House of Commons Hansard #156 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was trade.

Topics

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1:15 p.m.

Liberal

John Bryden Ancaster—Dundas—Flamborough—Aldershot, ON

Madam Speaker, I found the member's remarks very ingenuous because his own first speaker mentioned that it was a powerful lumber lobby in the United States. It is a bully. They are not acting very American, if I may say so, and they are applying muscle against the Canadians. We have done everything in our power. What it really boils down to is that in this sector there is a lack of goodwill on the American side. They are far more powerful than us.

In the end, will he not agree that the only way this situation will be resolved, short of going to the WTO, is to appeal to the goodwill of the president of the United States? That is precisely what the Prime Minister is doing at this moment. We have to hope that the Prime Minister is successful because there appears to be no way that we are going to find our way through the powerful lumber lobby.

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1:15 p.m.

Canadian Alliance

Rick Casson Lethbridge, AB

Madam Speaker, there is a powerful lumber lobby in the United States, but there is also a powerful lobby in the United States supportive of our position.

Why are we not finding the allies that we need to promote our position instead of continually talking about the other side? Let us bring the parties together that will help defend Canada's position on this issue.

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1:15 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Madam Speaker, I will be sharing my time with the member for Vancouver Centre. More and more in the House we are hearing debates on opposition day motions wherein members of the opposition seem to be struggling to find a position that substantively criticizes the actions of the government and to be moving on to more personalized attacks against the government.

I would like to bring this debate back to more of a businesslike atmosphere rather than the chirping that seems to be coming from across the way. I do not mind that; it tends to motivate and encourage me to carry on with my remarks.

I want to point out a couple of things. The first is that I really believe what is happening here is actually an attack on our sovereignty as a nation. It is an attack on our ability through our Confederation to determine how we will do business within our country and with other parts of the world.

Let us take the issue of stumpage. Stumpage, for the folks at home, is basically a system used by the provincial governments to manage the forests. They give out licences to lumber companies that in turn go out and harvest, and I use the word harvest because that is exactly what it is, the product from the forest under terms of the agreement that require them to replenish what they take away. The object under a proper forest management program strategy is that we not deplete what is clearly an important resource to our country.

The Americans do not like that because they operate a little differently. They simply go out in the world of let the strongest survive and buy the stumpage, buy the forest and do with it what they will. I do not challenge their right to do that. I would say, though, that under agreements like Kyoto and in other environmental areas there are concerns internationally about too much clear-cutting and raping of the land.

I would hope the Americans would look at it as more than just a trade dispute and recognize the impact that unfettered forestry operations could have on the environment. It also has a major impact on the economy.

We cannot sit back and tell the Americans to go ahead and tell us how we should manage our forests. Under the terms of Confederation that is a provincial responsibility. The issue we are debating is one of fair and free trade. What has happened?

Let us be fair to our friends south of the border in this regard. How do they compete with a 62 cent or 63 cent dollar? On top of that, how do they compete with an industry that is much more efficient, that produces a better quality product which their consumers are demanding in huge numbers?

They have difficulty because they would have to then turn around and invest tens or maybe hundreds of millions of dollars to upgrade the quality of their industry, of what they are producing in terms of a quality product. How can they address this issue? Either they make those investments over the long term and compete with the good quality Canadian wood or they call up George and slap on a duty. That is the easier way for them to do it. By slapping on a duty they then make our products more expensive to consumers in the United States.

I am quite sure the Prime Minister will be pointing out to President Bush that a number of very important groups in the United States actually want Canadian softwood lumber. Consumer associations have called for it. The housing and building industries are demanding that they be allowed to have access to softwood lumber.

A company we all know well, Home Depot, has stated on record in the United States that this is an unfair duty, that it is anti-free trade and that it should be eliminated.

I say to my friends opposite that the wording of their motion is almost like motherhood. Their simple solution is that we should somehow negotiate an agreement. For every major problem in government there is a simple solution and it is inevitably the wrong solution. What we need to do with the Americans is to put in place a long term sustainable agreement.

Our minister has met with and negotiated agreements with the provinces and industry. This is a dispute that has been going on back and forth for 20 or 25 years in one way or another. People are standing with the minister on a platform and saying that for the first time there is a united front in Canada.

People can poke fun at the fact that Canada is not as big and powerful as the United States. However let us not take away the impact that a trade war would have on both sides of the border. Some 87% of our exports go to the United States. An official opposition member suggested that all team Canada trade missions should be cancelled until this dispute is solved. What a brilliant strategy it would be to tell everyone around the world that we will stay in bed, pull the covers over our head and not carry on trade until this one dispute is resolved.

For members opposite to suggest in any way that the government has not taken firm action is just ludicrous. It is painting a picture to suggest that somehow we have poisoned relationships. A member opposite accused our Prime Minister of stating during the last federal election in the United States that he was rooting for the Democrats. Comments like that are misleading the Canadian public. It is very unfortunate that members opposite would use this kind of tactic during a serious debate on an issue which has an impact on jobs in virtually every part of the country.

People ask me why someone from Mississauga would care about this dispute. Let us think of the impact in a community like Mississauga with its growth rate and the building that has gone on in the housing industry. Let us think of the economic impact if our lumber industry were severely damaged. When 10,000 people lose their jobs in Thunder Bay in the lumber industry, I can assure the House that the ripple effect will come down the Great Lakes into Mississauga, into the greater Toronto area and throughout the rest of Canada. There is no question.

This is not just a British Columbia issue. I do not deny the significance to British Columbia. It is critical. I hope we can resolve it to save jobs in that province. However this is a critical issue for Ontario, New Brunswick and for every part of the province of Quebec. It is critical for all of us.

Alliance members have an attitude of wanting to embarrass the government. They pontificate about how supposedly we do not care about the issue. I would suggest that our Minister for International Trade has done a lot of things in the past well, but no issue has been worked on more diligently and with greater effort than the dispute in softwood lumber.

We had success in the steel negotiations. It could have been catastrophic for Algoma Steel and my home town of Sault Ste. Marie if we had not been able to make a deal that made sense and at least gave us an exclusion from what the Americans did. I do not happen to like what they did in other parts of the world, but we are not elected to represent all of the world.

We have to protect Canadian business interests, Canadian jobs and the Canadian economy. I challenge anyone in this place who says the government is not doing that. As we speak our Prime Minister is meeting with the president and we will hopefully get a resolution to this issue.

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1:25 p.m.

Progressive Conservative

Elsie Wayne Saint John, NB

Madam Speaker, the softwood lumber situation is a very serious one. I was glad to hear my colleague from Mississauga refer to New Brunswick because my city is the one that is closest to the U.S. border. The lumber industry of my province is in my city and the surrounding area . We ship into the United States. Americans love the lumber from our part of Canada. The U.S. industry wants our lumber. Yes, it is cheaper than if they had to buy it in their own country and it is the best that can be bought anywhere in Canada.

I have had a major concern since I have been here when it comes to what the U.S. did to our sugar industry. What happened to it? It is gone. I lost my sugar refinery. It was closed down because the Americans were to ship hundreds of thousands of tonnes of sugar containing products and said we could only ship 9,000 tonnes into the U.S. Also the Jones act protects their shipbuilding industry. They can bid on our contracts but we cannot bid on theirs.

It is very important because they think they are so powerful that they can take over Canada. They truly do. I agree it is not easy to go down there to negotiate. We have to take the strongest stands we can. Like our colleague from Mississauga said about the steel industry, my city is the one that ships the steel as well. I have Irving Steel in Saint John which ships into the U.S. as well.

When I came here in 1993 the population of Saint John was over 85,000 people and today it is 69,000. We have lost almost 20,000 people. It has never been like this in the history of Canada. Mine is the first city incorporated by royal charter.

I ask my hon. friend, and he is a friend of mine, what we can do. How can we turn it around? How do we all work together to make sure we keep our industry moving and put our people back to work?

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1:25 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Madam Speaker, probably the best way we could help Saint John is to have the hon. member return and be mayor again. Clearly she is renowned for having done a marvellous job in that regard.

I do not have a simple solution. There is not one. I think I made the point that there is a simple solution for all major problems in government which is usually the wrong one.

What we have to do is appeal to the good common sense of people like President Bush and others in the United States to recognize that Canada is a sovereign nation. It is interesting to see us go from the opposition wrapping itself in the American flag one day to trashing it the next and saying we have to fight them, man the turrets and do all that stuff. The reality is the U.S. is a friend and a business partner in many different relationships.

We have to impress upon the Americans that 25% of their exports come into our country and 87% of ours goes into their country. This is truly a partnership. There is a bit of an imbalance in the percentage. Yet we do much better on the dollar side of that equation having a very strong balance in our trade relation with the Americans.

It is a win-win. We have to say to President Bush and to all Americans that we do not need to be fighting among each other over these things. We can work together. We can provide good quality products in wood or in steel. Their consumers, home builders and taxpayers can benefit from them. In turn we will take many different products from them and people in Canada will benefit. There has to be some quid pro quo. There has to be co-operation. I am confident that is where we are headed.

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1:30 p.m.

Progressive Conservative

Elsie Wayne Saint John, NB

Madam Speaker, I want to bring to the attention of my hon. colleague from Mississauga West that I met with Vice-president Cheney in the U.S. and we discussed the Jones act. He agreed with me that it was unfair and that we should do something about it. I ask my colleagues on the government side to please take it up with the Prime Minister and ask him to speak with Mr. Bush and straighten out the Jones act.

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1:30 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Leader of the Government in the House of Commons

Madam Speaker, I rise on a point of order. Discussions have taken place among all the parties in the House and I believe you would find that there is unanimous consent for the following motion. I move:

That at the conclusion of today's debate on the Opposition motion standing under the name of the Member from Vancouver Island North, the said motion be deemed carried unanimously.

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1:30 p.m.

The Acting Speaker (Ms. Bakopanos)

The House has heard the terms of the motion. Is it agreed?

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1:30 p.m.

Some hon. members

Agreed.

(Motion agreed to)

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1:30 p.m.

Liberal

Hedy Fry Vancouver Centre, BC

Madam Speaker, I am pleased to respond to the motion put forward by the hon. member for Vancouver Island North.

This is viewed as a force in twenty years. It impacts hundreds of thousands of Canadian jobs directly and many more indirectly. Resolving the lumber dispute is a priority for the Government of Canada. The livelihood of many Canadians and their communities depend on this very important industry.

The hon. member for Saint John asked what we can do with regard to some of these trade disputes. Today is an example of what we can do. All members of the House are coming together with one strategy forming a clear team Canada approach.

I am delighted to see that the Alliance has finally come around to the government's way of thinking and to give a comprehensive stance on this particular issue. The stance has been a bit changeable over the past while. The hon. member for Nanaimo--Alberni has said in the House that our mill workers and mills cannot afford to wait one and a half years or two years for the WTO process to work its way through. The government has been looking at that. We have been aware of that. It is nice to see that the opposition agrees with us.

Alliance members seem to have faith in the WTO and NAFTA dispute resolution mechanisms only until they start to see their own constituents lose their jobs. Then suddenly they want a cost benefit analysis of litigation versus negotiation. Not just that, but Alliance members, including the former leader, have tried to tie softwood to trade in energy or tied to a support for a North American perimeter.

They have finally made a decision today to bring a motion to the House that all of us can buy into because that is the key thing. We must stand together as Canadians across the country regardless of party differences so that we can let the Americans see that we agree regardless of our affiliation.

While this has been going on our Prime Minister has been taking every opportunity in Washington to find a real solution. He is doing that as we are speaking here today on this issue. We have been advocating a team Canada approach for a long time. We have been talking with the provinces, with industry and with communities.

I am pleased to see that the NDP is finally on side for negotiating freer trade with the U.S. This amazing change of heart by the members of the New Democratic Party is a good one. I know that they have begun to see the error of their ways. I remember the hon. Ed Broadbent saying:

The truth is: we overestimated the negative impact of the free trade deal back in '88. We believed that free trade would result in massive job losses. But at this point, economists seem to agree that it's had a positive impact on jobs. If we're going to be intellectually honest, we have to admit it.

I am hoping this is a start of a trend in this House, whether it be on issues of free trade, issues of negotiation or issues of dealing with terrorism, that we come together on those common ground issues, that we find a workable solution that we can all agree with, that we can move together as a nation on those clear issues instead of playing the games that we have been playing in the past. Flip-flopping on softwood lumber reminds me of the old question, “If a tree falls in the woods, and there is no one there to hear it, does it make a sound?”

Free trade is our right and we will win. However we recognize that it may take some time. This is an issue that is important to all regions of Canada. Our government supports the best solution that will promote free trade for all regions of Canada.

This is a solid team Canada stance. Over 300 Canadian communities are at least 50% dependent on a strong lumber industry and about 1,200 communities across Canada have lumber as a key component of their local economy. The livelihoods of almost one million Canadians are related to this industry. We have heard in B.C. alone of about 15,000 to 20,000 workers who have been laid off.

I want to speak on a key area relating to the dispute. The state of Canadian lumber producers, the mill and the forest workers, is of utmost concern not only to the government but to all of us here in the House. I want to lay out for the House what we can expect in the days ahead relating to the pending U.S. decision and what the government will do to defend the interests of our industry, its workers and the communities that depend upon them.

We have been pursuing a two track strategy. We are engaging the United States in negotiations while challenging them on trade action at the WTO and under the NAFTA.

We are in detailed and intense negotiations with the United States. Later today the Prime Minister will raise the lumber dispute with President Bush, emphasizing the importance of reaching a durable resolution to the benefit of companies, workers and communities. We are committed to addressing the root causes of the dispute so that we do not face this kind of ongoing uncertainty again. An agreement designed to get us to free trade will be good for both the U.S. and for Canada, but more important, we will finally achieve the stability that industry, workers and communities have sought.

My colleague, the Minister for International Trade, held a very successful meeting with his provincial counterparts and industry leaders yesterday. There was unanimous agreement that we should continue to seek a durable negotiated resolution to the issue and one that would ensure long term, unfettered and open access to the U.S. market. While it is not possible to go into much detail at this time, given the delicate nature of negotiations, it is clear that the main elements of any agreement could include: the U.S. terminating the ongoing trade cases or a U.S. commitment of no future trade cases; and a commitment by provinces to change their forest management regimes.

We know the provinces of British Columbia, Quebec and other provinces have taken this very seriously. There is a possibility of a border measure on behalf of the provinces while provincial governments implement their policy commitments and a bilateral body at the ministerial level to oversee the implementation of the agreement.

These negotiations are exactly what industry, the provinces and the Government of Canada have agreed to pursue. We are hopeful that these negotiations will be successful; we know there are no guarantees. Government and industry have agreed to continue to litigate the dispute through all legal venues available. With the support of the provinces and the industry we have initiated several WTO organization challenges of the U.S. trade actions, its laws and its practices.

For example, last August the government commenced a WTO challenge of the commerce department's preliminary subsidy determination. Canadian industry is not subsidized. We are attacking the basis of the determination, the decision to apply duties retroactively and a provision of U.S. law that denies Canadian companies their WTO right to an expedited review of the result of the final subsidy determination following the investigation.

It is important to recognize that the government initiated two proceedings under the North America Free Trade Agreement. The NAFTA provides for binding panel review of final determinations in these cases. Last month the government filed notices of intent that it would seek panel review of those final determinations of a subsidy and dumping. These are the first steps. The notices have triggered panel selection and appointment processes and those are on the way.

The department of commerce is scheduled to make a final determination next week. If we were able to reach an agreement favourable to Canada and avoid these rulings Canada would be formally challenging the rulings under the NAFTA dispute settlement proceeding. The result would be binding on the U.S. so the request for a dispute resolution mechanism is already there and it has been included in chapter 19 under NAFTA. This would make for bilateral panels that would allow us to have binding decisions. That is the kind of thing that we have been seeking and that we have been pursuing for all of this time.

Everyone realizes the punitive and unfair U.S. trade sanctions on our industry. That is why we are trying to find a durable solution. We have found not only industry and provinces are on side, but first nations groups, communities, manufacturers and all of the communities. In the past we know there have been differences between the provinces. That is gone. The provinces are looking at changing policies so that we have some fair rules of the game. We are also looking at how we come together and form a very complete stand.

We have long advocated in the government this team Canada approach. We have had everyone else come on side so it is good to see that the opposition parties are now finally joining the team.

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1:40 p.m.

Canadian Alliance

Dick Harris Prince George—Bulkley Valley, BC

Madam Speaker, there has been a lot of activity by the government of late, but the fact is, and apparently the hon. member does not know, that this has been a burning issue since 1996 when the softwood lumber agreement was first signed.

We advised the government about the perils that awaited during the signing of the softwood lumber agreement. We advised it that it would come to an end and it had better be prepared. The hon. member said the government has been involved, but the government has simply allowed the SLA to run out while embracing the misguided notion that despite its history, the U.S. lumber industry would simply roll over and accept free trade on softwood lumber.

The member clearly demonstrated today that she has as little understanding about the softwood lumber issue as she did some time back about when crosses were burning in this country. That was a fiasco as well.

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1:40 p.m.

Liberal

Hedy Fry Vancouver Centre, BC

Madam Speaker, it is fairly clear and it is on record that the minister of trade had been dealing with these issues long before this. He met with the provinces, and I know he met with the province of British Columbia, to warn them of the consequences and to look at how we could deal with the issue well before it got to this point.

I would say to my hon. colleague from British Columbia that he might also try to be very clear on the history of how this has been going on with the government and with the provinces.

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1:40 p.m.

Liberal

Brent St. Denis Algoma—Manitoulin, ON

Madam Speaker, I first want to say in commenting on my colleague's very helpful remarks that what is really good about the issue, as difficult as it is, is that there is support on both sides of the House for a fair and appropriate resolution. Urban members and rural members are coming together on an issue that is of importance not just to rural Canada but to the whole country. I commend our urban colleagues on both sides for their support on the issue.

I also want to thank my colleague who just spoke for her helpful remarks. I agree with her that our team Canada approach under the leadership of our trade minister, the provincial ministers and industry leaders, has for the first time in a long time shown a united front when it comes to dealing with this very difficult issue.

Does my colleague from British Columbia agree with me, and I am sure she does, that a strong rural economy has an impact on our urban cities? The Statistics Canada report has indicated that many of our rural citizens are moving to the cities because we really love our cities. However, by having a strong rural Canada we hope to get some of them back in the years ahead.

I am sure she agrees that a strong rural economy is important to our urban cities.

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1:45 p.m.

Liberal

Hedy Fry Vancouver Centre, BC

Madam Speaker, we in British Columbia know very well about the dependence of the British Columbia economy on rural industries and natural resources. We know very well that the lumber industry has been a major one for us in British Columbia.

This issue has affected not only the rural communities but all of us in the urban areas. That is one of the reasons we have come forth and formed a solid coalition in British Columbia. It is why our government has been saying to put aside our differences across the country and speak with one voice.

The strength of Canada depends on its natural resources in so many ways, on the rural economies and on agriculture. We know this. We have taken this position all along.

It is another reason we have a Secretary of State for Rural Development. We believe this is important. He has produced a sound document that analyzes all the policies we make in terms of economic development in the rural communities as well as in the urban communities. We know there are differences and that one size does not fit all. That has always been the strength of Liberal understanding. We understand that one size does not fit all, that rural communities need to have special strategies. We all have to come together to help them.

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1:45 p.m.

NDP

Bev Desjarlais Churchill, MB

Madam Speaker, my hon. colleague said it was great that the opposition has come on side.

I want to remind her that as New Democrats we did not support the free trade agreement specifically because of the type of situation we are facing right now because the Government of Canada negotiated a flawed agreement. When people negotiate on behalf of Canadians, we want them to negotiate for the benefit of Canadians and not end up in a dispute such as the one on softwood lumber. The Liberals are back at the table because they bungled the first job and it is time they fixed it.