Mr. Rick White (General Manager, Canadian Canola Growers Association):
Thank you, Mr. Chairman, and good afternoon to members of this committee. Thank you for inviting me here today to speak about the Trans-Pacific Partnership or TPP.
The TPP is a significant opportunity for the canola industry and canola growers to gain access to a growing trading region. Equally important, it is an opportunity to establish science-based policies that deal with non-tariff trade barriers amongst a block of countries. Specifically, this includes low-level presence, or LLP; maximum residue level tolerances, also known as MRLs; and approved processes for biotech crops.
Canola is an incredibly important economic and agronomic contributor to 43,000 canola farms that span this country. CCGA represents these 43,000 canola growers and is governed by a board of farmer directors representing the provinces from Ontario, west to B.C. Canola is a Canadian success story, increasing from marginal production in the early 1980s to becoming the number one cash crop in the country, now contributing $15.4 billion to the Canadian economy annually. Over 14 million tonnes were produced in the last crop year alone and the industry has set a goal to increase production to 15 million tonnes by the year 2015. That goal may even be surpassed this year, two years early.
The canola industry is highly trade-dependent, exporting 85% of seed and canola products on an annual basis. Therefore, much of canola's current, as well as future, success is directly related to our ability to access and compete in global markets. With a large and ever-increasing population, the Asia-Pacific region continues to grow in economic importance and is a priority market for Canadian canola products. CCGA believes that establishing free and open trade with the TPP member countries will provide a significant opportunity to the canola industry and canola growers. Together, TPP countries represent 51% of Canada's agrifood exports. For the Canadian canola industry, this represents $2.9 billion in canola exports.
For a TPP agreement to really provide benefits to Canadian canola growers, it must address both tariff and non-tariff barriers to trade. In terms of tariffs, Canadian canola products currently face tariff issues in two of the TPP countries: Vietnam and Japan. This results in canola being less competitive in comparison to other oils such as palm, sunflower, and soy, and puts Canadian farmers at a competitive disadvantage. In addition, Japan and Vietnam have higher tariff rates on oil versus seed in order to protect their domestic processing industries.
This type of policy reduces the growth potential of Canada's value-added industry and its positive economic impact. For example, the tariff on canola oil in Japan can be as high as 20% versus a 0% tariff applied to seed. CCGA would like to see this market distortion eliminated by zeroing out the oil tariff.
Beyond reducing or eliminating tariffs, a TPP agreement must also deal with several non-tariff trade barriers. Non-tariff trade barriers have the potential to significantly disrupt trade and therefore directly affect the competitiveness and profitability of Canadian canola farmers. Canadian farmers are some of the most technologically advanced in the world, but non-science-based trade barriers limit the ability of growers to use and profit from technology. The ability to access and adopt new technology is vitally important to Canadian canola growers' ability to compete.
TPP negotiations represent a significant opportunity to establish enforceable and transparent trade policy that is aligned across a block of nations in the areas of LLP, MRLs, and biotech approvals. The importance of establishing transparent and science-based policy in these areas cannot be overstated. Yet TPP negotiations currently represent Canada's best opportunity to advance these issues in a very meaningful way.
In order to feed the world's growing population and at the same time ensure Canadian canola growers remain profitable and contribute to the Canadian economy, farmers must continue to adopt new and innovative technologies. This includes new crop protection products as well as new biotech traits. Crop protection products, which include herbicides, fungicides, and insecticides, are critically important tools in a farmer's production toolbox. They allow farmers to produce more per acre by helping to control yield-robbing weeds, diseases, and insects. Advancements in science are continually facilitating the introduction of new crop protection products that are more targeted, less expensive, easier to apply, or offer a different mode of action that aids in the effort to reduce weed resistance.
However, our trade rules are not set up to facilitate undisrupted trade with the ongoing introduction of new crop protection products. Importing countries can take years to establish legal tolerances for residue levels and often countries have near-zero tolerances for residues of products they have not yet approved themselves. To be clear, though, once a product is approved and an MRL is established in an exporting country, it becomes an issue of regulatory alignment, and is not a health and safety issue at that point. A TPP agreement should support cooperation in setting scientific, risk-based MRLs, thereby encouraging alignment between trading partners.
Another significant non-tariff trade barrier affecting canola growers is the approval of biotech traits. Every country is responsible for the regulatory approval of new genetically modified events. Unfortunately, the lack of consistency, and in many cases, lengthy approval processes, often results in non-tariff trade barriers that delay access to new technology, or in some cases, create disincentives to adopting new technology.
Through the TPP process, CCGA would like to see a commitment by the member countries to make regulatory system improvements that provide a clear and predictable approval process for canola and other events. In addition, this regulatory renewal should ensure a timely and synchronized introduction of new crop genetics to prevent non-tariff trade barriers and trade disruptions. This would require TPP countries to work towards synchronized approvals of new biotech crops as well as mutual recognition of scientific risk assessments.
In addition, with an ever-increasing number of genetically modified crops being grown around the world, there is the risk that the unintentional presence of genetically modified materials, which are approved in the country of export but not yet approved in the country of import, could disrupt trade, similar to the situation that arose with Triffid flax in Europe. It is very important that countries around the world adopt a consistent LLP policy to prevent this type of disruption to trade. As you are aware, the Government of Canada is currently developing a domestic LLP policy that would be applied to unapproved events found in shipments to Canada. CCGA fully supports the Government of Canada in these efforts.
The TPP is a prime opportunity to pursue the discussions around LLP, with the goal of putting in place an LLP policy that is consistent across all TPP member states, to help prevent future trade disruptions that will directly impact the competitiveness of Canadian canola farmers. In closing, I would like to make a brief comment on the Canada-Japan bilateral trade negotiations.
Although Japan is set to join the TPP negotiations this summer, CCGA believes it is still in our competitive interests to continue to aggressively pursue a bilateral trade agreement with Japan. Japan is a very important and consistent market for Canadian canola. They were one of our first, and continue to be one of our longest-standing international customers for canola seed.
Thank you for the opportunity to speak to the committee today. I look forward to taking your questions.
Mr. Jim Everson (Vice-President, Government Relations, Canola Council of Canada):
Thank you very much.
Rick has done a really excellent job of covering a lot of the ground, so I'll try to cut back on my presentation, because we are entirely in sync—the Canola Council and the Canola Growers Association—in terms of the policy issues that Rick worked through there.
Good afternoon. I represent the Canola Council of Canada.
I will just make a brief mention of the council. It is a value chain organization that represents the entire canola sector in Canada, so the same 43,000 growers that Rick represents are part of the Canola Council of Canada, as well as the seed developers, the crushers who process the seed into oil and meal, and the exporters who export canola as a grain for processing at its destination. The Canola Council is a vehicle through which the industry comes together to set objectives and implement plans for the entire sector.
Canola returns the highest value to farmers of any crop in Canada. The industry supports 228,000 jobs, and as Rick mentioned, contributes $15.4 billion to the Canadian economy annually. Our industry has doubled production in the last 10 years. This expansion has brought with it significant investment in rural communities. For example, there has been more than $1.6 billion spent in crushing and processing capacity over the last six years, reflecting the confidence in the opportunity provided by the sector.
Importantly, this income and this economic impact are generated mostly from international trade. More than 85% of the canola we produce in Canada is exported as seed, oil, or meal, bringing in close to $10 billion from exports in 2012. Our industry provides a heart-healthy canola oil and a high-quality animal feed protein to the markets that want it the most.
Our industry succeeds because we are competitive internationally. We've done best in markets that are free of tariffs and non-tariff barriers, where we can compete evenly. Government, through diplomacy and trade negotiations, has a very big role to play in growing and maintaining market access. The government's support of international trade and market access for canola and other agricultural commodities is welcomed by our sector.
Getting the most value from international markets by removing trade barriers means more economic growth, more jobs, and more prosperity for communities across Canada. This is what the TPP offers our industry—more value from international markets by eliminating tariffs and by making trade more predictable with science-based regulation.
I'll talk for just for a moment on trade. Our primary focus in the TPP would be to eliminate any tariffs that remain for canola seed, oil, and meal. Tariffs tax our exports and make them more expensive for consumers in the importing country. It's important to the canola industry that canola is competitive with other oil seeds and that tariffs for oil and meal—value-added products—are not higher than for seed. Eliminating tariffs is the base for a strong canola in export markets. Major markets for canola in the U.S., Mexico, and Japan have all developed in zero-tariff environments.
Japan, for example, has been a long-term and valued customer for canola seed. Our exporters have tariff-free access and can compete with other oil seeds. The result has been that canola has a very high market share in Japan. More than 40% of all vegetable oil consumed in Japan is canola oil, but as Rick mentioned earlier, we've shipped practically no oil to Japan because of restrictive tariffs, and this means that the economic activity that I was talking about earlier, with the new investment in Canada in crushing facilities associated with value-added processing, happens in Japan and not in Canada. The TPP provides an opportunity to address tariff escalation in some countries.
I was also going to speak about a number of the same issues related to non-tariff trade barriers that Rick spoke to. These include low-level presence policies for accessing markets, guaranteed access to markets in a world where there are more and more GM—genetically modified—products, and maximum residue levels. But Rick has outlined those pretty clearly, so I think that perhaps I'll skip that and just come to the conclusion.
I would just reinforce that access to international markets without trade barriers is critical to the canola industry. Canada's participation in free trade negotiations with 11 trade partners is very welcome. We call on the committee to recommend that our Canadian negotiators seek an agreement that eliminates tariffs on canola and canola products. That includes enforceable sanitary and phytosanitary commitments, and commitments to facilitate trade in the areas of crop protection products and biotechnology.
With that, I look forward to questions, Mr. Chairman.
Mr. Don Davies (Vancouver Kingsway, NDP):
Thank you, Mr. Chairman.
Thanks to both witnesses for being with us today and sharing their knowledge and expertise.
At the outset, I just want to say, on behalf of the official opposition, how proud we are of the canola industry in this country. I think it's been an enormous success. It's been an increasing source of our export strength. I want to commend you and the members you represent for the fine work you do and the contribution to our economy.
I want to start with some general issues around the transparency of these negotiations, which has been an issue. Many of us feel that the TPP is not being conducted with the kind of transparency and accountability that we'd like to see in negotiations. I know there are similar issues in the United States, where some 600, I guess, private interests are allowed to see the text and get information about the Americans' TPP negotiations, but Congress and the rest of the American public are not. A similar issue I think exists, at least from our side of the House, in Canada.
Have either of your organizations received briefings from DFAIT or been asked for your input into the TPP talks?
We know that the numbers in TPP are changing. There are 11 countries, soon to be 12, including Canada. Canada already has free trade deals with four of the current TPP members, the United States, Chile, Peru, and Mexico, and we are negotiating with Japan.
Some of the figures we've seen indicate that, leaving Japan out for a moment, the other six countries—Australia, New Zealand, Malaysia, Singapore, Brunei, and Vietnam—account for less than 1% of Canada's exports. Do you see, in terms of that 1% export share, room for growth with respect to those countries in terms of increasing exports from the canola sector?
Mr. Ed Holder:
In the spirit of debunking hoggle-swap, what I have to say here is this. Every time we've had someone at this end of the table talk to us about their issues relating to their growth opportunities—in forest products, wheat, lentils, mining, and I could go on—I can tell you that we get all the great responses that you've just given us. Yet I hear members opposite...perhaps one in particular who comes back and says, you know, our trade deals aren't working.
Some people forget, gentlemen, that we've been through a large international recession, and Canada has done phenomenally well. In fact, I need to quote and put on the record, because I get so frustrated, about the four countries that we've cited that we're dealing with. With Mexico, we have a merchandise trade growth since 2009 of some $600 million going up to 2012; on service trade, another $14 million. With Peru, a small country, we've had $20 million in merchandise trade growth. With the United States, just for fun, in the first 15 years of the free trade agreement—when folks like the members opposite say that our trade deal isn't working—in terms of our exports, not our two-way trade, Canada experienced some $254 billion in growth.
I have to tell you that this does not happen by accident. It happens because of your entrepreneurialism and because we set the terms of reference so that you can grow and you can prosper within your dynamics.
I have a question for you about transparency. Here's the issue I have about transparency. I have friends opposite who have both claimed that it's too secret. That was their lead comment. Here's my question for you. My personal view is that politics are done in public but negotiations are done in secret.
Have you ever had a deal that you've had to do and you didn't want to tell anybody, in your dealings, so you kept it kind of quiet—either of you?
Sorry: you can't just nod. They can't....
Mr. Ed Holder:
Oh, that's lots. Thank you very much.
You see, it's interesting, because when you speak truth, then what happens is...and you're the ones who are speaking the truth. You're the ones I've heard who have said, get these deals done, get Japan done, get the TPP done, and you've talked about this as a broader model.
It's interesting. Around this table, when Doha was a discussion.... Well, I'm not sure we were born when Doha was first initiated, but it seems to me, as I have said before, that it's deader than Elvis. I hate to break it to you, but he's gone. Now what has happened is.... People complained because we did bilateral deals, and frankly, they complained that they weren't multilateral. We can go back in text in this committee when members opposite said we weren't doing enough.
Now we have a multilateral that's called the TPP, we're working on the Pacific Alliance, and we have the CETA, which we're hoping to put to bed fairly soon. Do you support our efforts to try to aggressively go after multilateral deals?
Mr. Peter Clark (President, Grey, Clark, Shih and Associates Limited):
Thank you very much.
We've prepared a lot of background information and given you a link to a study that's several hundred pages long. What I'd like to touch on in the opening remarks are some of the developments in the TPP, and then I'll answer in advance a couple of questions you might ask.
Is the TPP valuable to Canada? Yes, it is. It's valuable as a bridge to Asia, not so much for trade among the participating countries at the present time other than Japan, where we have another negotiation going on in parallel, hopefully a little more advanced than the one for the TPP.
The bridge to Asia is very important. My view of trade agreements is that you shouldn't look at them the way a corporation looks at its quarterly reports. You have to take the long-term view.
When I'm asked whether with CETA we are getting beaten up a little bit, yes, we are, but we shouldn't be looking at the CETA for now or next year or two years from now. We should be looking at it in terms of decades, because we're building a structure that is eventually going to lead to the various big groups around the world coming together to do something that the WTO hasn't been able to do, which is to create true global free trade.
I think Canada really doesn't have any choice but to support that. We're an exporting country. We're a trading country, and we have to be there.
Dealing with the TPP, I've been on the record as saying the TPP isn't really very interesting for Canada without Japan. That's because we have agreements with everybody on this side of the Pacific, and the countries on the other side, with the exception of Vietnam, are pretty small. I've come before this committee previously to talk about our negotiations in South America and Latin America, and I described those as looking for love in all the wrong places—an awful lot of effort for very small markets.
So now we're going after the bigger fish. I think the negotiations with Japan are very important, and I think we're going to have to get on board with the Pacific Alliance fairly quickly.
Will the TPP be finished in October? Nobody really thinks so, not even the people close to President Obama. He has a habit, every time there's going to be a new leaders' summit for APEC, of setting that as the next date. Well, you don't set final dates according to photo ops. Maybe he does, but nobody who's negotiating does.
I do see changes coming. When we were asked back in December whether we thought there would be a TPP, I said what you're really looking at here and what you're looking at in Europe is that these negotiations—notwithstanding all the hype about comprehensive nature, no exclusions, and all that nonsense—are really about exclusions.
Why do I see more hope for the TPP now? Because the Americans are now consulting with their stakeholders. They're asking their stakeholders whether they could redefine their priorities in these negotiations. That means they're going to be backing off some of their more serious demands. But from our perspective if we want to get something out of this deal, there are certain American exclusions that have been there from the beginning that we have to be very wary of and we have to get at.
Our negotiators are first rate. We talk to them fairly often. They can't talk to me about the TPP for some reason because I write columns for iPolitics from time to time or National Newswatch, and we journalists can't be trusted.
A voice: That's true.
Mr. Peter Clark: That's true, yes. Notwithstanding the fact that the official secrets act that I signed when I was in the Department of Finance a long time ago is good for life, and I've been reminded about that.
In any event, it is coming together better, but we have problems with the way the Americans approach this. They've excluded the States from certain important parts of the deal.
They're playing a bit of a cagey game on market access with cumulation. When you have a plurilateral deal like this with 12 countries, you should be able to cumulate the content of each of the members to qualify for the rates. They're under a lot of pressure from Mexico, which doesn't want to buy candy and confectionery from Canada that's made with Australian sugar.
There are games like this going on that we have to be very careful of. I'm glad you're having these committee hearings because you're doing a major service to the country, exposing the issues that we need to deal with.
I'm concerned about the automotive industry. The Americans are doing their own negotiation with Japan, and I'm not sure we'll be able to get the same deal. This is one of the problems we had with Korea. We were nearly there. We stopped negotiating with them. Then the Americans got their deal and now the Koreans don't want to give us the same deal.
You have to face it, we're smaller. Why should they pay the same price for access to our market as they do for the United States?
These are the types of issues that you need to address. I'm happy to talk to you about any of these things, but I'm trying to set a framework. Number one, it's very important for Canada. Canada can't be left out of big deals. If we're not in there for offensive reasons.... Now you heard all kinds of good offensive reasons from the canola people, and I'm sure you'll hear them from my friend Richard as well.
What you're looking at in a trade agreement like this with preferences, and particularly when you have high tariffs, is playing a defensive game. It's far better to be inside the tent sharing the preferences than outside the tent and having people discriminating against you. That's just a basic fact of life in trade negotiations. When you look at Canada, we have to take a look at the size of the package compared to what we're offering because we are a relatively small market.
The last point I'd make is that everybody has problems and everybody tends to get them looked after if there's going to be a deal. The big problem with getting the deal with the United States is that even though they're diluting their ambition, and they're taking serious steps to dilute their ambition to try to get a deal sooner rather than later, the people who support it in Congress are the guys they are trying to dilute and they haven't spoken to Congress yet.
Mr. Easter was asking about people seeing copies of the text. Congress hasn't seen the text. They haven't seen the text, which I find hard to believe.
We were at Capitol Hill dealing with another issue for the Canadian pork industry and we asked them that specifically. They said they haven't seen the text. It's a funny way to run a railroad. In order to get fast-tracked in the United States, they have to go to Congress. Congress holds hearings, and Congress tells the negotiators how they want them to negotiate.
The big issue for them now is that because of the automotive industry and because of Japan, they want a permanency clause in the agreement, which is going to be very difficult to negotiate.
Now China is coming out of the woodwork. Hillary Clinton and somebody else suggested to them that maybe they should join the TPP. They said, “Well, yes, we'd like to join the TPP, but we want it to be more flexible. We want it to be more pragmatic and we want it to take account of differing stages of development.”
If China gets there, it will go longer than Doha.
Mr. Richard Phillips (Executive Director, Grain Growers of Canada):
I'm going to be referring specifically to the deck that was passed around. I'm going to take you through it. There are a number of photos and some facts in there. I'll be referring to that continuously as I go through, so I will ask people to follow along with me.
Thank you very much, on behalf of the Grain Growers, for the invitation to be here to talk a bit about TPP. I looked at the witnesses you were calling and there are some people giving you lots of stats and arguments for and against, and I thought I would to take a little different tack today. I'm going to back it right back down to the farm gate and why this is important for farmers and how we farm today in Canada.
The Grain Growers of Canada represents over 50,000 producers. We grow wheat, durum, barley, oats, corn, soybeans, lentils, canola, peas, rye and triticale. Those are the commodity associations that directly belong to the Grain Growers of Canada.
We're excited about a large regional deal because, as Peter talked about, you can make more gains than you can in a simple bilateral deal.
Coming back to the farm gate, in the next picture here you see a field full of weeds. This is a field of corn and it's full of weeds. The reason I show this to you is that this is how it happens if you plant some crop in the ground in Canada. Whether you're in Quebec, Prince Edward Island, or in the Prairies, a lot of weeds will come up like this. It will choke out the crop. It takes away the nutrients and takes away the water and your yield suffers a lot.
Mr. Richard Phillips:
Not quite. The weeds would be bigger.
Some hon. members: Oh, oh!
Mr. Richard Phillips: Wherever you farm, if you have a lot of weeds growing you have only a couple of solutions.
One is hand tillage. Here's a photo out of Africa. I used to work for an international organization and I did a lot of work in Africa. This is how you control the weeds in Africa. If you were to go back far enough in Canada, you'd find that people controlled weeds this way in Canada, as well, before we were mechanized.
In the next photo there is a tractor in a cornfield. This would be more of a North American model, where you would till the weeds. If you did not farm with modern methods, you would simply use that tractor. You would drive up and down that field three times, four times, five, six, maybe even seven times in a season, burning fuel, continually cultivating the soil, and drying out that soil, as well. Again, there's an effect on your yield, and you burn a lot of fossil fuels. You spend a lot of your time on that tractor seat, farming that way.
Those are two options.
The next picture is a tractor with a lot of dust on it. This is how I grew up farming on our farm. What happens is, if you don't use biotech and you don't use pesticides, you have to kill all the weeds with cultivation, this is exactly what your fields will look like. Many of you from the Prairies would have seen this, people driving down their fields with dust blowing everywhere. The soil erosion, alone, is incredible. I can tell you that farmers do not want to go back to farming this way.
After you've worked your land and you get a big rainstorm, there's soil erosion. This happens in Africa, as well, if they overwork the soil. The soil washes away when you're trying to kill all those weeds by working the fields. In Canada and in many countries, in fact in a growing number of countries, we're seeing far more spraying to kill the weeds. You'll see the sprayer coming down the field. We don't work the soil nearly as much. We farm much more sustainably than we used to.
In this next slide you see the total number of acres seeded to biotech in the world. The green line is the developing countries. This is the developed world. The blue line, which has actually surpassed us now, is the developing world. This is Africa and Central America. You see that farmers in both developed and developing countries are adopting the new technologies.
When you hear the canola people and others talk about how in this agreement we should have maximum residue levels and low-level presence policies, how we need to get biotech approvals, and how we need to do all these things so that trade can continue, it's because all over the world farmers are adopting these new technologies. We need to have trade agreements that, in the modern era, will take into account what's really happening on farms, not the way it was 20 years ago.
I can tell you that once he starts farming with the new tools, there isn't a single farmer in Africa or a single farmer in Canada who wants to go back to putting that hoe in his hand and hoeing those weeds. Nobody wants to go back to that. That's why you see the graph continually going up.
You see a photo of me in my wheat field. If you farm the new way, this is what you get when you use the new tools. You end up with clean fields. You end up with good yields because you haven't overworked the soil. In fact, in many places we're seeing the soil organic matter coming back because we've stopped cultivating so much. In the next photo, you see me in a field of canola.
In summary, it is absolutely critical in a deal like this, which has so many countries in it, that we find tools within these trade agreements to deal with these non-tariff trade barriers. There are countries that are really good at putting them up. Peter knows far more about tariffs than I'll ever know in my life, and he can answer questions on that. But on the non-tariff trade barriers, the reality of modern agriculture today and the growing acres in it, these agreements need to have clauses with effective dispute resolution mechanisms and effective levels that we can manage for the reasons of both trade and food security in the world going forward.
Thank you very much.
Mr. Don Davies:
You also say:
||At this point, participation in the TPP raises more questions for Canada than it answers. Gordon Ritchie, who was so pivotal in negotiating Canada-U.S. Free Trade, suggests the TPP will not be worth much to Canada. I agree.
You say, “the near-term prospects are, frankly, underwhelming.” You point out that Canada already has free trade agreements with four participants.
||...there is thus little new market access that Canada can gain from Chile, Peru and Mexico. And, the U.S. has made it clear that market access discussions with Canada will be one way—[going] South.
There was a sermon from my honourable colleague, Mr. Holder, about the value of trade agreements, but you point out that “Canada has negative trade balances with all members of the current TPP group other than the U.S. and Australia.”
For the countries we have trade agreements with, there are negative trade balances. With Chile, we have a $1 billion deficit. With Mexico, we're have a $21 billion deficit. With Peru, it's a $3 billion deficit. We've had trade agreements with some of these countries for a long time. We have deficits with Vietnam, Singapore, New Zealand, Malaysia. Brunei is a wash. With Australia, there's a slight surplus, and the same with the U.S.
When you point out that we have negative trade balances, even when we have trade agreements with some of these countries, can this possibly be of economic value to Canada?
Mr. Gerald Keddy:
I think it is a reference to the long game, Mr. Chair.
Mr. Clark, thank you for your comments. Many of them here, quite frankly, I agree with, and I do think it's the long game. You can look at your comments and you can say that the glass is half empty, or as I would prefer, look at it and say that the glass is half full.
I appreciate your comments earlier about TPP, and about the importance of being at the table. I'm not about to suggest that it's a perfect set of circumstances, or that the Americans are simply there for the good of all of the other countries involved. I think they're there to protect their self-interest.
My first question is on the challenge. I expect that Japan will be ratified and be a full member. The challenge will be to keep the Americans focused—I think they have been making most of the snowball so far, without question—and to make this broader than it is at this time.
I don't disagree with your statement that this is a long game and it's going to take some time.
Do you agree with that? Is there the possibility that we can actually turn this into something that's workable?
Mr. Peter Clark:
I believe there is a possibility that it can work.
My function is usually to try to stir up discussion and try to point to problems. The problem I see with the United States is that they've sold a big package, and Congress really hasn't had a look at it yet. When they go to get trade promotion authority, I think Congress could make it a bit of a Christmas tree—they have a habit of doing that—and it could make it somewhat harder to do.
My view of the TPP is that it's something we need to do to start our bridge across the Pacific, because the Pacific partners that we have in the TPP are not the ones we want. We want Thailand. We want Indonesia. We want the Philippines. We want those bigger countries that have the capacity to take a lot of our agricultural goods and to take our manufactured goods, especially in the high-tech area.
I look at trade agreements that we're getting involved in now in two ways. One way is that they're defensive, because if you're not in there you're going to lose markets you have. The other way you really have to look at it is as a bridge, and the bigger part of the bridge across the Pacific is the Pacific Alliance, and that's something that you should....
I know the Prime Minister said that we're not ready to jump on board full-time, but when I was in Chile last year they were quite happy that Canada had observer status and that Canada was showing interest.
Hon. Wayne Easter:
Thank you, Mr. Chair.
Thank you, folks.
At the risk of having another rant or sermon from the member opposite, I think you mentioned, Mr. Phillips, that it's not a question of being for or against an agreement. I'd agree with you, but one of the difficulties we do have with this government.... I think the real idea is this. How do we get the best deal to make a trade agreement work for Canada?
I maintain and stand by the fact that we're not doing well under trade. Of the last 61 months, 41 have shown trade deficits. Now, even with a trade deficit, you're still in the value chain and make some gains within Canada. Mr. Clark mentioned the $100 million in pork exports to Korea, where we had a market. In total, when you add in beef, it's a billion-dollar market lost, and the Americans are bragging about taking over our market.
I don't think we're doing well under the trade agreements, and I agree with Mr. Clark that we would do worse if we didn't have them. However, any time you open up a discussion to say there are some problems here, the government takes it as criticism.
Do either of you have any suggestions as to how we can do better under the current trade agreements than what we're doing? What do we need to do to make trade agreements work for Canada? Those questions are for both of you.