I am appearing tonight before the House of Commons committee of the whole to discuss the 2017-18 main estimates for Global Affairs Canada. I will be discussing trade opportunities and trade services in Canada.

In 2002, I earned an international trade designation, CITP, in Ottawa. Following my election in 2015, I was proud to be named to the Standing Committee on International Trade. I am honoured to represent the riding of New Brunswick Southwest. My riding borders four federal ridings in New Brunswick, as well as the state of Maine.

International trade and investments are crucial to inclusive economic growth, growing the middle class, encouraging innovation, and creating well-paying jobs in Canada and, more specifically for me, in Atlantic Canada.

The relationship between communities in New Brunswick Southwest and Maine is close and strong. For example, we share a mutual aid agreement for fire services and first responders. When there is a structural fire in New Brunswick Southwest, for example, in St. Stephen, the Calais, Maine fire department responds, and it is pre-cleared.

To date, I have held 17 town halls across my riding. At the most recent town hall in the village of McAdam, six miles from a U.S. border crossing, three Americans appeared out of interest. They stayed for the meeting and listened intently to the discussion, particularly the discussion on the risk of job losses on the American side if disruptions in trade between Canada and U.S. occurred.

At the end, they talked with me privately about how the end of NAFTA was incorrectly misunderstood in their communities as positively impacting economic growth. They were taking the discussion points home and sharing them with their friends and family members. They hoped to return for future town halls in my riding, and invite others.

As border MPs, we have a unique opportunity to include our American friends in our discussions. In my area, we see ourselves as one region

. This spring I hosted, with the St. Stephen chamber of commerce, a trade and opportunities luncheon. Almost 70 people attended. Presenting at the luncheon included, Export Development Canada, Atlantic Canada Opportunities Agency, Business Development Bank of Canada, Women in Business, Opportunities New Brunswick, Canadian Manufacturers & Exporters, and other area chambers.

We engaged in discussions about Canada trade services, on how we could help foster businesses, and help them grow through international trade. Our conversations focused on how our government could utilize our strengths of services and sectors to create new opportunities for Canadian businesses to connect business to business, and how our businesses could access international markets.

Fifty per cent of Canadian businesses are not exporting in its second year. I have heard from businesses in my riding that there exists a need to increase the awareness and promote the opportunities that trade can bring to micro-sized businesses, which have one to four employees, and small to medium-sized businesses as well. We need to work with these businesses and support their growth. Disruptions in trade with the United States will risk jobs on both sides of the border. Our American friends and neighbours I have spoken with are concerned, too, about jobs, growing the middle class, expanding opportunities for young people, and caring for seniors.

The Government of Canada is committed to inclusive economic growth, growing the middle class, encouraging innovation, and creating policies and programs to create well-paying jobs in Canada. This government is committed to expanding our trade relationships and has already given Canadian businesses access to more markets than ever before, whether through CETA, CUFTA, or our current discussions on NAFTA.

The opportunity to grow business on the international stage is profound, and Canada is in a place of strength to begin expanding our businesses internationally through trade. We continue to work with our American counterparts to strengthen and expand ties, and there exists a high demand for Canadian products and services.

Our government already has strong support services and well-integrated Canadian consulates. Many of our banks in Canada are fully integrated in foreign markets, and some are the strongest in the world. Canadian-owned businesses also benefit from an active Canadian consulate. These consulates work to promote businesses abroad.

Our government continues to emphasize a whole-of-government approach, which is why we offer services like the trade commissioner services. We see ministries and departments working together, whether it is innovation, science, economic development, international trade, foreign affairs, small business, tourism, immigration, refugees and citizenship.

We have a great, strong network in Canada of chambers of commerce. I remember in my early days of teaching international trade an excellent program, the export partnering program, that was federally funded in our area through ACOA. It would connect a busy business owner with a student either at a community college or a university. The student did the legwork and the homework the business owner did not have time to do. The success rate for those students and businesses in that engagement was exponential.

The Minister of Foreign Affairs and the Minister of International Trade have done outstanding jobs using these strengths in the Canadian system and working with our international partners to create opportunities. By signing and ratifying the Canada-European Union comprehensive economic and trade agreement, as well as the Canada-Ukraine free trade agreement, our government has given our businesses the opportunity to explore new markets through free trade.

Members of the Standing Committee on International Trade have heard from witnesses about the trade opportunities, whether it is the harmonization of standards; increased awareness of how trade will benefit citizens and businesses on both sides of the border; smart and more efficient border crossings, not the thinning or thickening of the border; the modernization of NAFTA; the possibility of pre-clearance for people and cargo, integrated law enforcement between Canada and the United States; and wraparound services.

Ratifying free trade agreements, with the best deal for Canadians in mind, is critical. We have more work to do to best prepare our young entrepreneurs, our micro-businesses, and our small and medium-sized businesses to take advantage of trade opportunities and supply chains. Therein rest many opportunities for businesses that want to grow through trade. We must ensure that our government continues to support and foster businesses as they begin to trade internationally.

One service that has helped businesses grow through trade is the Canadian Trade Commissioner Service, or TCS. The TCS assists Canadian businesses of all sizes in all sectors and in every region across Canada. The vast majority of Canadian companies are small, and the assistance trade commissioners provide is essential in helping them navigate the complexities associated with doing business abroad.

If I may share a funny story with the House, a few years ago, when teaching international trade, I recall a company that had contacted another company in Georgia. The person on the end of the phone in Georgia asked, “Are you registered with the virtual trade commissioner service?” The Canadian company said, “No”, and the person hung up. The Canadian company called back, the same question was asked, and the response was the same. The person in Georgia hung up. The Canadian company called back a third time and said, “Just hold it, I've registered”, and the person asked, “How can I help you?”

Turning to education, in 2014, some 338,000 international students generated $11.4 billion in spending, supporting some 123,000 jobs in communities in every province across Canada. The international education sector generated over $2.1 billion in tax revenue for all levels of government.

The TCS's EduCanada program, jointly developed with the provincial and territorial governments, complements the work of Immigration, Refugees and Citizenship Canada to better attract and retain top student talent and allow Canada to compete with well-funded competitors, such as Australia and New Zealand, in this highly competitive sector.

The TCS helps communities and businesses prepare to enter international markets, assesses their likelihood of achieving success in their target markets, provides qualified local contacts, and gives advice and assistance in resolving business problems.

The TCS is well positioned to help Canadian businesses with its network of international business support services in more than 160 offices abroad and through five regional offices across Canada.

In closing, I would once again like to thank the Minister of International Trade and the Minister of Foreign Affairs for their tireless work in promoting Canada's trade interests abroad while also working with Canadian businesses to best support them as they grow and trade internationally.

My first questions tonight are about finding solutions for stronger partnerships and about our bilateral and trilateral trade in North America.

NAFTA is a 25-year-old agreement that could benefit from upgrading and improvements to help North America be more competitive with other nations. Consider that when it was first negotiated, the Internet did not exist. We have a North American integrated supply chain. There is no trade-off between border security and efficiency in our integrated supply chain. What are the opportunities for greater integration of the North American supply chain? How can we better use technology to more efficiently, in terms of time and cost, pre-clear our cargo and citizens?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Mr. Chair, I would like to start by thanking the member for New Brunswick Southwest for her very hard work. I would like to tell her, through you, Mr. Chair, something I have not told her directly. Her story about the very close cross-border integration in her community is one I shared just yesterday with Senator Susan Collins of Maine. She told me that she grew up 20 miles from the Canadian border and is also very familiar with towns where hospitals, fire departments, and schools are shared across the border. That is a very important story about the Canada-U.S. relationship, and I really want to thank the member for telling that story so eloquently.

When it comes to NAFTA, as the member said, it is indeed good practice in trade to update and modernize trade agreements. We are currently in the midst of updating our trade agreements with Chile, with Israel, and with the EFTA countries. It is simply what is done. In fact, when it comes to NAFTA, by our count, there have been 11 significant modifications to this very important agreement since it first entered into force, so we very much welcome the opportunity to modernize the agreement. As the member suggested, the whole e-commerce Internet space is certainly one area ripe for some positive advances.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Mr. Chair, I also have the opportunity of sitting on the status of women committee. Currently, we are studying the economic security of women. We frequently hear from witnesses that to improve justice and empowerment for women, women need wraparound services, such as financial literacy, role models, financing, and strategies to grow their businesses.

Female entrepreneurs are significantly under-represented among exporting firms. How is the government helping female entrepreneur-led businesses to grow and benefit from trade opportunities?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Chair, I would like to take a minute to thank the member for New Brunswick Southwest very much. We say it is a whole-of-government effort when it comes to our trade relationship with the United States. I would like to applaud her work not only as a member of the trade committee but in her own riding. She shared her story, which is very powerful. The Minister of Foreign Affairs just referred to it.

She mentioned something. For those who are watching at home, I would like to take a moment to applaud the more than 1,300 trade commissioners who serve Canada so well in Canada and in more than 100 cities around the world. I want to take the chance, because some of them might be watching us, to thank them on behalf of the Government of Canada and all of us in the House, who I am sure applaud their work. They are helping--

[The Deputy Chair, NDP, Carol Hughes]

Sorry, your time is up.

The hon. member for New Brunswick Southwest.

[Karen Ludwig, Liberal, New Brunswick Southwest, NB]

Madam Chair, the minister spoke earlier tonight of his role as Canada's chief marketing officer in both promoting Canada's exports to the world and in attracting international investment. There are, I am sure, several tools in the minister's toolkit he can use in these efforts, such as trade missions like his most recent trip to China to promote the sale of Canadian softwood lumber. Another tool, however, is Export Development Canada. EDC is a crown corporation within the minister's mandate, which is intended to help Canadian companies benefit from international business opportunities.

Could the minister tell us about EDC's work in helping Canadian businesses succeed on the international stage and about how important a tool this is for promoting trade?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Madam Chair, I would like to thank all the employees of EDC, who are doing fabulous work around the world. Singapore is our new post outside Canada, and I will be there to salute their work and the work of all the employees of EDC in helping Canadians succeed.

[Tracey Ramsey, NDP, Essex, ON]

Madam Chair, I will be using my whole time for questions this evening.

The Minister of International Trade does not have the mandate for international aid responsibilities. Could the minister assure us that the development financing institute will be explicitly subject to the Official Development Assistance Accountability Act. Yes or no?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Madam Chair, the Minister of International Development very clearly and eloquently explained how she and I work together when it comes to this corporation. Thus, I have nothing to add to my colleague's comments on this issue.

[Tracey Ramsey, NDP, Essex, ON]

Madam Chair, I am not clear if that was a yes or a no. I am looking for an answer as to whether the development finance institute will be explicitly subject to the Official Development Assistance Accountability Act.