Bill C-20 (Historical)

Canada-Honduras Economic Growth and Prosperity Act

An Act to implement the Free Trade Agreement between Canada and the Republic of Honduras, the Agreement on Environmental Cooperation between Canada and the Republic of Honduras and the Agreement on Labour Cooperation between Canada and the Republic of Honduras

This enactment implements the Free Trade Agreement and the related agreements on environmental and labour cooperation entered into between Canada and the Republic of Honduras and done at Ottawa on November 5, 2013.
The general provisions of the enactment specify that no recourse may be taken on the basis of the provisions of Part 1 of the enactment or any order made under that Part, or the provisions of the Free Trade Agreement or the related agreements themselves, without the consent of the Attorney General of Canada.
Part 1 of the enactment approves the Free Trade Agreement and the related agreements and provides for the payment by Canada of its share of the expenditures associated with the operation of the institutional aspects of the agreements and the power of the Governor in Council to make orders for carrying out the provisions of the enactment.
Part 2 of the enactment amends existing laws in order to bring them into conformity with Canada’s obligations under the Free Trade Agreement and the related agreement on labour cooperation entered into between Canada and the Republic of Honduras.
Part 3 of the enactment contains coordinating amendments and the coming into force provision.

Canada-Honduras Economic Growth and Prosperity Act

[Erin O'Toole, Conservative, Parliamentary Secretary to the Minister of International Trade]

Mr. Speaker, I would like to echo the comments made by a few of my colleagues welcoming the hon. member for Toronto Centre. I listened intently to her maiden speech, and as the parliamentary secretary, I hope she joins the trade committee soon to participate in our discussion.

She also mentioned a book that I am going to put on my reading list, and I would put one on her reading list. On the day she was elected, November 27 of last year, our government introduced the global markets action plan. In her speech she asked with regard to Africa, “Where is Canada?” That global markets action plan not only discusses South Africa but also discusses emerging markets like Côte d'Ivoire, Cameroon, Nigeria, Mali, and Zambia. That document is the culmination of many years of strategic thought she seems desperate for. Which are her top countries in our global markets action plan that she will work with us on to create jobs for Canadians?

[Chrystia Freeland, Liberal, Toronto Centre, ON]

Mr. Speaker, I thank the member very much for the welcome, but the action plan unfortunately was not published on my election day, which was November 25, not November 27, obviously a more important date personally for me than for other members of the House. Maybe only three other members find it as significant.

I look forward to working with the hon. member on the trade committee and I promise to carefully study that report and let him know what our priority countries are. I would say, however, that it is not only about priority countries; it is about a broader vision.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, I will be sharing my time with my colleague from Prince Albert.

I would first like to add my voice to the chorus of introduction and welcome to the hon. member for Toronto Centre to the international trade file. I look forward to working with her and all of our colleagues to foster job opportunities, growth and prosperity for Canadians from coast to coast to coast.

It is a pleasure to rise in the House to speak in regard to our Conservative government's commitment to protecting and strengthening the long-term financial security of hard-working Canadians. That is why on November 5, 2013, my hon. colleague, the Minister of International Trade, signed the Canada-Honduras free trade agreement.

Trade has long been a powerful engine for Canada's economy, as we have heard from previous speakers. It is even more so in what remain challenging times for the global economy. With this agreement, we can celebrate yet another milestone in the achievement of our government's vision for engagement in the Americas.

The Canada-Honduras free trade agreement is an important part of Canada's commitment to the Americas. For Canada to remain competitive, our government is pursuing new strategic partnerships with emerging economies, especially those in the Americas.

Honduras has its own active program of bilateral and regional trade and investment agreements. Specifically, it is a signatory to active free trade agreements with eight partners, including the United States and the European Union.

Our government is helping Canadian exporters and investors compete on a level playing field. As we know, the United States, our biggest trading partner, has a trade agreement and so has a trade advantage, and the signing of this free trade agreement and its coming into effect would help level the playing field.

Economically, Canada and Honduras have a bilateral trade and investment relationship that has potential for long-term growth, as we heard earlier from our colleague across the way from Winnipeg North. We already have a healthy and growing commercial relationship with Honduras.

According to Statistics Canada, two-way merchandise trade between Canada and Honduras has been steadily growing, which is very encouraging, reaching nearly $257.2 million in 2012, an increase of almost 9.3% compared to 2011. In 2012, Canadian exports to Honduras totalled $38.6 million and Canadian imports from Honduras totalled $218.6 million, up 17.4% from 2011.

How will that growth happen and what does this free trade agreement with Honduras entail specifically for Canada? For Canadian firms and communities that depend on continued and growing business activities for their livelihood, it is an excellent question. I know from my constituents of Kelowna—Lake Country that one in five jobs are based on trade.

I want to expand a little more over the next few minutes on some of the concrete benefits of this free trade agreement with Honduras. We have signed this FTA, which includes provisions for market access for goods and cross-border trade in services, investment and government procurement.

On goods market access, once the free trade agreement is in place, Honduras would immediately eliminate tariffs on almost 70% of its tariff lines in respect to goods from Canada. Most of the remaining tariffs would be phased out over periods of five to fifteen years. The range of products that would benefit from enhanced market access opportunities is wide and includes agriculture and agrifood products, forestry products, plastics, chemical products, vehicles and auto parts, and industrial machinery, just to name a few.

For Canada and Honduras, a free trade agreement would play an integral part in strengthening and growing our economic relations and lead to growing economic opportunities and prosperity in both countries.

One example is in our agriculture and agrifood sector. My colleague from Prince Albert, who will be following me, is no stranger to the agricultural file in Saskatchewan and will expand on the benefits for agriculture. However, one of the big aspects is restored access for beef and pork, which is estimated by industry experts to have a combined market value of approximately $5 million to $7 million annually with the majority of exports expected to be pork. We know that pork producers need all the help they can get. It is a difficult industry and in expanding I know they would welcome this new market as well.

This access would open up new opportunities for Canadian farmers, especially those producing pork and beef products, and thus contribute to the continued maintenance of Canada's agriculture sector as a strong driver of the Canadian economy and Canadian exports.

Under this free trade agreement, Canadian companies in diverse sectors would benefit, not only from the elimination of tariffs and from better and more secure access to service markets but also from the greater certainty provided by the investment rules contained within it. As we all know, certainty, stability and predictability are characteristics that our Canadian businesses are always requesting, especially that these trade agreements provide that stability and predictability.

Some Canadian companies have already demonstrated an interest in Honduras as an investment destination. Clothing and textile manufacturer Gildan Activewear of Montreal, for example, is the largest private-sector employer in Honduras with over 20,000 employees. That is amazing: 20,000 employees employed by a Montreal-based company, and that being the largest private-sector employer in Honduras. The Ottawa-based Canadian Bank Note Company, one of the world's foremost security printing companies, has met success in selling its electronic lottery system to Honduras. Aura Minerals of Toronto, a mid-tier gold and copper mining company, operates a gold mine in Honduras.

These companies, in order to ensure the sustainability and effectiveness of their investments abroad, are making real contributions to the communities in which they operate, thus fostering more diversified and sustainable economic co-operation and development in Honduras. That is CSR, as we heard before, corporate social responsibility in working together for Canadians and Hondurans.

Moreover, there is our government's commitment to ensuring that the responsible business practices of our firms operating abroad, particularly in the extractive sector, go beyond words. In the specific case of Honduras, for example, our government, through its development co-operation program, has provided assistance to that country under the democratic development initiative, to improve governance in the Honduran mining sector. An important part of this initiative includes the provision of technical assistance and thus local training in capacity building in their sector. We heard before that a rising tide lifts all boats. We are using Canadian technology and training to increase their capacity building so they can help grow their economy as well.

As a country of focus for Canada's development assistance, Honduras benefits from initiatives that promote sustainable economic growth, food security and access to social services. These initiatives are designed to create a sound, predictable and safe environment for its citizens and for businesses. Indeed, in its commitment to helping Canadians compete and succeed in the global economy, this government has adopted a comprehensive approach to free trade agreements that often includes provisions for investment, trade in services, intellectual property, government procurement, technical barriers to trade, and temporary entry. They are also accompanied by parallel agreements setting out obligations on the environment and labour, which are very important because our Conservative government firmly believes that trade liberalization goes hand in hand with workers' rights and sound environmental practices.

Now more than ever, Honduras, a small and growing market for Canada, can be a valuable trade and investment partner for Canada. Going forward, the Canada-Honduras free trade agreement is a firm commitment from both sides to grow and expand this important strategic relationship. It is also emblematic of our government's confidence in and support of continued democratic, social and economic development in Honduras. As we have heard from previous speakers, this is consistent with Canada's objective of building dynamic economies and promoting responsible investment and open markets to create new opportunities in jobs in the Americas. The twin engines of growth, investment and trade, are the keys to sustainable prosperity; so investment and trade are the two pillars and foundation we need to help grow our economy.

As part of our Conservative government's ambitious pro-trade plan for jobs and growth, we have been proactive in fostering increased integration of Canadian firms and global value chains, and engaging with a greater number and wider variety of international trade and investment partners. We have been doing so to foster Canada's competitiveness in the global market and to ensure that our firms are on a level playing field in as many arenas as possible, so that they and the communities from which they stem, which we all represent, can stay competitive, innovative and prosperous.

In closing, I therefore urge all hon. members of the House to support this free trade agreement as part of our collective efforts to help Canada thrive in the world economy.

[Jack Harris, NDP, St. John's East, NL]

Mr. Speaker, I listened to the member's presentation, and he seemed to think, in using the phrase “a rising tide lifts all boats”, that if there is prosperity in Honduras, this is going to make a difference to the lives of everybody in Honduras. We know the regime is unequal and repressive and subject to human rights abuses.

One of the witnesses before the Standing Committee on International Trade, representing the Canadian Council for International Co-operation, expressed the concern that Canada has validated the existing regime by adopting a business-as-usual approach in signing a free trade agreement with Honduras in spite of its human rights record. We know there are no mechanisms in this legislation, that we are aware of, that would have any effect on enforcing or doing any of the things that the member suggests would result from this agreement.

Why should Canadians be involved in a situation of actually validating a regime that is guilty of such egregious action against its own citizens and the whole human rights standards of the world?

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, the member for St. John's East would obviously know about rising boats, being from the coast, and would appreciate sharing the analogy.

It is an analogy that means we need to look at helping others who need a hand up. I believe in providing hope for others. The analogy we use in that respect is believing in engagement rather than isolation. If one looks around and sees other people wanting to better themselves and their country, I believe it is our responsibility as Canadians, as humans, to help others.

I have had the opportunity to meet with the Honduran ambassador to Canada on several occasions. I know there has been positive movement. Our colleague, the Minister of State, Foreign Affairs and Consular was there last week, working with the Hondurans and trying to help initiate positive movement.

I would just like to close with the fact that in 2008 when I was on the trade committee we went to Colombia and it was a similar situation. We met with people in the shanty town there. They were basically destitute. Connie Watson, who was a reporter for CBC, asked at the time if a free trade deal would help the situation. The answer was yes. They said that investment would be welcome, especially on roads, schools and jobs and for these displaced people, 40% of whom cannot find work in their city. There is a similar situation in Honduras. That is why we are supportive.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I do think it is worth repeating that Canada and Honduras currently do have a merchandise trade. It is getting to well over $200 million on an annual basis. We see entering into a freer trade type of agreement with other nations as a positive thing for Canada as a whole.

I want to pick up on something that I think many Canadians are growing more and more concerned with, and that is the overall trade, the bigger picture here in Canada and the impact it is actually having on the middle class.

The member would no doubt be aware that, when the Conservatives took office, there was a fairly significant overall trade surplus. That trade surplus has been lost. We have now had a significant trade deficit for a number of years.

I am wondering if the member might want to provide comment in terms of how he feels these trade agreements are going to help. Should the government be focusing additional attention on the matter in which they have really not been successful, and that is increasing overall trade so that Canada would have a trade surplus, which would generate literally thousands of additional jobs here at home in Canada?

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, trade has expanded, as the member mentioned. It has steadily grown, reaching nearly $257 million in 2012, an increase of almost 9.3%. It is great in that respect.

Our exports to Honduras continue to grow, up by 17.4%. Positive numbers include agriculture, machinery, wood and a variety of products that we are exporting; that provides jobs for Canadians.

There are almost 40 trade agreements that we have signed since 2006. I have been on the trade committee for almost eight years now. I believe middle-class Canadians are in the best position, as we have had more than 160 different tax cuts and the GST went from 7% to 6% to 5%, saving the average family of four approximately $3,400.

The fact is that with the increase in growth, we can have a growing economy, which allows the opportunity to lower taxes and provide more jobs, growth and prosperity for Canadians.

[The Acting Speaker, Conservative, Bruce Stanton]

Before we go to resuming debate, I see there is an awful lot of interest in questions and comments. I would just reiterate to hon. members that during such times we try to get members to limit their question time, and similarly the response time by the hon. member who had been speaking, so that we get more people participating.

Resuming debate, the hon. member for Prince Albert.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, it is a great pleasure to rise in the House today to talk about the Canada-Honduras free trade agreement.

As we know, our Conservative government is committed to protecting and strengthening the long-term financial security of hard-working Canadians. The creation of jobs and economic growth for the benefit of Canadian businesses, workers, and their families continues to be our focus. That is why we will continue to deliver pro-export leadership.

In 2012, Canada exported almost $39 million worth of merchandise to Honduras. Trade with Honduras creates jobs and economic growth for Canadians. This is a high-quality, comprehensive agreement that would increase trade and investment between our two countries. Canadian exporters have an excellent opportunity to expand as Honduras markets grow, with GDP growth reaching almost 4% in 2012. The government is steadfastly committed to promote free trade in order to support economic growth and to create jobs for Canadians. To this end, our government has embarked on one of the most ambitious pro-trade plans in Canadian history, and this agreement is an important part of that plan.

Today I would like to spend a few minutes talking about the new export opportunities this trade agreement would provide to Canadian producers, processors, and manufacturers. Once implemented, the agreement would improve market access for Canadian goods into Honduran markets by lowering trade barriers, such as tariffs, which would increase Canadian exports to Honduras. Soon Canadian businesses will enjoy the same access to Honduran markets as those in the United States and the EU, which already have trade agreements with Honduras in force.

This agreement would help level the playing field and maintain the competitiveness of Canadian companies doing business in Honduras. Today Canadian exports to Honduras face an average tariff of 10.5% for agricultural products and 4.5% for non-agricultural products. Once the Canada-Honduras free trade agreement is in place, Honduras would immediately eliminate tariffs on almost 70% of its tariff lines covering goods imported from Canada, with most of the remaining tariffs to be phased out over a period of five to 15 years. The elimination of the vast majority of Honduran tariffs would benefit numerous sectors of the Canadian economy across many regions of the country.

Let us look at the impact of the agreement in detail. One sector that would see the benefits is the agriculture and agrifood sector. In 2012, Canada exported close to $3.3 million worth of agricultural products to Honduras. Canada's agriculture and agribusiness sector is innovative and competitive and is becoming increasingly focused on international markets. Trade agreements like this one help create new opportunities for Canadian producers and processors to export their high-quality products around the world.

The elimination of Honduran tariffs on agricultural products under this agreement would help Canadian exporters gain new market access in Honduras. This would mean more jobs and economic opportunities for Canadians. Since the range of products produced throughout Canada that would benefit from this agreement is so wide, allow me to mention just a few examples.

This agreement would eliminate the Honduran tariffs of up to 15% on pork. This is outstanding news for our hard-working farmers in Ontario and Quebec. Likewise, the removal of tariffs of 15% on beef would benefit producers in Alberta and Saskatchewan, while the elimination of tariffs of up to 15% on processed potato products, including french fries, would bring positive impacts to growers and processors in Manitoba, New Brunswick, and even Prince Edward Island. Saskatchewan producers also stand to gain from this agreement with the elimination of the 5% tariff on linseed oil.

Companies producing plastics and chemical products are employing Canadians throughout our country. Companies located in Ontario, Quebec, Nova Scotia, New Brunswick, Manitoba, and Saskatchewan are already exporting Canadian products to Honduras. In 2012, Canada exported $9.1 million worth of chemical products and almost $937,000 of plastics to Honduras. With tariffs of up to 15%, it is not hard to imagine how the complete elimination of Honduran tariffs in these two sectors could allow Canadian companies to enjoy enhanced market opportunities to export a diverse range of products.

Canada is a renowned worldwide manufacturer of high-quality wood and pulp and paper products. Our country is blessed with vast and abundant forest land, and our companies and workers possess the expertise to transform the natural resource into value-added products. In 2012, Canada exported $1.2 million worth of forestry products to Honduras. Again, considering that Honduras maintains a tariff as high as 15% for these products, Canada's past exports in this sector are only the tip of the iceberg of what could possibly be exported in the future. The elimination of all tariffs by Honduras in this sector would unleash important gains for Canadian forestry products.

Other products that would benefit from this agreement are vehicles and auto parts. Manufacturers in Ontario, for instance, could seize new export opportunities that would be created by this agreement.

Canada has exported products such as specialty vehicles, including tractors, buses, and construction vehicles, and automotive parts to Honduras. While some automotive parts and certain types of vehicles already enjoy duty-free access to Honduras, there are tariffs ranging from 5% to 15% that are applicable. With this agreement, they would be completely eliminated.

Canada has one of the world's most valuable commercial fishing industries. While Canada's exports of fish and seafood to Honduras have historically been low, Honduras' high tariffs of up to 15% for these products are certainly a factor that has contributed to this situation. The complete elimination of Honduran tariffs under the agreement would allow Canadian fishers and fish and seafood processors from Nova Scotia and Newfoundland and Labrador, for instance, to fully capture the export opportunities the Honduran market has to offer.

This agreement is about creating future opportunities for our exporters and producers to grow and diversify their markets. Our government is creating the right conditions for this to happen. Knowing the ingenuity of our companies and how innovative and hard working Canadians are, we know that removing trade barriers, including tariffs, stimulates job creation and achieves economic prosperity for all Canadians.

Allow me to touch briefly on the various sectors that comprise our advanced manufacturing industry. I am talking here of sectors as varied as aerospace, industrial machinery, and information and communication technology. Again, Honduras applies a high 15% tariff on imports of products in these sectors, which can certainly hinder Canadian competitiveness in that market.

The agreement would completely eliminate all Honduran tariffs on these products, which would allow Canadian companies to take advantage of these new possibilities. Manufacturers in British Columbia, Alberta, Manitoba, Ontario, and Quebec can expect to enjoy these positive benefits.

There are many more examples I could cite, but the fundamental point is that comprehensive tariff elimination under the Canada-Honduras free trade agreement would create the potential for increased Canadian exports to Honduras. This would mean more jobs for Canadian families and more prosperity for our economy, and it would benefit every part of our country.

Throughout the negotiations for this agreement, government officials consulted with a wide range of stakeholders, and the message was clear: Canadian companies and exporters look forward to the implementation of this agreement and the benefits it will create.

Canadians value the real and tangible benefits that free trade brings to our country, and that is why Canadian companies support our government's initiative to forge new trade opportunities around the world. Our businesses deserve the right to compete on a level playing field with their U.S. and E.U. counterparts as they market around the world.

I had the opportunity to be in Honduras. I went to see a manufacturing company called Gildan, which manufactures clothing in Honduras. It is a Canadian company that has done very well there. As we toured the plant and facilities there, we could see that it was a first-class, very well-run facility that Canadians could be proud of. It was something we might see in downtown Montreal, downtown Toronto, or any other place in Canada, because the company was allowed to use the codes and the regulations used in Canada.

The workers from Honduras would travel for miles to apply for work there, because it provided economic benefits for them and their families. We talked to some of the employees. They really understood the importance of trade and what it meant to them personally and to their families. It allowed them to provide a good quality of life and a good income for their families. Those are some of the benefits we will see in Honduras as we do more trade with that country.

I also have beef producers in my riding who bring in workers from Honduras. They are some of the best workers they have.

As we look at the connections between Canada and Honduras and Canada and other Central American countries, they are getting closer all the time, and we are learning from each other. They are learning from us what is acceptable and what is not acceptable as far as human rights and things like that, and we are learning about their needs and requirements and how we could help them become better individuals. Not only that, but their country could become one of the more outstanding countries. Somewhere down the road, they can look back at their history and say that they were there, and look where they are today. Canada can help them get there.

Mr. Speaker, I appreciate the time to speak on this agreement, and I look forward to the questions.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Mr. Speaker, I do not share that vision. I find it amusing that two of my colleagues opposite mentioned Gildan.

Gildan does not export pork or potatoes. It exports jobs. Gildan was one of the only profitable textile factories in Montreal that was still successful. Now, it is going to become a mere distribution centre with everything being made in countries such as Honduras.

I doubt that the astronomical salaries those companies pay in Honduras are more than a couple of dollars a day because that is the international standard.

I have a feeling that there is still a chance that we will lose and export jobs. International aid, now disguised as something else, will serve to repair the damage caused by mining companies.

In any case, I am wondering if the member thinks it is profitable to export jobs to Honduras.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, I am not surprised the NDP would not agree with this side of the House. It has never supported any trade deals we have put forward in the past, whether it was the Conservative government or even the one or two deals the Liberal government entertained. That does not surprise me. New Democrats always do the Chicken Little thing. They say we are going to lose jobs. We are going to lose capacity in our economy. People are going to lose their jobs, and we are all going to sit at home and have nothing to do.

When we look at FTAs we have done in the past, NAFTA for example, and the benefits that have come to this country because of agreements such as that, it is amazing. For the NDP members not to recognize those benefits is actually really crazy, because it is foolish to not accept those facts. Those facts are clear. They are black and white. Every Canadian family benefits from agreements such as this.

The member talks about Gildan and about exporting jobs. Canadian companies need to have opportunities to take advantage of situations around the world and look at them in a comprehensive manner. If they find a situation where they cannot manufacture here, they may have to make a change. I would rather see that change go to countries in Central and South America, where they have the same values we have here in Canada, than go to other regions of the world where they actually have different values.

The situation in Central and South America is a part of the world where we can really help. They can become better people, and we can help them to do that.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, my province of Manitoba has industries, such as the aerospace industry and the potato industry. Members made reference to those two industries. No doubt there will be opportunities for some provinces more than there will be for other provinces.

To what degree does the government have discussions with other provinces prior to signing onto an agreement? For example, would the Province of Manitoba be endorsing this trade agreement? Does the government have any sense of what sort of provincial support it has for this agreement?

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, if we look at the Canada-Europe free trade agreement, there is a very comprehensive consulting process that we used. The provinces are consulted. Stakeholders are consulted. A variety of different inputs go into the development of agreements such as this. We have been very extensively involved in consulting with all players in regard to this agreement.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, I would like to welcome my hon. colleague from Prince Albert to the trade committee.

I appreciate the fact that we have a rules-based, stable, predictable agreement. One of the keys to helping a community and a country grow is development.

I know that tourism is a big economic pillar and driver for Honduras. I have a constituent who has been going there for the last few years. In July he is going back there to get married, because he loves it so much.

Would my hon. colleague share with the House what Canada is doing as far as investment and security and the development of capacity-building? My rotary president just left this week to volunteer in an orphanage. Maybe the member could expand a little bit as far as some of those partnerships that Canada and Honduras are working on.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, I look forward to learning as I go at the international trade committee, and I look at working at that committee wholeheartedly. It is very important to Canada, and I am glad to be a part of it.

The member raises some good points. We need to highlight the fact that Canada has been actively working in Honduras in helping people achieve improvements in human rights, for example. There are numerous examples of exactly what Canada has been doing in that country that he could refer to.