Industry committee  Thank you, Chair. Good afternoon, everyone. Thanks for inviting EDC to appear before this committee. It's the first time EDC has been invited here. I have had the opportunity to brief certain members of the committee in the past, and I welcome the opportunity to meet everyone at once.

International Trade committee  If I had to pick a favourite to specialize in, it would be this: the business model I've described is evolving in such a way that it's face-to-face business. One needs a presence in Saudi Arabia in order to take advantage of the great growth possibility. One needs a presence in China to take advantage of this.

International Trade committee  Thank you. If you do not mind, I will answer in English. It will be clearer. Many would say that we are too dependent on the United States. More than 80% of our trade is with the United States. I mentioned before that our trade has become triangular. Much of our trade growth has been with globalized U.S. companies, and in that sense we are tapping into the global economy, albeit indirectly.

International Trade committee  To begin, I want to emphasize that this is part of a process that starts with that face-to-face meeting, perhaps in a faraway land. The people at head office do most of the work of the actual completion of those things. And we spend a great deal of time out in the marketplace as a staff when the transactions come to light.

International Trade committee  In principle, that's exactly what happens. I just want to caution that it's not a cookie cutter approach or something that works every time. But most Canadian companies, when they are feeling those kinds of preventive pressures, are looking for a way to reorient themselves, as the member described.

International Trade committee  We, of course, are major participants in Canada's agricultural economy. They're one of the biggest users of our insurance product, which Mr. Siegel was talking about before. There is considerable global reach out there. It's very big business, and it's been one of the faster-growing ends of our export community over the past year or so.

International Trade committee  I do think it is both logical and unavoidable that if we were to try to develop incentives to keep our companies whole here in Canada, that incentive would need to grow every year. It would be without limit, in effect, and it would prevent us from actually capitalizing on the growth in the world economy.

International Trade committee  Excellent. The end of your question before was what is EDC doing to deal with this transformation that is in services as opposed to merchandising, and this connects directly to your question as well. We have never drawn that distinction per se. Many of the companies we work with are service providers, like engineering companies.

International Trade committee  Thank you. Those are both good questions, and they do allow me to finish what I forgot to say to Mr. Menzies.

International Trade committee  Thank you. To back up a little, the story really doesn't distinguish between goods or services, but what it envisions is that the process of taking an idea and ending up with a sale, whether that sale be of a service or a good, usually involves a sequence of activities, some of which could be thought of as services and others that involve merchandise in one form or another.

International Trade committee  Yes, it is.

International Trade committee  Thank you. I think I will let my president answer this question.

International Trade committee  This is a standard clause in the economic world. There is usually a very distinct separation between risk analysis, and particularly economic analyses, and decisions made about transactions. We routinely use this formulation. It does not indicate that Mr. Siegel does not agree with me.

International Trade committee  Yes.

International Trade committee  Thank you for the question. It's probably not appropriate for me to comment specifically on those moves. As a general proposition, although I would like to see more feet on the ground, I also would like to see them optimally allocated. Strategically we don't have limitless resources in this respect.