WT/TPR/M/314 19 August 2015 (15-4200) Page
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WT/TPR/M/314 19 August 2015 (15-4200) Page: 1/53 Trade Policy Review Body 15 and 17 June 2015 TRADE POLICY REVIEW CANADA MINUTES OF THE MEETING Chairperson: H.E. Mr Atanas Atanassov Paparizov CONTENTS 1 INTRODUCTORY REMARKS BY THE CHAIRPERSON ....................................................... 2 2 OPENING STATEMENT BY THE REPRESENTATIVE OF CANADA (HONOURABLE MR CAMERON MACKAY) ................................................................................................... 4 3 STATEMENT BY THE DISCUSSANT ................................................................................ 8 4 STATEMENTS BY MEMBERS ........................................................................................ 12 5 REPLIES BY THE REPRESENTATIVE OF CANADA AND ADDITIONAL COMMENTS ......... 47 6 CONCLUDING REMARKS BY THE CHAIRPERSON ......................................................... 52 Note: Advance written questions and additional questions by WTO Members, and the replies provided by Canada are reproduced in document WT/TPR/M/314/Add.1 and will be available online at http://www.wto.org/english/tratop_e/tpr_e/tp_rep_e.htm. WT/TPR/M/314 • Canada - 2 - 1 INTRODUCTORY REMARKS BY THE CHAIRPERSON 1.1. The tenth Trade Policy Review of Canada was held on 15 and 17 June 2015. The Chairperson H.E. Mr Atanas Atanassov Paparizov (Bulgaria) welcomed the delegation of Canada headed by Honourable Mr Cameron Mackay, Director General, Trade Negotiations, Department of Foreign Affairs, Trade and Development; the rest of the delegation, including H.E. Ambassador Jonathan T. Fried, Permanent Representative of Canada to the WTO; other colleagues from the Mission in Geneva; and the discussant, H.E. Ambassador Remigi Winzap (Switzerland). 1.2. The Chairperson recalled the purpose of the Trade Policy Reviews and the main elements of the procedures for the meeting. The report by Canada was contained in document WT/TPR/G/314 and that of the WTO Secretariat in WT/TPR/S/314. 1.3. Canada adopted the alternative time-frame for its TPR. The following delegations submitted questions one week before the meeting and had been transmitted to the delegation of Canada: Singapore; Malaysia; Switzerland; Australia; Chinese Taipei; Brazil; Peru; Mexico; Hong Kong, China; United States; New Zealand; EU; China; Norway; Japan; Argentina; and El Salvador. The following delegations submitted written questions after the deadline and had also been transmitted to the delegation of Canada: Guatemala; Chile; Colombia; the Russian Federation; Ukraine; Dominican Republic; India; Republic of Korea; Trinidad and Tobago; Ecuador; Turkey; Indonesia; and Thailand. 1.4. The Canadian economy had recovered well from the financial crisis with GDP growth averaging 2.4% annually but had been impacted by weaker export growth and investment during the period 2011-14. While long-relying on its natural resource wealth, the Canadian economy was diversified with manufacturing and services also contributing significantly. The energy and minerals sector had declined the most in the post-crisis period, but had gradually rebounded and had shown strong growth since 2013. 1.5. In terms of trade, Canada's merchandise imports and exports had grown steadily during the review period, with import growth rates of 15% on average, twice as high as export growth rates, of 7% per year. During 2011-13, exports had been relatively flat due to weak global trade and in particular, weak energy prices, but had rebounded in 2014. Canadian merchandise export trade was heavily reliant on one sector, energy products, and one market, the United States. Despite efforts to diversify trade, Canadian imports and exports had concentrated further during the review period with its major market which had contributed to a larger percentage of both import and export trade. Although having a very service-oriented economy, Canada's services' trade remained relatively small, about one-fifth the size of its merchandise trade. 1.6. Canada had a relatively open foreign investment policy. Both inward and outward FDI had exhibited growth during the period, but inward FDI flows had been modest and had fallen in 2014. Canada had taken steps to reverse this trend and facilitate FDI in a number of ways during the period by concluding a number of bilateral investment agreements, removing some telecom investment restrictions, and promoting its funding programmes to attract investors. 1.7. During the period under review, Canada had moved ahead with its unilateral trade liberalization initiatives. The elimination of tariffs on a broad range of manufacturing inputs and capital goods was undoubtedly the highlight of these initiatives. The Chairperson was convinced that Members would not fail to encourage Canada to sustain these efforts. 1.8. Agriculture remained a key sector of the Canadian economy, owing in particular to its contribution to national wealth and employment. The sector was also highly important for the rest of the world because Canada was among the major players in international trade in agricultural products. Renewal of the Growing Forward Framework Agreement was most certainly one of the key developments in recent years. A number of measures pertaining to the sector were nonetheless questioned by several Members. These related in particular to the fairly high level of tariff protection; the current supply management system for dairy products; and the preferential treatment said to be given at sub-federal level to certain products such as wines, beer and spirits of local origin. WT/TPR/M/314 • Canada - 3 - 1.9. As regards sanitary and phytosanitary measures, Members did not fail to note the process to reform the food regulatory system, in which Canada had already been engaged for some years. Some Members expressed concerns regarding the new import licensing requirements. This meeting might be a good opportunity for Canada not only to clarify this aspect of the reform but also to expand on its main lines of action and prospects. 1.10. Judging from the number of advance questions received, other areas of great interest to Members included Canada's intellectual property regime in which new legislation and regulations had been of significant interest as well as clarifications on how certain provisions would be implemented and monitored or enforced. Another area related to contingency measures whereby a number of questions had been raised on the procedural aspects of investigations, the significant increase in investigations, and how specific provisions were implemented in practice. 1.11. The Chairperson was sure that these topics and themes, and many more, would be touched upon in greater detail at their deliberations on the first and second day of the meeting. 1.12. The Chairperson closed his introductory remarks by wishing Canada a very successful tenth Trade Policy Review. He looked forward to its active engagement in this TPR. 1.13. He also noted that a podcast would be made of the meeting which could be accessed on the Members' website. WT/TPR/M/314 • Canada - 4 - 2 OPENING STATEMENT BY THE REPRESENTATIVE OF CANADA (HONOURABLE MR CAMERON MACKAY) 2.1. I am very happy to represent my country at this tenth WTO review of Canada's trade policy, and thank each one of you for your willingness to take part in this important process. 2.2. Special thanks go to Ambassador Paparizov for agreeing to chair today's meeting. I am especially happy that Ambassador Winzap will do us the honour of serving as the discussant. 2.3. I also thank the WTO Secretariat team for preparing such a detailed and comprehensive Secretariat report. 2.4. As one of the initial architects of the TPR process, we are deeply convinced that it enables all WTO Members to benefit from a transparent, predictable and rules-based international trading system. 2.5. As both the Secretariat and Government reports point out, since our 2011 review, Canada's economy has capitalized on strong economic fundamentals, and prudent fiscal policy to recover successfully from the global financial crisis. 2.6. The Canadian Government's annual "Economic Action Plan" consistently focuses on balancing the budget, supporting jobs and growth, developing resources responsibly and supporting families and communities. 2.7. To support the private sector's creation of jobs and prosperity, we have lowered taxes on businesses, encouraged regulatory efficiency through harmonization efforts, and cut administrative red tape – especially for small businesses. 2.8. And the stability of Canada's financial sector continues to receive international recognition. For the seventh consecutive year, the World Economic Forum has declared Canada's banking system to be the soundest in the world. 2.9. The results are clear. 2.10. Forbes and Bloomberg have both rated Canada as the best place in the G20 for business. Canada has also recently been ranked by the Economic Intelligence Unit as the best place for doing business among the G7 and G20 countries over the next five years. 2.11. Canada maintains the lowest net debt-to-GDP ratio in the G7, and is expected to be among the top G7 performers through 2017 with respect to economic growth. 2.12. Of course, growth only matters if it benefits people, including through job creation. 2.13. On that front, Canada's economy was the first among G7 nations to recoup the employment losses recorded during the global recession. 2.14. Nearly 1.3 million net new jobs have been created since July 2009; almost 86% of those have been full-time jobs. 2.15. WTO Members know that trade and investment play a key role in Canada's economic success. 2.16. Trade is equivalent to more than 60% of our GDP, over 40,000 Canadian companies export internationally, and one in five Canadian jobs are directly or indirectly related to trade. 2.17. In that light, Canada knows well the importance of trade and investment as the twin engines for economic growth. And we know the dangers of protectionism. 2.18. So we work closely with Canadian businesses to help shape trade and investment policies that help them prosper. WT/TPR/M/314 • Canada - 5 - 2.19. Clearly, the private sector is leading tremendous change in the global economy.