Moved second reading of Bill C-101, An Act to amend the Customs Tariff and the Canadian International Trade Tribunal Act.

She said: Honourable senators, I rise today to share my thoughts with you as the Senate sponsor of Bill C-101. Though short in length, this bill weighs heavily with considerations on the job security of workers, Canada’s trade interests and the rules-based international trading order. When faced with such challenges in the present international climate, we must weigh the risks and pursuit in balance.

Senators, I ask of you to consider whether Bill C-101 strikes that balance. I believe it does. Bill C-101, plain and simple, makes a small and temporary change to the rules for using global safeguards. Global safeguards are trade measures authorized under the rules of the World Trade Organization and Canadian law by which, when faced with evidence that an increase in imports is causing or threatens to cause serious injury to domestic producers, a set of measures to manage those flows may be triggered.

In simple terms, it’s a rules-based system for putting in place tariffs or quotas to manage extreme volatility.

Under Canadian law, these measures can be applied by the Governor-in-Council on the recommendation of the Minister of Finance on the basis of an inquiry by the Canadian International Trade Tribunal or in critical circumstances, on the basis of a report by the Minister of Finance, with immediate referral to the CITT for inquiry. This process is set out in a document called Customs Tariff. Bill C-101 amends one simple aspect of those provisions.

Presently, subsection 55(5) of the Customs Tariff prohibits the reimposition of safeguard measures on products that have already been subject to safeguards within a period of the previous two years. Bill C-101 repeals this subsection from the Customs Tariff. In other words, this bill, in essence, permits the government to reimpose safeguards within a shorter time frame than the two years currently permitted.

Additionally, the bill comes with a built-in sunset clause. Two years after this bill receives Royal Assent and comes into force, the Customs Tariff shall return to its present form.

In the past decade, honourable senators, we’ve seen populist movements and protectionist walls rise once more. 2016 was a turning point in this shift with the election of Donald Trump to the United States presidency. For Canada, this meant the reopening of NAFTA in 2017. It was also followed by the U.S. imposition of tariffs on steel and aluminum, with all imports into the U.S. targeted in May 2018 under Section 232 of their Trade Expansion Act of 1962 on the grounds of “national security.”

Canada retaliated. The government imposed surtaxes on a long list of American steel, aluminum and many other goods. It also put in place a number of provisional global safeguards to protect the Canadian market from a surge of foreign steel that could no longer find a home in the now-closed American market.

On September 30, 2018, we reached a deal with the U.S. and Mexico on free trade. On May 17, 2019, we reached an agreement with the United States to pull back our respective tariffs.

Crisis averted? Well, not so fast. Just because a crisis was averted with our neighbours to the south does not change the fact that the U.S. market maintains barriers with almost all other major steel-producing countries. Where will that steel go? With a number of our safeguards now removed, how will we defend against surges to Canada? Can we afford to wait two years to reimpose safeguards? Steel companies operating in Canada fear that without provisional safeguards in place, even more of their businesses will be targeted by foreign producers.

In short, more action is desperately needed to protect the steel industry from the surges of foreign steel imports. That’s why Bill C-101 is needed. The government wants to have the ability, if needed, in volatile times like these to reimpose tariffs on such surges to protect both Canadian jobs and maintain good relations with the United States.

One of the conditions of the agreement to remove tariffs with the U.S., I point out, was that Canada ensures no transshipment of steel into the U.S. market. Essentially, we cannot become a gateway for others to export into the U.S. to bypass the tariffs and surcharges that have been put in place by the U.S. government.

On June 8 and 9, the G20 trade ministers met for the Global Forum on Steel Excess Capacity. Later this month, a G20 leaders’ summit will take place, and this will be a subject of discussion again. In September, the OECD Steel Committee will meet, followed by the WTO Committee on Safeguards in November. At each of these meetings, Canada has had or will have opportunity to make its intentions known, alleviate concerns and reassert its commitment to return to more stable relations. One way or another, many risks — in acting or not — remain.

Looking closer to home, CUSMA has not yet passed through our neighbours’ legislatures. The U.S.’s section 232, in technical terms, is not officially considered a safeguard. Therefore, it allows the U.S. to reimpose tariffs should they not be satisfied with our efforts on transshipment.

There are also tensions of a domestic nature to consider. Steel jobs are primarily in Ontario, Quebec, Alberta, Saskatchewan and Manitoba. On the other hand, British Columbia is more accustomed to importing steel. Companies in construction, energy and other downstream users of steel rely on cheaper steel from, for example, Asian exporters.

We know this already. Any protectionist measure will create winners and losers. So we must consider now, as senators, as we examine Bill C-101, our international trade system is in a state of disorder, imbalance and confusion.

Clearly, colleagues, this is an unfortunate situation, but it is an unfortunate situation that we are nonetheless already in and not of our choosing.

Canada is a strong supporter of the rules-based international order. Moving in this direction now is both out of character for us and continues the international community’s collective stepping away from the quiet, well-regulated trade regime of the past. But what choice do we have now and in this moment?

I believe Canadian interests, Canadian industry and Canadian workers must be protected, and government needs all the tools at its disposal, period.

As Senator Eaton raised in committee, this bill is a precautionary, preventative measure, and a necessary tool to provide government with the flexibility to act if the steel industry brings forward evidence that warrants action.

Without a doubt, the times they are a changing. To meet that challenge, there are indeed long-term plans in place, and still forthcoming, that are beyond the scope of this bill.

Honourable senators, I remain optimistic. There may be light at the end of the tunnel. Here is where the built-in sunset clause of Bill C-101 becomes so fundamental to both this bill and to our measured, made-in-Canada approach. It signals the exceptional nature of the situation. It demonstrates the sincere desire — the commitment in fact and in law — to return to more certain times in the near future.

Senators, we are left here to consider these complexities, and admittedly not with very much time. There are risks both ways. Whichever way the country moves and whichever risk is taken, I believe it is responsible to give ourselves the tools we require to give the people of Canada the best chance possible.

I’ve kept my remarks today brief, relatively speaking. If you wish for more detail, I recommend to you the more fulsome version of my second reading speech, which I sent to all of you this morning. I have filed this speech in my records as the best speech I never got to give.

I would like to extend my thanks to our Finance Committee colleagues, the chair, Senator Percy Mockler, as well as the clerk, analysts and supporting officials from the Finance Department and Global Affairs Canada.

Honourable senators, thank you for your time.