Thank you, Mr. Chair.

On behalf of the membership of UFCW Canada, I thank you and welcome the opportunity to appear before the Standing Committee on International Trade to comment on Bill C-41, an act to implement the free trade agreement between Canada and the Republic of Korea.

Before I begin, however, I would like to bring greetings and regrets from our national president, Paul Meinema, who, is unfortunately unable to appear, due to a scheduling conflict. I would also like to apologize that I'm unable to appear before you in person today, but I do appreciate the arrangements you have made for me to share our concerns with respect to Bill C-41.

UFCW Canada is Canada's leading private sector union. Together, we are more than a quarter of a million Canadian workers strong. Together, we are building a stronger future for UFCW Canada members, families, and communities, while protecting and promoting employees' rights and social justice for all. UFCW Canada is a leading force for workers in the retail food processing and hospitality sectors. As part of Canada's most progressive unions, our members live and work in communities from coast to coast and in every province. Our members are your neighbours. They are your grocery clerk or the cashier you have gotten to know. They work in meat packing plants and hotels. Some work in nursing homes, car rental agencies, drugstores, food processing plants, and many other sectors of the economy.

UFCW Canada believes that the Canada-Korea free trade agreement overall will be a good deal for Canadian workers. Korea is and will continue to be a strategic economy for many Canadian exports. Korea is heavily dependent on food imports with a demand exceeding $28 billion annually. Korea is Canada's fifth largest agricultural food export market. It has a population of 50 million relatively high-income citizens, and GDP per capita based on purchasing power parity is about $31,000 or 75% of Canada's. In other words, the Korean population has the resources to consume the full range of products from technology to agrifood and consumer goods to culture. A wide variety of sectors in Canada export heavily to Korea. Some of those are plastics, beef, pork, canola, other grains, wines, spirits, processed foods, value-added wood products, seafood, and fish. The agrifood sector represents 8% of the Canadian economy and is said to sustain one in eight jobs, a number that should increase with the Canada-Korea free trade agreement.

Another main reason for believing this will be a good deal for UFCW Canada members and other Canadian workers is that Canadian workers need a level playing field to compete in Korea. Canadian workers have become severely disadvantaged in exporting their products to the Korean market over the past three years due to Korea signing trade agreements with other countries, such as the Korea-U.S. Free Trade Agreement, as was already mentioned. U.S., EU, and Australian products compete significantly with Canadian products in the Korean market. Every year that passes Canadian products lose competitiveness and market share.

In the first year after KORUS took effect, Canada's exports to Korea dropped by $1.5 billion. The value of Canadian exports to South Korea decreased by 27.2% between 2011 and 2013, including a loss of more than 70% in the agricultural sector. With the recent signing of the Australian trade agreement in 2014, which is not fully implemented yet, and with imminent agreements with Mexico and New Zealand, which are also major competitors with Canada for agrifood, we believe this situation will likely only worsen.

Furthermore, increasing trade with Korea and other similar countries is a crucial step to diversifying our export industries, reducing risks and dependence on the health of the U.S. economy. At UFCW Canada, we also realize that the Canada-Korea free trade agreement is different from other free trade agreements such as the Canada-China foreign investment promotion and protection agreement and CETA. Therefore, the benefits of the Canada-Korea agreement will outweigh the negatives. Unlike controversial components of CETA and the Canada-China FIPA, the Korea FTA does not apply to or negatively affect supply-managed agricultural sectors. It does not contain any negative intellectual property provisions that would precipitate massive cost increases for pharmaceuticals in Canada and cost seniors and the Canadian health care system dearly, so it will benefit not only our members but all Canadians. While it has an investor-state dispute settlement provision, it contains transparency, guarantees for tribunal proceedings, and it is fully cancellable with six months' notice.

For UFCW Canada members, CKFTA will be beneficial. As previously mentioned, Korea is heavily dependent on food imports with demand exceeding $28 billion annually. It is Canada's fifth largest agriculture and food export market.

In the absence of a formal trade deal between Canada and Korea, the Canadian agriculture and agrifood sectors are missing out on potential business opportunities. This in turn impacts the 2.1 million workers who labour in Canada's agriculture and agrifood sectors. Signing the agreement will help Canadian exports, expand their market share, and support jobs in this sector. As it stands now, Korean tariffs on Canadian pork and beef are as high as 25% to 40%, and beef exports to South Korea shrank between 2011 and 2013. The agreement will level the playing field for Canadian agricultural and agrifood workers. This will bring significant benefits to UFCW Canada members, particularly in Quebec and Ontario. Quebec, with 26% of the UFCW membership, and Ontario, with 48% of the UFCW membership, are respectively first and second as Canadian producers of pork products. In dollar values in the pork sector, Canada currently ships approximately more than $76 million in product with $33.5 million from Quebec, $3.6 million from Ontario, $11.5 million from Manitoba, and more than $26 million from Alberta. Without this deal, the impact on exports will be negative as the Canadian economy will suffer, with no doubt a loss of jobs in that sector alone.

This agreement means that not only members at our locals in Quebec, such as Local 1991, and Ontario, Local 175, will benefit from this free trade agreement but locals in Alberta, such as Local 1118 and 401, and Saskatchewan, Local 1400, will also have the potential to benefit. This deal will not only help to protect the jobs of our members in these provinces but has the potential to increase employment with good union paying jobs that benefit the communities.

The agreement also protects the terms “Canadian whisky” and “Canadian rye whisky” as geographical indicators, ensuring that they remain exclusive to Canadian producers such as Gimli's Crown Royal distillery in Manitoba where members of Local 832 are employed.

This agreement may not be perfect and we would have liked to have seen it negotiated differently, particularly around the investor-state dispute mechanism. It may not be a boon to all sectors of the economy. Whether it succeeds in the short term will largely depend on how quickly South Korea is able to recover from the economic downturn that it is currently experiencing.

Granted, it is difficult to protect all of the possible repercussions of the deal, but on the whole we believe the Canada-Korea free trade agreement will benefit most sectors of the Canadian economy. It will be in the best interests of Canadians and in our opinion contains more positives than negatives. UFCW Canada members stand to benefit from the deal going forward.

Thank you.

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