trade-policy 15 August 2024

Canada launches consultation on ‘economic security interests’

The government of Canada says it has launched a consultation on ‘potential new measures to advance and defend Canada’s economic security interests,’ which, it says, will ‘help assess whether Canada has the best tools to promote economic prosperity and resilience.’

Amongst the issues on which it is consulting are:

‘Strengthening supply chains: Explore potential policy measures (e.g. restricting eligibility to incentives or other trade and investment benefits) to strengthen Canada’s supply chains in relation to certain products, for instance in critical or strategic sectors, to limit the sourcing of these products from entities that pose risks related to Canada’s essential security interests.

‘Trade controls: Ensure the export controls regime under the Export and Import Permits Act (R.S.C., 1985, c. E-19) continues to address risks to national security posed by exports of advanced dual-use technologies. Consider additional critical or strategic items to be added to the Export Control List or Import Control List, including where enhanced monitoring may be required.

‘Investing in critical minerals supply chain resilience: Consideration of financing options or measures to address price volatility and to support diversification of critical minerals supply chains, including through financing from federal Crown Corporations (e.g., Export Development Canada and the Business Development Bank of Canada), or through other mechanisms to support targeted Canadian direct investment domestically and abroad in strategic projects.’

Amongst the questions it would like to see respondents address are:

‘What do you view as the main external risks and threats to Canada’s economic security? Which economic sectors do you think are most vulnerable to these threats?
‘Do you have specific suggestions for improvement to a Government of Canada tool used for addressing economic security vulnerabilities, such as economic coercion, shocks to essential supply chains, unfair trade practices that undermine Canada’s competitiveness on the global stage, and protectionist policies by other countries that restrict Canada’s access to international markets? What guardrails do you think are needed to constrain overuse of a measure? Are there implementation considerations that could improve effectiveness of tools?’