Second Reading Bill C-79: Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation Bill

Hon. Larry W. Smith (Leader of the Opposition): I would like to congratulate Senator Marwah on an excellent presentation in terms of the thoroughness with which he attacked disclosing this information to our colleagues.
I feel a tremendous sense of urgency to beat the clock and make sure that we can get this to committee.

I am rising to speak today on Bill C-79, An Act to implement the Comprehensive and Progressive Agreement for Trans-Pacific Partnership between Canada, Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, otherwise referred to as the comprehensive and progressive agreement.

I would trust you would allow me not to get my PPs mixed up with the CPP and TPP, et cetera.

Honourable senators, I am very pleased that this bill has finally made its way to the Senate. The CPTPP replaces the original TPP signed by the previous government and represents a unique opportunity for Canada to enter into a free trade relationship with 11 major Asia-Pacific economies. Canada already has free trade with some of these nations under bilateral pacts signed by the previous government.

Senators, I am pleased that this bill has finally arrived in the Senate Chamber. It is the successor to the original TPP agreement signed by the previous government. It represents a tremendous opportunity in that it permits Canada to enter into a free trade relationship with 11 key economies in the Asia-Pacific region.
With some of these states, Canada already has a free trade relationship, largely due to the vigorous pursuit of such bilateral arrangements under the former government.

However, some of these relationships we will enter into under this new agreement are entirely new and present Canadian businesses with completely new market opportunities. The new deal is essentially an update on the former TPP agreement negotiated; these discussions concluded in 2015.

Regrettably, on November 22, 2017, the United States indicated that it would not enter into the TPP. This led the other 11 countries who were party to the TPP to proceed without the U.S. and, ultimately, bring the new CPTPP into force.

The CPTPP countries have a collective population, as Senator Marwah outlined, of 495 million people and a combined gross domestic product, or GDP, of CAD$13.5 trillion — and I hope I have the right numbers in terms of the global GDP. This market represents a tremendous opportunity for Canada.

As the provisions unfold, it will eliminate 95 per cent of tariff lines among the parties, governing 99 per cent of current Canadian exports to partner countries.

Ratification of this deal is predicted to grow our economy, as outlined, by $4.2 billion through preferential access to these markets. Canadian imports from and exports to the 10 other countries involved account respectively for imports of $72.5 billion and exports of $31.5 billion in 2016. The expected gains from this new deal will benefit a wide range of sectors including financial services, fish and seafood, forestry, agriculture, agri-food, metals and minerals, which Senator Marwah so neatly described.

Given the significant benefits to Canada that will come with this deal, I am very surprised at how long it has taken to get this deal to move this legislation forward. As honourable senators will be aware, the Leader of the Opposition Andrew Scheer called on the government to recall Parliament over the summer in order to expedite Canadian ratification. Regrettably, the request was rejected by the government. The government has continually emphasized that it is important for Canada to be among the first six countries to ratify the deal. That is because the first countries to ratify will be instrumental in determining the pace at which tariffs are reduced for those who ratify later. If we are not in this first class of six, then Canada’s competitors will benefit, as has been outlined from tariff reductions, while Canadian companies will face higher barriers. Ratifying now means that Canadian companies will have a greater opportunity to become a supplier of choice in these important markets.

Testifying before the international trade committee of the House of Commons on September 20, the chief Canadian negotiator Bruce Christie noted that New Zealand, Australia, Chile and Vietnam are expected to complete ratification processes by the end of November. This was outlined as one of the issues. When will the other countries of the top six get their deals done and get back? I would assume this is a close race at this time.
I very much agree that time is of the essence. I only wish that the government had demonstrated real commitment on the issue and maybe acted a little faster. From the perspective of the work done in the Senate, we are now faced with a very rushed process.

Colleagues, I’m sure you will agree that this chamber has a very important role to play in scrutinizing legislation that comes before us in examining the issues that may have been missed in the other place, thus the reason for having a Senate in which we are all involved.

That process will not be as thorough as it may have been otherwise in relation to this agreement in legislation. I’m not going to comment on the other place in terms of the work and quality of work done. However, we have been placed in a position where we have to act. We shouldn’t delay any longer than necessary. We all need to be cognizant about that as we go through the process.

The Senate is now tasked, due to the government’s situation, with ensuring that Bill C-79 is reviewed with due diligence that a bill of this magnitude requires while acting under regrettable time constraints. There are many issues that will need to be examined in a short period of time including the implications of the agricultural provisions of the agreement, particularly in the context of new market access granted to U.S. suppliers under the recently concluded USMCA provisions related to the auto sector, implications of side letter agreements concluded between Canada and the other member countries, and other issues. According to the Government of Canada website, all CPTPP countries have side instruments or agreements involving Canada. This means that the Standing Senate Committee on Foreign Affairs and International Trade is faced with the unenviable task of examining the most important implications of these side agreements, but in a truncated timeframe.

While I’m pleased that the deal is before us, I’m disquieted about the broader policy environment the government is creating relating to Canada’s competitiveness and our ability to access and supply global markets. To be sure, the government has taken the cosmetic steps. It has appointed a newly titled Minister of Trade Diversification but, despite the title, it is unclear that there is any real understanding about what true trade diversification involves and what it takes to promote and secure economic competitiveness. Trade diversification is a rhetorical goal, but what is the government doing to position Canada for success in the Asia-Pacific marketplace? What is its strategy for ensuring tax competitiveness? How is it reducing the regulatory burden on Canadian businesses? These are all realistic questions. Even as it preaches trade diversification, the current government is introducing legislation which will actually deter international investment.

The measures proposed in legislation such as Bill C-69 and Bill C-48 will make it almost impossible to take advantage of new markets and successfully export Canadian oil to East Asia, a region hungry for such exports. Knowing what percentage that energy plays in our economy is important in a deal like this because this deal provides a huge opportunity for oil exports or natural gas.

I have yet to see any concrete plan from the government for completing the Trans Mountain pipeline expansion. Trans Mountain remains in limbo and the government has taken decisive steps to kill the Northern Gateway project exactly when such a project is most needed. If these projects had been completed, then we could accelerate a higher volume of business into this new deal we are going to sign. I’m only thankful that the former government laid the foundation for initiatives such as the CPTPP so at last this opportunity is not lost to us.

I hear some commentary from the other side, but we can be a little introspective and look at the good and bad side. But even here, the government came close to putting the gains of this new deal at risk. Some may have forgotten Prime Minister Trudeau’s decision in November of last year to skip a key international meeting related to this deal because he said he wasn’t ready to sign the deal. That move nearly snatched defeat from the jaws of victory but, thankfully, the process was sufficiently well advanced for Canada to recover.

These are things we have to analyze in terms of success and things we could do better next time. Because of this mixed record, we in the Senate now have an opportunity to signal through expeditious action that Canada remains open for business.

I look at this as a great opportunity for our Senate to make a major contribution. We have made major contributions to Bill C-45, to assisted dying, a to many of the bills that we have passed, but this is another big step for us. Let’s be honest and assess the good things we could do better to get this done properly.

The CPTPP will clearly benefit Canadians and Canadian businesses. It will help diversify and grow our economy and help to create good, well-paying Canadian jobs. We are all in agreement with that. Of course, people in the past have done heavy lifting and Ed Fast should get credit from all sides because he did a hell of a job in making this come to fruition.

We should follow through and do our part to ensure Canada is as well positioned as possible to benefit from this important deal.

Quick summary: We have a sense of urgency, we need to act expeditiously. It is not about acting impulsively, it is about acting and get this done. This is important. We want to know now that we are going to beat the other three or four who are trying to get in in front of us.