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The economic statement from the fall, released by Finance Minister Bill Morneau, gives more money to the Trudeau government's trade diversification strategy, with the goal of further encouraging companies to embark on export markets beyond the United States.
A new export diversification strategy is allocating $ 1.1 billion over the next six years, starting in 2018-19, to improve infrastructure and provide more resources and services to exporters.
The goal is to boost Canadian exports abroad by 50% by 2025, particularly in sectors that have shown potential in some parts of the world.
For example, when Morneau and International Trade Diversification Minister Jim Carr were in Beijing earlier this month, they set a goal of doubling Canada's agri-food exports to China by 2025 and bring global agricultural exports to $ 75 billion a year the same year.
Wednesday's economic statement emphasized that agriculture accounts for more than six percent of Canada's gross domestic product. The government is providing $ 25 million over five years to "strengthen the federal government's ability to deal with situations in which Canadian agricultural producers could be prevented from selling their products in international markets."
The Liberal government's trade agenda highlights the economic growth potential of opening up new markets for Canadian goods and services. Although Canada has negotiated preferential trade agreements with all G7 countries, its exports of non-energy products – which account for about two-thirds of the total volume of exports – have remained virtually unchanged over the past decade.
The economic statement indicates that 99% of Canadian oil is exported to the United States, creating "near total dependence" on the US market. Canada will face pipeline transportation constraints to the construction of the TransMountain pipeline extension, which is now owned by the federal government.
A recent analysis of import and export data for the first few months after the implementation of the Comprehensive Economic and Trade Agreement (CETA) with the European Union revealed that Canadian exports were not growing faster. significantly or did not increase as fast as EU exports, under the terms of the new agreement.
Finance Minister Bill Morneau's Fall Economic Statement Accelerates Funding for Port, Rail and Marine Road Infrastructure to Facilitate Non-Energy Access to Markets Outside the United States . (Sean Kilpatrick / The Canadian Press)
Canada's share of goods exported to emerging economies (developing countries) is also lower than the share claimed by countries with which it wants to compete. The Finance Ministry attributes this to US market dependence – but given the protectionist measures put in place by Donald Trump's administration, it is risky to focus too much on US clients.
Morneau 's statement Wednesday said that of the $ 597 million raised to date in recent retaliatory tariffs in Canada (introduced in response to US tariffs on steel and aluminum), $ 250 million will be invested in an existing strategic innovation fund to fund new investments in the sector. .
New financing for transport infrastructure
While the use of the US market has drawbacks, it may be equally difficult to take advantage of the new opportunities offered by US trade policy decisions. Soybeans, for example: the retaliatory tariffs put in place by the world's largest soybean buyer, China, have virtually prevented US farmers from leaving a key market, while other countries have not been able to afford it. were installed. However, rail transportation and the port have prevented Canadian soybean exporters from moving much of their crop to Asia.
The economic statement of Morneau's fall is based on nearly $ 774 million of infrastructure spending announced in the 2016 budget – over a ten-year period – and makes it possible to finance investments in seaports, rail infrastructure and highways over the next five years.
An additional $ 13.6 million over the next three years will be devoted to improving rail passenger and freight data to help Canadian supply chains improve operate more predictably and efficiently.
The Canadian Trade Commissioner Service will receive $ 184 million over the next five years, which will strengthen its ability to provide advice and services in areas such as digital technology, e-commerce and intellectual property.
Its Can Export program, which helps Canadian companies find new markets, will be tripled. Its technology acceleration program, which has helped Canadian companies raise capital in Boston, Philadelphia, New York and Silicon Valley, will receive an additional $ 17 million to expand to Delhi, Hong Kong and Tokyo.
Other measures in the update to assist Canadian exporters include:
- The extension of a program to help small and medium-sized enterprises in the steel, aluminum and manufacturing sectors to explore new export markets created by the recent trade agreements with the EU and the Pacific. An investment of $ 50 million was announced last June, and this economic statement provides an additional $ 100 million over six years.
- $ 13.5 million for a "mentors" program for "high-potential exporting companies".
- $ 10 million for partnerships with other levels of government and professional organizations to help small and medium-sized businesses cope with international competition.
No clear amounts for dairy compensation
Anyone hoping to get more details on the compensation of Canada's farm regulated supply sectors in Wednesday's statement was disappointed.
The Global and Progressive Trans-Pacific Partnership will come into effect on December 30, opening new slices of Canada's protected dairy, egg and poultry markets to foreign competition. This market access was a concession that Canadian negotiators deemed necessary for Canada to reap further benefits from the new agreement.
When the original TPP was negotiated, the former Conservative government proposed a major compensation program for these industries, worth billions of dollars. The Trudeau government has not yet committed to specific measures, but has formed two working groups to discuss the future of these industries in general, and compensation in particular.
A table included in Wednesday's documents includes a line for "non-announced measures" – which could include anything that the federal cabinet may decide as a compensation program – but it is unclear what percentage of these figures could be spent on compensation.
Little progress on interprovincial trade barriers
Morneau's statement also recalls an old story that the Canadian economy would be more competitive if internal trade barriers were reduced between the various jurisdictions in Canada.
Premiers such as Manitoba Premier Brian Pallister, Nova Scotia Premier Stephen McNeil and Ontario Premier Doug Ford met for the last time in July. They will meet with Prime Minister Justin Trudeau on December 7 for talks focused on economic and trade issues. (Andrew Vaughan / Canadian Press)
But we do not know how many regulatory barriers were removed in the months that followed.
This is a problem that Canada's prime ministers have struggled with for years. The next meeting of Canada's Prime Ministers, scheduled for December 7, will be dedicated to the issue again.
Wednesday's statement includes a list of 23 items in a "work plan", categorized into four categories: freight transportation (including trucking), food inspection, construction services, and alcohol liberalization.
While the federal government sits on the federal-provincial committee on internal trade, most of these measures fall under provincial jurisdiction. The federal government has only dealt with two of them: the elimination of restrictions on the biological labeling of aquaculture products and the repeal of the inspection requirements for certain agricultural products.
Wednesday's announcement announced new funding for the National Research Council to make free access to national building codes – to help small businesses and boost the construction sector. Ottawa works with the provinces and territories to encourage them to adopt national codes, so the industry does not deal with different rules in the Canadian provinces.
