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View Bob Saroya Profile
CPC (ON)
View Bob Saroya Profile
2020-03-11 17:40 [p.1961]
Madam Speaker, I come from the private sector and I am really glad to speak to this very important subject.
For Canadian businesses, when it comes to finding customers, Chicago and Toronto are separated by only 800 kilometres. Vancouver and Toronto are separated by 4,000 kilometres. For businesses in Vancouver, customers in Seattle are much closer than even customers in Calgary.
To put it into perspective, 66% of Canadians live within 100 kilometres of a border. It is closer to ship to the south. Geography is a part of it, but over 325 million potential customers is a powerful reason for businesses to look south before they look east or west. For any growing Canadian company, it is just a matter of time before it looks to expand south.
Business is just one part of this equation. Customers in the United States demand Canadian products and Canadians demand American products.
In terms of trade, no relationship compares to that between Canada and the United States: 75% of Canada's trade is done with the United States and $2 billion worth of goods crosses the border everyday.
Just because trade is mutually beneficial does not mean it is easy. Trade can be complex, with different regulations, safety concerns and government help to the industry in different countries. Free trade is never free of rules. That is why agreements need to be reached.
When Canada and the United States began to trade, we did it piecemeal until 1992. That is when Canada, led by then prime minister Brian Mulroney and the Progressive Conservative Party, signed the North American Free Trade Agreement. That created the world's largest economic trading zone. That agreement was an overwhelming success in growing our trade in both the United States and Mexico.
The deputy prime minister put it into perspective when she said, “Today, Canada, the United States and Mexico account for nearly one-third of global GDP despite having just 7% of the global population.”
The clear benefits of NAFTA have helped establish free trade as a foundation of Canadian conservatism, a foundation that former Prime Minister Harper built on by signing trade agreements with South Korea, Jordan and Columbia, among others. Let me remind everyone that the new European Union trade deal was negotiated almost entirely under the previous government. Simply put, the Conservatives understand that.
I am here to discuss the next stage of our trade relationship with the United States and Mexico, the Canada-United States-Mexico agreement, CUSMA, also known as the new NAFTA.
We all know how we got here. On the campaign trail, President Donald Trump promised Americans a better deal with trade. Millions of Americans were concerned that jobs were flowing south to Mexico because of low wages, little regulation and few rights for workers. President trump told them that they were right. On election night, many analysts pointed to these words as the reason that President Trump was able to carry the rust belt states. That delivered him the presidency.
Unfortunately for Canadians, as soon as President Trump was elected, it became clear that calls for a new deal were more than just hot air. Renegotiating NAFTA was a primary goal for his presidency. That meant Canada would be back at the negotiating table.
The talk around the negotiating table was not comforting. Statements made by the Canadian government made it look like it did not take the situation seriously. The Prime Minister threw personal attacks at President Trump, which showed an interest in scoring political points rather than securing a good deal for Canadians.
On the other side, statements by the President about Canada were often not true. At times, it seemed as if Canada was an afterthought, as President Trump focused on Mexico.
The good news is that the deal is done. After years of uncertainty, businesses can once again begin investing in Canada, and investors can be assured that trucks, ships and planes carrying goods between the United States, Canada and Mexico will not grind to a halt due to the repeal of NAFTA.
Many businesses and industries as a whole have made it clear that they want this deal signed, and they want it signed soon. Premiers across the country have also added their voices to that message.
I have already made it clear that the Conservative Party supports free trade. We understood that billions of dollars and hundreds of thousands of jobs, if not millions, were at stake. We wanted the best deal possible for Canadians.
As my colleague from Prince Albert put it, we wanted a good dealt that would last for the next 50 years, but that is not what we got. Instead, Canadians have a deal with new red tape and other barriers that hurt Canadian businesses, a deal that ignores ongoing problems and mutually beneficial economic opportunities.
The barrier I find most disturbing involves trade deals with other nations. Under CUSMA, if Canada continues expanding it free trade network, it will have to seek permission from the United States. This overreach into Canadian sovereignty is a hard pill to swallow. Canada should be free to pursue its trade interests with anyone.
That question of American oversight also made its way into the rules about dairy products. Canada gave up 3% of the market to American suppliers in the deal, but the concessions did not end there. Milk protein exports are now something the United States government has a say over. The Canadian government also negotiated away milk classes 6 and 7. With all these drastic changes, it should not be a surprise that the dairy industry will need help. That help will most likely come in the form of subsidies or payouts for which Canadians will be on the hook.
The new rules around aluminum have also raised concerns. Canada is a massive producer of aluminum. Globally we are the fourth-largest producer in the world. When CUSMA was being negotiated, it was clear we had to protect our market share in the United States, which, according to the Financial Post, is “just over half of it.” The new rules protect our steel industry but do nothing for aluminum.
As I mentioned before, one of the problems with this deal is the issues that were ignored. The issue that comes to the top of mind is the buy America policies. We failed to get rules in CUSMA that would stop the unfair boxing out of Canadian companies from government contracts in the United States. Mexico was able to strike a deal.
As for the lingering softwood lumber dispute, it was ignored and left in the hands of the World Trade Organization, an organization that has struggled to make any progress on the issue at all.
In terms of opportunities lost, a glaring example was not including more professions under section 16. That would have made it easier for companies to bring in high-demand low-supply professionals who they need to grow their businesses.
Instead of the 50 years of certainty, the new NAFTA gives 16 years, 16 years before we are back at the negotiating table, and that is if we can make it past the six-year formal reviews of CUSMA.
While there are many flaws, a deal is better than no deal, and we need to focus on the next steps. The agreement has put many industries at risk. There needs to be discussions on how Canada is going to ensure CUSMA is not a crippling blow for them. Unfortunately, that means Canadian taxpayers are once again facing new costs because of poor decisions by the Liberal government.
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