INTRODUCTION

According to the results of Canada’s recent census, in 2016, more than one in five Canadians were foreign-born, and almost two in five Canadian children had an immigrant background, either directly or indirectly through at least one foreign-born parent. Canada has a multicultural society, and its ethnocultural diversity is expected to become more significant in the future. From a variety of perspectives, including economic, this trend is beneficial. Immigrants to Canada are entrepreneurial, and some are business owners. A number of their firms export and import, and contribute to Canada’s trade and investment relations with countries around the world.

Immigrant Owners of Privately Incorporated Businesses, By Region of Origin, 2010 (%)

Notes:    Numbers have been rounded. The English-speaking countries are: the United States; the United Kingdom; Ireland; Australia; New Zealand; and South Africa. Statistics Canada did not appear as a witness during this study.

Source: Figure prepared based on: Statistic Canada, Table 3 Distribution of private incorporated business owners who are immigrants, by source region at arrival, 2010, 21 March 2016.

On 11 May 2017, the House of Commons Standing Committee on International Trade adopted a motion to undertake a study on multiculturalism and trade, with a specific focus on the impact of diaspora communities on trade and economic growth in Canada, the ways in which members of these communities trade with their countries of origin, and federal measures to support such trade. During three meetings held between 30 October 2017 and 8 November 2017, the Committee heard from 17 witnesses, including binational chambers of commerce, associations of businesses and professionals, and private-sector firms.

This report summarizes the comments made by these witnesses in four areas: their trade and investment promotion activities; opportunities to increase trade and investment between Canada and specific countries and regions; federal support for international trade and investment; and the employment of immigrants. The report concludes with the Committee’s thoughts.

TRADE AND INVESTMENT PROMOTION ACTIVITIES

Binational chambers of commerce, and associations of businesses and professionals, made comments to the Committee about the ways in which they facilitate international trade and investment. In particular, they focused on selected services that they provide and initiatives that they support, the networking and trade promotion events that they host, and their cooperation and interaction with the Government of Canada and foreign governments.

A. Selected Services and Initiatives

Some witnesses spoke about consulting and administrative services, as well as educational initiatives. For example, the Canadian German Chamber of Industry and Commerce Inc. noted the services that it provides mainly to German firms that want to export to, or operate in, Canada. According to the Canadian German Chamber of Industry and Commerce, these services are in such areas as business incorporation, the identification of business partners, market research, administrative support, financial and human resources needs, and import regulations, tariff duties and product certification requirements.

The Italian Chamber of Commerce of Ontario mentioned that it undertakes market research and coordinates trade delegations, and that it schedules meetings with financial institutions or law firms that can help these firms to gain access to the services and other supports that they need; it does not assist firms by completing all of the documentation required to begin operations in Canada.

B. Networking and Trade Promotion Events

A number of witnesses discussed networking and trade promotion events that they host. For instance, the Polish Canadian Business and Professional Association of Windsor indicated that it organizes annual dinners for business leaders and youth in Windsor to which it invites “high-ranking” keynote speakers; these dinners promote businesses in Windsor, especially those that are owned and operated by Canadians of Polish heritage. The Polish Canadian Business and Professional Association of Windsor also commented that it has had a trade commissioner from the Polish embassy make presentations about “best practices in trading with Poland” and actions to be taken to begin such trade.

As well, the Polish Canadian Business and Professional Association of Windsor said that it has “spearheaded five Polish weeks” in Windsor that encourage trade between Canada and Poland at “a local level,” and that – during each week – it organized more than “20 events celebrating [Polish] heritage with food, traditional dance performances, and educational activities with the University of Windsor and the City of Windsor.”

To help firms in Canada and India develop business relationships, the Indo–Canada Chamber of Commerce remarked that it organizes annual visits to India for a trade delegation comprising between 50 and 120 firms, and federal Cabinet ministers.

The National Federation of Canadian Italian Business and Professional Associations mentioned that it organizes regular dinner meetings with government officials and members of the business community, and hosts events that are primarily focused on business opportunities for women.

In describing its support for youth, the Canada–Ukraine Chamber of Commerce emphasized that it has a youth chapter and invites youth to its networking events; as well, some of its members mentor youth by taking them “into their businesses and showing them how the business is run.” Similarly, the Federation of Portuguese Canadian Business & Professionals said that it hosts various networking and other events for youth, including students, and described its scholarship program for high school, college, undergraduate and graduate students, with 40 scholarships to be presented at its annual gala in March 2018.

Some witnesses emphasized their partnerships with associations that are similar to them. For example, the Italian Chamber of Commerce of Ontario pointed out that it has worked with such groups as the European Union Chamber of Commerce, the Federation of Portuguese-Canadian Business and Professionals, the Indo-Canada Chamber of Commerce and the Toronto Chinese Business Association to co-organize seminars and trade delegations to Europe, including Italy, and to China. Moreover, the Italian Chamber of Commerce of Ontario remarked that it maintains strong relationships with Italian–Canadian businesses and cultural associations, and co-hosts fundraising and networking events with them.

Red Dot Digital suggested that it is “very good at making partnerships,” and highlighted that it collaborates with chambers of commerce, like the Indian and Chinese chambers of commerce, on initiatives and events.

C. Cooperation or Interaction with Governments

A number of witnesses described their cooperation or interaction with the Government of Canada and foreign governments regarding bilateral trade and investment. For example, the Canada–Ukraine Chamber of Commerce noted the Canada–Ukraine Trade and Investment Support project, which promotes trade and investment between Canada and Ukraine; the project is a joint initiative between it and the Conference Board of Canada that receives Government of Canada support. The Canada–Ukraine Chamber of Commerce characterized the project as an “an indispensable tool to the success of the Canada–Ukraine Free Trade Agreement” and as an initiative that promotes “Canadian values,” including those relating to the environment and gender equality.

Regarding the advice that it provides to policymakers, the Canada–Ukraine Chamber of Commerce mentioned that it has been urging the Government of Ukraine to improve its regulatory system in order to promote foreign investment, including by expediting extensions to oil and gas licences. The Canada–Ukraine Chamber of Commerce also stated that, during the negotiations for the Canada–Ukraine Free Trade Agreement, it told the Government of Ukraine not to focus on market access for agricultural goods that are supply-managed in Canada, but instead to pursue other priorities.

The Indo-Canada Chamber of Commerce indicated that it has been in contact with the Government of India to convey its support for a Canada–India comprehensive economic partnership agreement, as well as for a Canada–India foreign investment promotion and protection agreement.

The Polish Canadian Business and Professional Association of Windsor claimed that it “spearheaded the creation of the Windsor-Lublin twin city partnership agreement” in 2000, which resulted in memoranda of understanding between the University of Windsor and several universities in Lublin to promote exchange programs for academics and students. The Polish Canadian Business and Professional Association of Windsor also commented that delegations of academics, students, politicians and “trade professionals” from Windsor have now visited Lublin, and vice versa.

OPPORTUNITIES TO INCREASE TRADE AND INVESTMENT BETWEEN CANADA AND SELECTED COUNTRIES AND REGIONS

In speaking to the Committee, witnesses discussed opportunities for Canada to increase the value of its bilateral trade and investment with a number of countries and regions, with a particular focus on specific sectors, existing and future trade and investment agreements, and trade missions and delegations to certain locations.

A. Specific Sectors

Some witnesses identified opportunities that could lead certain sectors of Canada’s economy to increase their exports of goods and services to such countries and regions as India, Portugal, Ukraine and Europe more generally.

The Indo-Canada Chamber of Commerce suggested that Canada’s firms should pursue opportunities to supply India’s defence, infrastructure and education sectors. In particular, the Indo–Canada Chamber of Commerce indicated that between 15% and 17% of the Government of India’s budget is allocated to the country’s defence sector; while certain Brampton, Ontario firms are exporting to that sector, the amount of this trade is very limited. As well, the Indo–Canada Chamber of Commerce stated that Canada’s firms could contribute to infrastructure development for the 100 “smart cities” that India is building.

In addition, the Indo-Canada Chamber of Commerce mentioned market access opportunities in India for Canada’s small firms. In characterizing small and medium-sized firms as “the backbone of the Indian economy,” the Indo–Canada Chamber of Commerce said that creating connections between Canada’s small firms and similarly sized firms in India could “give [these firms] a boost,” and noted its priority “to have more focus [on small and medium-sized firms] to increase trade and small manufacturing, because in India, manufacturing is very cheap.”

To demonstrate the potential for increased Canadian maple syrup, lumber and beef exports to Portugal, the Federation of Portuguese Canadian Business & Professionals pointed out that maple syrup is “very popular” in the Azores, that the construction of wood-frame houses has become “the new thing” in Portugal, and that Canada has a chance to increase its beef exports to Portugal because that country no longer imports most of its beef from Brazil.

In describing the “huge potential” for firms in some Canadian sectors to increase their exports to Ukraine, the Canada–Ukraine Chamber of Commerce claimed that the country’s engineering, services and manufacturing sectors are a “power in the world.” As well, the Canada–Ukraine Chamber of Commerce suggested that Canada has the potential to supply new technology and equipment to Ukraine’s agriculture and energy sectors.

According to the Canadian German Chamber of Industry and Commerce Inc., opportunities for Canada’s firms to export to Europe exist in such sectors as medical technologies, wine, machinery and electronics.

B. Existing and New Agreements

Witnesses commented that some current and potential agreements involving Canada could facilitate trade and investment with particular regions of the world. For example, in referring to the Canada–European Union Comprehensive Economic and Trade Agreement (CETA), Cyclone MFG. Inc. stated that, "if we have that agreement ratified, it would really help us in doing more business with Europe.” The Italian Chamber of Commerce of Ontario remarked that, because of its efforts to inform firms in Canada and in Italy about CETA’s provisional application, firms in the latter are now more likely to consider the former as a potential place in which to do business.

In suggesting that Canada’s firms have relied on trade with the United States for “far too long,” the National Federation of Canadian Italian Business and Professional Associations mentioned that these firms should consider a “pivot to Europe,” and pointed out that “the opportunity for infrastructure projects is phenomenal” for firms in both Europe and Canada because CETA’s government procurement provisions apply to “provinces, municipalities, and cities—as well as, in Europe, a broader range than just the federal government….”

Additionally, the National Federation of Canadian Italian Business and Professional Associations said that CETA provides firms in Europe with a significant opportunity to export to Canada and to compete with the country’s firms, and described higher imports from Europe as “good” for Canada’s economy because of enhanced competition and “value for services provided.”

Similarly, the Canadian German Chamber of Industry and Commerce Inc. characterized CETA as a “milestone,” and commented that CETA will – in time – increase the number of firms in Europe that export to Canada. The Canadian German Chamber of Industry and Commerce Inc. also predicted that German firms will be affected to only a limited extent by CETA’s tariff reductions because Canada eliminated its tariffs on certain imports from the European Union in March 2015, before CETA’s tariff provisions provisionally took effect in September 2017.

According to the Indo-Canada Chamber of Commerce, a Canada–India comprehensive economic partnership agreement would reduce import duties, help to increase trade between Canada and India “multifold,” and create trust between the two countries’ governments and firms. In particular, the Indo-Canada Chamber of Commerce spoke about India’s “very high” ad valorem tariff on Canadian canola oil, and estimated that the country’s imports of this product would increase by more than 100% if Canada and India conclude a comprehensive economic partnership agreement. As well, the Indo–Canada Chamber of Commerce suggested that a Canada–India foreign investment promotion and protection agreement would lead to more Canadian investment in India.

C. Trade Missions and Delegations

Some witnesses advocated greater participation by Canada’s firms in trade missions and delegations, including to Europe. For instance, the Italian Chamber of Commerce of Ontario stated that these firms’ participation in trade delegations could lead them to “experience and gain a sense of the opportunities that there are in a foreign country to develop business.”

The Federation of Portuguese Canadian Business & Professionals noted that, to enter a new foreign market, “[y]ou have to develop the knowledge base and understand the culture, and you do that by going there and developing real partnerships with the organizations and companies there.”

Similarly, the National Federation of Canadian Italian Business and Professional Associations maintained that representatives of Canada’s firms should “get into an airplane, meet people, actually find the market for their product,” and “do business.” Red Dot Digital claimed that small firms do not always have the “opportunities or the means to participate in trade missions,” and suggested that they should receive funding to enable their participation.

The Canadian German Chamber of Industry and Commerce Inc. characterized German trade fairs as a “good instrument” for Canada’s firms that wish to export to Europe, and mentioned that a plan for about 100 such firms to visit Munich in January 2018 is “a great opportunity to get in touch with German companies.”

FEDERAL SUPPORT FOR INTERNATIONAL TRADE AND INVESTMENT

In discussing the Government of Canada’s support for international trade and investment, witnesses provided comments to the Committee about various existing and proposed services and programs, as well as about the need for greater awareness among firms regarding trade-related agreements, rules and regulations.

A. Existing and Proposed Services and Programs

Witnesses spoke about existing and proposed services and programs that the Government of Canada and some federal Crown corporations provide to support international trade and investment. For example, the National Federation of Canadian Italian Business and Professional Associations suggested that, while Canada’s exporters have “a lot of opportunities to get help from Canadian federal organizations,” they do not use the services offered by the Government of Canada’s Concierge program, Export Development Canada or the Business Development Bank of Canada to the extent that they could.

According to the Canadian German Chamber of Industry and Commerce Inc., the Government of Canada does “quite a bit” to help Canada’s firms export. In describing the opportunities that will result because of CETA, the Canadian German Chamber of Industry and Commerce Inc. maintained that a limited number of the country’s firms export to Europe, and proposed that Global Affairs Canada’s Trade Commissioner Service should support their efforts to do so.

The Canada–Ukraine Chamber of Commerce remarked that Export Development Canada’s webpage indicates that the war in the eastern part of Ukraine is leading the country to be a risky place in which to do business, and commented that Export Development Canada should “get on side” and “co-operate more.”

The British Canadian Chamber of Trade and Commerce said that the Government of Canada appears to be more interested in assisting the country’s manufacturing firms than its services providers, and pointed out that the latter also employ people and pay taxes.

Regarding proposed federal services and programs, Red Dot Digital highlighted that small and medium-sized firms in Canada’s services sector do not have enough opportunities to “break into the markets that have been typically and systematically given to the large companies, like the Deloittes, and so on.” Red Dot Digital stated that the Government of Canada should reduce “red tape” and provide more information about “matchmaking.”

In emphasizing that limited access to financing prevents young business owners from trading internationally, the Polish Canadian Business and Professional Association of Windsor mentioned that Canada’s ethnic communities would benefit if their youth were to become business owners, and encouraged the Government of Canada to establish a program that would make it easier for youth and immigrants to “get off the ground.” The Polish Canadian Business and Professional Association of Windsor added that such a program should include “traineeships” and grants.

As well, the Polish Canadian Business and Professional Association of Windsor indicated that one of its goals is to motivate youth to become educated and interested in business opportunities with Poland. In particular, the Polish Canadian Business and Professional Association of Windsor advocated a “more formal student exchange program between Canada and Poland,” and remarked that the Government of Canada should “simplify” internship programs and student exchanges for the country’s youth.

B. Awareness of Trade-Related Agreements, Rules and Regulations

Witnesses identified a need for greater awareness about trade-related agreements, rules and regulations. For instance, the Canada–Poland Chamber of Commerce commented that Canada’s firms need more information about the ways in which CETA can facilitate exports to Europe, and said that Canada’s small and medium-sized firms “are totally left in the dark.” Accordingly, the Canada–Poland Chamber of Commerce urged the Government of Canada to host workshops where public servants would provide information about CETA. Similarly, the Italian Chamber of Commerce of Ontario suggested that the Government should provide the country’s firms with “as much information as possible” about CETA.

The Canada–Poland Chamber of Commerce stated that Polish import regulations have changed significantly, and indicated that the “interpretation of particular laws and regulations in Poland is very questionable. You may get different interpretations, depending on which city you're trying to do business in.”

Cyclone MFG. Inc. mentioned that, when it seeks information from Canada’s embassies about foreign regulations, it is sometimes referred to public servants in Ottawa. Consequently, Cyclone MFG. Inc. called for that the Government of Canada to ensure that the country’s diplomats are informed about new regulations and have current information with which to respond to inquiries.

According to the Canadian German Chamber of Industry and Commerce Inc., firms in Germany that are interested in establishing Canadian operations lack knowledge about Canada’s taxation regime and business incorporation requirements, with the result that the country’s legal system is “the real big issue for them.” As well, the Canadian German Chamber of Industry and Commerce Inc. encouraged the Government of Canada to hold information seminars for the country’s firms that wish to export to – or invest in – Germany, with a focus on trade and labour laws, as well as the requirements for – and costs of – establishing operations.

The Federation of Portuguese Canadian Business & Professionals advocated a program that would inform Portugal’s firms about the rules and regulations for starting a business in Canada, and about the procedures for becoming a Canadian citizen.

In describing the challenges that some foreign firms face in understanding Canada’s rules and regulations, including in relation to selling wine to the Liquor Control Board of Ontario, the Italian Chamber of Commerce of Ontario claimed that – when compared to large firms – it is harder for small and medium-sized firms to “get a grasp of how everything works,” and stated that the latter need relatively greater support.

The Canadian German Chamber of Industry and Commerce Inc. described Canada’s technical standards as obstacles that prevent Germany’s firms from exporting to – or operating in – the country, and noted that firms in Germany and in Canada believe that it is too expensive and time-consuming to adopt Canada’s and Europe’s technical standards, respectively.

THE EMPLOYMENT OF IMMIGRANTS

A number of the Committee’s witnesses described challenges that may make it difficult for Canada’s firms to hire skilled immigrants, or that may impede immigrants’ ability to find jobs that match their qualifications and skills.

A. Firms’ Ability to Hire Skilled Immigrant Workers

Some witnesses discussed difficulties that Canada’s firms have encountered when attempting to hire foreign workers. For example, in commenting that skilled labour shortages are a “serious hindrance” to the prosperity of many of its members, the Canada–Poland Chamber of Commerce remarked that Canada’s immigration policies have not fully addressed “the current crisis” of limited access to skilled workers, and said that the Government of Canada’s procedures for hiring certain foreign workers are costly for the country’s firms.

The British Canadian Chamber of Trade and Commerce provided a specific example of a skilled labour shortage, noting that – because of “immigration issues” – one of Canada’s firms could not hire a Polish scientist, who was “integral to [the] company.” The Canada–Poland Chamber of Commerce spoke about a Polish sausage producer who operates in Canada and is willing to pay $15,000 to anyone who can assist him in recruiting a butcher who has “certain cultural knowledge of how we prepare certain things.”

To help ensure timely access for Canada’s firms to highly educated and trained English-speaking employees, the Canada–Poland Chamber of Commerce suggested the creation of a “prudently designed” immigration program for the 2 million Polish and other Eastern European individuals who live and work in the United Kingdom, some of whom “feel that their future is in question” because of “the uncertainty surrounding the ongoing Brexit negotiations.”

B. Immigrants’ Ability to Find Appropriate Jobs

A number of witnesses drew attention to challenges that make it difficult for some immigrants to find employment in Canada that matches their qualifications and skills. For instance, with a focus on the accreditation of foreign professionals, the Federation of Portuguese Canadian Business & Professionals claimed that many immigrants to Canada are employed in jobs for which they are overqualified.

In the view of Red Dot Digital, “[i]n some cultures, … you don't look at someone in the eye, and [in Canada,] you can actually … [lose an opportunity to have] a job just by not doing that”; consequently, immigrants’ entry into Canada’s workforce is hindered by inadequate “soft skills.” As well, Red Dot Digital commented that “[t]here should be a guide on general qualities” that are valued by Canadian employers, such as punctuality, and “an explanation of what it means to be a Canadian.”

In stating its support for Canada’s immigration system, the Indo–Canada Chamber of Commerce remarked that the Government of Canada wants skilled individuals to immigrate to Canada, and indicated that the Government “promot[es] their education.” In addition, the Indo–Canada Chamber of Commerce maintained that immigrants adapt to the country’s culture and that, after studying for two years following their arrival and being employed for two years with a work permit, immigrants “get a practical feel about Canada.” According to the Indo–Canadian Chamber of Commerce, after these four years, immigrants cannot legitimately claim that they are driving a cab because of an inability to get a job that is commensurate with their skills; these individuals have studied in Canada and have become accustomed to the country’s “systems.”

The Federation of Portuguese Canadian Business & Professionals provided several suggestions for helping foreign professionals find jobs in Canada that match their qualifications. For example, the Federation of Portuguese Canadian Business & Professionals pointed out that some of CETA’s provisions could make it easier for European professionals in designated occupations or sectors to work in Canada, and urged consideration of ways to facilitate employment for professionals in other occupations and sectors.

In addition, the Federation of Portuguese Canadian Business & Professionals stated that specific professional organizations should be made aware of the effects of delayed entry of skilled immigrants on Canada’s economy, and of the “superiority of the level of education in the other countries”; this information would increase the probability that these organizations would provide accreditation to qualified immigrants.

Moreover, because some students “have problems since they've gone to university, studied, and gotten credits, and those have become useless because they're not transferrable to these other schools,” the Federation of Portuguese Canadian Business & Professionals called for an international system of transferable education credits that would be recognized at multiple schools.

CONCLUSION

Apart from Indigenous peoples of Canada, the country is a nation of immigrants. Immigrants to Canada, and their offspring, have made – and will continue to make – positive economic and other contributions to Canada, including through their ownership or operation of some of the country’s firms. Among other benefits, these firms sell to, buy from and invest in countries around the world. They create jobs and pay taxes that help to finance a range of public policy priorities. They develop innovative products that improve business competitiveness and respond to consumers’ needs, while also contributing to the socio-economic development of local communities throughout Canada.

Canadians Under 15 Years of Age with an Immigrant Background, By Generational Status, 1891–2036 (%)

Notes:    The data for the 1891–2016 period are actual; those for the 2021–2036 period are projections. “Total” means total children with an immigrant background. “1st Gen.” means first-generation individuals, while “2nd Gen. (1)” means second-generation individuals with one foreign-born parent and “2nd Gen. (2)” means second-generation individuals with two foreign-born parents. Statistics Canada did not appear as a witness during this study.

Source: Figure prepared based on: Statistics Canada, Children with an immigrant background: Bridging cultures, 25 October 2017.

Many of Canada’s diaspora communities maintain strong family, economic and other ties to their countries of origin and to their heritage. In the Committee’s view, Canada can do more to leverage these ties in order to increase Canadian exports and attract investment, thereby creating a greater number of jobs for Canadians of all origins.

In that regard, the Committee urges representatives of federal trade-related agencies, such as Export Development Canada and the Trade Commissioner Service, to attend events organized by binational chambers of commerce, as well as associations of businesses and professionals, with a view to identifying and exploring opportunities to enhance trade and investment.

The Committee hopes that decision makers will continue to recognize the contributions that Canada’s ethnocultural diversity makes to the country’s economy, including through international trade and investment activities, and to make policy choices that would ensure ongoing positive outcomes.