June 21, 2016
The Right Honourable Justin Trudeau, P.C., M.P.
Prime Minister of Canada
Langevin Building - 80 Wellington Street
Dear Prime Minister:
We, the undersigned technology-enabled small businesses, commend you for your commitments to promote Canadian small business exports. We agree that now is the time to modernize our trade policies to ensure businesses like ours can benefit from the global economy. As you come into the North American Leaders’ Summit and consider ways to promote intra-regional trade, we urge you to support updates to our country’s trade rules – including Canada’s de minimis threshold – to ensure small Internet-enabled businesses like ours can grow through exporting.
Small businesses like ours are the economic backbone of our country as well as a significant source of innovation and productivity gains. We make contributions to our communities by creating jobs, driving commerce and reinvesting locally. Our small businesses are distinct in that much of the economic contributions we make at home are the result of the opportunities that we seize abroad.
According to a study from eBay Canada, 99.8 per cent of Canadian small and medium-sized businesses (SMBs) using eBay marketplaces trade across borders, and on average these businesses sell to 20 countries. Comparatively, less than 11 per cent of traditional SMBs trade with customers outside of Canada and, on average, they sell to fewer than three countries. [i] Our businesses serve as proof points that the “face of trade” is evolving and becoming more inclusive.
Unfortunately, businesses like ours cannot realize our full trade potential because outdated trade policies around the world limit our reach.
Further, trade rules developed in a “pre-Internet” era unnecessarily complicate international opportunities for our businesses: domestic and international customs rules create real obstacles for us to increase exports. For example, Canada’s de minimis threshold, currently set at $20, creates real barriers to trade as well as significant competitive disadvantages for small Canadian exporters because it complicates our ability to access business inputs or accept retail returns. Recently, our position relative to our US competition has worsened due to the increase of US de minimis from US$200 to US$800.
Trade agreements, including the Trans-Pacific Partnership Agreement and CETA, create opportunity to reduce or eliminate international barriers to our businesses.
Still, more needs to be done to ensure our businesses are internationally competitive in the years ahead – including an increase to Canada’s de minimis threshold.
We are encouraged by your pledge to include SMBs in your international trade agenda and we hope that your commitment to Canadian SMB’s can find its way into your upcoming discussions around the North American Leaders’ Summit. Thank you for your support on policies that ensure small businesses can grow and thrive in the global marketplace.
Boutique Step Up/ Enterprises
Blezard Valley, ON
Style Conveyor Inc.
Szabo Trading Group Inc.
Groupe CDREM Inc.
The Giftmasters Inc.
Zarify Luxury Designer Gowns
Endzone Sports Exchange
cc: Hon. Bill Morneau, Minister of Finance, P.C., M.P.
Hon. Navdeep Bains, Minister of Innovation, Science and Economic Development, P.C., M.P.
Hon. Chrystia Freeland, Minister of International Trade, P.C., M.P.
Hon. Bardish Chagger, Minister of Small Business and Tourism, P.C., M.P.
[i] Industry Canada, Small Business Branch, Key Small Business Statistics (August 2013)