Thank you very much, Mr. Chairman.
Good morning to all the committee members.
Perhaps I will begin by briefly introducing my colleagues at the table. Alessandro Longo is with Agriculture and Agri-Food Canada. Brooke Davis is with Global Affairs Canada and is the deputy chief negotiator on this initiative. Stacy-Paul Healy is with the legal bureau at Global Affairs. Pierre Bouchard is from Employment and Social Development Canada. He was one of the negotiators on this deal, as were Stacy-Paul and Alessandro. Pierre, obviously, was involved in the labour chapter of the agreement.
Mr. Chairman, if I may, I will give a very brief opening set of remarks, focusing on Bill , which is the legislation in question here concerning the Canada-Ukraine free trade agreement. The bill, of course, is called the Canada-Ukraine Free Trade Agreement Implementation Act.
Canada already complies with many of the obligations under the Canada-Ukraine FTA, or CUFTA, as we refer to it. However, before this agreement can be brought into force, a statutory authority is required for Canada to implement some of the provisions of the agreement.
Bill contains the provisions typically found in an implementing bill for Canada's bilateral free trade agreements. These essentially fall into three groups: one, authority to implement institutional provisions of the agreement; two, amendments to Canadian law necessary to implement the agreement; and three, coordinating amendments.
Bill starts with provisions to enable Canada to implement the institutional provisions of CUFTA—for example, establishing the authority for ministers to appoint individuals to committees and to dispute settlement panels and other bodies established under the agreement, and also the authority for the Government of Canada to pay its share of expenses related to the operation of the agreement. Bill C-31 also authorizes the Governor in Council to make orders for carrying out provisions of the act, such as the suspension of benefits following dispute settlement.
Second—and this is the second group of elements of Bill —the bill amends seven existing Canadian laws to enable the implementation of CUFTA. At the heart of these changes are amendments to the customs tariff to implement preferential tariffs for Ukrainian goods in line with the market access provisions in the agreement. There are also changes to the Customs Act that support these market access provisions. An example is authority to check whether goods qualify for tariff preferences under the agreement and to provide advanced rulings to assist companies in knowing how goods will be treated under the agreement.
The customs tariff and the Canadian International Trade Tribunal Act are also being amended to implement provisions related to bilateral safeguard measures that may be taken if injury is caused to domestic producers due to increased imports.
The dispute settlement mechanism in the labour chapter of the agreement can result in a monetary assessment made enforceable in domestic law through amendments to the Crown Liability and Proceedings Act and the Department of Employment and Social Development Act. There are also amendments to the Financial Administration Act to authorize the Governor in Council to issue directives to crown corporations for the purpose of implementing the agreement.
Third, Bill contains amendments to coordinate with Bill , which is the Canada-EU Comprehensive Economic and Trade Agreement implementing legislation. Because both bills amend the same parts of the Customs Act, the coordinating amendments ensure that the amendments made by Bill C-30 do not undo the amendments made by Bill C-31, and vice versa.
That provides a brief overview of the contents of Bill , Mr. Chairman.
I would be happy to address any questions that you or other committee members might have.
Thank you for the question.
We could answer that in relation to three categories: agriculture, fish and seafood, and industrial goods.
I mentioned a couple already in agriculture. I mentioned wine. Our largest agricultural export to Ukraine is pork, and we will have duty-free access from day one for pork, both fresh and frozen. There's also maple syrup, maple sugar, and pulses, principally from western Canada. Canola oil is currently subject to a tariff. Things like pet food, animal feed, frozen french fries, and other processed foods are some of the main agricultural products that stand to benefit and will be subject to a duty-free treatment.
In the case of fish and seafood, mackerel, caviar substitutes, and a range of other frozen fish will benefit. Also benefiting will be industrial goods such as automotive tires, plastics of various types, articles made of asphalt, and various watercraft. I mentioned surveying instruments earlier, and other articles of iron and steel, such as reservoir tanks, as well as actual iron and steel, all of which are currently subject to tariffs.
I should also mention electrical machinery, non-electrical machinery, tools—particularly metal tools—and various consumer products, such as cosmetics. These are products that Canada exports a fair amount of, and they will all benefit from duty-free treatment.
Thank you very much, Chairman.
Thank you very much, members of the committee. I think we've all been busy. I think the trade committee has been one of the busiest, most active, and most energetic committees, and I thank you very much for that work. It's really important.
I want to introduce my officials. You've just been hearing from Marvin, who is working on the trade agreement that I think is close to the hearts of all Canadians. Everyone knows the famous Steve Verheul, of CETA fame. I don't know if people have had the chance to meet the terrific new deputy minister of trade, Tim Sargent. We are very lucky to have him. For people who don't know Tim, he comes to International Trade from the Department of Finance and brings to the trade files a very strong economics and financial background. I think that's extremely valuable to have in our department.
Thank you very much, Tim.
I'm going to make a few opening remarks, and then I look forward taking your questions.
I am very pleased to speak to you today in support of CETA, the Act to implement the Comprehensive Economic and Trade Agreement between Canada and the European Union, and the Act to implement the Free Trade Agreement between Canada and Ukraine. These are two historic trade agreements for everyone, and I know many honourable members have worked hard on both agreements.
Our government believes strongly in an open global economy, and we will continue to champion the open society and open global trade. However, we cannot ignore the reality that, today, we are living in the most protectionist environment I have experienced in my lifetime, probably the most protectionist environment since the Second World War.
The Canada-EU Comprehensive Economic and Trade Agreement, CETA, and the Canada-Ukraine free trade agreement, CUFTA, are historic trade agreements for everyone. I know everyone in this room has worked very hard on both.
Our government, and I personally, believe very strongly in an open global economy, and we will continue to champion the open society and open global trade, but none of us here, and no Canadian, can ignore the fact that today we are living in the most protectionist environment I have experienced in my lifetime, probably the most protectionist environment since the Second World War, if not earlier.
There's a reason for that. A lot of people feel that 21st century global capitalism just isn't working for them. This very big anxiety is manifesting itself, among other things, in a powerful backlash against globalization. For those of us who support the open society, it is incredibly important not to be in denial about the power of these sentiments that are sweeping so much of the Western industrialized world.
Mark opened up our conversation by saying that Canada is a trading nation, and I know we all understand that profoundly. Those of us who really understand that in our core can be tempted to believe that the issue is only one of rhetoric and that if only we were better at talking about how valuable trade is and how costly protectionism is, everything would resolve itself. I think that is not going to be enough. We need to look more deeply than that and understand that this powerful wave of populist anti-globalization sentiment that we're seeing around the world is based in the real, very concrete experience of so many people, particularly in Western industrialized countries, including our own.
When we look at the sources of anxiety that people have, that sense of a hollowed-out middle class, I think we also have to appreciate that the answer has to be about more than trade deals, because the anxiety is about more than trade deals, even if that is where the anger is sometimes directed.
What people are worried about, and I think rightly, is the impact of 21st century global capitalism. The concerns people have, their economic concerns, their concerns for themselves, for their retirement, and for the jobs their children will have or not have are very real, and we need to address them. That is why I feel a central part of our ability to be effective on the trade file, of my ability to be an effective trade minister, comes from other parts of our government's agenda. It is why I am so proud to be part of a government whose first action was to cut taxes for the middle class.
I am proud that we raised taxes on the 1%. That element of fairness is so important to Canadians. We are very proud to have created the Canada child benefit for the families most in need and to have boosted CPP for our seniors.
We are making essential investments every day that strengthen and support our middle class, and it is because of those investments, that broader economic framework, that we can proudly say that in Canada, unlike in very many countries today, we do have broad public support for the open society. We are open to trade and open to immigration.
CETA is one of the most progressive trade agreements ever negotiated. It will help redefine what trade can and should be. It will lead to increased prosperity on both sides of the Atlantic, and create well-paying middle-class jobs, which is our priority objective.
With CETA, Canada is raising the bar and establishing more inclusive trade and higher standards for how global economies must function in the 21st century. This agreement that we are examining today cements the paramount right of democratically elected governments to regulate in the interest of our citizens, to regulate the environment, labour standards, and in defence of the public sector.
When it comes to CETA, this is the most progressive trade agreement that has ever been negotiated. Well done, Steve. CETA will help—is already helping—to redefine what trade agreements can and should be. CETA will lead to increased prosperity on both sides of the Atlantic and create well-paying middle-class jobs.
Canada is raising the bar with CETA. With this agreement we're establishing more inclusive trade and higher standards for how globalization should work in the 21st century. The agreement that we are talking about today crucially cements the paramount right of democratically elected governments to regulate in the interest of our citizens to protect the environment, to protect labour standards, and to defend the public sector. Those are key elements, something I am very proud of. We're proud to have made these changes to CETA since coming into office, and we will continue to champion progressive trade policies.
As oursaid about CETA:
||That leadership that we were able to show between Canada and Europe is not just something that will reassure our own citizens but should be an example to the world of how we can move forward on trade deals that do genuinely benefit everyone.
And the benefits really are clear.
I want to mention a couple of examples of companies that will benefit from CETA, because while it can be fun for us to talk about policy, I think it's really important to bring it back to actual humans we are helping with our work.
Take Vancouver's Corinex, which will now be able to bid and compete for contracts and provide its consulting and communications services to EU clients on a fully competitive basis, or Northland Power from Toronto, the city I represent, with its clean and green power projects that will now be able to expand even further into Europe, where it has a strong footprint, or one of my personal favourites, Manitobah Mukluks, the Métis-founded business based in Winnipeg, whose mukluks are currently subject to a 17% tariff in Europe. That tariff will go down to zero after CETA comes into force. It's clear, Mr. Chair, that CETA will translate into increased profits and market opportunities for Canadian businesses of all sizes, in all sectors, and in every part of the country.
Now let me speak for a few moments about CUFTA, which I know you were speaking about earlier.
This is an agreement that has great personal significance to me as a Ukrainian Canadian. I was thinking about it this week, because Tuesday was the day when we gathered to commemorate the very bitter anniversary of the Holodomor, the artificial famine created by Stalin in Ukraine. That was a moving reminder for me of the very deep connections between Canada and Ukraine. Although I expect to face fierce questioning from you all—not from Gerry, though—it was a reminder for me that in our country we have support across party lines for Ukraine. Linda Duncan was there representing the NDP and Peter Kent was there representing the Conservatives.
It was a great personal honour for me on July 11 this summer to sign the free trade agreement with Ukraine in Kiev. My Ukrainian counterpart Stepan Kubiv signed it on behalf of Ukraine.
Canada and Ukraine understand the importance of trade and of developing our economic relationship for the prosperity of people in both countries, but the agreement is also a further affirmation of the strategic partnership between Canada and Ukraine. It's a very concrete way that we can support a country that is fighting very bravely for its independence and for its democracy and that has deep historic ties with our own country.
I should also say that signing the Canada-Ukraine free trade agreement this year is a nice historical moment, since it's the 125th anniversary of the arrival of the first Ukrainian immigrants in Canada.
Actually, they arrived in my home province, in Alberta, but there are a lot in your province too, Randy.
Interestingly, I find a similar question, although perhaps with a different emotional tone, from both sides of this table.
As we've been discussing, what had happened was that CETA was stalled, and it was stalled around European concerns about ISDS. When we looked at the agreement, we found that we shared those concerns, and we were happy to work with the Europeans to develop the most progressive ISDS system that exists in a trade agreement.
We made changes in two particular areas. One was on the substance. We strengthened the right of the state to regulate, particularly in the interests of the environment and when it comes to labour standards. We clarified that it was the job of democratically elected states, and not of a trade agreement, to choose which parts of the economy should be in the private sector and which should be in the public sector, and that this agreement should not restrict, for example, the right of a government to choose to renationalize some area.
That's very important, and I think that speaks to concerns people have. People want to be able to elect a government and through that election to choose what will be public, what will be private, what will be environmental standards, and what will be labour standards. They don't want a trade agreement to decide that, and that is one of the things we were very pleased to change.
The other element we were pleased to change was the process and how the ISDS system worked. We have created a system in which the arbiters, the judges, have a much clearer ethical line. They cannot be lawyers in private practice one day and arbiters the next. That's really important. We've also created a system in which the choice of who sits on the panel is not dictated by the company that is choosing to bring a case, so both the process and the substance have been improved.
Something else that's worth explaining is that when it comes to the dispute settlement system, this is the one element of CETA that the Europeans determined was of national competency. That means that it is the element of the agreement that will not be provisionally applied, if and when the agreement is ratified by the European Parliament and by us.
In the way we structured the work we're doing on improving ISDS, there are some areas that are open to discussion. This is really a very important landmark development in how dispute settlement is done in international trade, and we have embarked on a very important conversation with Europeans on how to create the next-generation, more progressive dispute settlement process. I think it's something Canadians can be very proud of.
Ms. Lapointe, I thank you for the question, and for your work.
Since you are the only member from Quebec here, I would like to take this opportunity to tell the members of the committee how important the work done by Quebec was for CETA. Indeed, Quebec's diplomacy was essential, because there were issues to settle with Wallonia. The family links between Quebec and Wallonia and Quebec and francophone Europe were essential to obtaining Europe's support for this accord.
I want to thank you personally for your work on our project with Wallonia, and for your work with the members of the Walloon Parliament.
The Government of Quebec also worked very hard. I would like to take this opportunity to thank Premier Couillard and ministers Christine St-Pierre and Dominique Anglade, as well as our colleague Pierre Marc Johnson.
We spoke of the elements of CETA that will be very important for Quebec. Mr. Couillard and the Government of Quebec are convinced that CETA will be very important not only for all of the provinces of Canada, but especially for Quebec. As you know very well, there are now some very strong relationships between Quebec and francophone Europe. These trade relations will be easier, particularly because of tariffs.
We have not yet discussed matters related to government procurement, which is a very important element of CETA. This is also true in the cultural sphere, where there are some very solid relations between Quebec and francophone Europe. I am certain that CETA will be important.
I hope that we will have the opportunity of talking about the agricultural aspect of CETA. You probably know that Quebec is a leader in the production of hormone-free beef, which represents a great opportunity for exports from Canada to Europe.
Minister, first off, congratulations to you and your team. Canada is writing the playbook when it comes to progressive trade agreements. I'm sure the world has been watching what we're doing, from the start to where we are today, acknowledging also the work the previous government and the ministers did.
I had an opportunity to speak to former Ontario minister of economic development and trade Sandra Pupatello the other day, and she said she is so delighted that we have got to this stage and this is going to happen.
Working with Steve and with others and then at the table is why we got the buy-in from the provinces, and then in turn from the municipalities and all the stakeholders and the people.
We're always talking about trade here. We're in the bubble. Minister, I often speak to Mississaugans. I speak to my neighbours and I tell them about productivity and efficiency and trade deals, etc., and their eyes glaze over.
What they want to know, Minister, is jobs, jobs, jobs. That's what they talk about. Those jobs mean that they can send their kids to college or university. Jobs mean that their potential is going to be met and that they will be able to fulfill their dreams.
Your opening comments were so right. It has to be a win-win-win for everybody. It's not just about business or about countries; it's about the people. Setting the stage with progressive tax measures in the Canada child benefit and now with the enhancement of the CPP is what others will look to so they can get the buy-in from their citizens.
Minister, when I think about this, I think about a company in Mississauga, Maple Leaf Foods, the biggest processor of beef and pork, etc. How will this impact those workers at Maple Leaf Foods? What will this mean to them in Mississauga?