International Trade Committee on April 30th, 2024

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Are you suggesting that in many cases this will happen in Canada? Does the scanning have to happen before the trucks enter the United States?

[Ron Reinas]

It doesn't have to happen in Canada. What I'm saying is that if it happens in Canada, it means the truck doesn't have to stop on the U.S. side to get adjudicated.

The way it works is that the truck gets scanned. Then there's a command centre where there are people who are watching the scan. That will be replaced by artificial intelligence in a few years, but the truck still has to sit there and wait. The beauty of putting it in Canada is that it allows that adjudication to take place while the truck is crossing the bridge, the two to three minutes there. Otherwise, it has to sit there and wait for two to three minutes. That backs up very quickly if you can't do it while it's in motion.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Okay. I'm sorry if I was caught up in all this while you were giving your statement. What are the real challenges for us right now where the federal government could help?

[Ron Reinas]

Well, I think there are two things. One is being aware that it's happening, as it could have a big impact if we're not ready for it by 2026.

The second thing is that we want to include facial verification. Customs already has photographs of the drivers in their system. What we're saying is to include that in the information packet of the cargo being scanned, the drivers and licence plates being scanned, the RFID technology and all that. Include the facial identity because those trucks that are scanned must go to the United States. The opt-out, if a truck doesn't want to do that, is before the scanning. Once it's scanned, it has to go to the United States. Include the facial piece in there because then everything can be adjudicated, and there will be no need to stop at the U.S. primary inspection booth, which facilitates the movement of Canadian exports into the United States.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Do you see this happening at the land border crossings, like the Pacific border crossing in British Columbia and places like that?

[Ron Reinas]

Yes, it will be happening at every port of entry coming into the United States; the non-intrusive inspection will be there.

What we're saying is that at the big crossings, when you have a bridge where there's going to be time to adjudicate, why not put the technology on the Canadian side because it facilitates the movement of goods and traffic.

It's very similar in many ways to what happens at airports in the pre-clearance mode, where people are actually cleared in Canada. Then, when they get to the U.S. side, they're free to go.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Right, and in airports that includes the facial recognition?

[Ron Reinas]

Yes.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

When I have to stand there and get.... It never works for me.

[Ron Reinas]

We're not part of the pre-clearance model because this is in the cargo environment, which is different, but the principle is very much the same.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

The Canadian government is concerned about the facial recognition piece?

[Ron Reinas]

They were when we made our original national trade corridor fund application. We got approved with an IBTTA permit from the International Bridge, Tunnel and Turnpike Association to do the technology, but specifically did not include facial verification.

Therefore, we have applied again. At the beginning of March, we applied to Transport Canada to add the facial verification piece. We haven't heard anything yet as to whether that will be approved or not.

What I'm saying is that we're building it this summer. It would be nice to incorporate it now and allow us to have the full package done by the end of the year.

[The Chair, Liberal, Judy Sgro]

You have zero seconds left.

Mr. Seeback, you have five minutes.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Thank you very much, Madam Chair.

I just want to jump back to something that Mr. Arya was trying to say about trade. Actual trade volume in Canada went down from the latest trade report. The actual dollar value went up, but the actual volume of trade went down. It went up because of inflation and things like the carbon tax.

It's the same thing with our percentage of the U.S. market. While our trade value may have gone up because of inflation and the carbon tax, we've lost market share. When you're losing market share, you're losing. That's why we're now their third-largest trading partner. You can try to put lipstick on a pig, but it's still a pig. That's the Liberal record on trade.

Part of the problem is infrastructure, our trade infrastructure. We know that the Canada West Foundation put out a report that our trade infrastructure has precipitously declined in the last 12 years.

I want to ask Mr. Weller a question. To add to the problems with this, the radical Liberal environment minister said that we shouldn't invest in roads anymore—as if roads are these terrible things. I think roads are critical for trade. I suspect everyone here might agree with that, and we probably need to expand our roads to be able to expand trade.

Mr. Weller, would you like to comment on that?

[Matt Weller]

Sure, Madam Chair, through you, regardless of whether our future is a green economy or not, infrastructure is going to be a critical piece of it. Meeting the needs we're going to have for green energy, for solar panels and for EV production, requires not just having the resources of minerals but also the extraction and processing of the minerals on a scale that we haven't seen before. We're talking about an industrial build-out that we haven't seen before, which is why I mentioned that we need to reindustrialize.

Frankly, from a practitioner's perspective, the goals that have been set are not attainable in the current environment. You probably should have started years ago to get there. It's not the popular answer, but that is the reality of it. Yes, you're going to need roads for sure. You're going to need infrastructure. You're going to need power grid updates. You're going to need municipal infrastructures to support communities that are involved where this is going on, and on and on. You are going to need some sort of overarching coordination of all of it, not the individual pieces of it. In order to actually get an overall benefit to the entire system, you have to coordinate all of it together. That's what I refer to when I say “a whole system thinking approach”.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

To continue with infrastructure, a part of supply chains is going to be infrastructure. The government actually commissioned a report called the “Final Report of The National Supply Chain Task Force 2022” that said we need major investments in “highway and road structures and [other] networks” worth $3.3 trillion, which includes railways and ports and everything else. However, I was shocked to see that in the federal budget there is virtually no actual investment in this critical infrastructure.

Canada is a trading nation: 60% to 70% of our GDP comes from trade, so these investments are critical. What do you think about where we are on the investments we're getting to support supply chains and train infrastructure with what the government seems to be offering?

[Matt Weller]

Again, I'm going to speak purely from the manufacturing perspective because that's the background I'm involved in.

I think we simply need more investment in productivity. When we talk about the supply chain, export and export development, and increasing trade—any of these things—what we're ultimately talking about is productivity. That is the measure as far as the national economy is concerned.

I don't need to go into detail about the Bank of Canada's recent statement about productivity. Everybody in this room knows the numbers. I don't need to quote them. I would say the record has been poor. That is not to denigrate any political party, but I say that with the optimism we can do better. Once we start to see how these pieces actually fit together, we can coordinate a response to that and improve it, and I think we can improve it. Canada is rich with resources. We need to focus on being able to process those resources and not just sell them so that we can buy them back down the road, further down the value chain, at a higher value.

[The Chair, Liberal, Judy Sgro]

You have 16 seconds.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

There's not much I can do in 16 seconds.

Thanks, Madam Chair.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We will now go to Mr. Badawey for five minutes, please.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

Thank you for having me on the committee today. I do appreciate the presence of all of the witnesses here this afternoon.

Throughout both the United States and Canada, leaders are prioritizing regionally based hubs where the production happens. They're concentrating on those areas where the sales happen within some regions to streamline logistics, improve inventory management and accelerate the response to market demand. With that, this committee has taken on a supply chain study. There are outcomes that are expected of this study. You folks are tasked, in your daily business and everything that you're doing on a daily basis, with helping move goods and people and creating that fluidity. You are also tasked with looking at different mechanisms, whether they be policy or financial investments, that we as government can actually partner with you on to help you meet your goals.

With that said, I do want to first concentrate on Mr. Hamilton with respect to some of the projects that the Hamilton-Oshawa Port Authority is working on right now. Being a Niagara-area member of Parliament, I know we in Niagara have been very successful at integrating our multimodal network, looking at land acquisition and really creating a new economy. I know we can't talk about much of that new economy yet. There will be a day for that.

With that said, Mr. Hamilton, what are some of the wins that are happening not only in Niagara but also in Hamilton and Oshawa?

Afterwards, I'm going to go to Mayor Steele.

Mr. Hamilton, please go ahead.

[Ian Hamilton]

On that, Parliamentary Secretary, our vision is to create and lead an integrated port network in southern Ontario. What we've really wanted to try to do is combine assets so we can ensure that cargoes are moving through the most efficient supply chain and the most efficient port of entry, as well as concentrate the infrastructure investments so we can get the biggest bang for our buck.

In Hamilton now, one of our challenges is that we've run out of space, and the space we do have is becoming increasingly expensive. Looking towards the Niagara region, we saw a real opportunity to take advantage of the industrial space that was available, along with access to the marine supply chain through the Welland Canal, a good road network and proximity to the U.S. border.

Over the last couple of years, as we've entered Niagara, we've been able to, with our partners, invest about $100 million. We now have about 800 acres we've been developing, and we are home to 12 tenants, all of whom are really there because of their access to great supply chains.

Where we see future investments is in better utilizing the St. Lawrence Seaway in particular to get better access to the water and, again, give these companies more sustainable and robust supply chains by combining the multimodal nature of road, rail and marine.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Mr. Hamilton.

Obviously that is creating some productivity within the region as well as within the province of Ontario.

[Ian Hamilton]

Yes, certainly.

As we look at that, for every dollar we spend, we're probably able to attract an additional eight dollars.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Mr. Hamilton.

Mayor Steele, can you elaborate?