Mr. Speaker, I am thankful for the opportunity to speak to this very important bill, Bill , an act to implement the new North American Free Trade Agreement, NAFTA, formally known as the Canada-United States-Mexico agreement. This agreement is extremely important to Canada, Canadian businesses and workers, and I can say, as a representative of a Mississauga riding, that the bill, this agreement, is very important for my constituents and the businesses in Mississauga.
Our government has embarked on a very aggressive trade agenda because trade is extremely important to Canadian businesses and workers. Members will be interested to know that one out of six jobs in Canada depends on trade. It is because our country produces some of the best products and services in the world, and the world needs more Canadian products and services. We know that with our agenda to grow and support the middle class and create more jobs for the middle class, we need to encourage Canadian businesses to trade, export and import more.
Our government maintained an aggressive trade agenda, and over the last few years we have signed and ratified CETA, a free trade agreement with the European Union, and the CPTPP, a free trade agreement with Asia-Pacific nations. Today, Canada is the only G7 country that has a free trade agreement with all other G7 nations. This is a competitive advantage that our friends and competitors in the United States do not have. We have a great environment in Canada for businesses and workers to export our products and services around the world.
Over the last few years, after the U.S. election, President Trump has campaigned on the issue of revamping and reviewing NAFTA. Our government took that very seriously and engaged with the U.S. administration to make sure that we protect Canadian interests, particularly the interests of Canadian workers and businesses. Access to the United States market is extremely important for businesses. Every day, almost $2 billion of products and services cross the border into the United States, so we know how important maintaining access to U.S. customers and businesses is for our businesses and workers.
At a time of increased protectionism, when, as we all know, the U.S. administration was adamant about increasing protectionism and building barriers, it was very important for our government to protect the interests of Canadian businesses and workers. What did we do? We assembled a strong team of industry, labour and stakeholders, a team that transcended partisan lines, with representatives from different parties and groups, to make sure that a complete voice for Canadian businesses was at the table as we were negotiating and protecting Canadian interests.
Canadians will recall the process that we engaged in over the last few years. It was at times very difficult, as most trade negotiations are, and there were moments of challenges and difficulties. In assembling a great team, engaging the provinces, premiers, stakeholders, legislators in the House of Commons and senators, we took an excellent team Canada approach as we embarked on this negotiation process with the United States, led by the , the , the and other ministers. We made sure that Canada's voice was strong and firm at the table, as we were very interested in maintaining access to Canadian businesses, markets and workers.
There were some challenges. As members may recall, there was a period when the U.S. administration imposed steel and aluminum tariffs on Canadian businesses. We were very firm and clear in our opposition to those tariffs. We fought very hard for businesses and workers to have those tariffs lifted. There was a regrettable time when some opposition voices were asking us to lift the countervailing duties that we had imposed on American products, but we knew it was the right thing for Canada. It was the right thing for Canadian interests.
The outcome of the negotiations was very good for Canada. We ensured that 99.9% of Canadian businesses, products and services maintained tariff-free access to U.S. markets. It was really important for business certainty, for business continuity and for workers to know that that access would be maintained.
For the automotive sector, we have increased the rules of origin to 75%, and that is good news for Canadian workers and businesses. We all know how important the auto sector is to the Canadian economy. It is very important for businesses in my riding of Mississauga Centre.
We have also preserved the state-to-state dispute resolution mechanism. That was something the U.S. administration was intent on removing, but we knew it was really important to continue to have an independent adjudicator for the dispute resolution mechanism, and we were able to preserve it.
We were also able to preserve the integrity of our supply management system. Again, the U.S. administration came to the table intent on completely dismantling our supply management system. However, we stood our ground. We stood firm behind our farmers and producers, and we protected the integrity of our supply management system.
We also preserved the cultural exemption that existed in NAFTA. That was very important for our cultural industries. Canada, compared to the United States, is a relatively small market, but we have our own unique identity. We have the unique identity of bilingualism and multiculturalism. We were able to protect an inclusion for our cultural industries, so that we could maintain our policies to nurture and support Canadian culture here at home.
We created provisions or chapters for rules of labour, for the environment and for making sure that we maintained our policies for reconciliation with indigenous peoples. We wanted to make sure that we retained sovereignty over our policies as we were embarking on this journey of reconciliation with our indigenous peoples.
The agreement preserved important access to the United States and Mexican markets. Today, businesses are seeing a lot of uncertainty, especially during this difficult time of dealing with the COVID-19 outbreak around the world. It is very important for businesses that are investing in Canada, and for businesses that rely on access to the United States, that they know that access to the U.S. market is preserved and supported, and is there for the long term.
It is really important to thank all the stakeholders who were involved throughout this difficult and long journey to reach this agreement with our friends, the United States and Mexico.
It was important to have their voices at the table. It was important to have their insight at the table and our government made sure that we took their input into account.
I want to take a moment to thank our colleagues in the House, the Conservatives, the Bloc and the NDP, for offering support to help us ratify the bill in front of us today. It is a sign for all of Canada that we can set aside partisanship when we know that we are working on something that is in the interests of all Canadians and Canadian businesses. Even at a time when people are saying minority parliaments may be more difficult to work in, this is a great moment for all of Canada to see that we are able to set aside partisanship interests because we know what is in the interests of Canadians is in the interests of all parties in the House.
I am grateful to the Standing Committee on International Trade for doing its job in studying the bill. I know the members worked tirelessly around the clock to make sure that voices who wanted to offer their opinion on the bill were able to testify at committee. Experts were able to come and present their testimony before the committee. Members of the House who sat across from each other at the committee were able to work collaboratively and pass the bill at second reading and send it back to the House of Commons.
This is a moment for us to acknowledge that we are able to work together for the benefit of all Canadians. I look forward to our colleagues in the Senate studying the bill in an expedited fashion. I know they understand the importance of the bill. We know that our friends in the United States and Mexico have already ratified the agreement, so Canada is on its way to finalize the ratification process.
Businesses know that it is very important for them. It is very important to note that businesses are breathing a sigh of relief today when they see the House of Commons about to ratify this NAFTA and they are comforted by the fact that there are so many upgrades to this agreement that benefit them.
I talked about the protection for labour standards, environment, indigenous policies and cultural exemptions, and about increasing the rules of origin for our products. I also want to take a moment to recognize how we were able to deal with the steel and aluminum tariffs that were imposed on Canadian products by the United States.
We were able to stand firm. Today not only have we been able to lift those tariffs, but now we have a side letter with our friends in the United States that ensures that, if at any point in the future the United States decided to impose tariffs under the guise of national security, we were able to get Canadian businesses an exemption from those tariffs. Those exemptions are at a greater level than the levels of our current production and current exports to the United States. Not only were we able to lift those tariffs, but we were able to get guarantees and exemptions from the United States that if at any point in the future, for some reason or another the United States decided to impose those tariffs again, Canadian products and services from steel and aluminum will be exempted.
When we tabled Bill , I know our friends in the NDP and the Bloc had some questions about the bill. I am happy to talk about the process of our discussions that took place, ensuring that we listened to their concerns and we found a way to address their questions so we could reach consensus on the bill.
Let me take a moment to thank my colleagues in the NDP. We were able to reach an agreement that, with future trade agreements, we will declare our intentions and objectives of those negotiations here in the House of Commons where all MPs and Canadians will see up front what the objectives of those negotiations are.
In discussions with the Bloc, we were able to come to an agreement that on behalf of Canadian workers and producers of steel and aluminum, Canada will work with our friends in the U.S. and Mexico to encourage them to implement some monitoring measures the way we have in Canada on the production of steel and aluminum.
This is a great example of how our government is able to work with the other parties in the House to respond to their needs and address their legitimate questions.
I know the , and entire government are all looking forward to ratifying this important legislation. It will mean stability and increased exports for our businesses and workers. It will mean increased and growing prosperity for the middle class. It will mean growing jobs for the middle class in Canada. I am grateful to my colleagues in the House of Commons for supporting us and I am looking forward to the debate.
Madam Speaker, it will be that member's maiden speech so I think we are going to hear a really good speech from him today. I cannot think of a better topic for him to speak to, because trade is an important issue to the people in his riding. I look forward to hearing his comments. I am sure they will be wise and worth listening to, unlike some of the other comments we have heard here today. No offence intended.
We are getting through Bill . There is no question about that. We kept our word. We said we would not hold this up. We said that we would do everything we could to properly see this go through the committee stage, which we did. We heard some 200 submissions from people who wanted to appear before the committee.
Even though the Liberals shortened the time, with agreement from the NDP, and made it tough to hear from all of those witnesses, we managed to get through the bulk of them by having extended sittings. I want to thank all members of the committee for sharing their time in the evenings and the staff who were involved so that we could listen to these people. They had serious concerns, and I want to talk about some of those today and get them on the record.
I will start off with dairy. During the TPP negotiations, we were going to give roughly 3.5% market access for dairy to the U.S. and all of the other countries involved in the TPP. When the Liberals pulled us out of the TPP and held us back for a year and a half, and Obama lost the ability to move it forward in the U.S., TPP was going to be the replacement. By the Liberals not moving forward here in Canada, and not creating a window for Obama to move forward in the U.S., we lost that window of opportunity for a period of time, thus a new election in the U.S.
We did the TPP. We still gave up 3.5%, and now we had to negotiate a new NAFTA deal with the U.S. What did we do? We gave up another 3.5%. Dairy producers have been hit twice, which they feel is unfair, and I can understand where they are coming from.
What makes it even more disturbing is what else the Liberals gave up. They gave up their ability to market things like powdered milk around the world, things that we have a surplus of here in Canada. When they were being consulted through the negotiations, they told us in committee that they were under the impression that it would be limited to North America. The text of the agreement indicates that it is global.
Why would the Liberals let another country determine the amount of exports a sector is able to do? That is what the Liberals agreed to in this agreement. The dairy sector has some serious concerns and complaints about that, and this is something the minister will have to address.
Aluminum and the 70% rule are another issue with respect to this agreement. There is still a lot of concern in the aluminum sector in Quebec about why that was different from the steel industry. Why was the aluminum industry not given the same considerations as steel? If we wanted to have North American content, it should have been that way.
What is concerning here is that there could possibly be a back door through Mexico for a pile of cheap aluminum to be dumped into the North American market based on how that country goes through the process of identification. I understand our officials have said they are going to monitor it, along with the U.S., to make sure that does not happen, but the same thing could have simply been done for aluminum as was done for steel. We would have been fine.
Another opportunity that the Liberals missed out on, and which the member for brought up in one of our meetings with Steve Verheul, our trade negotiator, is the fact that green aluminum is produced in Quebec and in other parts of Canada. It is all based on hydro power. The facility in British Columbia is based on hydro. The facilities in Chicoutimi are based on hydro. Canada probably produces the most environmentally friendly aluminum in the world.
Why would that not be put into the agreement? Why would we not say that if we want to have green vehicles, environmentally friendly vehicles, let us use environmentally friendly products like Canadian aluminum?
There were opportunities to say that was the way the implementation should be, so that we were not renegotiating the deal. Instead, all three countries said they wanted to do more for the environment and this was one way, so let us put it in our implementation act that we do just that. There was an opportunity there again, an opportunity we would not have known about unless we did some due diligence in committee.
Government procurement is very disturbing. The Liberals did not even touch on it in this new agreement. They said they would leave it up to the WTO. Then we found out the U.S. was talking about pulling out of the WTO government procurement program. We have no protection with respect to government procurement. We have no provisions to fight off buy America. We have nothing in place.
I would strongly encourage the government to go back to the table on this part, especially if we see the U.S. pull out of the WTO agreement. It should get a deal on procurement and deal with buy America, because the Liberals did not do that in this agreement.
Then there is the auto sector. We feel that Canada's auto sector is going to be hit by a decline of almost $1.5 billion when we look at the impact of the changes in the auto rules.
I understand that the U.S. was very tough on these negotiations. There are some wins in it for our guys here in Canada, there are some wins in the U.S. and some concessions made out of Mexico on that. When it comes down to the auto part of the deal, that was actually done in Mexico between the U.S. and Mexico and we took what was left. We did not have a lot of input into the auto part of this deal.
I have some concerns about longevity when it comes to the competitiveness of our auto sector. With these new rules, we are going to have more expensive cars and they are going to be more expensive in the global marketplace. We did nothing to improve the competitiveness of the auto sector within the three countries, which is a really huge missed opportunity.
We also need to talk a little bit about de minimis rates. I know the U.S. wanted us to go up to a higher number. We kept it at a lower number, which is good, but then they put in a strange amendment. They left Canada Post out as being one of the carriers. Looking at it, all of the commercial carriers can handle any packages across the border and get the new de minimis rate, except for Canada Post.
I live in rural Canada. Canada Post delivers my parcels. Why would we have a deal leaving out Canada Post? It is a Crown corporation, and parcel delivery is probably the most lucrative part of Canada Post. Again, this is an area that I think the government needs to look at and fix, because it does not make a lot of sense.
We tried all along to see this piece of legislation go forward. We knew the importance of the deal. We did not like it. We knew it stunk, but I want to get it on the record that we were being progressive and trying to be proactive in moving this forward. This goes back to before the election.
Before the election, we made a motion at the standing committee, once the original deal was signed, to do a pre-study. There were concerns at the time that we would not have the U.S. moving at the same speed as us and we would be ahead of them. Mexico was actually moving very fast. We said that we should have all the pre-studies done and then we would just have to deal with it in the House. The Liberals declined. In December 2019, we offered to come back early and deal with this. The Liberals declined.
It was not until the end of January that the Liberals actually brought it into the House and we managed to work with the other opposition parties and everybody here. Instead of taking the normal 16 days, we did it in six days. At committee, all we wanted was to do thorough research, so we were willing to get it done in the last week of sitting. That last Thursday we put forward an unanimous consent motion, which the Liberals declined, to start this process basically two weeks ago. The member across the way said no. I want to make sure that everybody understands in the House that we have never been the ones holding this up, but we did say that we wanted to have a good thorough look at it.
One of the things that happened at committee, which I think committee members and all members of the House should be very concerned about, is that 20 minutes before our last meeting the Liberals dropped off their economic analysis. They gave us not even an evening, not even an hour to go through it, only 20 minutes. We quickly went through it and started looking at the announcements and the benchmarks, which were compared to nothing. Instead of taking this agreement and comparing it with what we have today, which is what was done on TPP and other trade agreements, it was compared to nothing.
It was a horrible assessment. It was just unusable to help us talk to people who were going to be negatively impacted to find a way forward. It was just incredible.
When C.D. Howe did its assessment, it found this deal is going to cost our economy $14 billion a year. For the Liberals to say this is a win-win-win, no it is not. It is plug our noses and be thankful we got something, because something is better than nothing.
As I sum this up, there is more that I could probably talk about with regard to the committee, but I want to thank all the companies that came forward and all the individuals who gave evidence.
I want to challenge the government because you got a lot of really good information. Do something with that information, mitigate the losses and make sure they are not left out, because it is your responsibility to come up with a game plan. We would be glad to help.
Madam Speaker, as this is my maiden speech, I would respectfully ask for the traditional maiden speech consideration to acknowledge those who have helped create this opportunity to address the House today.
As a colleague stated several weeks ago, cats have nine lives, but members of Parliament who do not acknowledge their families and forget them have only one, so I want to begin by thanking my wife, Charlene, for her support as we began going down this road several years ago. Charlene is a relatively quiet, private individual, so when she joined me knocking on doors in an unfamiliar part of our riding on our 34th wedding anniversary, I knew I had her full backing. I am thankful for Charlene's love and support.
We are blessed with four daughters, aged 23 to 30, who are presently scattered across Canada, and I also enjoy their support. Kiana is pursuing her master's degree in economics at Waterloo; Brenna is articling for the Bar in Vancouver; Carina is a registered nurse working in long-term care, pursuing her master's degree in gerontology and living in Kamloops, B.C., with her husband Adam, and this June will give us our first grandchild; lastly, our oldest daughter, Alyssa, lives closest to us near Leamington and continues to pursue her dream career as an operatic lyric soprano while teaching music.
I am very proud of my four daughters and I will continue to work to ensure that their lives have no glass ceilings above them.
I am fortunate that my parents, Abe and Susan Epp, who are in the mid to late 80s, were able to join us here in Ottawa in November as I accepted the responsibilities of this office. I thank them for a lifetime of love and support.
I also want to thank my brother Peter and his family. They are the business partners of Lycoland Farms, a family farm business founded by my grandfather, who purchased the home farm in 1949. I have the privilege of being the third generation living on that property today, with my brother and his son providing the day-to-day leadership in that business. We pride ourselves on maintaining this farm along with other lands now under our stewardship in a better environmental state than when my grandfather first purchased this property.
It is my privilege to represent the riding of Chatham-Kent—Leamington, CKL for short, which is Canada's most southerly riding. I want to thank our EDA, along with all the volunteers who joined our campaign last fall.
With two major centres, Chatham and Leamington, and more than 20 smaller towns and villages, providing a better future for our community of communities is a shared goal. Historical communities such as Comber, Blenheim, Morpeth, Highgate, Ridgetown, North Buxton, south Buxton, Charing Cross, Erieau, Wheatley, Stoney Point, Lighthouse Cove, Rondeau, Merlin, Erie Beach, Clachan, Duart, Shrewsbury, Guilds, Rushton Corners, Prairie Siding, Sleepy Hollow, Coatsworth, Jeannette's Creek, Port Crewe, Port Alma, Dealtown, Cedar Spring, Fletcher, and Muirkirk provide a rich, unique legacy in Canada, and I sure hope that I did not forget one.
Chatham—Kent—Leamington is one of the earliest settled areas in Canada. It is largely surrounded by water, which is why it was settled early, as water was one of the most efficient means of travel and trade two to three centuries ago. That same water still has a profound effect on our riding today.
As Canadians, we describe our country as stretching from shore to shore to shore. The north shore of Lake Erie forms the southern boundary of the riding, with Pelee Island and Middle Island's shores entirely within that lake. With additional shoreline on Lake St. Clair also adding to the over 150 kilometres of shoreline, Chatham-Kent—Leamington, along with other ridings across approximately one-third of Canada's southerly border, truly belongs in our national maritime boundary description. These shorelines provide sources of employment and enjoyment, but they also provide challenges as we grapple with record-high Great Lakes water levels.
However, for the moment, I want to focus on the hard-working folks who work some of Canada's most productive soils that are surrounded by these shores, and the people who add value to the products from our farms in the food sector.
Agriculture and food processing are the traditional bedrock of our local economy. With the 42nd parallel running through the riding about two kilometres south of my home farm, we enjoy one of the longest growing seasons in Canada.
Along with very fertile soils, our microclimate, buffered by the Great Lakes, allows the production of grain and oilseeds and a whole range of fruits and vegetables that make an important contribution to Canada's food security.
This vegetable production on some of our sandiest soils also spawned a greenhouse industry that today is a world leader. It is an honour to represent some of the most advanced greenhouses in the world. They utilize the most modern technologies, thereby reducing negative effects on the environment and considerably improving the energy efficiency of crops, and thus remaining competitive both in national and international markets.
Similarly, our manufacturing sector, with geographic proximity to the historical birthplace of the North American auto sector, has developed into a world leader, not only in the tool and die sector for auto but also for aerospace, automation, food processing and handling, greenhouse technologies, and a host of other industrial sectors.
We have a talented, industrious workforce led by entrepreneurs whose imagination drives their initiatives, both in their businesses and in our communities. Agriculture and agrifood, as well as the manufacturing sectors, are solid, competitive local industries ready to serve both domestic and export markets.
Therefore, Bill , the Canada–United States–Mexico agreement, CUSMA, which is being debated today, is highly significant to my riding. We have a long history with trade, with many businesses having grown to service the logistics of trade and participating both domestically and in export markets. Our riding is well positioned geographically to serve Canada's interests by being ready, willing and capable of adding to Canada's exports, one of the stated goals of the government.
Let me add my voice to those who say the Conservative Party of Canada is the party of freer and more liberalized trade. We were party to the original North American Free Trade Agreement, NAFTA 1.0. Let me state that this agreement before us today is certainly not NAFTA 2.0; NAFTA .7 might be more accurate.
Nevertheless, we have been clear from the outset that the Canadian business community needs certainty, and we will support this bill. In fact, we have been pushing the government, as the previous speaker stated, to expedite the passage of this bill, but coupled with a proper examination of its implications. A closer look revealed several flaws that will cost our country. For example, and as previously mentioned, softwood lumber issues related to the buy American policy were not addressed.
Let me focus some comments on two areas of the economy that are important to my riding. While the horticulture and grain and oilseeds sector of agriculture were largely unaffected by the negotiations, our supply-managed sector was not. An additional 3.6% of our dairy market was opened up to imports, which was more than what was intended under the TPP, the trans-Pacific partnership.
Originally, with Mexico and the U.S. as planned signatories to the TPP, the new TPP thresholds were intended to be updated to NAFTA levels.
In addition, this agreement eliminates class 6 and class 7, and establishes export thresholds for milk protein concentrates, skim milk powder and infant formula. Other supply-managed industries also had similar outcomes, with imports given additional access to domestic markets.
Canadians are wondering what Canada got in return for these concessions. Would the opportunities for other agriculture sectors, such as our grain and oilseeds and horticulture sectors, be enhanced? Not that I have heard.
At the last minute, another concession was given. Aluminum was not afforded the same protection as steel, which was that 70% of steel used in auto production must be North American, defined as melted and poured in North America. Aluminum was not afforded the same consideration.
With increased interest in the electrification of vehicles and the replacement of steel with aluminum parts to lessen vehicle weight and increase fuel efficiency, it is expected that aluminum content will only increase in future automobile manufacturing. This development directly impacts a business in my riding. Dajcor Aluminum began 10 years ago in Chatham, and in the last decade has grown from nothing to over 250 employees. They extrude aluminum into various parts, mainly targeted to North American auto manufacturers.
Mike Kilby, president of Dajcor, testified at the trade committee hearings into Bill . He concluded his submission with the following:
To summarize, this is a terribly bad deal for NA aluminum producers, extruders and for manufacturers of aluminum automotive components in Canada and the U.S. Mexico already has a labour advantage and now they get to add a subsidized commodity to that advantage.
The Conservatives support freer and fair trade. We will support this bill, despite its many shortcomings, because of the certainty that investment demands. There must, however—
Madam Speaker, I am pleased to rise on behalf of the Bloc Québécois to speak to the Canada-United States-Mexico agreement. The Standing Committee on International Trade has put a lot of time into analyzing the agreement. My colleagues who sit on that committee with me can confirm that we have worked late on many occasions.
As I reminded members in my first presentation to the House on this topic, Quebec's separatist movement does not need any lessons on fostering trade with the rest of the world. Free trade with the United States is the result of a successful gamble taken by Jacques Parizeau and Bernard Landry following—and this is interesting—a fear campaign led for the most part by the House targeting Quebec's presumed inability to survive without the Canadian economy. That was not the case.
We took a chance on free trade, and what a success it has been, since access to the market south of us has been such a windfall for our SMEs, especially because Quebec has always managed to merge openness to trade with economic nationalism, using the most effective tools. However, as Jacques Parizeau later criticized, free trade has too often become synonymous with secret negotiations in favour of multinationals, ranging from the relinquishment of political sovereignty to sacrificing the most vulnerable members of society.
What does all this mean for CUSMA?
First of all, transparency was severely lacking from the entire process. At the Standing Committee on International Trade, the economic impact study authored by the chief economist at Global Affairs Canada was not tabled ahead of his appearance. How were we supposed to read and go over that study with enough time to prepare speaking notes?
What is more, the study presents a dubious and dishonest methodology because it compares CUSMA to the absence of an agreement. It compares CUSMA to nothing, as though NAFTA has not been in effect for years. Of course, some might say that without CUSMA there would be nothing left.
Personally, I cannot imagine a situation in the near future where Canada and the United States would no longer trade with one another. We can only conclude that, without CUSMA, we will revert back to NAFTA. If we tear up NAFTA then we will go back to the FTA. If we tear up the FTA, then there is always the World Trade Organization.
I know that each of these scenarios does not amount to the same thing. I know that it would be better to have a direct channel between the signatory countries. Nevertheless, it is just fearmongering to claim that we would somehow magically end up in a situation where trade between the United States and Canada would no longer exist.
I would also like to address another matter. The first version of CUSMA, as presented in recent years, was completely unacceptable. Just think of the provisions that would have allowed the digital giants to bring their goods into Canada without tariffs and to sell them tax-free. The provisions concerning pharmaceutical patents would also have benefited major corporations and increased the cost of prescriptions. Fortunately, these provisions are not in the current version of CUSMA.
I must say from the outset that the current version of the CUSMA is far from what an agreement should be in 2020. I will take the example of the environment. Although we are in a climate crisis, the agreement contains next to nothing on the environment, except for some good intentions. There is no mention of environmental agreements other than those that were in NAFTA. There is no climate standard, no acknowledgement of climate change and no system to deal with problematic cases, except for the state-to-state dispute settlement mechanism, which is not exactly known for its amazing efficiency.
However, when compared to NAFTA, CUSMA is an improvement in some respects. For that reason, we must opt for this version rather than the status quo.
CUSMA abolishes the ban on limiting exports of Canadian oil to the United States, a measure that could hinder efforts to fight climate change, and that is just fine.
The agreement reaffirms the cultural exemption, which we are very happy about. Quebec has been actively advocating at UNESCO, with the support of France, to make sure that culture is not treated like a commodity.
The elimination of NAFTA's chapter 11 is another significant step forward. This chapter dealt with investor-state dispute settlements and sacrificed political power in favour of a virtual government of multinationals. These multinationals were able to sue states if they had the misfortune of limiting the ability of a corporation to make profits while trying to protect their citizens.
Ottawa was sued several times over the years, for example for its decision to restrict imports of a fuel additive suspected of being toxic, for restricting the export of toxic waste, for revoking patents for medications of questionable quality, and also for Quebec's decision to ban the sale and use of certain pesticides on lawns and Quebec's moratorium on drilling in the Saint Lawrence. That list is far from exhaustive.
Canada is the NAFTA country most often sued by private investors. The worst thing is that this mechanism has subsequently been emulated in all of the free trade agreements. Around the world, 60% of these lawsuits have ended in multinational corporations triumphing over the states being sued or negotiating a friendly agreement, according to the UN report. That means that in 60% of cases, the power of money partially or totally prevailed over the states' political will and the power of democracy. Naturally, this quantitative assessment does not factor in the constant pressure on public decision-makers, who need to censor their own comments to avoid getting dragged into court.
Jacques Parizeau used to say that globalization was like the tide. We cannot stop the tide, but we can build dikes.
This chapter of NAFTA did not even allow us to build dikes. Now that this chapter, which had such serious consequences, is gone, all we can say is good riddance. However, we will keep a vigilant eye on the new chapter on good regulatory practices. The chapter is quite restrictive, and its tone reveals a deep-seated distrust of state intervention. That is something we will certainly have to keep a close eye on, to ensure that it does not turn out to be a new impediment.
The elimination of the provision allowing private investors to sue states is a laudable precedent. It will be hard to bring back that type of mechanism in future international negotiations.
Other gains were sadly much too symbolic. CUSMA includes one chapter dedicated exclusively to small and medium-sized businesses and it emphasizes how important they are. That is very good, but this chapter unfortunately does not go beyond affirming some basic principles. CUSMA fortunately protects market access for these businesses in most sectors.
The chapter on labour does contain some notable improvements, in particular for the auto sector. Although Quebec has no direct ties to this sector, the provision does indirectly establish a minimum wage that, I must say, will be difficult to enforce. Nevertheless, that is definitely an improvement.
Other categories of workers will unfortunately not benefit from that same improvement, although this chapter does give workers some recourse. Will these methods be effective? Only time will tell.
However, CUSMA is not free of grey areas. It is important to mention that one of them is softwood lumber. The softwood lumber situation is a constant irritant. It never stops. It is like a problem that is never solved. As we know, the United States has always applied punitive tariffs on our lumber. The U.S. math has always been clear: Industries are driven into bankruptcy while the wheels of justice slowly turn.
Washington has always been able to play outside the rules. The CUSMA negotiations could have been an opportunity to clarify those rules to ensure that such unfair practices no longer occur. That was not the case.
That is why I introduced an amendment to have the minister create an advisory committee on softwood lumber products that are not on the export control list.
As my colleague mentioned earlier, some copyright issues are being addressed similarly to how the United States is addressing intellectual property. This approach may well favour big business.
The dairy sector has clearly suffered a setback. The scenario is always the same: Every governing party makes a heartfelt commitment during the election campaign to never tamper with supply management again. Every party tells us not to worry because it will not touch it, unlike its predecessor. However, when that party takes office, it goes about negotiating in secret, like its predecessor, and then we learn that supply management has been affected. When the agreement under discussion becomes public, the excuse is always that it is only a small breach and that we must not worry because it is only a small percentage. Okay, fine, but when those small breaches are taken together, let's face it, they amount to a sizeable crater.
In CUSMA, giving up 3% of the market means losses of about $150 million per year. The agreement also eliminates class 7, which dealt with the dairy protein problem. Worse still, it gives Washington the ability to limit the amount of dairy protein our producers can sell to other countries. Allowing one country to oust another as a global competitor by controlling its exports is, we believe, unprecedented.
We will not back down on this. The government must provide direct compensation to affected farmers without delay. I would also encourage the House to support the Bloc's bill banning any future hits to supply management. Our food supply is too important to be subject to the rules of global economic war. Lip service and simple election promises do not cut it anymore. We need a legal obligation here. Our farmers, the very people who enable us to fill our fridges every day, have been made to suffer enough. The first thing we do when we get up every morning is open the fridge. We owe our farmers a debt of gratitude. After all, they are the only professionals we need every day, many times a day.
On the sensitive issue of aluminum, the government pulled a classic Canadian move. Despite the government's denials, aluminum, a Quebec industry, was not given the same protections as Ontario steel. While the government was celebrating this agreement, the Bloc Québécois noted that the protections were not the same and spoke out about it. The agreement protects only North American aluminum parts, but requires that steel be melted and poured in North America. However, Mexico does not produce aluminum and could continue to use dirty Chinese aluminum, which is lower quality and made in coal-fired plants. This dumping would have jeopardized the expansion projects of Quebec aluminum plants, threatened jobs in those plants and undermined the tremendous environmental opportunity presented by our carbon-neutral aluminum, which is the greenest in the world. What is more, in an era of climate change, the trend in the auto manufacturing industry is to move toward lighter parts. The Quebec National Assembly voted unanimously on a motion to support our aluminum workers and industry.
At first, the government denied the elephant in the room, but we held firm. That paid off and the government committed to collect real-time data on aluminum imports. If that data shows that Mexico is indeed sourcing foreign aluminum, the government promised to revisit this issue and ensure that our aluminum gets the same protection as steel. Mexico's angry response shows that there is indeed a problem that the government insisted on ignoring.
Although certain representatives tried to claim that there was no real change, Canada's chief negotiator, who was responding to a question I asked in committee, acknowledged that this definitely constituted a gain. We will be keeping an eye on the government to make sure it keeps its word. The burden lies on its shoulders. We will therefore be voting in favour of CUSMA, not happily and not particularly enthusiastically, and, more importantly, knowing we will remain extremely vigilant. In fact, I promise to be the watchdog at the Standing Committee on International Trade. We will also keep a close eye on all this here in the House.
In closing, I want to talk about a long-term vision for the future. In this file, as in many others, we tried to minimize the losses. The Bloc is always hard at work when it comes to damage control. However, we must not forget one basic rule: Those who are absent always get the blame. Not being at the table when decisions are made definitely has its consequences.
In fact, in the negotiations for the agreement with Europe, the former Quebec representative within the Canadian delegation said that the role of the Quebec delegation was unfortunately limited to offering a love letter. In other words, people were hard at work everywhere, especially behind the scenes, where they were trying to influence the delegation, except at the decision-making table. This cannot always be without consequence. Those who are absent always get the blame. That is why the ultimate, long-term goal of our actions is of course the independence of our nation, Quebec.
Madam Speaker, I have found the third reading debate and indeed this whole process around the Canada-U.S.-Mexico trade agreement interesting. Today I watched as the governing Liberals, the opposition Conservatives and the separatist Bloc all tried to take credit for free trade and sing the praises of free trade. I can tell members that the New Democrats are not here to sing the praises of corporate free trade; far from it. We have been pretty consistent critics of this model of trade, but not trade itself.
One of the sleights of hand that too often happens not just in this place but in the media about trade is that somehow the corporate model of free trade that has been very good at reinforcing corporate rights over the rights of people and the environment is somehow the only way to do trade. New Democrats are not under that illusion. We know that too often corporate free trade deals have meant that countries get trapped in a race to the bottom, that these deals are structured in a way to allow international capital.
We hear in other debates about how Canada needs to compete for investment, and if it tries to regulate in the public interest in areas that have to do with the environment or workers that international capital is going to leave and go to other jurisdictions. These types of free trade agreements are all about making that easier and all about intensifying the threat of capital flight in the event governments choose to stand up for their workers, the environment or the rights of indigenous people within their territory.
CUSMA unfortunately is part of that model. What is different here is that we are not talking about going from no free trade agreement to having a corporate free trade agreement. What we are talking about is two different agreements and which one we are going to have. As some people mentioned earlier, if we did not go for the new CUSMA and the existing NAFTA was abrogated by the President of the United States, there would still be a free trade deal in place, the original free trade deal between Canada and the United States.
We are not in a position where we are talking about whether Canada is going to sign up for some new commitment under the corporate free trade agreement. What we are talking about is which commitment is going to serve Canadians better. That is an important point to make, and that has been a consistent theme throughout the debate on this. Certainly it has been an important part of the NDP's deliberations on this particular deal.
In my speech at second reading, I said there were two questions that were going to guide us in our thinking. One was whether, on balance, this deal would leave Canadians better off than the current agreement. The second question I said would guide our deliberations was whether we could leverage the process around this deal, which we knew was going to pass anyway because the Conservatives said early on that whether they liked it or not or studied it a long time or a short time, ultimately they were going to vote for it. We knew that this was an agreement that was going to pass, and the question was whether we could use the process around this ratification in order to get a better process that made the next trade agreement negotiation more open and transparent to the Canadian public.
I want to talk a little about some of the problems with the model and then I want to talk a little about this particular agreement and why, on balance, we think that the package of things that comes with this agreement will leave Canadians a bit better off than the status quo.
In addition to the problems of the corporate free trade model I mentioned earlier, particularly that race to the bottom when it comes to environmental standards and labour standards, there is another problem. We hear often from Conservatives that what they do not like about government is that it picks winners and losers, except that they have no problem with that when it comes to free trade agreements. Often the Conservatives negotiate the deal and then the Liberals sign the deal. That seems to be the pattern.
The Liberal Party and Conservative Party work very well together when it comes to advancing this corporate model of free trade, but Conservatives do not have a problem picking winners and losers in free trade agreements even though they do not like the idea of picking winners and losers when it comes to funding renewable energy, for instance, over other industries. They say that is an unacceptable picking of winners over losers. However, when it comes to sacrificing the dairy industry in agreements, we know the Conservatives negotiated concessions on supply management in the TPP, which ultimately the Liberals signed on to.
I was trying to listen in the best spirit and interestingly, optimistically, I heard members of the Conservative Party defending Canada Post, a Crown corporation. That was great to hear. I might add that is not reminiscent of the way the Conservatives behaved as a government, but it was nice to hear. That was another instance where they were decrying picking winners and losers. I am inclined to agree that Canada Post should not have been singled out, because I am a proud supporter of Crown corporations. I hope their resolve carries forward with them into whatever future positions they may have in this House, be it government or the fourth party. We can only hope.
I mentioned also that CUSMA picks winners and losers when it comes to the digital economy. Unfortunately, the losers, by and large, are Canadians themselves. This has been another feature of these corporate free trade agreements where governments, I think quite needlessly, tie their hands when it comes to making good public policy. One of the things this agreement does is it really constricts the options Canadian governments have going forward on how to deal with what is a new, emerging and very important and significant aspect of the global economy, which is the digital economy.
For instance, in this agreement, the government has agreed it will not make third party platforms responsible for the content posted on those platforms. That is a major policy decision. It is one that we may well live to regret. It is a discussion which, in my opinion, should have happened in this House in a far more robust way. That is not the kind of thing we should have been negotiating with trading partners prior to having a meaningful debate about how Canada wanted to treat this issue.
In some places within trade agreements we get protection for existing laws, rules and policies. We really have not had the opportunity to establish those in a meaningful way for many aspects of the digital economy. We see the government already signing away its ability to make those decisions and, by extension, the ability of this place and Canadians themselves to decide how they want their digital space managed going forward. That is a feature of these kinds of agreements. It is the kind of thing the NDP has been a vocal critic of. We think it is one thing to decide we want to trade with another country, but when we look at agreements like the Auto Pact, which were not global free trade deals but about dividing up the wealth that comes from producing those products and ensuring that the trading partners each were getting their fair share of the wealth generated by the products that were going to be moving freely across the border, that is not what free trade is. Rather, it is more about, as I said earlier, setting up rules to make it easy for multinational corporations to move their production around. That may have a short-term benefit on price, but it does not always. We know companies charge what the market will bear. In the long term, I think there are many Canadians who would appreciate the opportunity to pay a bit more for a good or service that contributes to Canadian workers and keeps wealth in Canada, but I digress.
I mentioned earlier there were two questions that would guide our deliberations. I want to speak to the first one now, which is whether, on balance, this agreement is better than the status quo. There are a few things I would point to that are laudable, despite the faults of this agreement.
One is the elimination of chapter 11 of the original NAFTA. That was the clause under which foreign corporations, not Canadian corporations—although I would not have been a fan of that, but I think it was that much more egregious that it only gave these rights to foreign corporations—could sue the Canadian government for creating laws or instituting regulations that protect the environment or workers that they saw as costing them profit. Canada not only put that in the original NAFTA, but these investor-state dispute settlement clauses have been in most of the trade agreements that we have negotiated. Canada has paid out the most in the world under these kinds of clauses, so I am glad to see that go. I note it was something the President of the United States wanted gone and that initially our government defended, which has always seemed backward to me. Nevertheless, regardless of who got it out, it is out and that is a good thing.
It is likewise with the energy proportionality clause. It said that if, in any given year, we take the average percentage of Canadian production of oil and gas that went to the United States over the previous three years, in future years the U.S. would have a right to insist on that percentage of Canadian production. Regardless of whether there was a domestic shortage or whether we could get a better price somewhere else, the United States would have a right to that percentage of our production of oil and gas. We have always seen that as a completely unreasonable, to put it mildly, infringement on Canadian sovereignty and something that was not in the best interests of Canadians, so we are glad to see that go.
There are a number of new North American content provisions for the auto sector, which we think is a good thing. They hearken back to the Auto Pact. Those provisions are actually least like free trade provisions, but they are being lauded as potentially doing the most for the Canadian auto sector. I think this is a signal that the free trade model, in itself, is not enough for Canadian success.
One of the other things to note is that in the original version of CUSMA there were provisions that would have significantly increased the cost of biologic drugs. This was due to, unfortunately, not our own government, but to the Democrats in the United States who went back to the table. Because they were not satisfied with the original agreement, those provisions came out. That means that some of the increases in the cost of prescription drugs that were going to happen as a result of this agreement, which we have seen in other agreements like CETA and the TPP, are not happening in this agreement. That is a good thing. One of the reasons that the NDP has often opposed some of these trade agreements is because they offer unreasonably good protection to international pharmaceutical companies at the expense of Canadians who require medication to improve their quality of life.
We also saw, in the second round of negotiations spurred by the Democrats in the United States, first-of-their-kind labour provisions in a trade agreement. I will not say that they are perfect; a lot of work is going to have to be done in order to ensure that they are implemented in a way that realizes the maximum potential for workers in Mexico, but these agreements would provide some upward pressure on wages for Mexicans working in the auto sector. I think just as, or more, importantly, and we heard this at committee from a Mexican member of the labour movement, it will make it easier for them to organize real unions in their workplaces. Evidence shows that when there is a union, one is able to get better working conditions and secure better wages. That is good for Mexican workers and for workers in the United States and Canada as well. This is to the extent, and that extent remains to be seen, that companies will not be picking up their operations and simply moving them to Mexico because it is a way of getting out of having a union in a workplace and paying higher wages.
Again, this is not a panacea; it is not going to change things overnight, but these enforceable labour provisions are the kinds of things that New Democrats have said for decades ought to go hand in hand with the rules that are established, and very strongly protected, in international trade agreements.
By voting for this agreement at this time, we are trying to consolidate the gains of having chapter 11 eliminated, having the proportionality clause eliminated and having the potential increase in prescription drugs stopped. We want to give a chance to allow these first-of-their-kind labour provisions to play out and to see whether we can use trade agreements to increase fairness for workers. I hope, if we can show that there is success on that front, that one day we could get meaningful enforcement of some environmental rules across jurisdictions too.
This agreement really does not do that. It does not mention the most important agreement designed to address the most important environmental challenge of our time, which is the Paris accord and climate change. I think that is where we are going to need to get if we are going to have accountability internationally for countries reducing their climate emissions. We need to tie those accords to economic accords as well, so that there can be meaningful consequences for countries that do not live up to their expectations.
I want to spend a little time now talking about the second question that I said would guide our deliberations on this matter, which was whether this ratification process could be leveraged to get a better trade process for the next time.
This process in itself was not great. We heard other members speak earlier about just how late Parliament got an economic impact assessment. By everyone's admission, we are talking about a major deal. We are talking about a lot of trade crossing the border every day, and there has been a lot of commentary on the agreement. The surprising thing for Canadians who may just be learning about this, if they are watching at home, is that debate was not supported by any real economic data because the government did not release it until the day before the end of the committee hearings, which was just the last sitting Thursday. Therefore, the economic report that actually puts some numbers to what we are doing here came out on the Wednesday and the committee study concluded and moved along on the Thursday. That did not make a heck of a lot of sense.
There are other things that have not made sense over the years, particularly the high degree of secrecy around trade negotiations. As I mentioned in my speech at second reading, two of our biggest trading partners, with which we have concluded free trade deals, the European Union and the U.S., both released far more information about their negotiation process to the public. They create far more of a space for civic engagement around trade negotiation and allow their citizens to weigh in on what is important to them, what they think their executive is doing right in those negotiations and what it is doing wrong. We saw how that interplay between the legislature and the executive can create opportunities to get better deals. We saw that happen with this very agreement, unfortunately not here in Canada but in the United States where Congress was able to get involved and require the President to go back to the table in order to get a deal that was acceptable to the legislature.
This Parliament only deals with trade deals once they are signed, sealed and delivered and there is no possibility of going back to the table. That was why I contacted the early on in this process, to talk about some of those problems of process and how we might be able to improve those going forward. That precipitated a period of negotiation, at the end of which the government committed to put in its policy for tabling treaties in the House of Commons a new commitment. The government will now tell Parliament formally, 90 days before beginning formal negotiations with another country or group of countries, of its intent to bargain a new trade deal. It will table its negotiating objectives in Parliament, which means publicly, 30 days before those negotiations. That is comparable to what already happens in the United States, and is even less stringent than what happens in the European Union, so it is a completely reasonable thing to do and Canadians will be better off for it.
Finally, on the topic of the economic impact assessment, we got a commitment from government that it will make it a matter of policy that governments table economic impact assessments side by side with the ratifying legislation so that we never again end up in the ridiculous position we were in this time, where we were being asked to study a bill without having any economic data about its impact. I should not say “any”; we did have some from the United States because a year ago, it published an economic impact assessment. Canadians and their parliamentarians should not have to look to our trading partners for information about how a trade deal is going to affect us. We should be able to get that from the government. We now have a commitment to make it a matter of policy that governments will provide that information, which is important.
There is more I would like to say, but I look forward to the question and answer period.
Madam Speaker, it is with great pleasure that I rise to speak to Bill , an act to implement the agreement between Canada, the United States of America and the United Mexican States.
We must ask parliamentarians to come together and join our partners in the United States and Mexico and ratify this agreement. We need to ratify it expeditiously and ensure certainty for businesses and, more important, ensure certainty for employees across this beautiful country we call home. It is of paramount importance.
I recommend all my colleagues and all Canadians watching read the economic impact assessment on the new NAFTA, the CUSMA. I will read some of the preamble, which states:
The final CUSMA outcome effectively achieved Canada’s overarching objectives by preserving key elements of NAFTA, modernizing and updating the Agreement to support Canada’s access to and integration with the North American economy, providing important stability and predictability with respect to overall market access, and addressing the harmful impacts of U.S. Section 232 tariffs on steel and aluminum, as well as threats of similar tariffs on automobiles and auto parts.
I am sharing my time today with my hon. colleague, friend and mentor, the hon. member for .
Two aspects of the agreement need to be highlighted as we begin the debate in the House. These are of paramount importance to the New Democratic Party, the Conservatives, the Greens, the Bloc and the Liberals.
The first is that this would ensure Canada's trading partners in North America would maintain high levels of labour and environmental protection. This agreement has bipartisan support in the United States between Democrats and Republicans. It has been ratified already by the United States and Mexico. It has support from our major unions in Canada, Unifor, Canadian Labour Congress. The agreement is a win for the environment. It is a win for labour. It is a win for hard-working middle-class Canadians from coast to coast to coast. It is a win for our businesses to help grow our economy and keep it moving forward.
Second, the agreement would strengthen the state-to-state dispute settlement mechanism between parties and would ensure that disputes would be settled in an effective and efficient manner. This is all contained in the impact assessment that was done by Global Affairs. It is a great read, is quite insightful and it provides an overview of where we will go with this agreement and how it will benefit all three trading partners and their workers.
We all know we live in a world that is currently seeing a lot of uncertainty with COVID-19. I want to express my sincere appreciation and full support to our health professionals in Canada and across the world who are on the front lines of the situation we are facing. I pray for them and thank them again for what they do.
Many of my colleagues will know that I am economist by training. I worked globally in Toronto, New York City and spent time in Europe before I entered politics. In my view, Canada, its workers and businesses are well positioned to handle the evolving economic environment or landscape. As a country, we will continue to succeed and grow as a people and our economy. We will continue to create jobs.
I witnessed first-hand the tech boom and bust, the global financial crisis of 2008 and 2009, which at one point our U.S. neighbours to the south were losing several hundred thousands jobs a month. Thankfully coordinated action by the Federal Reserve, under Ben Bernanke, central bankers everywhere and policies pursued by the Obama administration staved off what I believe would have been a second global depression.
As parliamentarians, we must understand how interconnected the global economy is and with that how interconnected the global energy sector is. We have all read the headlines. There are many forces at work currently in the global energy markets, and I wish to begin part of my speech and speak to the importance of Canada's energy sector to Canada's economy today and in the years and decades to come.
CUSMA guarantees access for Canadian products and services to the United States, keeps barrier-free from happening and is good for our energy sector among all other sectors, such as auto, aluminum, steel, dairy, services, intellectual property, etc.
I would like to express my thanks to all of Canada's energy and mineral mining sector workers, whether it be those in the oil sands sector, those working in the western Canadian sedimentary basin, those mining uranium, those maintaining our nuclear plants in Ontario and those working on the TMX pipeline or on the Coastal GasLink, which will supply LNG to the Asian markets, displacing coal and thus reducing the world's global greenhouse gas emissions.
We speak about climate change. We speak about saving our planet. We speak about moving forward. One of those aspects is displacing coal through LNG and that needs to happen so we can get to where we need to be.
CUSMA provides the energy sector, auto sector, our tremendously hard-working dairy farmers, steel and aluminum sector workers and the entire Canadian economy with certainty. However, again, let us focus on Canada's energy sector, which accounts for a very large portion of the two-way trade between Canada and the United States and for a very large portion of the trade between all three countries.
Here are a few facts about how important the energy sector is to the Canadian economy.
As of 2018, Canada's energy sector directly employed more than 269,000 people and indirectly supported over 550,500 jobs. It is all on Enercan's website and I encourage Canadians who want to analyze how important this sector is to take a quick look. That is over 800,000 good, middle-class jobs, with the overwhelming majority providing good wages and benefits to families across Canada.
According to 2018 statistics, the energy sector accounts for over 11% , or $230 billion, of Canada's nominal GDP. Direct revenues from energy to governments totalled over $14 billion in 2018.
As an economist, one measure I like to see is our merchandise trade statistics that are published monthly. In 2019, the Canadian oil and gas sector generated a trade surplus of $76 billion for our economy. That is money flowing into our economy to pay for schools, bridges and roads and to maintain our high standard of living. We can compare this to the auto sector, which is so important for Ontario, that has a trade deficit of $20 billion.
Behind that $76 billion trade surplus, Canada is the sixth largest world's energy producer, the fifth largest net exporter and the eighth largest consumer of energy. Frankly, energy drives our economy, our daily lives and our standard of living.
Total energy exports in 2018 were $132 billion versus $55 billion of imports, with oil and gas exports at $118 billion of which 95% were to the U.S. Notably, we export energy products to approximately 148 countries and 90% of that goes to the United States.
Human capital is a paramount strength of Canada, its people, its diversity, the ability to be an inclusive society and strengthen our economy. That is what makes our country a blessed place to live. When we also include Canada's natural capital resources, whether it is our agricultural sector, our forestry sector, hydro-electric power driven by our rivers and waterways, the mineral and energy wealth our country, Canada and its citizens are blessed and our potential when we work together is endless.
The new free trade deal between the three countries provides certainty to over $1.4 trillion, and growing, in trade volumes. Trade generates jobs, grows our economy and ensures a bright future for all children, including my own.
The world is becoming more interconnected. Our trade deals, CETA, CPTPP and CUSMA allow us preferential access to 1.5 billion individuals across the world. They allow us to continue to export our goods and services. Canada is a magnet for immigration. The best and brightest want to work here. They want to invent. They want to raise their families here. They want to call Canada home, and we welcome them.
On that front, CUSMA will allow us to move forward. When I read the economic impact assessment produced by Global Affairs, I saw what we have done, what the team under Steve Verheul has done. I applaud them. I applaud the for her steadfast commitment to ensuring a great deal for Canadian workers and businesses.
I have heard from all sectors and stakeholders in our economy and they all want this deal to pass. Whether it is the Chamber of Commerce, both locally and Canada-wide, or Unifor or the Canadian Labour Congress, they all want certainty. In this period of time, we need certainty for our economy. This deal would deliver it.
I look forward to debate this week and participating in it, commencing with today's speech. We know we need to provide certainty for our workers and literally the millions of Canadians whose livelihoods depend on trade with the United States and Mexico.
Mr. Speaker, I am very pleased to join my colleagues today as we deal with Bill , which is extremely important for us. We call it the CUSMA, or the Canada-United States-Mexico agreement.
I am pleased with the work we did at committee on this particular issue. My committee colleagues from all parties showed their dedication to their constituents and their country while we did this study. Every member made it clear to me that it was their sincerest intent to collaborate, co-operate and come together as a committee to make sure that we did the job we were elected to do and worked in a non-partisan way on something that is critically important to Canada.
With our intensified schedule, our committee analyzed this bill for a total of 38.5 hours. The hard work that took place at committee ensured that Bill was returned in a timely fashion. Over 117 witnesses were invited, and we heard from a large range of individuals, organizations and businesses.
I would be remiss if I did not acknowledge the hard work of the staff of the House of Commons who were present during these extended meetings. None of this could have been possible without the work of our committee clerks, analysts, translators and the House of Commons staff, who carried out their duties with utmost professionalism. A huge thanks goes out to everyone involved.
This new agreement will help reinforce strong economic ties between Canada, the United States and Mexico. It will improve North America's ability to compete on the global stage. This agreement will also bring back predictability and stability to the economic relationship between Canada, the U.S. and Mexico, which we heard a lot about from various businesses and presenters.
We have seen several actions from the U.S. on trade that had contributed to economic instability for Canadian businesses and their workers, and they were clearly concerned. Canada was confronted with the option of either renegotiating NAFTA or facing the possibility of the United States withdrawing from the agreement. I am pleased that we now have a modern trilateral agreement that turns the page and focuses on the three pillars that make our economic relationship so successful: stability, economic integration and clear, transparent and enforceable rules.
From the start of the negotiations, Canada set out to achieve key priority outcomes: preserve important NAFTA provisions and market access into the U.S. and Mexico, modernize and improve the agreement, and reinforce the security and stability of market access into the U.S. and Mexico for Canadian businesses. We are proud of the fact that we have achieved all three of those objectives.
It is particularly important to note that the preferential tariff treatment under NAFTA is preserved in this new agreement. Canada's preferential access to the U.S. and Mexican markets is vital to the continuing prosperity of Canadian workers whose livelihoods rely on this trade. During consultations with stakeholders, we heard repeatedly about the importance of preserving the benefits of NAFTA and the integrity of North American supply chains. We understand how vital they are to Canadian companies and exporters.
As an annual average from 2016 to 2018, Canada exported 412.2 billion dollars' worth of goods to the United States, Canada's top export market. Over the same period, Canada exported an annual average of 9.2 billion dollars' worth of goods to Mexico, Canada's fifth-largest trading partner. These are very significant numbers, and the new NAFTA ensures continued preferential access to these key export destinations.
The new agreement preserves the market access outcomes that were achieved in the original NAFTA. This means that NAFTA's duty-free access for all non-agricultural goods will be maintained. For agricultural goods, Canadian exports will also continue to benefit from duty-free access for nearly 89% of U.S. agricultural tariff lines and 91% of Mexican tariff lines. The new NAFTA will help farmers to be more competitive and will make it easier for them to export their products and continue to feed North America and the rest of the world.
Maintaining these tariff outcomes provides Canadians with an advantage over those in countries without a preferential trade agreement with the United States and Mexico. It also ensures predictability and continued secure market access for Canadian exporters to our largest trading partners. The preserved tariff-free environment also safeguards the integrity of the integrated North American supply chains. Other key elements of the original NAFTA have also been preserved, including the chapter 19 binational panel dispute settlement, a state-to-state dispute settlement, the cultural exception and temporary entry for business persons.
The new NAFTA also helps open new market access opportunities in the U.S. for Canadian companies and improves existing market access. The new modernized agreement includes new customs and trade facilitation measures that will make it easier for companies to move goods across the border, including by eliminating paper processes and providing a single portal for traders to submit import documentation electronically. In particular, the new agreement moves away from the traditional certificate of origin to a new certificate of origin that allows companies to use existing documents in their business process to certify origin.
The new NAFTA includes a new stand-alone chapter on rules of origin and origin procedures for textiles and apparel goods that will support Canada's textile and apparel sector. The agreement preserves the existing market access that Canada has under NAFTA to the U.S. and Mexican markets in these sectors and ensures that the benefits of the agreement go primarily to producers located in North America. The new agreement provides greater flexibility for producers to use small amounts of materials from outside the region without losing their preference.
Furthermore, the agreement expands a provision from NAFTA to set out a special procedure to more easily establish the origin of the indigenous textiles and apparel. Under this provision, a textile or apparel item that the parties agree is an indigenous handcrafted good will be eligible for duty-free treatment, even if the good does not satisfy the applicable product-specific rule of origin.
Given the importance of predictability and transparency in international trade, the new NAFTA includes provisions that will provide added assurance for exporters that their goods will not be delayed by unjustified or unclear measures at the borders. Companies will have enough time to adjust to new regulations and other requirements. The agreement also ensures Canada's agricultural and processed food exports can rely on sanitary and phytosanitary measures that are risk-based and that increase predictability of market access so that products make it to market in a reasonable amount of time.
The section 232 side letter on autos and auto parts achieved as part of the overall outcome provides added security and stability for Canadian automotive and parts companies that export to the U.S. market. It will reaffirm Canada's attractiveness as an investment destination for this sector.
On trade and indigenous people, for the first time in a Canadian free trade agreement, the new NAFTA incorporates a general exception that clearly confirms that the government can adopt or maintain measures it deems necessary to fulfill its legal obligations to indigenous peoples. An indigenous working group was established to further the dialogue between the government and indigenous peoples, share ideas and work collaboratively on solutions.
We are pleased to have concluded an agreement that incorporates new and modernized provisions that seek to address 21st century trade issues and support opportunities for Canadian businesses and workers. This includes bringing obligations on labour and environment into the agreement and subjecting them to dispute settlement. It also includes important outcomes toward inclusive trade, including with respect to gender and the interests of indigenous peoples.
In particular, the new labour chapter includes commitments to protect and promote internationally recognized labour rights and principles in North America. It also includes unprecedented protections against violence and against gender-based discrimination with regard to sexual orientation, sexual harassment, gender identity, caregiving responsibilities and wage discrimination.
Mr. Speaker, I will be sharing my time with the member for .
As the member of Parliament for Renfrew—Nipissing—Pembroke, I welcome the opportunity to participate in this debate regarding the Canada-U.S.-Mexico agreement, or CUSMA, which will replace the North American Free Trade Agreement that was negotiated by a previous Conservative government.
To paraphrase comments previously made by my Conservative colleagues, the good news is that, after rigorous debate in Parliament and at committee, Canada will continue to have a trade agreement with our largest trading partner. The bad news is that it was negotiated by the Liberal government, which made concession after concession to the United States and Mexico.
The United States is our greatest ally and our largest trading partner. The NAFTA deal that was negotiated by the Conservatives was good for Canada, with $2 billion a day in trade crossing our border, which represents 75% of Canadian exports. The U.S. direct investment in Canada was over $400 billion, which is huge.
Since NAFTA was first implemented, over five million jobs have been created, and total trilateral trade has quadrupled to $1.2 trillion. Conservative trade deals have done a good job creating jobs for Canadians.
The Conservative Party of Canada is the party of free trade. An election was fought over free trade. Luckily for Canadians, the Conservatives won that election. It was under former prime minister Brian Mulroney that the first Canada-U.S. free trade agreement was signed. Then it was under former Conservative prime minister Stephen Harper that Canada signed a record number of trade agreements, providing Canadian businesses with unprecedented access to markets around the world.
The Conservative Party is the party of free trade. We have long supported free trade and will continue to support a free trade agreement with the United States, our largest trading partner, and Mexico.
On February 25, I had the honour of presenting a private member's bill, Bill , an act to amend the Expropriation Act with respect to protection of private property. There has been a disturbing trend in Canada toward what is referred to as regulatory, de facto or constructive taking of private property. This happens when government uses its statutory powers to regulate or restrict the property rights of an owner without acquiring title to the land being adversely affected. The landowner feels the impact of the regulation as if the land has been expropriated.
In the United States, the fifth amendment of the American constitution protects private property rights. In Canada, government acquisition of land without the owner's consent is not subject to the Canadian Charter of Rights and Freedoms. Private property rights were excluded from the Canadian Constitution when it was repatriated in 1982.
In Canada, landowners' rights are found in the expropriation legislation. The government must follow the law as to what land may be expropriated and must observe procedures set out in the legislation. In Canada the government can strictly regulate land, limiting its value and what a landowner can and cannot do with it without triggering the procedures in the legislation.
A de facto regulatory taking means a property owner is not entitled to compensation unless the restrictions of the owner's rights are such that they should be properly regarded within the meaning of the Expropriation Act.
I introduced Bill to provide some protections from the government taking people's property without compensation. It would appear that CUSMA addresses the issue raised by my private member's bill, Bill C-222. Canadian common law on de facto expropriation suffers from what some jurists refer to as external incoherence.
The present context of CUSMA decries the possibility that the rights of foreign investors in Canadian property are afforded more protection than the rights of Canadian property owners of Canadian property. The source of this incoherence is article 1110 of the North American Free Trade Agreement, or NAFTA, which has been carried over into CUSMA under article 14.8 on expropriation and compensation.
Article 14.8 in the new agreement provides:
1. No Party shall expropriate or nationalize a covered investment either directly or indirectly through measures equivalent to expropriation or nationalization (expropriation), except:
(a) for a public purpose;
(b) in a non-discriminatory manner;
(c) on payment of prompt, adequate, and effective compensation in accordance with paragraphs 2, 3, and 4; and
(d) in accordance with due process of law.
(a) be paid without delay;
(b) be equivalent to the fair market value of the expropriated investment immediately before the expropriation took place (the date of expropriation);
(c) not reflect any change in value occurring because the intended expropriation had become known earlier; and
(d) be fully realizable and freely transferable.
3. If the fair market value is denominated in a freely usable currency, the compensation paid shall be no less than the fair market value on the date of expropriation, plus interest at a commercially reasonable rate for that currency, accrued from the date of expropriation until the date of payment.
4. If the fair market value is denominated in a currency that is not freely usable, the compensation paid—converted into the currency of payment at the market rate of exchange prevailing on the date of payment—shall be no less than:
(a) the fair market value on the date of expropriation, converted into a freely usable currency at the market rate of exchange prevailing on that date; plus
(b) interest, at a commercially reasonable rate for that freely usable currency, accrued from the date of expropriation until the date of payment.
5. For greater certainty, whether an action or series of actions by a Party constitutes an expropriation shall be determined in accordance with paragraph 1 of this Article and Annex 14-B (Expropriation).
The language used here was rolled over from the 1992 NAFTA and it refers to the indirect nationalizing or expropriating of a measure as being tantamount to nationalization or expropriation. The language clearly exists to ensure that compensation will be owed for both de jure and de facto expropriation by the expropriating country.
The scope of article 14.8 is indeed wide. “Measure” includes any law, regulation, procedure, requirement or practice, and the definition of “investment” is so expansive that it cannot be included here. Moreover, there is no allowance, as there is in Canadian common law, for express statutory language to extinguish the right of compensation.
How the previous NAFTA article 1110 has been treated in arbitration among the parties of NAFTA, Canada, the United States and Mexico, has, or at least should have, bearing on expropriation law in Canada generally. This is particularly so given NAFTA's, now CUSMA's, constitution-like status as a document that cannot be amended without the consent of all signatories.
The NAFTA expropriation case that has received the most attention from Canadian legal scholars is probably The United Mexican States v. Metalclad Corporation. In that case, Metalclad had received approval from the federal government of Mexico to operate a landfill in the municipality of Guadalcazar and began to construct the landfill on that basis. Mid-construction, Guadalcazar informed Metalclad that it would require a municipal permit and must cease construction pending its issuance. More than a year later, Guadalcazar finally made its decision: permit denied.
The governor of San Luis Potosi, the state in which Guadalcazar is situated, further declared Metalclad's land to be a natural area for the protection of rare cacti. The federal government took no saving action. In its decision, the tribunal stated, “these measures, together with the representations of the Mexican federal authorities”, on which Metalclad relied, “and the absence of a timely, orderly or substantive basis for the denial of the construction permit, amounted to an indirect” or de facto “expropriation.”
The tribunal's belief in the far-ranging scope of article 1110 is evident. As outlined in its decision, expropriation in NAFTA, and now CUSMA, includes not only “the open, deliberate and acknowledged takings of property” but also the “covert or incidental interference with the use of property which has the effect of depriving the owner, in whole or in significant part, of the use or reasonably-to-be-expected economic benefit of property.”
Where the ratification of CUSMA will leave expropriation law and Canadian property rights in the future is uncertain. Time will tell whether or not the law will continue to afford foreign investors more protection than Canadians. This is one example of why a detailed analysis of CUSMA is so important for Canadians to understand what is being signed.
Mr. Speaker, I truly appreciate the opportunity to speak to Bill , the new free trade agreement with the United States and Mexico, at third reading.
Perhaps I should say that I appreciate finally having the chance to speak to this agreement, as Conservatives have tried time and again to move this deal forward.
It is that clear we need economic stability, and an unsigned free trade agreement with our largest trading partner is anything but stable. In 2016 alone, Canada exported approximately $425 billion in goods and services to the United States while importing approximately $407 billion.
I will be speaking about how this deal will impact my riding and my province, but first I want to reflect on how we got here.
For over 30 years, free trade in North America has been a cornerstone of the Canadian economy. Negotiated by a Conservative government in the early 1990s, NAFTA made tangible, positive impacts on the lives of millions of Canadians. It helped propel us to becoming one of the most prosperous countries in the world, a country that weathered the 2008 recession better than any of our G7 counterparts. This is a Conservative legacy, a legacy of prosperity.
However, for some time during the previous Parliament, it appeared that this legacy of prosperity was in jeopardy as a result of the actions of the Liberal government. Still, the Liberals managed to pull a deal out of the fire. Of course, it would have been better not to have started the fire in the first place.
This deal is likely the best the Liberals could do, but it certainly was not the best deal possible. When negotiations began, President Trump was concerned about what were perceived as unfair trade practices from Mexico. Canada was not his target, nor was there any reason to expect that we would be, yet the Liberals squandered much of the goodwill we had with the United States almost as soon as the negotiations began by presenting a list of priorities that had essentially nothing to do with free trade, a list not, I would note, dissimilar to the list the Liberals presented in their initial discussions with China, who quickly sent them on their way.
Within months, the United States placed the removal of the dispute settlement mechanism and supply management on the table. There had been little indication that these were issues with Canada. The United States went further by imposing tariffs, no doubt unfairly, on Canadian steel and aluminum. We were then left on the outside looking in as the Americans negotiated and agreed to a bilateral trade agreement with Mexico. Canada was forced to play catch-up in negotiations and needed every ounce of goodwill to save a deal.
How did the now respond to this precarious situation? She responded by using her platform while accepting an award to imply that the president of the country we were trying to sign a free trade agreement with was a totalitarian. That is what I mean by starting the fire.
It is remarkable, and I say this with all honesty, that the Liberals were able to salvage any deal out of that house fire, let alone one that contained a dispute resolution mechanism and did not do away with supply management entirely. Still, the question must be asked: How much better would this deal be if the Liberals had not undermined themselves time and time again? Unfortunately, we will never know what deal we could have had, but we do know what deal we have.
Now I would like to take some time to speak about how this agreement would impact my riding and my province.
As many in the House may know, I represent a large, mostly rural riding which is home to the majority of Saskatchewan's supply-managed farms. However, most of my colleagues would be unaware that I also represent a large area that is referred to as the “iron triangle”, a cluster of municipalities with metal manufacturing as a primary or major industry. Communities like Humboldt, Annaheim, Englefeld, St. Gregor, Vonda and many others punch well above their weight in the design, development and manufacture of high-quality, world-leading agricultural equipment.
They make up an important part of Saskatchewan's growing manufacturing industry, which is an industry that exports over $300 million in products each and every year. One can imagine how much of an impact the tariffs placed on Canadian steel and aluminum had on these communities and the companies that call them home.
The trade war that resulted had real consequences for the constituents in my riding, many of whose livelihoods rely on the free movement of manufactured metal equipment throughout North America. Understandably, it came as a relief that the tariffs on steel were removed in the negotiation process. However, that good news has been tempered by the ongoing tariffs on Canadian aluminum. Given what I have already outlined, I think there can be little doubt that a better approach in negotiations would have seen these tariffs removed completely.
Similarly, Canada was in a good position at the beginning of these negotiations to finally bring an end to the long-running saga of softwood lumber disputes. Now, as luck would have it, the United States Department of Commerce recently announced that there would be a significant decrease in the tariffs on Canadian softwood lumber, yet there is still no agreement in place going forward, leaving lumber producers in Saskatchewan in limbo for long-term planning. This was another missed opportunity.
Supply management, as I mentioned earlier, is a part of our economy that likely only came under scrutiny because of the Liberals' poor strategy in the early days of negotiations.
First, let me be clear that I am very happy to see that the Liberals did not literally give away the farm, although whether they figuratively did is up for debate. This new agreement would open up 3.6% of the Canadian dairy market to imports, significantly more than was agreed upon by the previous Conservative government in the TPP. It would also impose a threshold on Canadian exports of milk protein concentrates and other similar products to the United States and Mexico.
But there is more: Not only would CUSMA limit dairy exports to the signatory countries, but it would also limit exports to other countries not party to this agreement. What is more, we would now be required to report to the U.S. dairy commission before we begin negotiations with other countries. This would further limit the ability of Canadian dairy farmers to replace market share lost in Canada by sales to the signatories of CUSMA, and would handcuff us in other free trade negotiations going forward.
The losses to our dairy sector arising from these concessions will be in the hundreds of millions of dollars, and this comes at a time when dairy farmers are seeing increased costs from the carbon tax, costs they cannot recover either through rebates or through the market. The government must realize that our dairy industry, especially the many family farms in my riding, cannot continue to see their margins shrink and still remain in business.
There is more I could say on this deal, but in truth, Canada needs a free trade agreement going forward. We recognize that. Our already weakening economy cannot handle further trade uncertainty. Industry groups, chambers of commerce and provincial premiers understand this, and the majority have therefore asked the House to ratify CUSMA.
Faced with this reality, the questions of what could have been must give way to what is, and so, while far from perfect, CUSMA is better than nothing.
Mr. Speaker, I will be sharing my time with the member for .
I am pleased to rise in the House today in support of Bill .
Over the generations, Canada, Mexico and the United States have established an economic relationship that is a model for the entire world. Since 1993, trade between Canada, the United States and Mexico has more than quadrupled and was valued at $1.2 billion U.S. in 2018.
In 1994, NAFTA created the largest free trade zone in the world. The continental North American economy, which is currently estimated to be worth $23 billion U.S., encompasses a regional market of nearly 490 million consumers.
Under this proven, rules-based free trade system, key sectors of the North American economy have developed into integrated production platforms that strengthen the innovative and competitive economic backbone of North America.
The new agreement will enhance the strong economic ties between the three countries and improve North America's ability to remain competitive globally. This agreement also restores the predictability and stability of economic relations between Canada, the United States and Mexico.
The U.S. took several trade actions that contributed to economic instability for Canadian businesses and their workers. Canada had to choose between either renegotiating NAFTA or seeing the United States withdraw from the agreement. I am pleased that we now have a modern trilateral agreement that turns the page and focuses on the three pillars that make our economic relationship so successful: stability, economic integration, and clear, transparent and enforceable rules.
From the start of the negotiations, Canada set out to achieve key priority outcomes: preserve important NAFTA provisions and market access into the U.S. and Mexico, modernize and improve the agreement as much as possible, and reinforce the security and stability of market access into the U.S. and Mexico for Canadian businesses. We are proud that we achieved those objectives.
It is particularly important to note that the preferential tariff treatment under NAFTA is preserved in CUSMA, which helps consolidate our most important trade relationship. Canada's preferential access to the U.S. and Mexican markets is vital to the continuing prosperity of Canadian workers whose livelihoods rely on this trade.
During consultations with stakeholders, we heard repeatedly about the importance of preserving the benefits of NAFTA and the integrity of North American supply chains. We understand how vital it is to Canadian companies and exporters.
As an annual average from 2016 to 2018, Canada exported $412.2 billion worth of goods to the United States, our top export market. Over the same period, Canada exported an annual average of $9.2 billion worth of goods to Mexico, our fifth-largest trading partner. The new NAFTA ensures continued preferential access to these key export destinations.
Maintaining these tariff outcomes provides Canadians with an advantage over countries without a preferential trade agreement with the United States and Mexico. The agreement ensures predictability and continued secure market access for Canadian exporters to our largest trading partner.
The preserved tariff-free environment also safeguards the integrity of integrated North American supply chains. Other key elements of the original NAFTA have been preserved, including the chapter 19 binational panel dispute settlement mechanism, the state-to-state dispute settlement process, the cultural exemption and temporary entry for business persons.
The new NAFTA also helps open new market access opportunities in the United States for Canadian companies and improves access to existing markets. The new modernized agreement includes new customs measures and will also make it easier for companies to move goods across the border by reducing paper processes and providing a single portal for submitting import documentation electronically.
In particular, the new agreement moves away from the traditional certificate of origin to a new certificate of origin that allows companies to use existing documents in their business process, such as an invoice, to certify origin.
The new NAFTA also includes a new stand-alone chapter on rules of origin and origin procedures for textiles and apparel goods that will support Canada's textile and apparel sector. The agreement preserves the existing market access that Canada has under NAFTA to the U.S. and Mexican markets in these sectors and ensures that the benefits of the agreement go primarily to producers located in North America.
Furthermore, the agreement expands a provision from NAFTA to set out a special procedure to more easily establish the origin of indigenous textiles and apparel. Under this provision, a textile or apparel item that the parties agree is an indigenous handcrafted good will be eligible for duty-free treatment, even if the good does not satisfy the applicable product-specific rule of origin.
The new NAFTA includes provisions that will provide added assurance for exporters that their goods will not be delayed by unjustified or unclear measures at the borders. The section 232 side letter provides added security and stability for Canadian automotive and parts companies that export to the U.S. market and will reaffirm Canada's attractiveness as an investment destination for this sector.
With respect to trade and indigenous peoples, and for the first time in a Canadian free trade agreement, the new NAFTA includes a general exception that clearly confirms that the government can adopt or maintain measures it deems necessary to fulfill its legal obligations to indigenous people. An indigenous working group was established to further the dialogue between the government and indigenous people, to share ideas and work collaboratively on solutions.
We are pleased to have concluded an agreement that incorporates new and modernized provisions that seek to address 21st century trade issues and support opportunities for Canadian businesses and workers. This includes bringing obligations on labour and environment into the agreement and subjecting them to dispute settlement.
It also includes important outcomes for inclusive trade, including with respect to gender equality and the interests of indigenous people. In particular, the new labour chapter includes commitments to protect and promote internationally-recognized labour rights and principles in North America.
This chapter also includes unprecedented protections against violence and gender-based discrimination with regard to sexual orientation, sexual harassment, gender identity, caregiving responsibilities and wage discrimination. It is worth noting that the new chapter also includes a non-derogation clause that prevents the parties from weakening their labour laws to encourage trade or investment.
To address labour violations related to collective bargaining and freedom of association in a timely manner, the agreement also includes new mechanisms for rapid response between Canada and Mexico and between the United States and Mexico.
In the event that, in a state-to-state dispute settlement, one party is found to have violated its obligations with regard to child labour, the other party could trigger the rapid response mechanism to remedy the violation of the child labour obligations.
The full environment chapter, which is subject to the dispute settlement mechanism, includes measures for implementing the parties' obligations under multilateral environmental agreements and responding to global environmental problems, such as illegal wildlife trade, illegal fishing, conservation of species at risk, protection of biodiversity, ozone-depleting substances and marine pollution.
This modernized agreement is good for Canadians because it provides the predictability and stability that businesses and workers sorely need.