Oireachtas Joint and Select Committees

Tuesday, 20 June 2023

Joint Oireachtas Committee on Jobs, Enterprise and Innovation

Ireland's Trade Relationship with Canada: Discussion

Mr. Jonathan O'Hara:

I thank the Chair, Deputies and Senators. As a son of Ireland, albeit three generations removed, it really is an honour to be here today. I hope to assist the committee by offering my perspective as a lawyer in Canada who helps business do business in and with Canada, with some guidance. I will cover two different points. First, I want to highlight some of the strengths of the existing relationships to understand where some of the big drivers are, and then I will quickly offer three possible suggestions as to ways to build on and further leverage those strengths.

The two strengths I want to talk about our the life-sciences sector and the professional services sector. Last year, Ireland exported 1.6 billion pharmaceuticals goods to Canada. That 1.6 billion is of a total 2.7 billion, therefore half of Irish exports to Canada were pharmaceuticals. If one looks back the past ten years, that trend has been similarly strong. It has consistently been the case that one third to one half of Irish exports to Canada are pharmaceuticals.

The second topic is services that are going to Canada and I want to particularly focus on management services. This is things like business consulting, administrative services, and business services. In 2016, before the Comprehensive Economic and Trade Agreement, CETA, Irish exports of those kind of services to Canada were $43 million. In 2021, the last year for which we have available data, that rose to $485 million. That is a tremendous gain. If we take the gain over those five years, that is €1.8 billion added to the Irish economy by virtue of those management services. Putting Ireland's provision of management services in context, Ireland is Canada's third largest provider of management services. It is behind only the United States and the UK. Of Canada's total imports of management services, there are €13.5 billion so there is clearly a lot of room for Ireland to grow its position from the third place onwards and upwards to contribute further to the Irish economy.

In terms of my three suggestions to better leverage those Irish strengths, the first is to improve regulatory co-operation between Canada and Ireland. The second is to provide additional support for Irish businesses in the life-sciences sector which are participating in public procurements in Canada and I will dig into why that is important a tiny bit further given time constraints. Then the third suggestion is regarding these management services to analyse further to see where the opportunities there are.

First, with respect to regulatory co-operation, CETA, especially chapter 21, covers regulatory co-operation as it tended to further the regulatory co-operation. Since CETA has been provisional enforced, there has been very limited growth there and so there is an opportunity there for the Government of Ireland to push that further, particularly with respect to pharmaceutical regulatory co-operation. We have already talked about how big the pharmaceuticals are. They can only grow further and benefit further from increased regulatory co-operation.

With respect to my second suggestion, that is, the public procurement aspects, CETA opened up the Canadian provincial procurements for the first time. This was particularly helpful to Ireland because the life-sciences sector, which are the entities that are buying those pharmaceuticals, are primarily provisional governments. The EU, as the first entity, gets preferential access to that and preferential access to all those public procurements via hospitals and so forth. As a result, there is a legal right of access. There are practical challenges, however. Those public procurements are all conducted in an open, transparent, and fair manner and are publicly advertised, but by no means are they all advertised in the same place. They are advertised in many different places; it is highly decentralised. There is an opportunity for the Government to assist with that. These hospitals, provincial entities are new to the level of rigour that is going to be imposed on their procurements to ensure they are fair, open, and transparent. They are going to make mistakes. Some of those mistakes may well be to the detriment of Irish companies and may be to the advantage of some of the incumbents. Therefore, there is an opportunity for the Irish Government to help ensure the commitments under CETA are fully adhered to to the benefit of Irish companies.

My third suggestion is with respect to the management services. There would be a benefit to gathering more data to understand exactly where the drivers are there so that we can continue to grow what was $485 million in 2021, and continue to grow it onwards at the pace it has been growing.

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