House of Commons Hansard #85 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was israel.

Topics

Questions On The Order Paper
Routine Proceedings

10:20 a.m.

The Acting Speaker (Mr. Kilger)

Is it agreed?

Questions On The Order Paper
Routine Proceedings

10:20 a.m.

Some hon. members

Agreed.

Questions On The Order Paper
Routine Proceedings

10:20 a.m.

The Acting Speaker (Mr. Kilger)

I wish to inform the House that because of the ministerial statement, Government Orders will be extended by 12 minutes.

The House resumed from October 9 consideration of the motion that Bill C-61, an act to implement the Canada-Israel free trade agreement, be read the second time and referred to a committee.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

October 10th, 1996 / 10:20 a.m.

Reform

Charlie Penson Peace River, AB

Mr. Speaker, this seems to be a busy week for bills dealing with trade issues, unlike the normal situation where about one bill in trade comes forward per year. We happen to have had two this very week.

We are now debating Bill C-61 which implements Canada's free trade agreement with Israel. I have to admit to being a little surprised at seeing this bill because there certainly was not much fanfare heralding its arrival. The Minister for International Trade signed the free trade agreement with Israel in the dead of summer, on July 31, when most people are about as far removed from what is happening federally as they can get.

Other than a brief announcement, I do not recall any signs that the free trade agreement was in the works. I do not recall any news releases, any articles in the press or any calls for consultations with industry groups that might have wanted some input in the process.

Let me be clear that we are not opposed to this bill. We believe that each step made in the direction of trade liberalization is a good one. I am only surprised at the low key, behind closed doors way in which the deal was struck. There should have been more opportunity for input from industry groups.

We are in favour of trade liberalization. I understand the Liberals are now in favour of free trade as well. I compare them to a born again crusade; all of a sudden they have discovered the virtues of free trade and have embraced it with vigour. I do welcome that.

I recall in 1988 they were very much against free trade and campaigned against free trade in the 1993 election, but here we have the Liberals doing their famous flip-flop. They are becoming free traders with all the will and might they can muster. I do think we are going in the right direction and I am glad the Liberals finally saw the light.

One out of three jobs in Canada is created as a result of our exports. Thirty-seven per cent of our GDP is derived from trade. Growth in the economy has virtually only occurred in the area of exports in the last three years. The domestic side of our economy has been very flat and we do have to credit the growth in our exports as being one way we have been able to grow out of the recession we were in in the early 1990s. I think we are on the right track and I would like to see that continue.

As a matter of fact, I would like to see the next round of the World Trade Organization talks concentrate on further trade liberalization because Canada is in a good position to take advantage of that. We can compete with the best in the world but we have to have the trade rules that back us up and give us the clout in case we have trade harassment.

We have heard a lot about the proposal for the free trade agreement with Chile. There has been a lot of discussion about that agreement being closely patterned after the NAFTA agreement and the potential for that country to eventually enter NAFTA. I welcome that. There has also been talk about the eventual enlargement of NAFTA to join the Mercosur countries of the southern hemisphere to form a free trade area of the Americas. However, with Israel of course we did not hear a word until it happened.

Officials of the Department of Foreign Affairs and International Trade were kind enough to give us a briefing last Tuesday regarding the free trade deal. They explained that this trade agreement is fairly simple. There is really no point in building an elaborate structure for dealing with a relatively small amount of trade.

Our trade with Israel is really a drop in the bucket when compared to our trade flows with other countries; nonetheless it is important. Exports to Israel totalled $216 million last year, while imports from Israel amounted to $240 million.

Although we are enjoying a big trade surplus now, essentially it is only with one country, the United States, which is of course our largest trading partner. It disturbs me that we continue to run trade deficits with almost all of our other trading partners. The amount we are talking about is almost the same amount as our trade with Cuba.

It is my understanding that the benefits in this agreement will also be extended to the Palestinians. Under normal circumstances trade flows freely between the West Bank, Gaza and Israel. Even with the present closure between Israel and the occupied territories, one would hope this trade agreement would be extended to the people living in the occupied territories as soon as possible.

I find this agreement interesting because it eliminates all tariffs on almost all industrial goods immediately upon implementation on January 1, 1997. Our free trade agreement with the United

States called for a fairly lengthy phase out period, 10 years on some goods. Fortunately we were going to be there by 1998. But with this agreement we are going to zero tariffs overnight, which is absolutely great.

There are only a couple of exceptions and I am not exactly sure why. Ladies swimsuits at the request of a Canadian swimsuit manufacturer and certain cotton fabrics at the request of Israeli manufacturers will have tariffs for another two and a half years. This will allow the affected companies to adjust to the competition over that period of time.

It is interesting to note that non-tariff barriers for the most part will not be allowed. This is following the lead that has been established at the World Trade Organization.

The agriculture sector, because of sensitivities from both sides, has been somewhat excluded from tariff elimination, although Canada has gained an increase in market access for certain commodities. These include grains, grain products, oilseeds, pulse crops, beef and various processed fish products. I have not had a chance to analyse what this might mean for farmers like myself who grow canola, but I think that any opportunity for access into these countries is a good one for us.

It disturbs me a little that Canada continues to protect our supply management industries with tariffs that are as high as 350 per cent. These tariffs are known around the world as Canada's dirty tariffs. We simply must get into the 21st century and realize that it is not in our best interest to continue to support these. A reasonable phase out time to allow for that to happen is acceptable. We have to start that process. I would like to see it done at the next round of the World Trade Organization talks.

Further trade liberalization is good for Canada. We have been one of the main proponents of trade liberalization. Yet right here at home we continue to restrict access to part of our economy. On the other side of the coin, the United States is using similar tactics to restrict access to Canadian supply management producers that compete head-on with the United States.

I understand that the impetus for concluding a trade agreement with Israel at this time is that our largest competitors in that country, the United States and Europe, have had free trade agreements in place for some time. This will put us on a level playing field.

The dispute settlement process in the agreement is fairly straightforward and it is binding. One of my colleagues who will speak later is quite interested in the whole dispute settlement process and will be examining that in some detail. He is concerned that dispute settlement procedures for international agreements are much better than the procedure we have for disputes between the provinces and Canada. It is very interesting that the Liberal government, once it realized the benefits of free trade, aggressively worked toward signing international agreements on trade.

Where the government has fallen down is that it has not been able to put the same processes in place for trade between our provinces. That continues to cost Canadians somewhere in the area of $8 billion a year. The fact that we are not able to trade freely within our own country is a real contradiction. We have better trade agreements with our international partners than we have at home. My colleague from Vegreville will be speaking on this subject later today.

Another colleague who is a well respected economist in his own right will talk about bilateral agreements versus multilateral agreements. I know there is a bit of controversy among trade economists whether countries should enter into bilateral agreements. The argument has to do with efficiency and production. The concern is that the most efficient producer, given a situation in which all tariffs are equal, loses business when his competitor in another country moves to a zero tariff with a buyer. Trade is then diverted from the most efficient producer who, unfortunately, still has to add a tariff to his price. When he sells the product to a foreign country he becomes a less efficient producer.

The industrialized world is moving toward free trade with the World Trade Organization. The next round of trade talks will be held in 1998-99. The process is fairly slow, but we are getting there.

The last Uruguay round of the GATT declared there would be an average 36 per cent drop in tariffs over a six-year period. We are now halfway through that period. That is nothing compared to the 100 per cent drop in tariffs which has been achieved through the signing of the Canada-Israel free trade agreement.

Even though these bilateral deals may divert trade from efficient companies to less efficient ones, they also create new trade which did not exist previously.

I believe that bilateral deals are useful in trying out different rules and in testing different approaches. I suggest that the next bilateral agreement which Canada signs should try to up the ante beyond what we have been able to achieve at the World Trade Organization. We should try to get a proper definition for subsidies, countervail and some other things which were not achieved at the last round of World Trade Organization talks.

We in the Reform Party welcome the bill. We believe that trade liberalization is good for Canada. We are a trading country. We have a relatively small population. Only about 10 per cent of the GDP in the United States is derived from exports. In Canada, 37 per cent of our GDP is derived from exports. We need trade very badly. We need further trade liberalization in order for us to compete.

Canada should be a bit more proactive in the bilateral agreements and at the next round of the World Trade Organization talks. We could have used the opportunity with Israel to get an agreement on subsidies. That is what we should be looking at in our next move. Overall I support the bill. I am pleased that in just two

months manufactured goods will travel between our countries on a daily basis duty free.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:30 a.m.

The Acting Speaker (Mr. Kilger)

We will now move to the next stage of debate where member's interventions will be limited to 20 minutes and subject to 10 minutes of questions or comments.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:30 a.m.

Eglinton—Lawrence
Ontario

Liberal

Joe Volpe Parliamentary Secretary to Minister of Health

Mr. Speaker, I am delighted that my colleague opposite is in complete agreement with the initiative put forward by the Minister for International Trade. It shows great foresight.

I do not mean any disrespect by this, but the hon. member, who sits on the international trade committee, has for the last three years applauded all moves which liberalized trade and that increased Canadian business opportunities abroad. Generally speaking, he has been very supportive of the kinds of initiatives that the bill presents. He is unlike many of his Reform colleagues in that regard. We have actually seen eye to eye.

I want to stress some aspects of the bilateral relationships between Canada and Israel and remind members here in the House of the speech the minister made last night.

For some time now, Canada and Israel have had an excellent relationship based on shared values and strong bilateral and social ties. Given the current critical situation, we are supporting the efforts made by Israel and its neighbours to achieve a legitimate, global and durable peace in the Middle East.

While Canada was negotiating NAFTA with the United States and Mexico, Israel was increasing its commercial ties by signing free trade agreements with the United States and, more recently, with the European Union, Turkey, the Czech Republic and Slovakia.

While that may have been a great idea for the Israelis, for the Europeans, for the Americans, it put us and our businesses at a slight disadvantage.

Trade between Canada and Israel was, however, stagnating. In November 1994, Prime Minister Jean Chrétien and the late Prime Minister of Israel, Yitzhak Rabin, decided to do something about it. The leaders announced the beginning of negotiations that would hopefully lead to a free trade agreement between their two countries.

Last January, Canada and Israel reached a tentative agreement that both governments kept trying to improve upon.

While it would be my intention to applaud not only the foresight of the Prime Minister in this case and the diligent work of the Minister for International Trade, I would be greatly remiss if I did not acknowledge the focus of the individuals involved in the genesis of this idea, the generation of energy that led to its fruition, if I did not also underline the democratic process that led to this deal.

As my colleagues on both sides of the opposition have indicated, this trade deal is one to be lauded, not so much for of its grandeur because it may have some limitations in relation to the kinds of business we do with the United States and other countries, but it is an important and crucial first step. Quite often many of us feel dwarfed by the magnitude of government and by what appears to be the inaccessibility of the decision making process.

If members will allow me a personal reflection, this trade deal was really born out of a desire of entrepreneurs in Canada who saw opportunities emerging in the Middle East, and Israel in particular. They noticed that, notwithstanding all the difficulties that the area was having, because of the enormous influx of immigrants into Israel and because of the initiatives of the Israeli government to reach out and make peace and at the same time establish economic ties with its partners, there was a mini-economic boom.

The Europeans were the first to notice this. Their companies, with the support of their governments, were able to develop a niche market that had started initially with the growth of tourism. It may come as a surprise to most members, but the tourism industry and related industries are at their most potent right in the Middle East, most particularly in and around Israel.

That boom in the tourism industry allowed for enormous demand, much more than the area could supply for such things as furniture, for example, or textiles and clothing but also in the petrochemical and chemical industries.

Our entrepreneurs in the Toronto-Montreal area found that, notwithstanding the competitiveness of their product and the quality of their materials they could not compete with the Europeans or the Americans because of the free trade agreements they had struck with Israel. They asked the then leader of our party, now the current Prime Minister of Canada, if he could address this at a public meeting. The soon to be Prime Minister was asked if he would address this vacuum in Canadian international trade policy. Notwithstanding the dangers that address might put the party in, he promised he would do it. This he did immediately on assuming the

mantle of Prime Minister. We have seen the results. After two years of negotiations we finally have a deal.

As well, many of my constituents who were involved in the initial genesis, the push toward getting government foreign policy and international trade policy to respond to the interests of entrepreneurs in Canada, took every opportunity to remind me as their local member and other members from Toronto and Montreal that this treaty needed to be signed. Not only would it benefit Canadians economically, it would give us indirect access to the European Union. I know my colleague from the Reform Party would appreciate that.

It took a while for people to respond because obviously the details of such a deal had to be worked out. It is a credit to the people who were involved in this. I met them last July when the Minister for International Trade signed with his counterpart, Natan Sharansky in Toronto. Obviously there was some assiduous work to ensure that the deal would take place so that the new bilateral relations between Canada and Israel would work to the advantage of both parties.

Statistics were related by the Minister for International Trade yesterday and repeated by my colleagues from the Bloc and the Reform Party this morning. Trade has already picked up in some areas by as much as 37 per cent and in others by 49 per cent over last year. Such is the impact of the discussions of such a deal. We can anticipate that much more will happen as soon as the agreement has been inked. I am hoping that the House will approve this today following the debate.

In a crucial area like the Middle East, the presence of Canada whose reputation for altruism as seen through its peacekeeping efforts everywhere throughout the world would be a welcome addition. It has no interest except as one that would introduce expertise in the areas of the region that need it most. I pointed to petrochemical industries. The minister pointed to the electronic and agri-products industries.

When we speak of Israel we are speaking of relations with a country which is not much larger than Prince Edward Island and half of it is desert. Most people can develop policy by shouting from one city to another, in the same way that we shout at each other in the House. The place is intimate, the proximity of one market to another is such that most of us would not appreciate the impact for economic secrets.

However, the presence of Canada, not only as a peacekeeper but as a nation of entrepreneurs, that is willing and ready to provide not only its products but also its expertise will provide Canada, the Middle East and particularly Israel an opportunity to see how things can and should work.

Both opposition parties have indicated that they recognize the import of Canada's initiative of strongly promoting that such a deal also be made available to the Palestinians in the area. I think it is marvellous that the Israelis saw an opportunity for a lasting peace with a Canadian presence on an economic and political basis.

The bill is one that reflects not only what entrepreneurs wanted because it was generated in part by entrepreneurs who saw an opportunity and seized the chance to apprise their government of it and then follow it through together with the bureaucracies of both countries to ensure that legislation would come forward which would cement the ties both were willing to establish.

We have already seen some of the product of that. We have seen some of the flower of that activity. I look forward to a greater, more blossoming economic activity and political participation on both sides.

Mr. Speaker, I thank you and colleagues for their attention. I thank them in particular for their support.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:45 a.m.

Reform

Jim Silye Calgary Centre, AB

Mr. Speaker, there is no question that we support free trade and we support bilateral trade agreements that are negotiated by our representatives.

I find it interesting to listen to the hon. member from the government side using such flowing and glowing eloquent language when describing this trade deal, but I wonder about the hypocrisy from the other side.

When the Liberals were in opposition and when they had a leader by the name of John Turner, they ran a whole election campaign which caused me a lot of grief. I had to hold my nose while I voted for the Conservatives because I favoured free trade.

I did not want to vote them in for another session. I did not want them to be here for another four years because they were incompetent. They were running the government very poorly. They were overspending. They promised tax cuts and did they give us tax cuts? They gave us tax increases. They promised integrity in government and what did they give us? They gave us nine cabinet ministers who quit in the first four years.

In opposition they debated how free trade is not good and in the best interests of Canada, and how North American free trade is no good for Canada. We just have to go back into Hansard .

John Turner ran a campaign against Brian Mulroney on free trade. That was the issue and the people over there, many who were in that campaign, were against it. Now we have every one of them, including the Prime Minister, saying free trade is great, quote the trade statistics.

Thank goodness we have free trade because that is what is saving their butt in terms of jobs and job creation. The only reason our economy is growing is our trade agreements. That is what is making it grow. Domestic growth is nil. It is next to nothing. There are no jobs in Canada. There are 1.4 million people out of work.

Thank God the jobs that are being created, those 600,000 jobs they brag about, over half of them are probably due to the trade.

What I do not understand is the hypocrisy of politicians who say one thing in opposition and then when they get on the government side they flip-flop. I am not sure if this member has flip-flopped. I am not accusing this member of flip-flopping. I am sure based on his speech, I am positive based on his speech, that he believed in free trade when he was in opposition. He believed in free trade when John Turner was running against it. He believed in free trade all the way. I am sure he did because you cannot use language like that today, having argued against it yesterday.

The hon. member is anxious to get up and I will let him get up, but I want to make a serious comment. I want to repeat it so that everybody understands my point.

My point is why say that you are against something in opposition, then go over to the government and be in favour of it and in such a way that they always believed in it? It does not make sense to me. Thank goodness for the wonderful rebirth of the Liberal Party in terms of understanding the economy of the country and I compliment it for flip-flopping.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:45 a.m.

Liberal

Joe Volpe Eglinton—Lawrence, ON

Mr. Speaker, I am not accustomed to his phrase flip-flop. It is not part of the thesaurus that I read.

I thank my colleague for pointing out why Canadians decided very decisively in the last election that they could no longer brook the kinds of people that were administering, in fact misadministering, the country.

I am pleased that he realized that this government, this administration, my party, has taken all the appropriate steps to ensure that bad decisions were redimensioned, that adjustment programs were provided, that the direction required for trade deals be appropriately moved so that the benefits to Canada could accrue in an accumulative fashion.

I am glad that he has noted that it has worked. He has pointed already to the impact of increased trade on the domestic economy. For that I thank him. He has pointed to the impact of this administration's approach to world trade, liberalized trade and its impact on the nation's finances. He has pointed to the importance of this kind of growth to the fiscal policies and to the impact on the interest rates which have accrued to Canadians, which is a very immediate and very profound financial impact. For all of these things I thank the member opposite.

I want to thank him as well for recognizing that the country is run by an administration that realizes the importance of a changing world, the dimensions of that kind of change, the impacts of implementations of measures to deal with those changes and to bring them to a point where Canadians are very much an integral part of a globalized economy, of a globalized political economy, one in which they can look forward to a future with prosperity and growth.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:50 a.m.

Reform

Charlie Penson Peace River, AB

Mr. Speaker, I enjoyed the comments of the parliamentary secretary for health and his recognition that indeed the Liberal Party has finally decided that free trade is an attribute and one that has been very successful in transforming the Canadian economy into one of growth.

As my colleague from Calgary centre has just stated, the domestic economy has not recovered. There still is not the confidence there with consumers but on the trade side, on the export side we have been very aggressive. We have done a good job and there has been tremendous growth.

I know the Liberal Party has done a major conversion here and now they think that free trade is good. Canada generally has been a leader in trying to put together the trade deals that are necessary. As I said earlier, we can compete with anybody on a level playing field but we cannot compete with subsidies from other countries and high tariffs.

At the last round of the GATT talks which the Liberals took over at the very end, they favoured supply management, article XI, which would preserve border closures and stop any product from coming into the country in terms of supply managed farm products. Canada became isolated at those trade talks. We were the only country that finally took that view and continued to take that view although it was not one that was conducive to free trade and it still is not.

We have moved to tariffs now, 350 per cent tariff on butter. Surely for a country that espouses free trade, trade liberalization, and has since after the second world war, are we not in a real contradiction here that we want free trade in other countries, we want access to their markets, but we will not provide it for the supply managed farm industry here at home?

I would like the parliamentary secretary to comment on that question.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:50 a.m.

Liberal

Joe Volpe Eglinton—Lawrence, ON

Mr. Speaker, I compliment the hon. member from Peace River. He and I sat on the international trade committee and on the foreign affairs committee for about two years. He has been insistent and persistent in his approach in defending the interest he feels he was elected to defend. I say that with no disrespect. It is important that members keep their minds on the issues.

In the course of those debates in that committee he pointed to this issue on more than one occasion. In fact, he was part of a series of studies that the committees undertook and participated in to bring just such issues forward.

The question of adjustments is not one that is going to be answered immediately in one debate in the House, nor dare I say, as we both found, in one committee. He pointed to the fact that Canada found itself isolated but that is part of the negotiating process. We entered into GATT, we entered into the World Trade Organization precisely because we wanted to ensure that the world recognizes certain standards, certain rules for dealing, for trading. We had to defend our own interests until we can find an alternative way to defend those interests.

In the context of those two organizations, we had to negotiate and we continue to negotiate for the interests of Canadians. I do not think we need to apologize for that, notwithstanding the philosophical positions other people have.

If farmers in Canada feel unhappy about the fact that we have defended their interests I would like them to say so. If what the member is saying, that defending our interests runs counter to the philosophical positions espoused by other countries and promoted by other countries to their own interest, that is a discussion that we can have a little later on. However, that is not what I am going to apologize for.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

10:55 a.m.

Bloc

Stéphane Bergeron Verchères, QC

Mr. Speaker, I find the debate that has been going on between our colleagues for the last minutes interesting. It illustrates quite well what my colleague for Terrebonne referred to yesterday, that is, for almost the last three years now, we have been amazed to hear the Liberal government speak in favour of free trade in this House and on at forums around the world, since it was so opposed to the Free Trade Agreement with the United States and, later on, to the North American Free Trade Agreement. Thus, like our colleagues of the Reform Party, we are very happy to see this quite spectacular conversion on the part of our Liberal colleagues.

This being said, I am happy to rise today in this House to speak on Bill C-61, an Act to implement the Canada-Israel Free Trade Agreement.

I must say at the outset that, even though we are critical of the way in which the Liberal government singularly excluded the official opposition from the negotiations along with all the other players interested in expressing their points of view on this matter, the government can be assured of the support of the Bloc Quebecois because we are in favour of free trade and globalization of markets, which anyway reflect an irreversible trend in world trade.

After the United States and Mexico, here is a third state, which is a lot farther from our frontiers, that will in all likelihood, in January, 1997, enter the group of countries with which Canada will remove all trade barriers.

The Bloc Quebecois favours the establishment of closer ties between Israel and Canada. We think that Quebecers and Canadians can only win from such an agreement, since the free flow of goods and the increased competition promoted by free trade will give our respective peoples access to a larger range of products at better costs. For these reasons, the Bloc Quebecois is in favour of this free trade agreement, which, as I said, will allow Canadian businesses to increase their presence in Israel and eventually in other countries in the Near or the Middle East.

This free trade agreement with Israel is designed to eliminate practically all duties on products traded between the two countries. Israel, with a population of 6 million-which, by the way, is just a little smaller than the population of Quebec-will have closer ties to Canada since tariff barriers that have restricted the free movement of goods until now will soon be eliminated.

This bill, which is divided into three parts and includes 62 clauses, will provide, among other things, for the elimination of duties on all industrial products as of January 1, 1997, except for two products for which the elimination of duties will be done more gradually, namely women's bathing suits and certain cotton fabrics.

In addition to those two products, the agreement also provides for a reduction of duties on most agri-food products, except for dairy products as well as egg and poultry products, as agreed by both parties.

This agreement comes just at the right moment to promote trade between Canada and Israel. In 1995, bilateral trade between the two countries reached $450 million or so, a 37 per cent increase from the previous year. As for Canadian exports to Israel, they stood at $236 million in 1995, up practically 50 per cent from 1994.

Trade between Canada and Israel has been increasing constantly over the last few years.

This is why the time has come to eliminate the trade barriers between the two countries. As Quebec's Deputy Prime Minister was saying, in October 1995, in a letter to the federal Minister of International Trade, Quebec, and I quote: "[-] has always been a strong defender of freer trade between countries-he was referring to the Free Trade Agreement, the North American Free Trade Agreement, the General Agreement on Tariffs and Trade and the World Trade Organization-and still supports freer trade as an instrument of growth". The Bloc Quebecois is in complete agreement with this view.

What is special about the State of Israel is that it is located in a geopolitical context completely different from ours. The history of the Jewish state has not been all peace and tranquillity, for most of the neighbouring Arab countries have been in an official state of war against it since its creation in 1948.

Certain events in the recent history of Israel are more significant than others. For example, the Six Day War that took place in 1967, culminating in Israel's victory over its neighbours, resulted in the occupation of territories that unfortunately has continued right up until the present.

The names of these territories continue to be well known to us today, because they are still at the centre of world news. Naturally, this presence only adds to tensions between Jews and Arabs, because even though Israel withdrew from the Sinai in 1982 and from the Gaza Strip in 1994, it still occupies East Jerusalem, the Golan Heights and the greater part of the West Bank.

However, in spite of the peace process set in motion in Madrid in 1991, followed by the signature of the 1994 accords between Israel and the Palestine Liberation Organization, better known as the PLO, the peace process still has a long way to go.

The tragic assassination of Prime Minister Yitzhak Rabin on November 5, 1995, dealt a disastrous blow to the peace process. This man, whose goal for many years had been to see the people of Israel finally able to live free of conflict, said in his last speech, just moments before being shot down by a young fanatic: "I was a man of war, but today we have a chance at peace. I believe we must take this chance, so deep is our yearning for an end to the conflict".

His assassination led to a deterioration in the situation. Last spring, the repeated suicide bombings by the Hezbollah prompted the Israeli army to carry out air raids and bombing attacks on southern Lebanon. These attacks left over 150 Lebanese dead, most of them civilians.

A few weeks ago, the decision by the new government of Benjamin Netanyahu to reopen the underground gallery leading to the site of the Al-Aqsar Mosque, the third most sacred Islamic religious site, led to riots in which some fifty Palestinians and some fifteen Israelis were killed. We sincerely hope that Prime Minister Netanyahu will re-examine his current hard line with respect to Palestinian autonomy.

It may be worthwhile to point out that the present Canadian government constantly maintains that human rights are promoted through trade links. Yet, the state of Israel has already signed a free trade agreement with the United States, in 1985, followed by a similar one with the European Union in 1988, and now with Canada. But have we seen any improvement in the situation? No.

We believe that the Israeli government ought now to be seeking solutions for reconciliation with the Palestinian authorities. After all, is politics not the art of compromise? Speaking of compromise, it would certainly be worth while to explore the possibility of expanding this free trade agreement to the Palestinians living in the occupied territories.

The first step would, of course, be to obtain the go-ahead from the Palestinian authorities, in order to have the assurance that their inclusion in an Israel-Canada treaty was indeed what they wanted. It is possible that, expansion of the agreement to include the Palestinians would result in increased employment in the occupied territories, which might eventually contribute to stabilizing the social climate.

The negotiations leading to the signature of this agreement were held throughout this entire troubled period. They began in November 1994, and ran until January 1996, and led to an agreement signed by the Minister of International Trade for Canada and the Israeli Minister of Trade and Industry, on July 31, 1996.

As the party forming the official opposition, we have difficulty accepting that virtually the entire process leading to this agreement was held in secret, with no public debate whatsoever. It is understandable that the negotiating process itself needs to be carried out behind closed doors, that is natural. We know that the negotiators are faced with a tough job and have to negotiate many pitfalls and obstacles, but we would appreciate progress reports on the negotiations.

Now we are not asking for parliamentarians to be present at the negotiating table, but we do believe that in a democracy, it is important to avoid any systematic exclusion of those who represent the people.

Remember that the most important issue in the 1988 election was the free trade agreement between Canada and the United States, to which the Liberals were opposed. Many groups that knew they would be affected by the agreement could therefore take part in the debate.

It was by defending their points of view and by making representations to the political authorities, that stakeholders, company directors and spokespersons for community and environmental groups were able to influence the tenor of the clauses included in the agreement before it was signed.

During the negotiations leading up to the North American Free Trade Agreement, the unions took a position on labour-related issues and expressed their fears about NAFTA. Environmental groups also expressed their concerns about environmental issues. Although the results were not satisfactory to all stakeholders, the fact remains that before the agreement was signed in December 1992, there had been had a major debate in the public arena.

The treaty dealt with in the bill before the House today has now been signed. Negotiations have been finalized and nothing can be changed. Without repeated interventions by the official opposition, which managed to draw the government's attention to the problems that such an agreement would represent for the lingerie and bathing

suit industry in Quebec, decisions that would have had a disastrous impact on this sector might have been made.

In fact, this industry would have been in serious jeopardy, since the State of Israel imports its fabrics from the European Union duty free, which it gives it a competitive edge on Quebec and Canadian markets. If we had not raised this issue in the House in November 1995, it is not certain that the negotiators would have been aware of the problem. And perhaps hundreds of jobs would have been lost in the process, especially in Quebec.

Canada is now busy negotiating free trade treaties right and left. We approve of the opening up of this country to various markets, but it is absolutely necessary to review the process leading up to the signing of these agreements.

The bathing suit issue is only one example of the potentially negative consequences of an agreement negotiated without public consultation. Although the agreement with Israel has already been signed, there is still time to improve the process for future free trade agreements being considered by this government. We are thinking for instance of current negotiations taking place between Canada and Chile, which are to lead to the signing of an agreement on or about November 15 this year.

Officials at Foreign Affairs and International Trade have given us the assurance that information on these negotiations will be made available to us. We can only hope that the ministers responsible for Foreign Affairs and International Trade are prepared to give their approval for the release of such information.

It is imperative to prevent a recurrence of this kind of situation, so that the opposition can do its job properly. Such a cavalier attitude on the part of the government is troubling, especially because the government knew quite well it could count on the support of opposition parties. Why persist in infuriating opposition parties when we could have presented the picture of a solid consensus to our trading partners?

If the government really wants open and transparent debates, it should practice openness and transparency itself. Otherwise, we will have to conclude, as it is the case now, that it prefers secrecy and obscurity. I plan to demonstrate the extent of this government's pettiness and inordinate mysteriousness with the official opposition on this whole issue.

Last April 25, during a special session of the Standing Committee on Foreign Affairs and International Trade on Israeli bombardments in South Lebanon, I conveyed to department representatives my reservations concerning the negotiations on free trade with Israel when it was bombarding civilian populations and openly crossing the internationally recognized borders of another independent country.

One official of the department replied that negotiations were interrupted pending the election of a new government in Israel. That statement seemed confirmed later on by replies we received from the Office of the Minister of International Trade. In fact, in May and June, we called the office of the minister a few times to find out when the negotiations would end and when the agreement would be signed and we were always told that the agreement was to be signed only in January 1997.

And yet, a few weeks ago-on September 19, to be exact-the Parliamentary Secretary to the Minister of Foreign Affairs informed the committee members that the agreement had been ready to be signed since March, and that the official signing, which was to have taken place during a visit of the Prime Minister of Israel in Canada, had been postponed because of the elections in Israel. This is what we are criticizing.

It would appear that the agreement with Chile will be much more exhaustive than the one before us today. The agreement with Chile is supposed to be modelled on NAFTA. Since it will be more encompassing, there are many issues which would have been interesting to raise with Chile prior to promoting the agreement. Cases in point are standards regarding the environment, labour in general and child labour, in particular. The agreement with Israel is limited to goods and, as such, does not include services or investments.

Last week, we met with Oxfam Canada representatives who told us how concerned they were with the lack of protection on social issues negotiations seem to be leading to.

According to this organization, the agreement, the content of which will be made public when it is signed, around November 15, will undoubtedly not contain stringent enough rules on the environment and labour.

Even though Chile is undergoing tremendous economic growth, too many of its citizens still live in poverty as a result of the polarization of wealth. Therefore, it would have been desirable, both for Chile's sake and Canada's, that these issues be looked at more carefully. This is why it would be important to know how the negotiations are going prior to the House being presented with a bill implementing the agreement.

At least Bill C-61 before us today has the merit of stimulating exports and levelling the playing field for our companies competing with American and European firms, which have benefited from preferential access to the Israeli market for some time now.

The Bloc Quebecois, therefore, will support this bill to implement a free trade agreement with Israel, while condemning the fact that the elected representatives in this House were kept in the dark with regard to the negotiations and the issues raised during the discussions. It is not by hiding each of the negotiating steps leading to the conclusion of such important treaties that we will be able to reasonably debate the themes and issues that will affect the daily lives of our fellow contrymen.

That is why, as I said earlier, the Departments of Foreign Affairs and International Trade should keep the members of this House informed of the status of negotiations, if we are to have an informed and responsible debate. Our position regarding Bill C-61, which goes in the same direction as the government's, shows once again how serious our party is when it comes to the interests of our constituents and their willingness to promote entrepreneurship.

In conclusion, let me quote a short excerpt from the dissenting opinion the Bloc Quebecois gave in November 1994, during the review of Canada's foreign policy: "Quebecers are not protectionists. They have shown it by strongly supporting the free trade agreement, the North American free trade agreement and the Uruguay round of GATT talks. Must we remind the House that Quebec's determination was the spearhead of the free trade movement in the 1980s? Far from seeing Quebec's sovereignist movement as a withdrawal into itself in response to economic globalization, we perceive it as an openness to the world".

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

11:10 a.m.

Liberal

John Bryden Hamilton—Wentworth, ON

Mr. Speaker, I would like to thank my colleague for some excellent remarks.

I would like to draw his attention to something that was said by the minister in his speech yesterday. I quote from Hansard . The minister said in reference to the free trade agreement: ``Why Israel? Israel and Canada have long enjoyed close relations. Our relationship is rooted in common values and shared democratic beliefs, the belief in freedom and the dignity of the individual''.

Yet we have a new regime in Israel under Mr. Netanyahu which has taken a very hard line with respect to the peace process, a very hard line with respect to the Palestinians. We have seen an outburst of violence on the West Bank.

I would like to ask my colleague whether he thinks, in supporting Bill C-61 which in essence ratifies the free trade agreement, we also endorse the policies of Mr. Netanyahu with respect to the Palestinians on the West Bank.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

11:15 a.m.

Bloc

Stéphane Bergeron Verchères, QC

Mr. Speaker, I think my hon. colleague has just asked me a very important question. I touched on this matter in my speech.

Last spring, we in the Standing Committee on Foreign Affairs and International Trade had a special meeting on the Israeli bombing in southern Lebanon. We were concerned at the time about the Canadian government beginning or pursuing free trade negotiations with the state of Israel, which was then bombing civilian populations in southern Lebanon and openly violating the internationally recognized borders of another sovereign state, Lebanon. We asked officials in these departments if they intended to suspend negotiations. All they said was that negotiations were suspended anyway, since they were waiting for the results of the Israeli election.

We then found out that negotiations had not been suspended, that the agreement was in fact ready for signing as early as March. This shows the government's contempt, if I may use this word, for the members of this House and the committee, as we should never have been told negotiations had been suspended when the agreement was in fact ready to be signed.

We did express reservations about the signing of this free trade agreement with Israel, given the Israeli government's somewhat intransigent attitude toward the Arab populations both within and beyond its borders.

This is why we ask that this agreement be extended to the Palestinian populations of the occupied territories, in the hope that this will eventually improve their economic situation. We also want to improve the social climate in the Israeli occupied territories.

Canada-Israel Free Trade Agreement Implementation Act
Government Orders

11:15 a.m.

Reform

Jim Silye Calgary Centre, AB

Mr. Speaker, I have a question for the Bloc member.

I have been dying to ask this member a question because I have a concern. This is a trade agreement and he knows full well that, as my colleague mentioned earlier, there is a protective tariff system in effect in this country, especially with subsidizing the dairy industry in Quebec.

We pay over and above the next lowest price we could get our dairy products for, 350 per cent supply management tariff. We subsidize that product in Quebec. It is a huge component of Quebec's economy.

The member was sent to this House by the people of his constituency to break this country up. The people in his riding say they want to go on their own and they want him to fight for that. They also say they will be better off once they leave and that they will not have to pay for this expensive overhead that Ottawa generates. They will be able to do it better themselves and economically they will be better off. The people his riding think they will be better off if they separate. A large component of their industry is the dairy industry which is subsidized by consumers across Canada, including Quebecers.

Does he believe that if Quebec separates we are going to continue to buy our product at a 350 per cent subsidized price from the province of Quebec, from the new country of Quebec or whatever it will be called?

I feel that the issue of trade, of economics and of separation can be reduced to a simple argument which may be a reality that might sink in to the people of his riding as to the cost of separation, to whether the burden of proof should be on the separatists to prove to the people of Quebec that they will be better off in trade after separation.

The Liberal member earlier asked why Israel. I ask, after separation why Quebec? We can get our product from ourselves. We can be the dairy industry to the rest of Canada. We can get it from the United States. They will become a competitor. Competition creates the best marketplace. The competition will reduce the revenue to the people in Quebec and Quebecers will have to compete. They will no longer be subsidized. The reality is they will be worse off. Would the hon. member like to comment on that subsidy?