Statement by Deputy U.S. Trade Representative Michael Punke at the WTO Trade Policy Review of Canada
June 15, 2015
*For the Record*
Welcome Director General Cameron MacKay and the whole Canadian delegation. I would also like to acknowledge and express thanks for the work of Ambassador Jonathan Fried. He is leader – and a thought leader – in this town. We’re grateful for his role.
As a neighbor and top trading partner, Canada’s trade regime continues to be of deep interest to the United States. The foundation of our long-standing relationship is the North American Free Trade Agreement, preceded by the U.S.-Canada Free Trade Agreement. Canada is the United States’ largest goods trading partner with $658 billion in total two-way goods trade during 2014, an increase of nearly 7 percent since Canada’s last TPR in 2011. Services trade between the United States and Canada has also grown by more than 5 percent since 2011, totaling $93.5 billion in 2014. Bilateral direct investment exceeds $600 billion (according to 2013 data) supporting enhanced employment opportunities in each country. Today, according to the Secretariat’s report, 77 percent of all Canadian exports go to the United States and 54 percent of Canadian imports come from the United States.
The United States’ partnership with Canada is critical to both governments’ national and economic security. Recognizing and building upon the dynamic economic relationship our two countries share, in 2011, President Obama and Prime Minister Harper launched the Beyond the Border and Regulatory Cooperation Council initiatives to deepen our regulatory cooperation efforts to increase economic competitiveness while enhancing security through secure, efficient, rapid, and lawful movement of goods and people. Nearly four years later, our mutual commitment to these shared goals remains and this important work continues.
Since Canada’s last Trade Policy Review, the United States and Canada have worked together to advance the multilateral trading system. The United States values Canada’s strong support for multilateral trade liberalization through pressing for pragmatism in the DDA negotiations. We are working closely with Canada in the Environmental Goods Agreement negotiations and believe strongly that one of the best ways we can respond to the environmental challenges our world faces, is by achieving our shared goal of global free trade in environmental goods. We welcome Canada’s support for the implementation of the Trade Facilitation Agreement and are appreciative of Canada’s role in the Trade in Services Agreement (or TiSA) negotiations. We look forward to continuing to work with Canada on these important multilateral and plurilateral efforts to open markets and to address other important issues that affect the global trading system.
Reflecting its deep commitment to trade liberalization, Canada has played a leading role in regional trade arrangements. Canada was a founding member of the Asia-Pacific Economic Cooperation forum in 1989, and continues to make valuable contributions to APEC’s important work to promote trade and investment liberalization in the Asia-Pacific region.
We are now working with Canada in the most ambitious effort yet to promote regional trade and investment liberalization, the Trans-Pacific Partnership (or TPP). Canada joined the TPP in October 2012, as did Mexico. The TPP represents the next step in the evolution of our trading relationship with our North American partners.
In TPP, we are seeking to liberalize trade and investment on a comprehensive basis, and are tackling a broad range of issues with relevance to the way trade happens in the 21st century. These are ambitious objectives, but the 12 TPP partners are committed to them, in part because we know an ambitious agreement is one that will generate the greatest benefits to its members, and for our citizens. We are committed to a TPP that is fully consistent with our WTO obligations and contributes to a stronger multilateral system.
Despite these positive achievements, there are some areas in which we would encourage the Government of Canada to make further improvements. We hope this Trade Policy Review will help draw Canada’s attention to those areas where we believe additional reforms would enhance its competitiveness.
First, the United States commends Canada for the passage of the Combating Counterfeit Products Act in December 2014. While the new law provides authority to Canadian customs officials to detain pirated and counterfeit goods being imported and exported at the border, the United States is disappointed that the new law does not apply to pirated and counterfeit goods in customs transit control or customs transshipment control in Canada. The United States urges Canada to provide its customs officials with full ex officio authority to improve its ability to address the serious problem of pirated and counterfeit goods entering our highly integrated supply chains.
Trade in agriculture and agri-food products comprises an important component of our vibrant and mutually beneficial trading relationship. Reducing barriers to agricultural imports that distort competition could improve Canada’s productivity to the benefit of consumers not only in North America, but also worldwide. We encourage Canada to re-examine policies that impose excessive tariffs and restrict imports of certain agriculture products, such as dairy products, eggs, and poultry.
Finally, we are also deeply troubled by recent changes to the Province of British Columbia’s rules for selling wine. As of April 2015, B.C. allows only B.C. wines to be sold on the shelf in B.C. grocery stores. Barring imported wines from also being stocked on local grocery store shelves reduces the competitive opportunities for imported wines. We therefore urge Canada to ensure that a level playing field is afforded to domestic and imported wines alike in accordance with Canada’s obligations under the WTO.
Mr. Chairman, as Canada’s largest trading partner and bound to it by an increasingly integrated North American economy, we share a strong common interest in Canada’s continued growth and prosperity. Our bilateral experience with Canada is compelling evidence that mutual trade liberalization is a powerful force for economic growth and increased competitiveness. For that reason, we look forward to working with Canada, and other WTO members, to support and strengthen the multilateral trading system. Thank you.