Legislature(2011 - 2012)BARNES 124
01/31/2012 10:15 AM House ECON. DEV., TRADE & TOURISM
| Audio | Topic |
|---|---|
| Start | |
| Presentation: Canada -alaska Relations Update by Canada's Cousul General Denis Stevens and Cousul Peter Taylor | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ECONOMIC DEVELOPMENT, INTERNATIONAL
TRADE AND TOURISM
January 31, 2012
10:24 a.m.
MEMBERS PRESENT
Representative Bob Herron, Chair
Representative Neal Foster
Representative Wes Keller
Representative Steve Thompson
Representative Berta Gardner
Representative Chris Tuck
MEMBERS ABSENT
Representative Kurt Olson, Vice Chair
Representative Reggie Joule
Representative Cathy Engstrom Munoz
COMMITTEE CALENDAR
PRESENTATION: CANADA-ALASKA RELATIONS UPDATE BY CANADA'S COUSUL
GENERAL DENIS STEVENS AND COUSUL PETER TAYLOR
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
DENIS STEVENS, Consul General
Consulate General of Canada in Seattle
Government of Canada
Seattle, Washington
POSITION STATEMENT: Provided a PowerPoint presentation
entitled, "Relations With Canada A Time of Opportunity," dated
1/31/12.
PETER TAYLOR, Consul
Consulate of Canada in Anchorage
Government of Canada
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the PowerPoint
presentation entitled, "Relations With Canada A Time of
Opportunity," dated 1/31/12.
ACTION NARRATIVE
10:24:55 AM
CHAIR BOB HERRON called the House Special Committee on Economic
Development, International Trade and Tourism meeting to order at
10:24 a.m. Representatives Herron, Thompson, Foster, and Tuck
were present at the call to order. Representatives Gardner and
Keller arrived as the meeting was in progress.
^PRESENTATION: CANADA-ALASKA RELATIONS UPDATE BY CANADA'S COUSUL
GENERAL DENIS STEVENS AND COUSUL PETER TAYLOR
PRESENTATION: CANADA-ALASKA RELATIONS UPDATE BY CANADA'S COUSUL
GENERAL DENIS STEVENS AND COUSUL PETER TAYLOR
10:25:43 AM
CHAIR HERRON announced that the only order of business would be
a presentation by Canada's Consul General Denis Stevens and
Consul Peter Taylor.
10:25:58 AM
DENIS STEVENS, Consul General, Consulate General of Canada in
Seattle, informed the committee the Consulate General of Canada
based in Seattle covers issues between Canada and the States of
Alaska, Oregon, Idaho, and Washington. He spoke of the strong,
long-standing economic links between Alaska and Canada, stating
that Canada is the United States' closest ally and economic
partner and - because Alaska is the Arctic state - Alaska and
Canada have many common concerns. He presented slide 3 of a
PowerPoint presentation entitled, "Relations With Canada A Time
of Opportunity," and said Canada now has a majority government
under Prime Minister Stephen Harper. Among the priorities of
the new government are economic issues that are also of interest
to Alaskans. Economically, Canada is doing O.K., in fact, Canada
is predicted to be an economic world leader for the next two
years. Of the G7 [international finance group] countries,
Canada has the lowest overall tax rate on new businesses and its
net debt to gross domestic product (GDP) ratio is the lowest.
In addition, Canadian banks are considered the soundest in the
world and its unemployment rate is below that of the U.S.
However, Canada must guard against complacency because it is
economically tied to the U.S. and Europe. In order to secure
prosperity and to position Canada for growth, the prime minister
announced the following transformations: a return to balanced
budgets and sustainability for social programs; health care;
retirement systems; investments in science and technology for a
competitive economy; immigration reform to supply the economy
and labor force; free trade agreements with the European Union
(EU) and India, and joining the Trans-Pacific Partnership;
energy sales to Asia; and the implementation of the joint Beyond
the Border Action Plan (BTB) initiative with the U.S.
10:32:45 AM
MR. STEVENS displayed slide 5 that indicated elements of the
"Canada-US economic relationship: working together." He said
Canada and the U.S. are essential economic partners and eight
million U.S. jobs depend on trade with Canada. The U.S. and
Canada have also been long-time security allies during worldwide
conflicts; closer to home, four hundred thousand people cross
the Canada-U.S. border daily. He recalled Canada and Alaska
have partnered in border management since the Klondike Gold
Rush. Although Alaska crossings are not the busiest, the
crossings at Skagway and on the Alaska Highway are vital to the
economies of Alaska and Yukon Territory. Furthermore, Alaska's
investments in the Port of Skagway will facilitate Yukon's
exports of mineral ores.
10:36:42 AM
CHAIR HERRON asked for suggestions to improve the "bottleneck"
at the border crossing north of Skagway.
MR. STEVENS understood the BTB initiative establishes a method
to assess ideas and opportunities posed by the regions affected.
He has heard federal officials from both countries are to
welcome new ideas from anyone regarding border efficiencies.
CHAIR HERRON further inquired how to formulate a strategy that
will educate the U. S. Department of Homeland Security about the
economic value of efficient crossings at Skagway.
10:39:36 AM
PETER TAYLOR, Consul, Consulate of Canada in Anchorage, asked
whether Chair Herron was speaking of delays only on goods going
into the U.S., or going both ways.
CHAIR HERRON surmised from speaking to officials at Whitehorse,
Yukon Territory, and Skagway, that the U.S. attitude toward
economic development between the two jurisdictions - and to
tourists crossing the borders - results in a system that seems
inefficient.
10:41:08 AM
MR. STEVENS advised the practical purpose of the BTB initiative
is to make it easier for legitimate travelers and traders to
cross the border, without weakening national security. The
initiative was led by the federal governments in Ottawa and
Washington, D.C., and he encouraged the committee to contact
federal authorities with ideas consistent with the initiative
that will strengthen trade and security, not one or the other.
Mr. Stevens pointed out that the Pacific NorthWest Economic
Region (PNWER) is engaged in this initiative and is gathering
ideas for solving problems; in fact, the Canadian government
will be listening closely to PNWER's recommendations. He
stressed that the overall approach in the perimeter security
action plan within the BTB initiative is to identify threats
earlier and offshore if possible, by the screening of shipments
at the perimeter, not the border. This would eliminate one
screening for cargo that arrives in port and then proceeds to a
land border. Also, there will be less focus on known shippers
and trusted, frequent, travelers and traders through their
membership in NEXUS and FAST [programs that allow pre-approved
travelers to cross quickly]. The action plan also calls for
investment in physical infrastructure and technology at the
border. He advised the initiative further addresses security
elements such as developing joint intelligence assessments,
sharing information between law enforcement and national
security agencies, enabling Canada and the U.S. to align their
regulatory approaches, cooperating on best practices, sharing
research and efforts to counter violent extremism, expanding the
Shiprider program, enhancing critical cyber-infrastructure, and
better preparing for disasters and emergencies. The second
initiative, the Regulatory Cooperation Council (RCC) addresses
differences in regulations such as labeling and duplication.
The RCC focuses attention to four key sectors of the Canada and
U.S. shared economy: agriculture and food, transportation,
health and personal care products, and chemical management and
the environment.
REPRESENTATIVE THOMPSON asked whether any progress has been made
on employment and the exchange of workforce between Canada and
the U.S.
10:50:29 AM
MR. STEVENS acknowledged the BTB initiative does not address
labor mobility. He pointed out that PNWER is developing a
promising pilot program on this major issue.
MR. TAYLOR added that there is a great demand in Alberta for
American workers and professionals, but immigration authorities
in Canada take a certain amount of time. The PNWER proposed
model creates a pool of prequalified, skilled workers from the
Pacific Northwest who would be eligible to work in Canada.
However, a problem exists with self-regulated professions -
particularly engineers - being qualified to travel and work in
either country. This problem must be resolved by U.S. and
Canadian professional certification boards.
10:53:58 AM
CHAIR HERRON recalled PNWER believes the best pilot program will
come from the close relationship between British Columbia and
Washington State.
10:55:03 AM
MR. STEVENS agreed the British Columbia-Washington State
relationship is special. He presented slide 9 that listed the
effects of the BTB and RCC initiatives on Alaska, and said the
effects are ambitious, practical, and have specific deliverables
and timelines. Three elements that may affect Alaska are the
Vancouver preclearance of cruise ship passengers bound for
Alaska, the coordination of infrastructure upgrades at small and
remote ports of entry, and a pilot project on inbound marine
cargo at Prince Rupert. Slide 10 listed new trends in the
Canada-Alaska economic relationship: There is positive two-way
trade - Alaska exports to Canada are up and Canada exports to
Alaska are up.
11:00:09 AM
REPRESENTATIVE TUCK referred to exports in the mining industry
and asked whether exported minerals out of Alaska by a Canada
company are reported as a Canada export.
MR. TAYLOR explained that those materials are an Alaska export.
In fact, production from the Red Dog mine goes "way offshore" or
to British Columbia for smelting. He said he did not know how
the companies report to Canada and U.S. tax authorities. In
further response to Representative Tuck, he said if materials
from the Red Dog mine are sold to Korea, it is considered an
export to Korea and if they are sold to Canada, it is an export
to Canada.
11:02:50 AM
MR. STEVENS continued to slide 11, entitled, "Canadian mining
companies and Alaska," and noted that mining is the largest
investment sector for Canada in Alaska; in fact, Canada provides
about 70 percent of the mining investment in the state. He
acknowledged that Canada is concerned about anti-mining
advertising towards foreign and Canadian mining. There is a
need to protect the "Canada brand" because this investment is a
"win-win" in a time when Alaska and Canada need growth in the
development of their valuable resources. Canada is heavily
invested in mining because Canadian companies have developed
expertise in this sector and the Canadian mining finance system
provides favorable tax treatment, even though some Canadian
companies mining in Alaska are widely-held, or owned by
Americans. Slide 12 listed Canadian mining companies working in
Alaska, and he pointed out 26 of 30 exploration companies that
are active in Alaska, as of 2010, are Canadian. Mr. Stevens
referred to a paper prepared by the consulate in Anchorage last
year that outlines Canada's role as a partner in Alaska's mining
sector. The paper - which will be provided to the committee -
sketches the economic benefits of mining such as well-paid
employment, taxes, and contracts for local businesses. He turned
to the subject of corporate social responsibility (CSR) and said
mining companies in Alaska are required to work with communities
and secure a social license to operate thereby committing to
developing resources responsibly and safely. There is also a
permitting process to ensure responsible resource development
and the protection of health and the environment. Canada has
similar standards and the Canadian government expects companies
will behave responsibly abroad. Since 2009, the Canadian
government has encouraged companies to support the principles of
CSR. Canadian mining companies build trust and support in
communities where they operate by balancing economic,
environmental, and social objectives; moreover, the major
companies adhere to industry initiatives and standards for
sustainable mining set forth by various organizations. He
stressed confidence in the mining companies and invited
suggestions in this regard. Finally, slide 14 was entitled,
"Canada US Collaboration in the Arctic," and he observed that
Alaska, Yukon Territory, and the Northwest Territories, are
natural partners in addressing the challenges and opportunities
of the North. Collaborations include: presidencies of the
Arctic Council by Canada and the U.S. beginning in 2013;
existing security and environmental protection partnerships in
the region; sharing of science to advance understanding of the
region; ongoing coast guard partnerships; and ongoing common
economic interests.
11:11:16 AM
REPRESENTATIVE FOSTER restated the importance of Canadian mining
to the economics of Alaska, especially on the Seward Peninsula.
He expressed his surprise that Canada is the greatest source of
energy to the U.S., and asked whether Asian countries are
investing in the Canadian energy sector.
MR. STEVENS anticipated that the U.S. and Canada will continue
to be major energy partners. He agreed that there has been
interest from Asian markets - China in particular - in Canada's
resources, including its oil sands. It is not surprising that
emerging countries are interested, and it is natural for Canada
to diversify its opportunities.
11:14:49 AM
MR. TAYLOR added that China and Korea hold shares in oil sands
developments.
CHAIR HERRON asked whether Canada had balanced budgets in the
past.
MR. STEVENS recalled that prior to the economic downturn there
was an 11- to 12-year period of budget surpluses. Presently
there is a federal deficit. In further response, Mr. Stevens
said there is no law or constitutional provision that requires a
balanced federal budget.
11:18:43 AM
CHAIR HERRON asked whether there is a realistic possibility of
an ore concentrate coming from the Northwest Territories through
Yukon to Skagway for export.
MR. TAYLOR said that is unknown. An east-west interconnection
for Yukon and the Northwest Territories would have to cover some
difficult country.
11:20:12 AM
CHAIR HERRON asked for Mr. Taylor's opinion on whether the
Keystone XL pipeline could take an alternative east-west route
to Prince Rupert.
MR. TAYLOR said there is a small pipeline to Vancouver that is
not suitable for large-scale exports. He warned that the coast
guard is cautious about the installation of an oil pipeline port
at Prince Rupert.
11:22:49 AM
CHAIR HERRON, returning to the theme of Canada's term as chair
of the Arctic Council, inquired as to the strategy that will be
taken regarding the alignment of the U.S. and Canada.
MR. STEVENS opined that officials speak of the successive
presidencies as an important opportunity for North America. His
government is still working on its focus for its period of
leadership, but partnership with the U.S. is always absolute.
11:26:03 AM
CHAIR HERRON recalled PNWER went to Ottawa and carried an update
on the Alaska Northern Waters Task Force. He asked whether the
consulate general had received any response.
11:26:50 AM
MR. STEVENS said he not received a detailed analysis.
MR. TAYLOR expressed his intention to "flag" some of the
recommendations on governance.
CHAIR HERRON related the task force found a lot of information
about the Arctic, and Canada has a wealth of knowledge.
11:28:24 AM
REPRESENTATIVE FOSTER called for the construction of more U.S.
icebreakers. He asked for the status of Canada's fleet of
icebreakers.
MR. STEVENS said Canada has one large active icebreaker and is
building a new one.
11:29:27 AM
MR. TAYLOR added that the Canadian Coast Guard Ship (CCGS) Louis
St-Laurent is a heavy icebreaker and larger than the United
States Coast Guard Cutter (USCGC) Healy, although it is old and
is to be replaced. Canada does have other medium-capacity
icebreakers for service in the Gulf of Saint Lawrence and the
Saint Lawrence River. He concluded that Canada's fleet is in
slightly better shape than that of the U.S.
11:32:08 AM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Economic Development, International Trade
and Tourism meeting was adjourned at 11:32 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| EDT - Canadian Consul General Presentation Jan 31 2012.pdf |
HEDT 1/31/2012 10:15:00 AM |
|
| EDT 1.31.12 Bio_CG Denis Stevens.pdf |
HEDT 1/31/2012 10:15:00 AM |
|
| EDT 1.31.12 Peter Taylor short bio August 2011.pdf |
HEDT 1/31/2012 10:15:00 AM |