CIIT Committee Meeting
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Standing Committee on International Trade
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EVIDENCE
Monday, November 30, 2020
[Recorded by Electronic Apparatus]
[English]
I am calling the meeting to order.
Welcome to meeting number nine of the House of Commons Standing Committee on International Trade.
Today's meeting is taking place in a hybrid format, pursuant to the House Order of September 23. The proceedings are available via the House of Commons website.
To ensure an orderly meeting, I would like to outline a few rules. Members and witnesses may speak in the official language of their choice. Interpretation services are available for this meeting. You have the choice at the bottom of your screen of either the floor, English or French.
For members participating in person, proceed as you usually would when the whole committee is meeting in person in a committee room. Keep in mind the directives from the Board of Internal Economy regarding masking and health protocols.
Before speaking, please wait until I recognize you by name. If you are on the video conference, please click on the microphone icon to unmute yourself. For those in the room, your microphone will be controlled as normal by the proceedings and verification officer. When you are not speaking, your mike should be on mute.
Pursuant to Standing Order 108(2), the committee will now proceed with the study of trade between Canada and the United Kingdom and a potential transitional trade agreement.
We welcome as our witnesses today, the Honourable Mary Ng, member of Parliament, Minister of Small Business, Export Promotion and International Trade; as well as Steve Verheul, the chief negotiator and assistant deputy minister, trade policy and negotiations; and Doug Forsyth, chief negotiator for the Canada-United Kingdom Transitional Trade Agreement.
Welcome to you all.
Minister Ng, a special welcome to you today. I will turn the floor over to you, Minister.
Thank you very much, Madam Chair and honourable members, for the invitation to appear before the House Standing Committee on International Trade to provide an update on the Canada-U.K. trade dialogue, based on the Canada-EU Comprehensive Economic and Trade Agreement, or CETA.
[Translation]
Our government remains committed to supporting Canadian businesses through economic recovery and beyond.
[English]
That is why I was happy to announce on November 21, alongside the Prime Minister and our British counterparts, that we have successfully concluded negotiations on the Canada-U.K. Trade Continuity Agreement.
The U.K. is our fifth-largest trading partner globally. In 2019, two-way merchandise trade with the U.K. amounted to $29 billion. This meant opportunities for our businesses and thousands of good jobs for people in both countries.
[Translation]
This agreement ensures Canada and the U.K. can sustain—and build upon—that relationship by preserving the main benefits of CETA.
[English]
More importantly, as it is based on CETA, an agreement Canadians are already familiar with, it provides continuity, predictability and stability for Canadian businesses, exporters, workers and consumers, which is more important than ever as we grapple with COVID-19.
Once the agreement is fully implemented, it will preserve CETA's tariff elimination on 98% of Canadian products exported to the U.K.;
[Translation]
fully protect Canadian producers of all supply-managed products;
[English]
maintain priority access for Canadian service suppliers, including access to the U.K. government's procurement market, which is estimated to be worth approximately $118 billion annually; continue to balance investor protections with Canada's right to regulate in the public interest; and finally uphold and preserve CETA's high-standard provisions on issues like women, small businesses, the environment and labour.
[Translation]
Canadian businesses have told us that what they want most at this time is stability, and this agreement would provide that.
[English]
Of course, we look forward to working towards a new comprehensive bilateral free trade agreement with the U.K. that best serves Canada's interests over the long term, including through strong provisions on women, the environment, small businesses and the importance of digital trade.
[Translation]
And we will continue to seek Canadians' views to ensure that post-Brexit negotiations and agreements with the U.K. continue to reflect Canada's interests.
[English]
Before I go any further, allow me to elaborate on how this continuity agreement between Canada and U.K. came to be and why preserving preferential access to the U.K. is a key priority for our government.
When the U.K. decided to leave the EU single market, customs union and free trade area, that decision drastically affected the U.K.'s trade and economic relations with its largest trading partner, the EU, as well as with Canada, of course.
[Translation]
I need not remind you that once the Brexit transition period ends on December 31, the country will no longer be party to CETA.
[English]
While we continue to closely monitor developments in the Brexit process to see how Canadian interests might be affected, we also realize that it is in Canada's best interests to conclude a stable, mutually beneficial continuity agreement with the U.K. that serves to mitigate Brexit uncertainty.
[Translation]
That is why we have been working on a smooth transition and a path to follow for the future between our two countries.
I know that many of you are wondering why we did not conclude this agreement earlier. Allow me to explain how we got here.
[English]
When Prime Minister Trudeau and then-U.K. Prime Minister May met in September 2017 to discuss ways to strengthen our bilateral relations following the U.K.’s decision to leave the EU, both pledged to make the transition as seamless as possible and sought to preserve CETA’s preferential trade agreements. Although the U.K. was still a party to CETA and therefore not able to undertake new international trade negotiations, preliminary discussions began regarding converting the terms of CETA to a bilateral agreement.
If members recall, at that time there was still much uncertainty surrounding whether the U.K. and the EU would reach an agreement on the U.K.’s departure, or whether the U.K. Parliament might reverse the course of Brexit. At times we were close to arriving at a deal, but the ever-changing circumstances of the U.K.'s exit from the EU made it virtually impossible to conclude a deal that would be in the best interests of Canada. Canada even had to pause negotiations when the U.K. abruptly announced a new tariff rate schedule that would have wiped out any benefit Canada would gain from a trade deal with the U.K.
[Translation]
Then in June of this year the U.K. announced its decision not to seek an extension to the Brexit transition period.
[English]
It was in this spirit that Secretary Truss and I reopened negotiations and committed to concluding a trade continuity agreement to provide certainty for our businesses.
As we approach the end of the U.K.'s participation in CETA, the successful conclusion of this agreement goes a long way to minimizing disruptions for Canadian businesses at this critical time.
[Translation]
That is why negotiators are working diligently to finalize the legal texts in both official languages.
[English]
It’s also why preparations are under way to seek the government’s approval for signature of the trade continuity agreement on an expedited basis so that Parliament may consider the bill.
Lastly, it is why we are also preparing for all scenarios, including mitigating measures that would ensure business flows are not temporarily disrupted under any circumstances in the event that Parliament is not in a position to pass implementing legislation before the end of 2020.
Throughout this process, Canada has continued and will continue to support Canadian companies doing business with and in the U.K. and the EU through what I call the team Canada approach to trade.
[Translation]
This is critical to Canada's economic recovery and future prosperity.
[English]
That is the message I will carry with me later this week as I begin a series of events to mark CETA's third anniversary and engage with Canadian businesses to learn more about their concerns, interests and priorities, as well as opportunities for growth.
[Translation]
Madam Chair, let me conclude by saying that the trade continuity agreement with the U.K. is good for Canadians and for the people of the U.K.
[English]
It is good for the strong, mutually beneficial relationship that our nations have built over more than 150 years. While CETA will continue to govern Canada-EU trade, this continuity agreement will continue to provide the predictability and remove uncertainty for Canadian businesses doing business with and in the U.K.
I would note that I was happy to speak with my critics from each party this past week on this important topic. I look forward to working with them and with my colleagues on all sides of the House to ensure a smooth transition in the Canada-U.K. trade relations in the coming weeks and a better outcome for Canadians in the months and years to come.
[Translation]
Thank you, everyone.
[English]
I look forward to your questions and our discussion.
Thank you, Madam Chair.
Thank you, Madam Chair, and thank you, Minister, for being here with us today.
Minister, last week we learned that it might take two to four weeks before the text of this agreement is finalized. When is this planned to be released?
Thank you so much, MP Gray. It really is terrific to speak to you and to see you today and to have spoken to you last week.
Our officials on both sides in the U.K. and Canada are finalizing the review of the legal text. I will follow the necessary cabinet and parliamentary processes, but know that it is my absolute commitment to make sure that I get this to you and to all of my colleagues as soon a possible.
We're working very quickly now on both sides to finalize the text. Our hope is to do the introduction before we all go away for the holidays. It is certainly my hope that we get through both the cabinet processes to enable me to provide the information to you and colleagues.
Minister, I understand that you're hoping, but is there a commitment to have this legislation to us before we rise on December 11 and to go through the processes? Is there a commitment to do that or is it just hopeful?
We have an agreement, and that is really positive and good. We have officials working on both sides making sure that the legal text is finalized and accurate. It is certainly my hope that we get this to colleagues, but we want to make sure that that important work and the important process around cabinet and parliamentary process is followed.
It is my commitment to do this as soon as possible, mostly because I know that all of our businesses and Canadians are looking to us to do that work quickly.
Okay, Minister. We heard that this is a rollover of CETA and not a comprehensive agreement, as has been stated by you and the departments. We still don't have a text. If it's a simple rollover, why are we here with eleven Parliamentary sitting days left with no text at the 11th hour?
If it were that simple rollover.... I know you explained some of the historical deadlines, but here we are. If it were that simple, why are we literally here in the 11th hour with no information other than an announcement and no text in front of us?
Madam Chair, to the member's question, it is a replication of CETA. It is still, however, an agreement between Canada and the United Kingdom. We want to be sure that the proper work is done by our extraordinary officials here in Canada and those in the U.K. do that work.
I want to share the elements of what is in this agreement. It protects 98% of our Canadian products being exported to the U.K. It fully protects Canadian producers of all supply-managed sectors. It's going to maintain priority access for Canada to our service suppliers. It's going to uphold the provisions that are high in CETA around access for women and small businesses and the labour and environment protection components.
That work has to be done by our officials and a continuity agreement has been reached. I assure the member that our officials are working as quickly as they can.
Thank you, Minister. That's basically the same information that we had in the announcement about nine days ago. I wanted to ask what tariffs are changing. Are any tariffs changing, and can you give us an example?
There are no tariff changes. This agreement largely preserves what is in CETA for our businesses. I think what's really important here is the predictability this agreement will provide to Canadian businesses.
We learned that Canada and the U.K. are set to go back to negotiating a full agreement within a year. That's to get back to negotiating, and we were just informed by Global Affairs this morning, just hours before this meeting, that there's an aim to complete those discussions within three years. So we are to start the negotiations and then to complete them within three years, and we're now four years out. Are these both written into the agreement?
Yes, the subsequent negotiations provision that commits both Canada and the U.K. to enter into negotiations on a new FTA within a year of this CETA's coming into force is in the agreement. Both parties are seeking to conclude the negotiations of the new FTA within a three-year period.
It will be in the agreement that we will enter within a year and that we seek to conclude it within three.
Thank you, Madam Chair.
I would like to welcome and thank you, Minister Ng, for all of the great work that you do and the outreach that you or your office provide, either directly from you or Rachel. Minister, you mentioned in particular that this trade will include the environment, digital, women and, of course, LGBTQ communities as well. Could you tell us how it will benefit in particular the communities that are concerned with these issues?
Thank you, MP Dhaliwal.
Both the U.K. and Canada are committed to entering into a comprehensive agreement that will maintain the high standards reached in CETA. I might remind colleagues that the high ambitions in CETA around the environment and labour were the first of their kind. This continuity agreement will preserve that. However, going forward, there really is synergy and agreement between Canada and the U.K. on the importance of creating even more opportunities for women entrepreneurs, under-represented groups and also for small businesses. Given the importance of digital trade, we are also going to look at how to ensure that a new agreement includes those provisions as well.
I must say that, in this period leading up to the negotiation of a comprehensive FTA, I'm looking forward—and I think we are all looking forward—to speaking with Canadians and businesses about what is important for them so that we can include their input in those negotiations with the U.K.
Thank you.
Over 80% of the businesses in Surrey-Newton, and of course in my colleagues' ridings and across B.C., are small and medium-sized. I would particularly like to know—because those are the businesses that we have to help—how it will happen, what government will do to make sure that it benefits them and how you will make them aware of these members. It's a three-pronged question.
l think it's very important to do that. It is basically fundamental to the mandate I was given by the Prime Minister in this file, as both the small business minister and the international trade minister. It's to ensure that we provide, through trade agreements like this continuity one and all of our trade agreements, opportunities for businesses to grow, particularly for our small and medium-sized businesses to get the benefits of trade and to be able to grow into those markets.
I use a Canada trade or team Canada-type approach where we have many tools in the tool box. It includes the trade commissioner service that helps so many small businesses not only become more ready to export but also helps them when they get in-country. We have a terrific team in the U.K. making sure that businesses get access to capital or the export insurance they need through EDC. Making sure that the resources of government in this Canada trade tool box are completely focused on helping our Canadian businesses start up and scale up in access into those new markets is the commitment of our work.
Minister, you mentioned trade commissioners. On the other side you also mentioned digital trade. We have been going through COVID-19 situation for the past few months, and work has changed.
Can you tell us if your trade commissioners have already started implementing digital technologies?
I was very proud just a couple of weeks ago when I launched the very first ever virtual trade commission. It is to another jurisdiction like South Korea, but we took over 200 businesses virtually into a new market. The trade commissioner service absolutely has adapted their services, and they're going to keep doing that during COVID-19 and beyond. This is going to help businesses do more trade, get access and learn about those opportunities.
I also want to say that our CanExport program has been modified during COVID so that businesses can get access to up to $75,000 to do things like have a greater e-commerce presence so that they take their businesses internationally. They are doing really terrific work, and we will continue to do that to support our small and medium-sized businesses.
In short, because we are going into the holiday season, I would like to request minister that, if there are any further developments, the minister share them with the committee members on all sides.
I agree and am looking forward to working with all of our colleagues on all sides.
I think all of our businesses across the country are telling us that it's really important during COVID-19, and an economic recovery is absolutely top of mind for them. This continuity agreement continues to preserve that access.
I'm looking forward to working with everyone on this.
Mr. Savard-Tremblay is not with us today, but we have Mr. Barsalou-Duval.
Go ahead for six minutes, please.
[Translation]
Thank you, Madam Chair.
I thank the minister for coming to testify today.
She may not be surprised by my question, but it is one that is on everyone's lips and for very good reason. Usually, when we ask questions in committee concerning a topic we must vote on or when we receive a bill or are dealing with an important issue, we can look at it before we position ourselves.
In this case, we must take a position based on words, thoughts and intentions, but there is nothing concrete. We are talking about an important economic agreement between Canada and the United Kingdom. Yet, we have no text for it.
Could the minister tell me why we have no text and when we will have one?
[English]
Of course, absolutely, I respect the work that you and your colleagues do in the service of our businesses. This continuity trade agreement was reached last week, and our officials immediately began the work of ensuring that the legal text of this agreement is reviewed and ready to be provided to us.
I want to commend the officials on both sides and in both countries for their work. I will endeavour to make sure that we get this to you. Of course, we're here today so that I can share the elements of what is in this agreement with you. I'm certainly pleased to be able to do that with you.
[Translation]
I have a point of order, Madam Chair.
I apologize; I did not mean to interrupt my colleague.
I just want everything to be very clear on the record: we are not currently studying the legislative measure. This is a preliminary study that was undertaken before the negotiations were concluded, at the end of last week. In fact, we are continuing the preliminary study at the request of opposition parties. We will be able to carry out the study on the legislative measure afterwards.
[English]
[Translation]
[English]
[Translation]
Thank you, Madam Chair.
I have another question for the minister.
You will understand that we cannot take a position on a document if we don't know what it contains. I assume that you would also not take a position on a document if you don't know what it contains.
I know that you are trying to be reassuring in terms of its content. However, we are used to bad surprises with the federal government, be they coming from the Liberals or the Conservatives, when it comes to gaps in supply management, for instance.
The deadline is set for December 31. Today is November 30, and we will stop sitting on December 11.
Since we don't know whether we will have the text before December 11, would you be able to tell us how many pages it will contain, so we can know how much work there may be? You will understand that, if we have one day left to vote on a 600-page text, that makes no sense.
[English]
Let me start by saying that we will endeavour to share this with colleagues as soon as possible. The officials are doing this really important work. I want to the committee to know that I respect the work you need to be doing in your work in studying this.
With regard to the agreement, I think it bears repeating that it is a rollover. It replicates CETA, but of course it is a bilateral agreement with the United Kingdom. Though it is a bilateral agreement, it does replicate what is in CETA. I will just remind everyone that it will eliminate tariffs on 98% of Canadian products that are exported to the United Kingdom. It will preserve CETA's high standards for access for women and businesses, as well as the environmental and labour standards. It also fully protects Canadian producers of all supply-managed sectors.
[Translation]
Thank you, Minister, but I was asking you how many pages the text will have. Will it be 10 pages, 300 pages or 1,000 pages? That will determine how much time will have to be set aside for considering the document that will be presented.
I understand that it is a document inspired by something that already exists. However, if we had an idea of how much content there was, that could also help us plan our time and know whether we will have a holiday break or not.
I have another question that could be of interest to you.
You talked a lot about predictability earlier. It is important for businesses to have certainty about the future and to have stability. When we invest, we want to do so knowing that there will be a return on investment and knowing the taxation level, as well as the regulatory framework. I understand, as people often don't invest for two days, but for years.
The deadline is December 31. I am now thinking about those business owners. By not knowing what the text of this agreement is, if I had an important decision to make about investments with the United Kingdom, would I decide to make a commitment or to wait?
That is another important question.
[English]
Thank you very much, Mr. Barsalou-Duval.
Madam Minister, please give a short answer to what ended up being a long question.
To the businesses, that is the whole objective of this continuity agreement: predictability and certainty. I want to assure Canadian businesses that we are also working on mitigating measures so that we are mitigating any impact of any disruptions.
Thank you, Madam Minister, for being here.
My first question is whether at any time you directed the Canadian negotiating team to remove the investor-state dispute settlement provisions that exist in CETA from the transitional agreement with the United Kingdom.
Thank you, MP Blaikie. It was really terrific to talk to you the other day.
This agreement is a replication of CETA, and our objective and goal is to provide that continuity based on CETA as the U.K. leaves the EU. There will absolutely be opportunities to seek input from Canadians and from businesses on a new FTA, but the purpose and the objective of this agreement is to replicate CETA so that there is predictability for businesses.
I know in the instance of CUSMA, Minister Freeland was very enthusiastic about the removal of the ISDS provisions from the original NAFTA, so I'm wondering if it will be an objective of the Canadian government in the subsequent negotiations to not have investor-state dispute settlement clauses in a new trade agreement with the United Kingdom.
That's a really important question and I think one that we will have an opportunity to dive into when we begin to pursue a new FTA with the U.K. We plan to do this within a year, as this transitional agreement will have outlined for us, and I will have an opportunity to engage all of my colleagues, and certainly Canadians, on this important feature.
Can you confirm for the committee whether there's a sunset clause in the transitional agreement that's been negotiated?
The agreement does not have that, but it does commit us to seeking to conclude negotiations within a three-year period after this agreement goes into force.
Okay, but if either party declined to come to the table, there would be no penalty and this agreement would continue indefinitely. Is that correct?
I think what we want to do here is to begin negotiations and do that within a year. Both sides, in good faith, want to commit to concluding them in three years. I think both countries recognize how important we are as trading partners and as allies, and we're both very committed to doing this. The conclusion of this transitional agreement, I think, is a good step in that direction.
But it is possible, after doing some negotiating, that if either party decided that the terms of the so-called transitional agreement were better for them, they could decline to sign a new agreement and this agreement would continue indefinitely. Is that fair to say?
Well, I don't want to prejudge the future.
What I do want to do, though, is take a very positive step based on what we have right now with the continuity agreement, which is good predictability and stability, and then begin those negotiations within a year, engaging our very good businesses and Canadians across the country on what's important, and to reach for those ambitions that both the U.K. and Canada have already expressed as important These include better access for our women entrepreneurs and our small and medium-sized businesses and high standards for the environment, preserving those good standards, those high standards, that are already within CETA on both labour and the environment.
We've indicated what's important, and I'm looking forward to pursuing that work with our U.K. colleagues.
One of the things I've been puzzling over that you might be able to help me and the committee with is just what is this kind of agreement? It's a nuanced difference, a transitional trade agreement that largely copies the provisions of an existing comprehensive trade agreement. It has no expiry date. How is that different from a trade agreement, full stop?
We have a transitional agreement. It has no expiry date. It covers all of the same ground as a permanent trade agreement on the one hand, and we're being told that that's a different thing than a trade agreement, full stop, on the other hand.
What really is the difference between a transitional agreement that never ends and a trade agreement?
Well, this continuity agreement provides.... What we sought to do was to get an agreement with the United Kingdom as they were leaving the European Union, as they were exiting. The U.K., of course, is a part of CETA, and we want to make sure that we have an agreement that preserves the terms of CETA for our Canadian businesses.
At the same time, Canada and the U.K. have a bilateral relationship, so while on the one hand we are preserving what we have already entered into while the U.K. was in the EU with CETA, we do want to be able to pursue a bilateral agreement between our two countries, which will of course necessarily take time for us to talk to Canadians and the Canadian people and businesses as we pursue that FTA.
Absolutely, we want to begin that work. Absolutely, we want to conclude a bilateral agreement with the U.K., but I think what I've heard from businesses and Canadians is that certainty and predictability are absolutely important at this particular stage. They want to make sure that as the U.K. leaves the EU, there is predictability and certainty around the terms of CETA. Then we will do the necessary work between the two countries to get to a comprehensive bilateral agreement.
Thank you, Madam Chair.
Thank you, Minister, for being here today.
Last week, we were told the deal would take two to four weeks to firm up and to be ready to present to Parliament. Last week was a week. I'm just curious. How much progress was made last week on the deal with regard to ratifying it?
Well, I think a lot of progress has been made, because Canada and the U.K. have come to an arrangement. We have come to a deal—
Just hold on now.
Just hold on now. I know that, but last week we were told that it would take two to four weeks. I'm just curious: last week was a week, so if we say two weeks, how much progress was made last week? Did we make any progress last week on firming up the deal?
I think progress was made. My officials have said to me that good work has taken place in the U.K. and Canada on reviewing and finalizing the legal text, so yes, progress was made.
Okay. That's good to know.
There's another question that I just cannot calculate in my head, and maybe that has to do with me and nobody else. If we were at a CETA rollover and we began negotiations.... When you see what the texts or the news releases were in March, was your or your office's initial goal, and that of the Prime Minister's Office, to roll over CETA? Whose idea was that? Was that the Prime Minister's? Was it yours? Was it Boris Johnson's? I'm just curious to hear whose idea that was.
We don't have time for that. I'm just curious about March. It said that in March the negotiations kicked off. I'd like to know what happened in March. Was that a rollover or were we originally going to try to do a different deal?
We were always going to make sure that we provided stability and predictability for Canadian businesses as the United Kingdom was getting ready to exit the European Union.
Okay. If that were the case—and basically what we've heard is that maybe it isn't word for word, but basically it was—why from March until now did it take so long...? I understand the WTO thing. I understand they walked away. Really, if it's the same deal—and you've said “predictability” about 13 or 20 times—why wouldn't we just do it earlier and have it off the table so that it could already be before the House?
Well, in all our of work—in all of it—we seek to do it in the best interests of Canadians and to make sure that Canadian interests are at the very, very top.
It was June this year when the United Kingdom announced they were not going to extend membership in, but to leave, the European Union. It was in that context that both Secretary Truss and I decided that we would re-enter negotiations so that we could get a deal that would provide continuity for businesses in both of our countries. But the underlying premise, every single time without fail, is that I will do things—we will do things—in the best interests of Canadian businesses—always.
That is exceptional.
I have one more question for you. In your discussions with the U.K. minister, did he ever say to you, “Geez, Minister Ng, we don't have the bandwidth to do this deal. We just simply do not have the bandwidth to get this deal done right away.” Did he ever say that to you?
I would say that Secretary Truss—and Secretary Truss is a she—and I have had several conversations leading up to what we now have, which is a concluding of this continuity agreement. We had both committed to work hard to make sure that we bring stability to our businesses on both sides of the Atlantic.
Thank you.
Concerning the Senate and our Senate colleagues, because of the schedule of the House, we are up against a tight timeline, and because of our Parliament, we need to have the Senate involved with any ratification of your bill. Have you had discussions with all the Senate House leaders on a timetable, and have you asked them for a commitment to work until the eleventh hour to pass this bill? Have you had any discussions with the leadership?
My officials have begun. I have not yet, but I absolutely intend to. I want to make sure that I start here with my colleagues in the House of Commons, so that we are doing this necessary work.
I will make sure that we follow both the cabinet and the parliamentary process, but there is no question we will be engaging our senatorial colleagues.
Thank you very much, Minister.
First, I want to give a shout out to you, all the officials and the parliamentary secretary for accomplishing this during these unprecedented times. As we know, the U.K. left the EU on January 31, 2020, after concluding a withdrawal agreement. That agreement is to conclude on December 31, 2020, so congratulations on getting the continuity agreement to where it is.
The U.K., as you have identified, is an extremely important trading partner to Canada. You mentioned it is in the top five.
To have no deal would have been devastating for our economy. Which sectors of our economy benefit the most from the U.K. market as a result of this particular agreement?
The member has hit at the very core of why it's so important to have this continuity in place with the European Union. It's really important that we maintain the 98% tariff reduction for our businesses.
It's really important for our agriculture and agri-food exporters that they continue to have access to this important market. It's really important that our services and our financial services continue to have access to this market. It's really important that our Canadian businesses, and I hope women's businesses, as well as small and medium-size businesses, get access to the lucrative—
—government procurement market, which is estimated to be $118 billion annually. It's really important to make sure that access is maintained for our Canadian businesses.
Thank you for that.
I've also asked this question of some of the witnesses we've had. You recently announced support and funding. We're talking about continuity. We have to continue to trade, and we have to continue to look for opportunities.
Can you make a couple of comments on the virtual trade missions and explain to the committee how these would continue to support Canadian businesses, since we're talking about continuity of those agreements?
Yes, indeed, trade agreements are absolutely terrific because they give our businesses that predictability. Businesses understand what the rules are to operate in places where we have trade agreements.
The other part that is equally important is to help our Canadian businesses benefit from trade agreements, making sure that trade and the benefits of it yield to our small businesses, our indigenous businesses, and youth-led businesses.
I am very pleased with the work that my department continues to do to provide tools. There are many tools the federal government has, working with our provincial and territorial colleagues and counterparts, to support businesses as they grow and as they are looking to grow into those international markets.
It's what I call Canada's trade toolbox. It includes our trade commissioner service and programs like the CanExport program. It's working with EDC, BDC and the Canadian Commercial Corporation. We are all literally working as team Canada to continue to provide support to businesses so they can pursue those opportunities in the international marketplace, and certainly in the U.K., through this continuity agreement.
In the continuity agreement there's a provision that requires Canada and the U.K. to return to the negotiating table. What would you like, if anything, to add to this agreement?
Maybe a short answer will not be possible.
Well, we're going to return to the table within a year. Both countries have already stated how important it is to bring about greater trade benefits for women entrepreneurs, preserving the commitments we've made to the environment and creating more opportunities for digital trade. However, I'm looking forward to talking to Canadian businesses about what's important to them.
[Translation]
Good morning.
I thank all the witnesses.
Allow me to first apologize for the microphone quality, which is not ideal. I also want to apologize to the interpreters. I will speak loudly and slowly.
I thank the minister for joining us.
You brought up the fact that there would be an investor-state dispute settlement mechanism.
Why, after removing such a mechanism from CUSMA, is it being brought back in the first agreement negotiated following the adoption of CUSMA, especially in a context of a health crisis where such mechanisms could be used to undermine the special measures we have implemented?
Thank you very much.
[English]
It's really wonderful to talk to you again. Thank you for taking the time with me the other day as well so that we could talk about this important continuity agreement.
What is top of mind for me, and certainly for the businesses and producers and stakeholders who have talked to me about this, is ensuring that the access to the U.K., as it leaves the European Union, continues to be made available to them. That is what this agreement does. I'm pleased that we have reached an agreement to replicate CETA. I'm also pleased that we will be able to do more work, building on this agreement, with a new FTA. We'll begin those discussions within a year.
[Translation]
Apologies, I will repeat my question.
Some of our witnesses who were on the department's negotiation team were saying that it would not be a complete copy of CETA, either.
[Technical difficulties]
[English]
I'm sorry, Mr. Savard-Tremblay, it's impossible for the interpreters to hear the question and get the translation done. You have about half a minute left. Should we go back to Mr. Barsalou-Duval for that half-minute?
Okay: I'll go back to Mr. Barsalou-Duval for half a minute.
[Translation]
Okay.
Thank you, Madam Chair.
Technical issues sometimes happen.
My question is for the minister.
The interim agreement apparently has no expiry date. However, we will have to vote on this agreement, and we will have to examine it very quickly. Things will go so quickly that we probably won't have time to analyze it.
Wouldn't voting very quickly on an agreement that could be applied for years be problematic?
[English]
That is a very important question. I want to assure my colleagues that it is really important that you get the time to do your work. I absolutely respect that. I respect the work of the committee. As I said earlier, officials are working very hard and very quickly, as fast as they can, to make sure that work is completed. I commit to sharing this with you as soon as we possibly can.
Thank you very much.
Madam Minister, I'm wondering if you can just walk us through the scenario where either the agreement isn't signed in time for December 31 or the enabling legislation doesn't pass through Parliament by December 31. What kinds of contingencies are you putting in place? What does supporting Canadian business, in the event a deal isn't enacted by December 31, look like?
Thank you very much. That is really important.
Of course, we are taking that into consideration. I know that all of us here are committed to doing whatever we can for our businesses by way of the agreement, but I also want to make sure that we have plans in place so that we are minimizing disruptions. We are looking at a range of options that will mitigate the impact of any delays that may occur. I can assure you that we are absolutely doing both pieces of work in tandem, because I think we all agree that what is really important here is to make sure that our businesses get that predictability and the continuity they are looking for.
Does there exist already, or have you sought, an understanding from the U.K. government that it won't assess Canadian imports that would qualify for tariff exemptions under the transitional agreement, so that tariffs won't be assessed against them, notwithstanding whether or not enacting legislation passes through the Canadian Parliament by December 31? Likewise, is there a sense that enabling legislation will pass through the U.K. Parliament by December 31?
That is the work that is ahead of us. I can assure you that the U.K. is as committed as we are. I think that both governments do not want to see any undue delays for their businesses on both sides of the Atlantic. We are working very hard and as fast as we possibly can and both of us together are looking at options for how we can minimize the disruption to our businesses and how we might be able to mitigate that. Certainly that work is under way.
I could see her reaching for the mute button.
I'm just wondering what some of those tools are, short of legislation, that would enable.... At the very least if we exclude those other provisions of the agreement that don't have anything to do with tariffs, what non-legislative tools are available to governments on both sides of the Atlantic to maintain the lower, no-tariff trade regime?
That's a very good question.
That's exactly the work that is going on right now. I don't want to make policy here on the fly; I really want the officials to do that necessary work and to look at how we might be able to put forward those mitigating measures. Both countries' goal, absolutely, is to ensure that we minimize the disruption to our businesses and that they get the continuity we have agreed to in this agreement for them.
Good morning, Minister, and thanks for appearing today.
You must have read this agreement. Can we assume that you have had a chance to look at it?
I think what is really important here is that the officials on both sides do the work they need to do so that we can take a look at the final product. I respect the work they do and I'm looking forward to getting that final agreement.
The CETA agreement does a number of things. For one, it provides incredible market access, thus a lot of new customers for Canadian businesses. CETA has eliminated tariffs for 98% of...and provides access to small and medium-sized businesses and women-owned businesses. CETA stands as a high threshold and high mark for labour standards and for environmental standards. It is a positive agreement from which we are seeing benefits for Canadian businesses that are exporting into that market.
I agree that CETA is a good agreement for Canadian businesses and Canadian workers. It seeks to provide opportunities for our businesses to grow into that market. It provides opportunities for our businesses on both sides of the Atlantic to collaborate, and businesses and workers are already benefiting from CETA.
Minister, if I understood correctly from your opening remarks, you have a plan, or you're talking about a plan, in case this agreement is not ratified by December 31 this year. That, to me, sounds like you are not very confident this is going to happen. There's something in your mind, as I'm listening to your speech, that tells me this agreement may not come to Parliament by the end of this year. Can you explain that?
I'm very happy to. I am very confident that both countries have reached a continuity agreement, and that we have worked hard to get to this point because of how important it is to provide stability and certainty to our businesses. I'm very proud about that.
I am very proud that our officials in both countries are working very hard to complete the legal text. I am very committed to making sure that we take a planned approach, making sure there is continuity and predictability, and minimization or mitigation of disruptions. You are hearing from me as someone who has planned, and someone who wants, to ensure that there is a method to minimize disruptions to our businesses.
I'm proud that we have this agreement and that we're able to talk about this now, and absolutely we're going to work hard to make sure that we mitigate any disruptions to business.
I'm not questioning your intention, Minister; I'm questioning your plan. Listening to your remarks, I read that you're not confident that we are going to have an agreement to ensure continuity, stability and predictability for businesses, for our businesses. If the agreement is not ratified by December 31, all of this is just, I'm sorry, fluff. It's just empty words.
I'd like to sense from you that assurance that we will see the agreement before Parliament rises for Christmas break.
Our plan is predictability and stability for our businesses. That is the top priority. We have a deal in place, one that we promised in 2017. We are here. I'm looking forward to our continued work, and I hope that we will all work together to do what is necessary to provide that predictability and that continuity for Canadian businesses.
[Translation]
Thank you, Madam Chair.
It is my turn to thank the minister for her work on this continuity agreement.
The committee heard from Mr. Gobeil, from Les Producteurs de lait du Québec. Mr. Gobeil was very worried about the fact that we may have made concessions on supply management to allow additional cheese into the country. If I understand correctly, Minister, we have stood our ground, and not an ounce of additional cheese will be coming into the country under this agreement.
Was it important for you and for our negotiating team to protect supply management to the benefit of our dairy producers, in Quebec and across Canada?
I thank my respected colleague for her question.
The agricultural sector is essential for Canada's economy. The Prime Minister and I have been clear: there will be no additional concessions. This commitment was made in the continuity trade agreement between Canada and the United Kingdom.
[English]
Yes, the supply-managed sector, the dairy sector, is absolutely important and the commitment is clear. We have protected that in this continuity agreement.
Thank you.
Turning now to the negotiations and what we have experienced over the last few years in negotiating with the United Kingdom, there has been some discussion by opposition MPs surrounding the pause in negotiations that occurred. I believe it was in March 2019, but please feel free to correct me if I'm wrong. It is my understanding that we paused negotiations at that time strategically in order to get the best deal for our Canadian exporters. Can you elaborate a little bit on that?
Let me start with the assurance that all of our negotiations and all of our work will always be guided by what is in the very best interests of Canadians, so you're absolutely right about that.
As I said earlier, there was uncertainty around the U.K. and the EU and whether they would reach an agreement or whether the U.K. Parliament might even reverse its course on Brexit. Given the changing circumstances of the U.K.'s exit from the EU, it was virtually impossible to conclude a deal that was in the best interests of Canadians.
I go back to “in the best interests of Canadians”. Yes, we did pause those negotiations with the U.K. because we wanted to be sure we got an agreement that was always in the best interests of Canadians. In June when the U.K. announced that it would not seek an extension to the Brexit transition period, Secretary Truss and I reopened negotiations and committed to arriving at a continuity agreement that would provide that predictability and that certainty for our businesses, and here we are with that agreement. I'm very much looking forward to working with all of our colleagues so we can bring this agreement into force and provide that continuity and that certainty for our businesses.
Thank you, Madam Chair. Do I have time for a short last question?
I have been receiving very positive feedback and comments from our stakeholders indicating that they very much appreciate that the negotiations have been concluded, and obviously that we have worked in parallel to prepare for all scenarios and mitigate any impacts on their businesses.
I wonder if you have received feedback, as well, from stakeholders and what that feedback has been so far.
Absolutely. The feedback has been positive, and the most positive thing and the most important thing for businesses is certainty. This continuity agreement provides that certainty for businesses, in that they understand that the terms of CETA will now apply to the U.K. as the U.K. leaves the EU. That has been positive.
Rachel, thank you so much for your terrific work. We will continue to work with our stakeholders and our businesses to make sure that we are mitigating any disruptions should there be any. Our commitment to our businesses in terms of continuity and predictability is absolutely our top priority.
Thank you, Madam Chair. Do I have time for one more question?
I think Madam Chair's on mute. I will go ahead.
Thank you, Chair.
Good try.
Minister, it's great to see you again here this morning. In your opening comments you talked about having some process in place if Parliament is unable to get this legislation through by December 31. What is that process? What does that look like, and how does it work? Just so that everybody knows what they're doing for paperwork, how is it going to function in regard to that scenario?
I think what you're asking about is exactly what businesses are looking for, which is that predictability.
I want to assure you that the work between Canada and the U.K. continues, and we will endeavour to look at a range of options that can help mitigate any disruptions there may be. Know that this is the work that is going on now and it is really important for us to make sure that we are there for our businesses.
That actually provides us with a lot of opportunity to actually properly reflect on this bill and bring forward witnesses and do the proper scrutiny that's required.
What would be your drop-dead date as far as seeing this through Parliament goes if your interim process is going into effect on December 31? Do you need it done by June, May, April, January? What would that date become?
I think businesses are looking for us to do our work expeditiously and quickly. I think businesses are looking for us to bring this continuity agreement—
Fair enough, and I agree with you, but they also want us to be thorough.
As Mr. Blaikie said, without a sunset or a binding clause in the agreement that actually forces both parties back to the table, we have to assume this agreement's in place for x number of years, because the reality is that governments change and different people come into place and all of a sudden we don't have the same parties at the table who had the agreement in the first place. We need the time. How much time do we have?
As I said, I respect the work that you and colleagues must do. I think that you and I and all of us listened to our Canadian producers and businesses. I think they expect us to do the work necessary to bring about that continuity for them. We've committed to try to conclude this new set of trade talks within a three-year period and to begin them within a year—
I've heard this. Sorry, I only have five minutes. I don't mean to be rude, Minister, please. I'm not being rude at all when I cut you off. I just need to get more questions in within a short period of time.
You basically said that you can assure Canadians and Canadian businesses that on January 1, they won't have to worry about paying a tariff, that nothing unusual will happen to them. It will be just like it was in 2019 and 2020.
What I'm saying is that we have a continuity agreement and that's good, and that we are working very hard to—
So you can't say that, as I asked?
What are the mitigating measures? You can't have it both ways. As I said, Parliament needs time to go through this legislation and vet it. It probably needs more time than normal because you haven't done consultations, you haven't had ministerial meetings with stakeholders and you don't know what the stakeholders require. In fact, if you talk to stakeholders right now, for example, in the agricultural sector, they're not happy with CETA. They have some disappointments with it and they don't want to see that cut and pasted into the U.K. agreement.
They have all sorts of concerns and if that's exactly what you've done, then they're going to look at it and ask, “What have we dealt with here, what have we got?”
We need, again, to know for sure that you've got a plan in place with the U.K., drawn up so that on January 1, we understand that there's no cause to be concerned, that we can actually see business continuing as you're promising.
I can confirm that we are going to work with the U.K. and that we're going to mitigate disruptions to businesses—
When you say “mitigate” then, if there are tariffs, are you going to subsidize and pay those tariffs on behalf of Canadian businesses?
This is where I get frustrated. We were asking you questions on this a year ago. We're highlighting the fact that this is coming due on December 31, that this is something you had to do.
How many people did you consult before you pulled out of your negotiations? Other countries didn't pull out, but we did, which put us at the back of the list. Whom did you consult with who said, yes, we should pull out, that it's in the best interests of Canadians? You haven't even consulted on what should be in the agreement and what those best interests are.
I won't take unnecessary time. We did commit to an agreement that would replicate CETA. That's what this continuity agreement is. The CETA agreement had seven years' worth of consultations with stakeholders. We put out in the Gazette in 2018—
Thank you, Madam Chair.
Thank you, Minister. I know you've had two challenging foreign concerns that caused you to have trade deals, whether it was the U.S. President asking for a revised NAFTA or Brexit happening in Europe. These were things that caught Canada almost off-guard, but you've been successful in reaching CUSMA and now this interim agreement with Great Britain.
For businesses, SMEs particularly, in my riding of Surrey Centre and the region, and for exporters and Canadian industries that we've heard from, by and large most are very happy and confident in the agreement we've reached. There are a few barriers and some challenges, particularly with agriculture— which has always been a challenge in doing international deals—but by and large, they're pretty happy.
So far they want me to thank you for that. However, after asking several questions of many in the industry and industry leaders, I am concerned that some of the Canadian industries have been slow to take up the benefits of some of these international agreements, particularly CETA, the predecessor to this agreement, in regard to the U.K. They're saying that it's a domestic challenge, not an international challenge, to get industry to be aware of it, to revamp it and to focus on it.
What are you and your ministry, which also deals with small business and enterprise in Canada, doing to raise awareness and know-how on how to take benefits from these agreements and how we can increase Canada's net exports abroad.
That's a terrific question.
As I said a little earlier, Canada can tout that we are the only G7 country that has a free trade agreement with every other G7 country. We have access to almost 65% of the world's economy. We have multilateral agreements like CETA, CPTPP or the new NAFTA, along with many bilateral agreements. That's a billion and a half customers in the global marketplace ready-made for our Canadian businesses, but you're absolutely right that we need to do much more work to help our Canadian businesses to understand the benefits of trade for all businesses: small businesses, women-owned businesses, indigenous-owned businesses and businesses owned by racialized Canadians.
There is work to be done. That's probably why I have a title that doesn't fit on a business card. Small business export promotion and international trade is making sure that we have a robust Canada trade tool box. That trade tool box includes the trade commissioner service; the Business Development Bank of Canada, which helps businesses with access to capital; Export Development Canada; the Canadian Commercial Corporation; and Invest in Canada to attract investment to Canada. Absolutely, work needs to be done domestically, including anchoring tools to Canadian businesses to help them become more export-ready and to take advantage of those opportunities in the international marketplace.
The trade accelerator program was an investment that our government made to the.... The organization escapes my mind now that is delivering that for us across the country. These are collaborations. In B.C. it is a partnership with the B.C. government through their export navigator program. This is about building capacity, helping our businesses understand that these customers are there, and then helping them be successful in that domestic scale-up so they can access those opportunities, businesses and customers abroad.
[Translation]
Thank you very much, Madam Chair.
Madam Chair, the member for Outremont asked you earlier whether there were any concessions on supply management. As this is a member of your party and you answered that there would be no concessions, I assume there probably won't be any, although we can always be surprised. In the past, the government has said countless times that it would protect supply management, and yet it has chipped away at it every time, be it under CETA or the trans-Pacific partnership agreement.
If there is no breach in the interim agreement, knowing that Great Britain has a lot of interest in obtaining concessions, our supply management may be sacrificed in the following agreement.
As the interim agreement will not have an expiry date, if supply management is attacked in the future agreement and concessions are requested, can you commit to keeping the interim agreement?
[English]
I do want to confirm that this transitional continuity agreement fully protects Canada's dairy, poultry and egg sectors, and that there is no new incremental market access for cheese, or any other supply-managed sector. This agreement does provide us a one-year time frame to launch negotiations, and in that it is very much our intention to work with Canada's producers. But I've been clear, the Prime Minister has been clear—
[Translation]
Thank you, Madam Chair. However, you have not answered my question.
If breaches to the supply management are requested in the agreement that will follow the interim agreement, can you commit to maintaining the interim agreement instead of concluding a new agreement that will attack supply management?
[English]
[Translation]
The Prime Minister and I have been clear. There will be no additional concessions.
[English]
Thank you.
I wonder, Madam Minister, if you have some insight into how the U.K. and the EU intend to resolve the dispute about the border between Ireland and Northern Ireland. How will that affect Canadian companies, such as Bombardier, that have production in Northern Ireland that depends upon an open border between Ireland and Northern Ireland?
Thank you very much for that question.
Canada has been really clear about this. We were part of establishing of the Good Friday Agreement. We've been consistently working on the realization of peace. We're always going to support maintaining the integrity of the Good Friday Agreement, including in the context of the U.K.'s exit from the EU. We firmly believe in preserving the Good Friday Agreement. It's crucial to maintaining peace.
I am very happy to hear of the government's ongoing commitment to maintaining the Good Friday Agreement.
I guess what I'm wondering, and members of the committee may know....
New Democrats voted against CETA. There were substantive issues with the deal, but there was also the fact that we didn't think it was advisable to rush through ratification of CETA when the Brexit question was pending because we thought that the ground might shift considerably.
I'm wondering how it is that we go about signing agreements in the context of such radical uncertainty. Depending on how things get resolved between the U.K. and the EU, do you not think that could have a material impact on the terms and conditions under which Canada may want to trade with the United Kingdom? Do you not think that on problems like the border question, Canada might be able to be more effective in, for instance, coming to a solution that maintains that Good Friday Agreement, if we had a better sense of where things were going between the EU and the U.K. before concluding an agreement with them?
That's an important question.
The purpose of this continuity agreement is to provide that predictability.
We do have CETA. CETA is ratified here in Canada. Businesses and Canadians have made plans on that premise. Having this continuity agreement will ensure that this predictability continues to be for Canadian businesses and Canadian workers.
At the same time, we are going to pay close attention to the U.K.'s exit from the EU. Our principles are clear around the Good Friday Agreement and the commitment to that. We will have an opportunity in the negotiation of a new FTA that considers many things from Canadian businesses. We fully intend to engage and listen to our workers.
The answer to your question is that it is really important that we do provide that continuity and that predictability for Canadian businesses. I've heard loudly from them on how important it is for them and their workers. That's what this continuity agreement will do.
Thank you, Madam Chair.
Minister, you mentioned several times over the last week that this agreement is not a cut and paste, even though it is a rollover. What changes, specifically, are in this agreement that make it not a cut and paste?
The agreement is between Canada and the U.K.; therefore, it is a bilateral agreement. The officials, of course, have to make sure that this agreement between the two countries is one that is applicable and enabling for both countries. While it is absolutely an agreement that preserves CETA, it is also a bilateral agreement between the two countries.
Thank you, Minister.
Can you give an example of what a mitigating measure might be if the agreement isn't finalized by the end of the year? You said there are many mitigating measures that you can consider. Can you give us one example?
I don't want to provide uncertainty. What I want to do is provide certainty for our businesses.
We are working on mitigating measures. I would be pleased to talk about them once that work is concluded.
Okay.
I agree that we have businesses that need certainty and stability. I don't understand how we can have certainty and continuity when we don't have a plan for when this will be coming to Parliament.
Just to clarify, Minister, you said that you haven't connected with the Senate. It sounds as if you haven't plotted out a plan over the nine days since this splashy announcement for when this would play out. For example, if it comes to Parliament on December 4, it would go to the Senate on this day, or if it comes to Parliament on December 8, it would go to the Senate on this day? Where is the plan for how that will be structured between Parliament and the Senate?
I can assure you that I will be following parliamentary processes, as well as cabinet processes. As I said earlier, our officials are working very hard to conclude the review as soon as they possibly can. I respect that work. I will endeavour to make sure that this gets to colleagues as soon as possible.
That's still not any kind of a plan where we might have an example of different scenarios. That, in itself, creates uncertainty.
I want to ask about stakeholder engagement because I know that we've heard many times that there was a lot of stakeholder engagement previously, leading up to the original CETA. What years would that have been?
I'm referring to previous to that because we've heard numerous times that there was a lot of stakeholder engagement leading into the original CETA. What years would those have been?
There was seven years' worth of stakeholder engagement to conclude and reach CETA. With respect to the Canada-U.K. trade dialogue, that was commenced in 2017.
Okay, so, if we look at when CETA went into effect and roll it back, we're talking many, many years ago that those engagements would have taken place. Do you feel that whatever information was gained back then—say, five years ago, six years ago—during that entire time period...? Do you feel that there were no issues in this ever-changing environment and that whatever information was gathered way back then suffices for today?
I also heard a lot from Canadian businesses about how important it is to ensure that the provisions of CETA are maintained. That's what this continuity agreement is. CETA was ratified three years ago. We are celebrating the third-year anniversary. I am speaking with businesses and workers this week on the effects and on even more opportunities under CETA. However, we heard also very, very clearly from businesses and workers that it was important to get a continuity agreement, to get an agreement with the United Kingdom as it leaves the EU so that those businesses that work in the EU have the continuity and the predictability that they need in their businesses with the U.K.
Thank you, Madam Chair.
Minister, welcome to the committee again.
I would like to ask you about manufactured products exported to the U.K. and Europe. Before that, let me state that I'm a bit concerned about the value-added manufacturing exports from Canada, which I believe are declining. I think that we should focus more on that. That is very important for the Canadian economy, Canadian jobs and our long-term prosperity.
Now, my understanding is that a lot of Canadian manufacturers' exports to the U.K. are actually destined for other parts of the European Union, that is, to other parts of Europe. If, due to Brexit, the U.K. and the European Union don't come to an agreement by December 31, there will be problems for Canadian companies exporting their goods to different parts of the European Union. Are you aware of this? If so, are you taking any measures to mitigate this?
CETA applies, and Canadian businesses that are exporting to the European Union have CETA. What wasn't in place until we reached this continuity agreement was a similar set of predictabilities for businesses that are exporting to the U.K. With this continuity trade agreement, we now have CETA, and the terms of CETA apply to the U.K. context for those businesses to export into the U.K.
Let me understand as well. The Canadian companies can export their goods to the U.K. Once they land in the U.K., they can go to different parts of the European Union even if the U.K. doesn't get into any sort of agreement with the European Union. Is my understanding correct?
I think a different way of explaining this is that CETA absolutely applies tot all of Canada's exports into the European Union, and the U.K. continuity agreement applies to all businesses exporting into the U.K.
Okay.
One other thing is that one of the witnesses we had before this committee was from Canadian Manufacturers & Exporters. He was concerned that many Canadian businesses, especially small businesses, are not fully aware of the various support programs available. I did tell him of the availability of the Canada Business app.
I just want to confirm with you that the Canada Business app keeps updated funding and other supports that are available to Canadian small exporters.
Yes, absolutely, MP Arya. It is at the very core of my mandate to help our Canadian small businesses start up, scale up, and access new markets and in doing so understand the range of tools that are available. Yes, the Canada Business app continues to be updated, ensuring that the range of information, including information that will support our small businesses exporting, is there.
The bulk of the funding that is available—say, through EDC—is still going to very few large companies in Canada that are exporting. Though the number of small businesses supported by EDC is quite high, the amount actually lent to them is quite small.
During the last four years, one thing I have noticed is that the industry lobby groups, especially those who are focused only on exports to North America but not beyond, seem to have been very vocal. They take up all of the bandwidth. That leaves out a lot of small businesses who are actually growing and whom we should support in exporting to different parts of the world. All of the agreements that we need we have onboard already. What are you doing to help these small Canadian companies export to different parts of the world?
It's the Canada trade toolbox. I am the minister of both small business and international trade, so it's at the core of my job to make sure that our tools are working in support of that exact growth, that of our small and medium-sized businesses.
Thank you, Chair.
Minister, I am just summarizing in my head this whole process. You started off negotiating with the U.K. while they were still part of the EU, early back in 2017-18. You saw the tariff schedules and said there was no advantage, so you broke the negotiations off. You didn't consult with anybody before you did that; you just did it. You didn't think about digital, you didn't think about non-tariff trade barriers, you didn't think about regulatory harmonization and you didn't think about paperwork. You just said, oh, we don't need it.
Then all of a sudden the new tariffs—which the U.K. had basically telegraphed were going to be coming—came out, and we realized, oh, my God, this is horrible. We went back to the table. But because we broke it off and all the other countries stayed on, realizing that there was still more to gain there, we ended up at the back of the line.
Now, we asked you again in January and then December...or, pardon me; well, last year we talked about this. Then we talked about it in February and March. We asked you a series of questions in the House. Then we find out it wasn't until August that you engaged.
What puzzles me even more is that when we asked Mr. Forsyth what his deadline was, he was told December 31. He wasn't even given a deadline that would have allowed Parliament to actually look at the agreement in a timely process.
You said that you have protected supply management. I'm glad to hear that, because Conservative governments in the past have protected supply management and done a great job at it. We did offer compensation, and it's nice to see you finally come through for chicken and eggs and some of the other supply-managed sectors that you didn't before, but at what cost? What was sitting there at the table so that you said we were going to defend supply management at all costs? Did we lose access for beef? Did we lose access for manufacturing? Did we lose access for anything else? Was there a negotiation where we were saying, well, we can maybe allow some access with compensation, or was that talk happening....?
Wait a minute: You didn't consult with anybody. So it's hard for us to understand what we're actually getting into. We have a negotiated agreement, supposedly. It's not through legal scrum. It's not signed. It's not introduced to the House. The House leaders haven't set aside time for it. The Senate isn't even aware of it. How do you tell Canadian businesses that you're serious on this file and that you actually have things under control?
That's a really terrific question and, Mr. Hoback, I think I need to correct you on a couple of areas here.
The United Kingdom, while they are a part of the European Union, was not negotiating comprehensive free trade agreements. They were negotiating—
Minister, let's go back to this again. I laid out the map, and it's a very true map, and if you talk to anybody in the U.K., they would agree with my assertions on this. If you talk to the business community, they also agree with my assertions on this.
We need answers. Let's go back to mitigation. You said that on December 31 Canadian companies won't have to worry going into the new year because they will be able to continue selling and buying goods out of the U.K. as they have before.
What does that look like? If it's not legislated by Parliament, how are you doing it?
You don't have a continuity agreement that's approved by either the Parliament in U.K. or in Canada by December 31. The odds of that happening are very small.
What does plan B looks like?
Plan B looks like mitigating measures that will ensure minimal disruption for Canadian businesses. That work is under way.
Okay, so we have minimal disruption to Canadian businesses. Let's key in on that: minimal disruption to Canadian businesses.
Who are they? Have they been identified? Have they been approached and told there's going to be a problem here for a short period of time until Parliament gets this done? Do you even know who those people are?
The answer is yes, I am in constant communication with businesses, as they are with me. It is really important, and I have heard loudly from them how important it is to have and how good it is that this agreement is here so they can continue to have access to the U.K. on those CETA terms. That work continues.
You said “minimal disruption”. Which sectors are going to be minimally disrupted, and what are you going to do to compensate them? Have you notified them that there's going to be a period of time when there's going to be disruption in dealing with the U.K.?
It's an excellent question, and we are absolutely working with the U.K. as we speak, and we'll continue to do so.
The last speaker will be Ms. Bendayan for five minutes, as we have to do a bit of committee business thereafter.
Thank you, Madam Chair, and if committee business requires it, you can cut me off slightly before. I do want to ask a question of the minister, however.
We heard from Madame Claire Citeau, who was speaking on behalf of agricultural producers. She mentioned—and we could go back to the record—that the problem is not or has not been with the text of CETA itself, but with the way that the EU countries have, since its ratification, interpreted it. As all of us on this committee know, there are significant non-tariff barriers and other technical barriers to trade arising from the way that EU U. countries have chosen to interpret the text of this multilateral trade agreement.
From several conversations with Ms. Citeau and other representatives of the industry, I understand that these technical barriers to trade are the subject of ongoing negotiations and discussion with you, Madam Minister, and your team.
Could you comment a little bit on that, because I think there's some confusion in the way opposition members are characterizing the problems with CETA being transposed to this continuity agreement? In fact, there's no problem with the text itself. The problem is with the way member states are erroneously interpreting it, and, of course, the way that the WTO is currently in a stalemate.
Madam Minister, I'll go over to you on that point.
Thank you very much for that opportunity to provide a bit of clarification. You're absolutely right: we are talking about two different agreements now.
With respect to CETA, while it did mark a new chapter in the relationship between the EU and Canada and, therefore, in the opportunities it provides for Canadian businesses, we are also actively working to resolve those challenges, such as non-tariff barriers posed by some of the EU regulations, particularly around agriculture and food.
I certainly raised this with the former EU trade commissioner, as well as the new EU trade commissioner as recently as just a few weeks ago. We're going to work with the EU on the tools and solutions for our Canadian producers.
With respect to the U.K. and this trade continuity agreement, it is a bilateral agreement. We will establish a Canada-U.K. joint committee that will be modelled on CETA but will work bilaterally between Canada and the U.K. so that we can ensure the successful implementation of this continuity agreement between Canada and the U.K.
Thank you, Minister. Would that committee you just mentioned be composed of officials and negotiators on both the U.K. and Canada sides, or would it include you and Ms. Truss as well?
What is the composition of that a committee?
It's a working level committee. It would comprise the right people on both the U.K. and Canada sides. The outcome or objective is clear: to create a mechanism to enable Canada and the U.K. to work together to resolve and ensure that this continuity agreement is applied successfully.
I had the privilege, as I hope other committee members did, of seeing the conversation involving you, Ms. Truss, our Prime Minister and Prime Minister Boris Johnson. I understand that the relationship between you and Ms. Truss is very positive.
Can you maybe let the committee know how you feel about the ongoing relationship between the United Kingdom and Canada, and your hope for that continued collaboration?
Thank you very much.
We have a positive relationship, because both countries believe in multilateral rules-based trading. It has benefited the economy and the people in both of our countries. We have a long history that goes back. We're very committed to entering into negotiations on a new FTA: one that we will have an opportunity to talk to people about.
I want to thank Secretary Truss and her officials for putting a priority on Canada, and for us to be doing this work together in the interests of our businesses and our people on both sides of the Atlantic.
Thank you, Madam Minister.
Madam Chair, in the interests of time I see it is 12:46 and I know that you did want to get to committee business. If there is any time on my clock remaining I would cede it to you, Madam Chair.
Thank you very much.
Thank you, Minister, and your officials who were here as well.
We very much appreciate it. We know that it's been a tough year for a lot of people, and there have been a lot of issues. The U.K. is just another tough thing to try to get through in 2020.
Thank you so very much. Good luck with everything. We will look forward to seeing the day when you are able to move things forward in the House and for all of us.
If the Minister and her officials would like to leave, we can deal with some committee business.
Thank you so much, Madam Chair. Thank you to the officials who are here. Thank you, colleagues for giving me this time today. Thank you.
How fast everybody disappears.
All right.
A couple of things. On the issue of the Canada-U.K. report, we need to establish a deadline for submission of briefs for the study of Canada-U.K. trade relations, so that the analysts will be able to insert whatever briefs are necessary that would go into the full report that we're talking about getting in 2021. We would receive this after we come back from the break.
The clerk and analyst have suggested that they would need any submissions of briefs by December 18, 2020, in order for this to be submitted, translated and ready for us when we return at the end of January.
Is everyone okay with that deadline of December 18?
I'm assuming so. Nobody is yelling at me.
Yes, Mr. Hoback.
It's hard to have deadlines when I don't know what the Minister's schedule is. Until we really see what's coming into the House and when, to put a fixed deadline on this becomes really tough. I understand the clerks' problem here. I want to work with them, but in the same breath, the problem was created by this minister and this government by not having this done sooner and by not having a firm game plan in place, even at this point in time, on when things would be proceeding.
What type of flexibility do we have here?
I think we could hold off on making that decision. Let's say that we get through another Friday and Monday and put that off for another week? We'll revisit that timeline next Monday and see what has happened between now and then point and if anything has changed. We will put the date off until this time next Monday as far as the final date for any extra briefs goes. Is that all right with everybody?
I have a budget that I need approval for in the amount of $2,900. I believe it has been circulated to all committee members. It needs to be adopted by the committee to pay for headsets and phone lines. There is a bit in there, apparently, for meals. Any unspent funds from that $2,900, of course, will returned to our Liaison Committee.
Is everyone in agreement with that budget?
(Motion agreed to)
The Chair: Thank you very much.
There is one other thing. On December 4 our committee will begin its study on the COVID-19 recovery plan, and we will review and adopt the draft interim report at that same meeting. The interim draft report will be sent to all members by December 2 for review on December 4. For the information of the committee, on December 7 we will resume our study again on the COVID-19 recovery plan.
Is that okay with everybody?
Mr. Hoback, that was an issue you were interested in. Are you okay with that?
Everybody is okay with that. All right.
One other thing, since we have a few minutes here, is that there apparently is going to be required a shutdown for critical maintenance. The whips have been informed that the special order allowing for hybrid sittings of the House and its committees expires on December 11. The infrastructure required to support committee meetings and other events will undergo critical maintenance from December 19 to January 17. This, apparently, has been planned for months, and fits for this time during an extended adjournment to reduce the impacts on normal parliamentary activities.
Right now the administration will be unable to support any events that require multimedia support, including committee meetings, between December 19 to January 17. It's here for the information of committees.
Mr. Hoback.
I guess what has being arranged, then, in regard to the committee meeting in person so that we have proper social distancing and proper things in effect.... Do we have a room big enough to handle all of us? Can we use the House of Commons, because, obviously, we're not going to have this here by December 11. If the minister says we have to get this done by December 31, and does not have a plan B, then what is our plan B? What do we have for facilities that we can utilize to do our job?
Apparently, that's all being looked into. There will be the adequate rules.
Madam Clerk, would you like to offer a comment on the knowledge that you have.
Okay, so they are working at it and trying to make sure we have everything necessary to be able to keep Parliament functioning and our committees functioning.
Is there any further comment?
Mr. Blaikie.
Mr. Blaikie, you're on mute.
It's trying to do too many things at once.
I was going to say that even Mr. Hoback's question, I think, presumes that some kind of enabling legislation will have passed second reading in the House of Commons by December 11. Even that seems unlikely to me. Then if we can't resume....
Maybe to the government members of the committee, and particularly our parliamentary secretary, it would be really nice to get something approaching the outline of a plan for how the House is supposed to deal with this. I don't expect that today, obviously. We just had the minister, and there is not yet the outline of something that looks something like a plan, but sooner is better, it seems to me. I don't know how the government's going to meet this deadline.
Thanks, Madam Chair.
I have two things. One is that I want to congratulate the minister for appearing for two hours, or an hour and 45 minutes. In my time there have been few ministers who have done that. I'm not going to grade her on her performance, but I will say that I give her 100% credit for appearing for that amount of time, and I would encourage other ministers to do the same going forward because I think it's a good thing to do.
The second thing is that I hope that the government will not propose to Parliament and this committee that it be approved at all stages at once with a unanimous consent type of thing. I feel that's the way we're going on this, but I sure hope they don't, and if they do, I hope there's something they can do before that.
Thank you.
Thank you, Madam Chair.
I just wanted clarification on the maintenance schedule from December 19, 2020, to January 17, 2021. Does that mean our committee could sit up until December 18 then, if we did have to deal with legislation that came forth towards the end of that week, like December 10 or December 11? Could this committee be sitting after that point sometime between the 13th and the 18th of December? Could that potentially play out?
The motion that was adopted on September 23 says that the committee can meet until December 11 in a hybrid format. As for what would go on after that, my guess, and I would have to check with my management, is that we could have in-person meetings here in Ottawa.
We'll see if we can get some more information on this for our next meeting so that everyone is clear on where we're going with this.
Madam Chair, I have a quick question. With regard to what we just heard—that there are no meetings between December 19 and January 17—who decides on that? Is it the House or us as a committee?
It's the system maintenance that's required. The House motion says that no hybrid meetings will take place after December 11. There's some critical maintenance that needs to be done on the system to sustain up to 60 events per week, and the House administration has decided to do that between those dates, when the House is not supposed to sit.
Madam Chair, I'm sorry to interrupt you. I did not want you to close the meeting before I had the opportunity to respond to Mr. Blaikie. I certainly received the message loud and clear on the interest of committee members for a plan, as well as Mr. Lobb's comment regarding a unanimous consent motion. I will do my very best to get back to the committee members as soon as possible.
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