Trade Clippings - April 20 to April 26, 2015

  • April 27, 2015

Dear International Trade and Investment Sub-Committee Members, 

Here are the international trade and investment articles and publications of interest for the week of April 20 to April 26. This week’s edition has been curated by Alexandra Logvin. Alexandra is an associate at Fasken Martineau in Ottawa, practising primarily in the areas of international trade law, investment law, commercial litigation, and arbitration.


Alastair Sharp, “Profits down at Rogers Communications as customers exit”, Reuters (April 20, 2015)

  • Rogers Communications Inc. posted an unexpected 17 percent drop in quarterly profit on Monday as the cable, phone and media company struggled to hold on to customers during a period of industry-wide turbulence.
  • The Toronto-based company, already struggling to maintain its leading position in the wireless industry, had to deal with regulatory changes in both its wireless and television markets that make it easier for customers to switch to rivals.

Susanne Craig, “Cuomo Stays Optimistic After Seeing the Challenges of Doing Business in Cuba”, New York Times (April 20, 2015)

  • Those along for the ride on Governor Andrew M. Cuomo’s whirlwind trade mission to Cuba got a quick lesson on the challenges of doing business here: They saw abject poverty and a poorly developed infrastructure — and even experienced spotty air-conditioning at a hotel as temperatures soared well above 90 degrees.
  • On Monday, the governor and a group of about 20 businesspeople landed in this island nation with a unified goal: to open the dialogue between New York and Cuban companies in the wake of President Obama’s decision to ease diplomatic relations between the United States and Cuba. Mr. Cuomo’s enthusiasm was hard to miss as he traveled from one meeting to the next, extolling the virtues of New York businesses. 

Pete Evans, “Federal budget 2015: How Joe Oliver balanced the books”, CBC News (April 21, 2015)

  • Ottawa posts first surplus since 2007, but it’s razor thin with very little wiggle room.
  • Finance Minister Joe Oliver unveiled a balanced budget Tuesday that posts a $1.4-billion surplus largely on the strength of money already banked from asset sales and by holding a little less money aside for unexpected pitfalls down the line.
  • Oliver dipped into the federal government's traditional contingency fund to the tune of $2 billion this year in order to balance its books.

WTO, “WTO members discuss how to step up notifications on import licensing”, WTO News (April 23, 2015) 

  • At a meeting of the Committee on Import Licensing on 21 April 2015, WTO members welcomed proposals by the Chair on how to improve WTO members’ compliance with notification requirements under the Agreement on Import Licensing Procedures. A workshop at the WTO headquarters was proposed as a means of tackling this issue.

WTO, “Agriculture Negotiations -- Chair cites “urgent need” to find solutions in farm trade talks”, WTO News (April 24, 2015) 

  • WTO members were urged on 24 April to step up efforts in resolving their differences on key issues blocking progress in the Doha Round farm trade talks. 
  • John Adank, the New Zealand ambassador chairing the negotiations, said there was an “urgent need to move from repeating positions to working for solutions”.

Mark Kennedy, “Chrétien to meet Putin in Moscow to discuss Russia-West relations”, Ottawa Citizen (April 24, 2015)

  • Former prime minister Jean Chrétien will meet Russian President Vladimir Putin in Moscow next week to discuss that country’s relations with the West, it was announced Friday.
  • Chretien will hold his discussion with the Russian leader on behalf of the InterAction Council, a group of former world leaders.

Jeff Lewis, “TransCanada seeking approval for another cross-border pipeline”, The Globe and Mail (April 24, 2015)

  • TransCanada Corp. is seeking approval for another cross-border pipeline even as its contentious Keystone XL project languishes in the U.S. political system.
  • The Calgary-based company this week submitted an application to the U.S. State Department for its $600-million Upland pipeline, a proposal that would bring U.S. crude north at a time Canadian oil production is testing the limits of existing export capacity.
  • The project is designed, in part, to connect fast-rising crude supplies from North Dakota’s Bakken oil play with the company’s planned Energy East pipeline, which faces mounting opposition in Canada. Initial capacity would be 220,000 barrels per day starting in 2020, rising to 300,000 barrels over time, spokesman Mark Cooper said.

HSBC to consider moving headquarters from Britain”, Reuters / The Globe and Mail (April 24, 2015)

  • HSBC Holdings, Europe’s biggest bank, said it has started a review of whether to move its headquarters out of Britain following regulatory and structural changes in the industry.
  • Shareholders have urged the bank to consider moving its headquarters to Asia, probably back to Hong Kong, due to a hefty UK bank tax and other costs associated with being based in London.

Jonathan Stempel, “Barclays must face U.S. fraud lawsuit tied to 'dark pool' probe”, Reuters (April 24, 2015)

  • Barclays Plc failed to persuade a U.S. judge to dismiss a lawsuit accusing the British bank of defrauding shareholders about a private "dark pool" trading platform even as it was publicly pledging to clean up its corporate culture.
  • U.S. District Judge Shira Scheindlin in Manhattan on Friday allowed most of the lawsuit brought on behalf of investors in Barclays' American depositary shares to go forward.

Devika Krishna Kumar, “Comcast drops Time Warner Cable bid after antitrust pressure”, Reuters (April 24, 2015)

  • Comcast Corp. abandoned its $45 billion offer for Time Warner Cable Inc on Friday after U.S. regulators raised concerns that the deal would give Comcast an unfair advantage in the cable TV and Internet-based services market.
  • The collapse of the deal opens the door for other possible offers for Time Warner Cable, but also casts heightened regulatory risk on merger activity in the U.S. cable industry, which has been rapidly consolidating in the face of competition from satellite TV and Web-based services.

Pete Evans, “CIBC shareholders vote against pay packets for outgoing execs”, CBC News (April 24, 2015)

  • CIBC investors voiced their displeasure loud and clear against a compensation scheme that will see two of the bank's most senior executives — who recently left the company — take in a combined $25 million in compensation this coming year.
  • At the bank's annual general meeting in Calgary on Thursday, only 43 per cent of investors voted in favour of an executive pay package that will see recently departed CEO Gerald McCaughey paid $16.7 million this fiscal year to retire ahead of schedule. COO Richard Nesbitt will also be paid $8.5 million for having his departure date also accelerated.

Dianne Buckner, “Google Fi might be exactly what Canada's telecom market needs”, CBC News (April 24, 2015)

  • Google is about to launch a new cost-effective mobile phone service for Americans only. And as the news spreads, it may trigger a new round of grumbling in Canada over the state of this country's telecom industry. 
  • Google Fi will cost a mere $20 a month for talk, text, Wi-Fi tethering, and international coverage in more than 120 countries. And here's a flashy selling point: customers will pay only for the data they use, and even get a refund for unused data.

Thomas Atkins, “Deutsche faces tough task paring back retail, investment banking”, Reuters (April 25, 2015)

  • If running a global bank is complicated, cutting one back is even more difficult. Deutsche Bank faces a long and costly battle to sell Postbank and pare investment banking, the new strategic goals it outlined late on Friday.
  • While the bank is due to publish results on Sunday, investors will get no details on its overhaul before Monday at a news conference. The scope of the challenge is already clear, however.

Government Press Releases

Foreign Affairs, Trade and Development Canada, “Canada Signs Investment Agreement with Burkina Faso” (April 20, 2015)

  • The Honourable Ed Fast, Minister of International Trade, today announced that Canada and Burkina Faso have signed a foreign investment promotion and protection agreement (FIPA).  
  • Canada’s Global Markets Action Plan identifies Burkina Faso as an emerging market with specific opportunities for Canadian business in sectors such as mining and industrial machinery and equipment. 
  • Canada is the largest foreign investor in Burkina Faso.
  • Canada and Burkina Faso will proceed with their respective ratification processes.

WTO, “Dispute Settlement -- Panel established in dispute between US and China over alleged subsidies” (April 22, 2015)

  • At its regular meeting on 22 April, the Dispute Settlement Body (DSB) established a panel to examine a dispute between the United States and China over alleged subsidies. The DSB deferred the establishment of a panel in disputes between the US and Indonesia, and between New Zealand and Indonesia over alleged restrictions to the importation of agricultural products.

Public Safety Canada, “Minister Blaney tables Canada-United States preclearance agreement in Parliament” (April 22, 2015)

  • Today, Canada’s Minister of Public Safety and Emergency Preparedness, the Honourable Steven Blaney, tabled in Parliament the signed Agreement on Land, Rail, Marine and Air Transport Preclearance between the Government of Canada and the Government of the United States of America. Minister Blaney and U.S. Secretary of Homeland Security, Jeh Johnson, signed the agreement in Washington on March 16, 2015.
  • When it takes effect, the new agreement will provide a legal framework for the establishment of new preclearance operations in any of the four modes of transportation – in either Canada or the U.S. It will replace the existing Air Transport Preclearance Agreement, signed in 2001, and will make an important contribution towards improving the flow of legitimate trade and travel. The Agreement will allow existing air preclearance operations to continue, as well as allow the market to propose new operations when and where they make sense – facilitating trade, travel, and creating economic benefits for Canadians.

Foreign Affairs, Trade and Development Canada, “Minister Aglukkaq Concludes Successful Arctic Council Ministerial Meeting, Marking End of Canada's Chairmanship” (April 24, 2015)

  • The Honourable Leona Aglukkaq, Minister of the Environment, Minister of the Canadian Northern Economic Development Agency and Minister for the Arctic Council, joined by the Honourable Rob Nicholson, P.C., Q.C., M.P. for Niagara Falls, Minister of Foreign Affairs, today concluded the ninth Ministerial Meeting of the Arctic Council in Iqaluit, Nunavut. This meeting marks the end of Canada’s Arctic Council chairmanship (2013-2015) and the start of the United States’ chairmanship (2015-2017). During the meeting, ministers of the eight Arctic states, including Minister Nicholson, adopted the Iqaluit Declaration 2015, underscoring the achievements of the Council under Canada’s chairmanship and setting the stage for the incoming U.S. chairmanship.
  • The creation of the Arctic Economic Council (AEC), an independent body made up of business representatives, was a key priority during Canada’s chairmanship. The AEC is facilitating Arctic-to-Arctic business opportunities, trade and investment in the North.

Foreign Affairs, Trade and Development Canada, “Minister Fast Encourages Canadian Small and Medium-Sized Enterprises in Nanaimo and Victoria to 'Go Global'” (April 24, 2015)

  • The Honourable Ed Fast, Minister of International Trade, alongside Marcus Ewert-Johns, Vice President of Canadian Manufacturers & Exporters British Columbia, today hosted an export workshop designed to provide small and medium-sized enterprises (SMEs) with the tools and practical information they need to take advantage of international business opportunities to export.
  • At the export workshop in Nanaimo Minister Fast announced $60,275 in support of Marine Renewables Canada from the government’s Global Opportunities for Associations (GOA) program, to help their members expand abroad.
  • In Victoria, Minister Fast announced Invest Canada - Community Initiatives (ICCI) program funding of $11,000 for the Greater Victoria Chamber of Commerce, in support of attracting job-creating investment.
  • Minister Fast invited participants to join him on his upcoming trade mission to the Philippines, which will take place in May 2015.
  • The next export workshop will be held on May 1, 2015, in Vaughan, Ontario.

Federal Economic Development Agency for Southern Ontario (FedDev Ontario), “Federal Government Announces Support for Manufacturing Growth and Diversification in London” (April 24, 2015) 

  • Starlim North America Corp. will be upgrading and expanding its manufacturing capabilities and services with the support of up to $4 million announced today by Minister of State (Science and Technology) Ed Holder.
  • FedDev Ontario's repayable contribution, through the Investing in Business Growth and Productivity initiative, is aimed at helping established businesses to expand their operations, invest in productivity improvements and compete globally.

Opinions and Editorials

Alexandre Laurin, “A prudent budget in a time of economic uncertainty”, The Globe and Mail (April 21, 2015)

  • Budgets, especially pre-election budgets, inevitably respond to short-term concerns and special interests. This budget is no exception. A prime example is the creation of a new fund to celebrate Canada’s 150th anniversary dedicated to the renovation of community infrastructure across the country, or yet another tax credit targeted to seniors. Over time, though, successive annual budgets write much of our fiscal and economic history – how much the government spends, taxes, and accumulates debts, and how well (or badly) fiscal policy has supported long-term growth. 

Dean Baker, “Obama is failing us all by ignoring the need for currency rules in TPP”, The Guardian (April 22, 2015)

  • The sums at stake over currency issues are an order of magnitude larger than any potential gains from the rest of the Trans-Pacific Partnership.
  • The Obama administration is doing its full court press, pulling out all the stops to get Congress to approve the fast-track authority that is almost certainly necessary to get the Trans-Pacific Partnership (TPP) through Congress. One of the biggest remaining stumbling blocks is that the deal will almost certainly not include provisions on currency. This means that parties to the agreement will still be able to depress the value of their currency against the dollar in order to gain a competitive advantage. This is a really big deal, which everyone thinking about the merits of the TPP should understand. 
  • The value of the dollar relative to other currencies is by far the main determinant of our balance of trade. We can talk about better education and training for our workforce, improving our infrastructure and better research, all of which are important for the economy. But anyone who claims that improvements in these areas can offset the impact of a dollar that is overvalued against another currency by 15-20% is out of touch with reality. If the dollar is overvalued by 20% against another country’s currency, it has the same effect as imposing a 20% tariff on US exports and giving a government subsidy of 20% to imports. 

Katie Allen, “Greek debts: what does it owe? When will the money run out?”, The Guardian (April 24, 2015)

  • Crunch talks between Greece and its eurozone creditors are under way, but investors are growing increasingly sceptical that the country can reach an agreement on reforms and unlock the aid it needs from international lenders to avoid a debt default.
  • Greece owes money to the International Monetary Fund, the European Central Bank and the European Union following its two bailouts in 2010 and 2012.