SINT Committee Report
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The Conservative Party respectfully submits the following dissenting opinion to “Elements of an Emerging Markets Strategy for Canada”, a report of the Standing Committee on Foreign Affairs and International Trade.
There can be no question of the importance of creating and pursuing a strong strategy for promoting trade with new and emerging markets, there must be a reflection of Canada’s need to grow beyond the notion of inflated imports alone as trade objectives.
The report as submitted by the members of the Subcommittee on International Trade, Trade Disputes and Investment occasionally falls victim to the use of language that leans towards reactionary protectionism for Canada’s domestic industries. A balance must be struck between adjustments to the ever-changing global trade environment and invoking temporary and unsustainable interventions to shield sectors from external market forces.
The Conservative Party of Canada recognizes the unique nature of our domestic trade objectives and counsels the government to end its policy of divisive and polarizing dialogue on international trade. Canadian industry relies on the federal government to continue its ambitious agenda of trade liberalization.
Issue 1.)
In the attached report, there is reference to and Recommendation made for including rules of origin requirements in bilateral and regional trade agreements (see Recommendation 3.)
The Conservative Party of Canada does not support establishing mandatory rules of origin requirements in bilateral, regional or multilateral trade agreements as this would negate the progress made to dismantle non-tariff trade barriers.
Issue 2.)
In section B, points 69-72 reflect the trend towards unbalanced dialogue. Legitimate discussion on the government’s commitment to defend the “unique policy models and institutions” is not balanced by a reaffirmation of the government’s commitment to aggressively pursue a global increase in strong, rules-based, clean market access for Canada’s export-oriented commodities.
The Conservative Party of Canada recommends that the Government of Canada re-commit to achieving a strong and enforceable agreement at the World Trade Organization (WTO) that achieves increased effective and efficient market access to global markets while also maintaining the sovereignty to retain domestic marketing practices consistent with WTO obligations.
Issue 3.)
Reactionary policy direction is also reflected in Recommendation #13.
Recommendation 13:
That the Government of Canada conducts a formal review of the Investment Canada Act, to ensure that the Act is effective in delivering on its stated intent — ensuring that foreign investment in Canada serves the national interest. The Investment Canada Act should make certain that foreign investment maximizes the benefit to Canadians, including, but not limited to: creating jobs in Canada; building the domestic capital stock; raising productivity levels; and improving research and development capacity. Any investment that is not in the Canadian national interest should be rejected.
“Elements of an Emerging Markets Strategy for Canada”
The Conservative Party of Canada recommends that the Government of Canada pursue all international trade actions with Canada’s national interests in mind, including new and emerging markets without resorting to aggressive and protectionist language or threats to reject foreign investment. The Conservative Party of Canada believes that the Government of Canada must commit to ensuring all negotiations are concluded in a manner than both promotes foreign investment and is consistent with Canadian interests and values.
The Conservative Party of Canada further recommends that the Government of Canada amend the Investment Canada Act to expand the review process to include not only the net benefit to Canada in reference to our industrial, economic and cultural policies, but also a consideration of our national security interests. This would include security of supply, technology transfer and any anti-trust implications.
Issue 4.)
In discussion of “Adopting a Whole-of-Government Approach” in section G, reference is made and recommendation is offered to leverage the Canadian International Development Agency’s (CIDA) funds and CIDA-INC program to promote trade in developing nations. The Conservative Party agrees with the Report’s expression of concern over CIDA’s move away from bilateral aid spending towards transferring monies, responsibility and accountability to multilateral institutions such as the United Nations. On the other hand, the Conservative Party does not agree with references to the concept of informal “tying” Canadian goods and services from the Canadian private sector to the delivery of foreign aid.
The private sector does play an important and under-recognized role in contributing to development in countries where they have investments. It must be made clear by the Government of Canada that private sector business can expect support from the government to establish development projects in concert with their operational investments around the world.
The Conservative Party of Canada Recommends that the definition of Export Assistance Programs under section C, sub-section 1, Existing Programs should make clear that CIDA-INC is an initiative that provides financial support to Canadian businesses planning development related projects as a consequence of their business investments in developing countries, rather than an initiative to establish Canadian corporate investment in developing nations.
The Conservative Party of Canada recommends that the Government of Canada address concerns raised by the un-legislated nature of CIDA which lays this crucial element of Canada’s global contribution vulnerable to misappropriation. The inclusion of CIDA and CIDA-INC in both the Commerce section of the recently released International Policy Statement (IPS) and the attached Report raises concerns by the Conservative Party that CIDA funds may be diverted from development work towards priorities such as trade promotion rather than being effectively leveraged to enhance the development advantages that can be achieved as a consequence of Canadian industry investment in developing nations.
Issue 5.)
The Virtual Trade Commissioner program has been expanded to address many of the elements of the now cancelled Program for Export Market for Industry program (PEMD). This negates the need to pursue new and potentially duplicate programs and services as recommended in Recommendation 29 of the attached report.
The Conservative Party of Canada recommends that the Government of Canada expand and enhance the International Trade Commissioner Programs and services to address specific emerging market requirements rather than add expense and bureaucratic infrastructure by establishing a program to provide support to small-and-medium sized enterprises.
The Virtual Trade Commissioner Program includes the International Business Opportunities Centre (IBOC), which is “the export opportunities sourcing centre for Team Canada Inc, a partnership of government departments and agencies working together to provide trade services to Canadian exporters.
Business leads from Canada's trade commissioners are collected and researched by IBOC. The opportunities are then disseminated daily via the Virtual Trade Commissioner (VTC) to Canadian companies who have registered via the VTC website at www.infoexport.gc.ca. The service is free of charge and is exclusive to Canadian companies.”
In addition, Industry Canada has developed an online portal to encourage Canadian businesses to access and pursue domestic and international trade opportunities. SourceCAN is an electronic marketplace. It raises the awareness of Canadian companies about business opportunities and matches their products and services with thousands of these opportunities posted daily, by both domestic and foreign corporations and governments. SourceCAN helps Canadian companies win new business both in Canada and in the international marketplace. It facilitates trade and empowers small and medium sized Canadian companies to compete in the global trading environment.
These initiatives address online, one-step access for Canadian businesses and while there may be room for discussion regarding the potential overlap and departmental territoriality of these two programs their existence contradicts the justification for Recommendation 21 of the attached report.
The Conservative Party of Canada recommends that the Government of Canada increase support and development and explore the streamlined delivery of programs and services that currently exist rather than establish a new and duplicate one-step program to distribute via the internet business opportunities for Canadian enterprises.
Conclusion
In an increasing competitive global economy, trade remains the key to future prosperity in Canada. Many Canadian jobs depend heavily upon foreign markets. Those jobs are placed in jeopardy when other nations make it difficult for our exporters to sell their products. The Conservative party of Canada is committed to improving overall economic growth in Canada through facilitating competition, improving productivity, streamlining regulation and fostering innovation in concert with free and fair trade agreements.
The Government of Canada must bring more security to existing trade related jobs. To create new employment opportunities it is critical to focus on diversifying both the products we sell abroad and the markets into which we sell those products.
Secure access to international markets through a rules-based trading system will maximize the benefits we have as a free trading nation, emphasizing the need to establish trading relationships beyond North America.
The Government of Canada must vigorously pursue reduction of international trade barriers and tariffs; eliminate trade-distorting government export subsidies within clearly established time limits and seek a clear definition of what constitutes an export subsidy.
The Conservative Party of Canada urges the Government of Canada to resist implementing reactionary protectionist policies, balance its domestic and international dialogues to reflect all sectors of the Canadian economy and reject pressure to undermine Canada’s foreign aid budgets by raiding legitimate CIDA programming to achieve international trade objectives. Finally, the Conservative Party of Canada supports the development of an innovative and aggressive strategy to develop trade ties with emerging markets.