Conservatives object to text of new Canada-Ukraine free-trade deal over references to carbon pricing

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Conservative Leader Pierre Poilievre’s party is objecting to the text of the renegotiated Canada-Ukraine free-trade agreement over its reference to promoting “carbon pricing” – a measure to fight climate change that includes a levy on fossil fuels.

The Conservative concerns cannot be remedied in the short term, at least, because the updated trade deal was already signed by both countries in September.

The proposed legislation underpinning the updated treaty, Bill C-57, is currently undergoing scrutiny at the House of Commons international trade committee.

It’s rare to see a partisan split in Parliament on matters related to Ukraine – a subject on which the Liberals and Conservatives have traditionally agreed. Ukraine has been battling an all-out military assault by Russia since February 2022.

Conservative MPs pressed International Trade Minister Mary Ng and Department of Global Affairs officials at the committee Tuesday on why a reference to “carbon pricing” is in the text. The Conservative Party has made fighting charges on fossil fuels arising from carbon pricing – what it calls a “carbon tax” – a central focus of its work as Official Opposition.

Conservative MP Stephen Ellis recently telegraphed concerns among his party when he publicly criticized the Liberal government for putting what he called “incredible woke” measures “woven into this free-trade agreement.” Late last month, he questioned why Canada was negotiating a new deal with a country at war, suggesting it put Kyiv “in a significant and difficult” bargaining position.

“Why would we negotiate a free-trade agreement now when we have given Ukraine significant amounts of money?” Mr. Ellis asked the Commons on Oct. 24, referring to Canada’s $9-billion in support over two years.

The text of the updated trade deal says both sides are expected “to promote carbon pricing and measures to mitigate carbon leakage risks.”

The revised treaty will replace the original Canada-Ukraine trade deal that was signed in 2016 and took effect in 2017.

Ms. Ng told MPs at committee Tuesday she was surprised to hear the trade deal described as “woke.” The updated deal includes new chapters on investment, trade in services, and talk of more inclusive commerce that benefits all sectors of society. “This is a high standard trade agreement that is good for Ukrainian businesses and Canadian businesses,” she said.

Ms. Ng asked what the opposition meant by “woke” in this deal. “Is it because there are progressive elements in it that protect the environment, and provide opportunities for small and medium-sized businesses?”

The Liberals accused the Conservatives of undermining support for Ukraine.

“The Conservatives are clearly trying to block our trade agreement with Ukraine. They’ve stalled implementing legislation in the House of Commons and now they’re criticizing it in committee,” Mark Gerretsen, deputy government House leader, said in a statement. He alleged that extremists in the Conservative party are against Ukraine, likening them to the Make America Great Again followers of former U.S. president Donald Trump.

“The MAGA-wing of Pierre Poilievre’s Conservative caucus doesn’t want to support Ukraine. It’s just like we’re seeing in the United States – these right-wing politicians don’t want to support Ukraine in its fight for its very existence in their fight against Russia.”

The Conservatives rejected the allegation, noting if this updated legislation is not passed, the existing Canada-Ukraine trade deal would still remain in effect, absent the negotiated changes.

Conservative MP Kyle Seeback told Ms. Ng he finds it contemptuous that his party is being criticized for raising objections to the deal as negotiated. “Conservative members of Parliament unanimously support Ukraine.”

Conservative MPs asked why the deal contained no references to liquefied natural gas trade or energy security.

Bruce Christie, the assistant deputy minister at the Department of Global Affairs in charge of trade negotiations, told MPs Tuesday it’s too late to amend the updated treaty because it has been negotiated and signed by leaders of both countries. Prime Minister Justin Trudeau and Ukrainian President Volodymyr Zelensky signed the deal Sept. 22.

He acknowledged later however that it was within the purview of the Commons committee to suggest changes and improvements that could be made down the road.

Upon questioning from Conservative MP Matt Jeneroux, Mr. Christie confirmed that other recent trade agreements signed by Canada – such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership; the United States-Mexico-Canada Agreement; and the Canada-European Union Comprehensive Economic and Trade Agreement – did not include provisions for carbon taxes.

Dean Foster, a director of trade negotiations at Global Affairs, told MPs the reference to carbon pricing in the deal does not require the imposition of a carbon tax in Ukraine. It is aspirational and is meant to lay out “principles for co-operation” in this area between the two countries, he said.

The head of the Ukrainian Canadian Congress (UCC) urged MPs to pass the underlying treaty legislation as soon as possible.

“The UCC strongly supports the strengthening of trade and economic ties between Canada and Ukraine. Canada and Ukraine have negotiated this treaty, and we call on all parties to support its swift adoption and implementation,” Alexandra Chyczij, national president of the Ukrainian Canadian Congress, said in a statement.

“As Russia continues its genocidal war of aggression against Ukraine, Canada and partners need to help Ukraine win on both the military and economic fronts. The modernization of the Canada-Ukraine Free-Trade Agreement is an important step in this direction – as is substantially increasing military assistance to Ukraine.”

International trade lawyer Larry Herman said the Conservative concern about a reference to carbon pricing makes them look “petty and hyper-partisan.”

The office of the Leader of the Official Opposition declined to say how the Conservatives will vote on C-57.