House of Commons Hansard #141 of the 38th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was industry.

Topics

Canada Council for the Arts
Oral Questions

3 p.m.

Jeanne-Le Ber
Québec

Liberal

Liza Frulla Minister of Canadian Heritage and Minister responsible for Status of Women

Mr. Speaker, I want to go back a bit. In its latest budget, the government allocated $950 million, almost $1 billion, or $125 million over five years, to the Canada Council for the Arts. This is the largest investment ever by any government in the history of Canada.

The Canada Council will celebrate its 50th anniversary in 2006-07. We intend to assume our responsibilities. In the meantime, I will remind my hon. colleague that his party voted against the budget, and therefore against artists and the arts.

Health
Oral Questions

October 25th, 2005 / 3 p.m.

Liberal

Ruby Dhalla Brampton—Springdale, ON

Mr. Speaker, according to the World Health Organization, the risk of pandemic influenza is a serious one. We have heard reports of avian flu infecting birds in Asia and Europe.

Canada and the Prime Minister have shown leadership in this area by organizing an international meeting to address global pandemic planning. Could the Parliamentary Secretary to the Minister of Health please inform the House about the objectives of this very important conference?

Health
Oral Questions

3 p.m.

West Nova
Nova Scotia

Liberal

Robert Thibault Parliamentary Secretary to the Minister of Health

Mr. Speaker, the Minister of Health has the honour and the privilege to host an international meeting of some 30 countries, health ministers, technical experts and five world organizations representing all areas of the globe, to look at how we can cooperate to prevent or deal with a potential or eventual pandemic in Canada.

Canada takes its role of working internationally to such a high extent that the Prime Minister addressed the group this morning. We want to replicate internationally what we have been able to do within Canada.

Within Canada we work collaboratively with the provinces to ensure that we are the best prepared country.

Taxation
Oral Questions

3 p.m.

Independent

Bev Desjarlais Churchill, MB

Mr. Speaker, while the Prime Minister was the finance minister the northern allowance tax credit for most of northern Manitoba was cut in half in an arbitrary decision that made no sense. The allowance for Grand Rapids was cut completely. Communities in Quebec as far south as Winnipeg receive a full northern allowance.

At a time when increased fuel costs are having grave impacts for all Canadians, those in remote and northern areas are hit even harder.

Will the government now move to right a wrongful decision and implement the full tax credit?

Taxation
Oral Questions

3 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, as the hon. member probably knows, the decision with respect to the northern allowance a number of years ago was based upon an independent analysis that was undertaken at the time to remove a whole variety of inconsistencies and anomalies in the law that existed then. The new regime was based upon recommendations of the task force.

The preference of the government going forward is to try to reduce the tax burden of Canadians generally and thereby improve the disposable incomes of all the citizens of our country.

The House resumed consideration of the motion that Bill S-36, An Act to amend the Export and Import of Rough Diamonds Act, be read the second time and referred to a committee.

Export and Import of Rough Diamonds Act
Government Orders

3:05 p.m.

The Speaker

Before the House broke for question period, the hon. member for Vancouver Island North had the floor for questions and comments and there remains five minutes in the time allotted for questions and comments on his speech.

Order, please. Questions and comments. Resuming debate, the hon. member for Sherbrooke.

Export and Import of Rough Diamonds Act
Government Orders

3:05 p.m.

Bloc

Serge Cardin Sherbrooke, QC

Mr. Speaker, in the context of the bill before us concerning the Export and Import of Rough Diamonds Act, I would like to begin by noting that it is often said that diamonds are forever. As a result, diamonds become a symbol of eternal love. Indeed, all of the ladies in this House, our colleagues, surely enjoy receiving a diamond as a token of love, but most certainly not a diamond produced by the atrocities of war.

It is in this context that Bill S-36 proposes certain amendments of a basically administrative nature to the Export and Import of Rough Diamonds Act.

Essentially, Bill S-36 will have two effects. First, it will authorize the government to compile and distribute data on international trade in diamonds. The adoption of this amendment, which would make the diamond trade more transparent and easier to control, is necessary for Canada to remain in compliance with its international obligations pursuant to the Kimberley process.

Second, it will remove a formality associated with the Kimberley process as regards very small diamonds less than one millimetre in size. In number and in weight, the great majority of the diamonds dealt on the market are tiny. They are not used just to make jewellery, but have more of a utilitarian function. They are to be found, for example, in turntable needles—less and less so, I am told—in watchmaking or in certain industrial knives.

Unlike large diamonds whose scarcity makes their price exorbitant, these diamonds are of no great value, and the administrative burden associated with the Kimberley process can be prohibitive. This proposed amendment will facilitate the diamond trade and is good news for the industry.

I might mention that Canada recently became the world’s third largest diamond producer. In Quebec, even though no diamond mine is yet active, seven mining companies hold licences on such mines, basically in Abitibi, Témiscamingue and the Northwest. Deposits of kimberlite, the ore in which diamonds are found, have been discovered in five sub-regions of Quebec.

The Bloc Québécois is not opposed to this new flexibility in principle, but it intends to ensure, in the course of review in committee, that it will not be introduced to the detriment of achievement of the objectives for which the act was passed, that is, the establishment of fairly tight control so as to prevent trade in conflict diamonds.

Allow me to quote Mr. Ian Smillie of Partnership Africa Canada who said:

In 2000, the international diamond industry produced more than 120 million carats of rough diamonds with a market value of US$7.5 billion. At the end of the diamond chain this bounty was converted into 70 million pieces of jewelry worth close to US$58 billion.

Of total world production, rebel armies in Sierra Leone, as well as in Angola and the Democratic Republic of Congo (DRC), are estimated by De Beers to traffic in about 4 per cent. Other estimates place the number higher. Although not a significant proportion of the overall industry, four per cent of $7.5 billion—or whatever other estimate one might use—can buy a lot of weapons.

The Export and Import of Rough Diamonds Act ensures that Canada is in compliance with the Kimberley process, an international agreement which has established a process for certifying the origin of rough diamonds. The Kimberley process is basically designed to limit the trade in conflict diamonds, which are sold by armed factions to finance their wars. Because they are small and highly valuable, the diamonds are easy to market and can be very profitable.

In the 1980s, this trade was a veritable scourge, and a major component in the funding of wars that displaced about 10 million people in Sierra Leone, Liberia, Angola and the Democratic Republic of Congo, to name just a few.

At first, only a few NGOs were concerned about these conflicts and were critical of the lucrative diamond trade that bankrolled them. In 2000, the UN published a report on the funding of the war in Angola, confirming everything that the NGOs had been proclaiming for years: the diamond trade was being used to finance the war.

Also in 2000, the RUF, the Revolutionary United Front, an armed faction in Sierra Leone, stepped up its attacks on civilians, making Sierra Leone the country with the largest number of displaced persons in the world.

With these two events, the African conflicts and their link to the diamond trade left the back pages and made the headlines.

That is when the countries and the companies that produce diamonds began to get involved. The moment that diamonds become synonymous with war, rape and murder and not with dreams, wealth and eternal love, they lose their core value.

Responding to the invitation of two NGO groups, Global Witness and Partnership Africa Canada, 37 countries and the principal diamond merchants agreed to sit down together with the NGOs to find a solution to the problem. The first meeting was held in May 2002 in the city of Kimberley, South Africa: hence the name the Kimberley process.

At the end of a series of meetings, they agreed that the best way to civilize the diamond trade was to put in place a system for certifying the origin of diamonds. Under this system, all diamonds exported from a country participating in the Kimberley process must be placed in a sealed container and accompanied by a government-issued certificate of authenticity called a Kimberley certificate. Importing countries that are participants in the Kimberley process may import only diamonds that are accompanied by this certificate. They may trade in diamonds only with participating countries.

Today the Kimberley process has 45 participants, including the European Union and its 25 members, for a total of 69 countries. These countries account for 99% of the legal international trade in diamonds.

To the NGOs who started this initiative and succeeded in transforming an awareness campaign into binding rules of international law, the Bloc Québécois says: well done. Without taking anything away from the other NGOs who have joined the movement and made it the success that it is, the Bloc Québécois wishes to specifically salute the work, clear-sightedness and tenacity of the two NGOs who got this initiative under way, Global Witness and Partnership Africa Canada.

It is necessary to proceed with amendments to the Export and Import of Rough Diamonds Act. From the outset, the Bloc Québécois has demonstrated keen support for the Kimberley process. In the fall of 2002, it lent immediate support to the bill on the export and import of rough diamonds, Bill C-14, which was intended to bring Canadian practice into compliance with the Kimberley process.

The Bloc Québécois continues to support the Kimberley process and will support the initiatives to make it more efficient and effective. Many of the amendments contained in Bill S-36 are the product of the discussions of the plenary session of Kimberley process participants held at the Lac-Leamy Hilton in Gatineau in 2004. Their adoption is necessary for Canada to remain in compliance with the Kimberley obligations. Most of the amendments in Bill S-36 are in fact designed to facilitate application of the process.

For these reasons, the Bloc Québécois supports Bill S-36 in principle and will vote in favour of it at second reading.

However, there are many shortcomings in Bill S-36.

Bill S-36 was introduced before Parliament could do a serious review of the current control mechanism. The Export and Import of Rough Diamonds Act requires the government to carry out a complete review of the operation and effects of the act three years after its coming into force and submit a report to Parliament.

Next January, the act will have been in effect for three years. The government will therefore submit a complete review of it, its operation and weaknesses, by January. By that time, Bill S-36 will probably have already been passed, if that is the wish of the House of Commons. In fact, some of these provisions must be in effect before next January 1 in order for Canada to remain in compliance with the Kimberley process and be able to continue exporting diamonds.

This way of doing things, in which the government starts by introducing amendments to the act and only afterwards tells us about the weaknesses in it is not a normal way of proceeding. The government is in a minority situation and can no longer permit itself to think that a majority of the members of the House are at its command and will pass anything that it proposes, even without having the requisite information.

The Bloc Québécois expects the government to issue its review of the Export and Import of Rough Diamonds Act and submit it to Parliament before Bill S-36 is considered in committee. However, even under Bill S-36, Canada is content with the minimum obligations under the Kimberley process. This process sets forth a series of minimum obligations that the participating countries must meet. Exported diamonds must be placed in sealed, tamper-resistant containers. The certificates of authenticity must contain certain information: the origin of the diamonds, the identity of the merchant, the total weight of the lot in carats, and so forth.

In regard to the Export and Import of Rough Diamonds Act, Canada decided to content itself with meeting the minimal obligations under the Kimberley process, even though it was free to go further. For example, in the information required on the Kimberley certificate, Canada is content to require the total weight of the lot. However, 20 ten-carat diamonds are worth 30 times as much as 400 diamonds of only 0.5 carats, even though both lots add up to 200 carats.

At present, an importer can very easily buy a lot of small diamonds on the legal market, replace them with large stones bought cheap on the black market, then sell them again with no problem, since his Kimberley certificate does not contain the information that could be used to spot the swindle. This dishonest importer will be able to make an enormous profit, while at the same time laundering an entire lot of conflict diamonds.

Has this in fact happened? We cannot know. What we do know, however, is that in 2003 Canada imported rough diamonds valued at $703,820, from India. It exported nearly $200,000 worth of them to the same country. The import value per carat was $162; the export value was $392. While this may simply be explained by the return of undesired gems of great value, or by exports unrelated to the imports, there might also be something fishy going on here.

If the Canadian certificate contained certain optional information provided for in the process, such as the number of stones over two carats in size, this sort of stratagem would no longer be possible.

The Bloc Québécois is counting on the committee hearings to see if it might be possible to make the act more effective.

The real weakness of a Kimberley process is the lack of resources dedicated to control in the poor countries and the lack of assistance the latter are being offered by the rich countries.

The participating countries have all had to pass legislation to bring their trade practices into line with the requirements of the process. Unfortunately, controls are lacking. The state apparatus is often disorganized, and civil servants who are underpaid, or not paid at all, are vulnerable to corruption. In conclusion, even the most perfect system on paper cannot function if it does not have the necessary resources.

For example, in 2003 the Congo was suspended from the Kimberley process because its civil servants had issued certificates representing two and a half times the country’s diamond production. Clearly, many of those diamonds were from neighbouring conflict-ridden countries, probably the Democratic Republic of Congo.

The Congo was caught out, but how many other countries serve as transit routes for conflict diamonds from the Congo, Côte-d'Ivoire, Burundi or elsewhere? What is urgently required is a substantial increase in international aid to permit states to function as they should.

Furthermore, it is not by chance that wars are going on mainly in the poor countries. Where the population is living in the most abject poverty, the ground is fertile for the creation of armed factions and the onset of civil war. Even if Canada were to pass the best law in the world on the diamond trade, it would not stamp out the problem—not without a substantial boost to its international aid envelope.

In 1993, when the present Prime Minister became Minister of Finance, Canada was allocating 0.43% of its GNP to international aid, making it the sixth most generous donor in the OECD. When he left the Department of Finance in 2002, Canada was allocating only 0.23% of its GDP and had slipped to 17th out of a total of 29. At its current pace of increase, Canada will not achieve the UN target—which however it has accepted—of 0.7% of GNP for international aid until 2033.

The government can boast of its role in the Kimberley process, but not until it is a serious contributor to the war on world poverty can it say that it is playing a role in conflict pacification.

We must take inspiration from the Kimberley process to promote equitable globalization. In the commercial realm, the Kimberley process is a remarkable innovation. It introduces considerations other than commercial and economic ones into the trade rules. The NGO campaign has been such a success that it has become indecent to oppose it, to the point that the WTO had to amend its rules in January 2003, barely four weeks after the Kimberley process came into effect.

The amendments to the WTO rules allow member states to ban the import of conflict diamonds. Their rules do not, however, allow restrictions on the importing of products manufactured by children or by prisoners of conscience in labour camps or virtual slaves exploited in factories where basic labour rights do not exist, nor those produced with total lack of concern for environmental destruction.

For years now, the Bloc Québécois has been calling for the government to propose the inclusion of such humane, social and environmental considerations in trade agreements. For years now, the government has demurred, on the pretense that these non-trade considerations have no place in trade agreements.

Had that logic prevailed in connection with conflict diamonds, the Kimberley process would be illegal according to WTO rules. When will we see a Kimberley for child labour? For forced labour? For environmental destruction and the forced displacement of aboriginal nations?

The proposed amendments will, of course, be examined in committee. As I have said, we are favourably disposed to them but there is still much room for improvement.

Export and Import of Rough Diamonds Act
Government Orders

3:25 p.m.

Yukon
Yukon

Liberal

Larry Bagnell Parliamentary Secretary to the Minister of Natural Resources

Mr. Speaker, I just wanted to comment on the review of the act and why we are doing these two minor amendments now. First, the member is right in that there is a review of the act coming. I appreciate the work the Bloc has done and for some interesting thoughts for amendments that we might put in.

We have to take care of things where we are out of step now with the international community. The scheduled review of the act is going to occur in 2006 and any change to this will also be influenced by the review of the Kimberley process certification scheme which is also going to occur in 2006.

Since the recommendations from the scheme review are expected to be only approved at the plenary in late 2007, any changes required to the process by this review and by extension to Canada's act would be delayed until 2008. Given this timeframe it is imperative that we make these amendments right now.

We want to demonstrate that we have taken the necessary steps to meet the requirements of the process by the next plenary meeting expected to occur this year. Non-compliance with the process could jeopardize Canada's participation in the international scheme.

As the member suggested, we are just making two minor amendments. One would allow us to publish our statistics and we are eliminating the very tiny diamonds that are valued in cents.

If we are not in compliance with the scheme as set internationally, it jeopardizes our participation in the scheme. Considering that well over 99% of the countries involved in diamonds are in this scheme, it could jeopardize our status until the changes I mentioned occur in 2008 and put in great jeopardy a $2 billion industry in Canada and the related 4,000 jobs.

In that all the parties that have spoken have expressed their support and in that they are minor administrative amendments, I would hope that we could get on with this very quickly. I definitely appreciate the comments the member made about other improvements that we could look at. We will certainly have those in the record as we do the entire review of the act that is proposed for 2006.

Export and Import of Rough Diamonds Act
Government Orders

3:30 p.m.

Bloc

Serge Cardin Sherbrooke, QC

Mr. Speaker, as stated, we are indeed in favour of the proposed amendments, given the need for them.

When something is brought to our attention, the government has a responsibility to react to it. The old saying goes “It's a tough nut to crack” but we still ought to require further controls.

Compliance with the Kimberley process does not require much of us, but there are still some loopholes. It is still possible that we may, unwittingly and indirectly, be contributing to war somewhere on this planet, and this cannot be allowed.

As I said, diamonds are forever. What also makes them so valued and valuable is that they are often tokens of love. There may be little conflicts among lovers, but in a world view we cannot allow diamonds to encourage conflict, wars and deaths.

We will have an opportunity in committee to hold discussions and ask the government to provide the Act to amend the Export and Import of Rough Diamonds Act with more teeth.

Export and Import of Rough Diamonds Act
Government Orders

3:30 p.m.

NDP

Peter Julian Burnaby—New Westminster, BC

Mr. Speaker, I am pleased to speak to Bill S-36, an act to amend the export and import of rough diamonds act. The act would serve to help us meet our commitments under the Kimberley process certification scheme.

I would like to say at the beginning that in this corner of the House we are in favour, in principle, of the bill moving forward but we are hoping at the committee stage there will be an examination of this important legislation, perhaps looking at the potential for improving it.

As the member for Sherbrooke mentioned, we are a bit concerned about the fact that the act in general will be reviewed in 2006. We are therefore making changes to the act, as proposed by this bill, even though we will not have the opportunity to review it until next year. This seems like a rather difficult procedure.

That being said, even if the process is of some concern to us, we are fully in favour in principle. There is not doubt about that.

I would like to go back to the principles of the Kimberley process and give a bit of the history of that process. The issue of blood diamonds, or les diamants du conflit, is something that has been a front and centre conflict, particularly in Africa, over the past decade. It was in 2000 that the first actions were taken to deal effectively with this issue of how to, in some way, cull or prevent blood diamonds from being distributed around the world and helping to fuel those conflicts.

A little later in my presentation I will outline the impact of the blood diamond trade on some of these civil wars. It has had absolute horrific results for the populations in these African countries. However for the moment I will just trace the history of it.

It started in July 2000 when the International Diamond Manufacturers Association and the World Federation of Diamond Bourses sat down at the World Diamond Congress in Antwerp and first started to address the issue of blood diamonds and how to create an environment where these diamonds were not trafficked and marketed in other countries such as Canada. That led to the formation of an active process and, as we know, we had 43 participants, including members of the European Community, who were part of the negotiations that led to the Kimberley process implementation. Canada chaired that process, which undoubtedly was important because it started to resolve the issue of blood diamonds and the impact of blood diamonds on these horrific civil wars.

As a result, we had a process that was implemented. We had a working group chaired by Canada and that process led to the creation of these voluntary standards that have now been put into place.

I will say that we are not talking about a perfect process. A little later on this afternoon I will mention some of the weaknesses of the existing process. However the process is undoubtedly better than what existed before, which was absolutely nothing to prevent the trafficking of these diamonds.

The issue really has to do with the impact the diamond trade had on the civil wars in Africa. I would like to mention four particularly horrific conflicts where very clearly blood diamonds sustained those conflicts and led to even further loss of life and further atrocities than what otherwise might have been the case.

What has often been cited is the Liberia Civil War which started in 1989, went through to 1997 and then started up again in 2000 and went until 2003. During this bloody dictatorship and the civil war that followed, about 200,000 people were killed and about one million civilians were displaced. That civil conflict was fueled by blood diamonds.

Second, the Angola Civil War started in 1975, after Angola acceded to independence and went right though to 2002, in other words, over a 30 year period. Some 500,000 people died, hundreds of thousands were displaced and thousands of civilians in Angola and combatants were maimed. The main rebel group in Angola, UNITA, controlled 70% of the diamond mines and that allowed for hundreds of millions of dollars in revenue coming into UNITA to actually sustain that civil war and the war effort. I will come back to Angola in a moment because I think here is a case where blood diamonds fueled that conflict and contributed to the appalling loss of combatants and civilians.

A third example that is often cited is the Sierra Leone civil war which started in 1991 and ran through to 1999. Fifty thousand people died in that conflict. It is estimated that the main rebel group, the RUF, mined between $25 million and $125 million in diamonds annually to finance its war efforts, which were attacks on the civil population in Sierra Leone. That country is still recovering from that brutal civil war.

I have former constituents who are working as part of the United Nations relief effort in Sierra Leone to address the appalling results of that war, including establishing housing and helping to integrate many of the child combatants into their villages. The effects of that brutal civil war are still being felt today.

We then have the Republic of Congo civil war, which started in 1998 and ran through to 2003, but is still very endemic today. Over three million people have been killed in the Republic of Congo and it has been expelled from Kimberley membership. We will come back to that in a moment but it is clear that the appalling civil conflict in the Republic of Congo was fuelled by the diamond trade.

I will now go back to Angola. An interesting article was published in Drillbits and Tailings, a publication concerned with the diamond trade and mining. It linked up in a series of articles the Angola civil war and diamonds. I would like to read a few paragraphs from that because I think it is illustrative of exactly how blood diamonds fuelled the conflict.

It said that the United Nations estimated that UNITA, the main rebel group in Angola after independence, earned between $3 billion U.S. and $4 billion U.S. over the last eight years of the conflict from diamond sales after Angola was engulfed in the civil war in 1975 after gaining independence from Portugal.

When UNITA relaunched the war in December 1998, it relaunched it with money made from investing profits from diamond sales. In fact, the head of the UN peace building support office, Felix Downs-Thomas, said that the conflict was referred to as a diamond war. Diamonds not only allowed UNITA to finance the war, it was the principal reason for the fighting. In fact, ongoing wars in Angola were being fought because of the pursuit of those mineral riches.

The article goes on to say that diamonds had spawned a culture of violence in Angola, including the hiring of mercenaries, as confirmed by a United Nations report that came out in October 1998, and that the mining company, DiamondWorks, had well established connections to mercenaries and that Tony Buckingham of Branch Energy, a British company that owns one-quarter of the shares of DiamondWorks, is known for brokering entry of the corporation into Angola.

Executive Outcomes, which was the company that came into Angola, was a South African mercenary army that included former members of apartheid death squads. Half a million Angolans lost their homes in that conflict and became internal refugees as the war to seize control of the mining regions continued.

Angola is a clear case of where the intense search for blood diamonds fuelled the war and, because of the immense riches generated by these blood diamonds, contributed to deepening and widening the conflict.

I could speak about Sierra Leone and the similar impact the diamonds had in that civil conflict, but I would like to read a couple of paragraphs of the Human Rights Watch report on Sierra Leone at the height of the blood diamond fuelled war.

Human Rights Watch has documented numerous rebel abuses committed in 2000 in the Port Loko district, which was an area allegedly under government control. The abuses included cases of rape, 118 cases of abduction of villagers, three murders, cases of mutilation, of forced labour, of massive looting, of ambushing and the training, as I mentioned earlier, of child combatants. Most of the victims were civilians living in camps for internally displaced people who were attacked when they ventured out to get food, wood or water.

The atrocities taking place in Sierra Leone, Angola and Congo are all fuelled by these blood diamonds. That is why, in this corner of the House, as previous speakers have mentioned, we fully support the intention of the Kimberley Process and the idea that the Kimberley Process will lead to a better situation and a partial resolution of this trade in blood diamonds that fuels these horrific civil conflicts. We know that it is civilians, women, men and children, who are the victims of these horrific conflicts.

We should say that the blood diamonds, even though they have been reduced through the Kimberley Process, have not been eliminated. Kim Sutch, who is the director of the Diamond Information Centre in Canada, says that the blood stones are still believed to make up about 1% of the legitimate diamond trade, while conflict diamonds were believed previously to comprise as much as 5% or 6% of the global rough diamond trade.

This trade has now been reduced, but we cannot say it has been eliminated through the Kimberley Process. We must say that the Kimberley Process is a significant step, but it is not a final resolution of the trade in these horrific blood stones. If we have reduced the trade from 5% or 6% to just below 1%, we have not completely resolved the issue.

In the Globe and Mail , London-based Global Witness stated, “Despite improvements, the Kimberley Process is still having difficulty in stopping conflict diamonds from entering the legitimate diamond trade” completely. Global Witness mentioned this in a June report. The Global Witness group, whose campaign helped trigger the Kimberley Process, said that diamonds continue to fuel conflict in areas such as the eastern Democratic Republic of the Congo and also play a role in the conflict in the Ivory Coast.

As we know, the Democratic Republic of Congo was kicked out of the Kimberley Process for non-compliance in 2004, but the Ivory Coast continues to be a member of the Kimberley Process. Even though this is a vast improvement in a situation that very clearly needed to be resolved, even though we needed to make a substantial gesture and the international community has come together for voluntary compliance, even though these are significant steps, that is why I have to underscore the fact that this does not resolve completely an issue that continues to exist.

We have to monitor it and look at furthering our international commitments so that indeed we can say, perhaps in the next few years, that we have entirely eliminated the trade of blood diamonds, that blood diamonds cannot squeeze through the loopholes that exist in the process.

In other words, the Kimberley Process must be a gigantic stepping stone to ultimate resolution, so that in no part of the world, especially in Africa, given the recent conflicts there, can there be trade in blood diamonds. That must be the ultimate objective.

I believe this is something that all four corners of this House would agree with. All members of this House believe that we must ultimately completely eliminate the trade in blood diamonds. This is a fundamental goal that we all share.

Since we have had a lot of discussion about diamonds and conflict, I would like to quote an article that was in La Presse a few months ago. It was an interesting article that raised the whole problem of blood diamonds. It said:

Angola, Liberia and Sierra Leone were posing a problem in the late 1990s when the UN Security Council decided to act. The sanctions that were provided have been easy to circumvent and have not had much effect. The diamond industry soon smelled a huge problem with them: the most coveted stone in the world was in danger of being boycotted, like fur 20 years ago. Already some NGOs like Oxfam and Amnesty International were decrying the abuses. The Kimberley conference, taken from the name of the city where it was held, produced an initiative: the certificate of authenticity that makes it possible to trace diamonds from their extraction in one of the 17 producing countries to the world markets. The diamonds leave the country with a seal of compliance that is required further down the line. “The process is doing its job, it works,” says Mr. Van Bockstael.

Mr. Van Bockstael chairs the committee in charge of the implementation of the Kimberley process.

The article also said:

For the rest, however, it is another matter. The big mining companies would try to ensure good conditions for their workers, but how could the unauthorized mining of local people in African villages working with spades and sieves be controlled?

For the time being, only the Republic of the Congo (Brazzaville), Liberia and Lebanon are excluded from the process. The Republic of the Congo, for example, produced only 50,000 carats a year but sold 5 million. A patent case of trafficking.

This is an interesting article because it brings up the point that that the legal production represents 1% of everything sold on the market. There is a problem in the Republic of the Congo. Even if production was a certain amount, what was sold was mostly blood diamonds, which amounted to 100 times the legitimate production.

I would like to conclude by mentioning that the Canadian industry is growing by leaps and bounds as well. Our adherence to the Kimberley Process also helps to legitimize our strong Canadian domestic production. We have a number of mines that have started production in the past few years. In fact, we are now the world's third largest diamond producer.

Even though we still have additional steps to take, for us to participate in a process that ensures as much as possible a legitimate diamond trade, a trade that stops the blood diamond trade as much as possible, and hopefully one day completely and entirely stops it, is something that also helps our legitimate domestic diamond trade.

For all those reasons I will stand in support in principle of Bill S-36. We are hoping, as I mentioned earlier, that we will be able to look at this in committee, of course, and examine it in more detail. However, we are completely in agreement with the principle of the Kimberley Process and any amendments that allow us to keep our commitments on the Kimberley Process.

Export and Import of Rough Diamonds Act
Government Orders

3:50 p.m.

Yukon
Yukon

Liberal

Larry Bagnell Parliamentary Secretary to the Minister of Natural Resources

Mr. Speaker, the hon. member's speech was excellent. I think that the way the debate on the bill has been going is the way Parliament should work. Every member has added more description to the problem and have given reasons why the bill should be supported. Some also have suggestions for improvements. I particularly enjoyed listening to the member outlining the graphic problem that is before us and which the Kimberley Process deals with.

I have one question. Perhaps the member can elaborate for me. At the beginning of his speech he said he was a bit perplexed with the process. I did not exactly understand what he was getting at.

I certainly agree with him that we should try to make any improvements we can. After the process has had three good solid years in Canada, it will be reviewed in 2006. At the same time, all the countries involved in the Kimberley Process plenary will be reviewing it. They hope to approve the changes in 2007, which means that by 2008 we could get changes coming out of that process to do what both the member and I would like to do, of course, which is to eliminate blood diamonds. Of course if we let down on our efforts, organized crime may be tempted to get involved. Those are the processes for the improvements that we all want in looking at new ideas.

I wonder if the member could elaborate about being perplexed. I did not quite understand that.

Export and Import of Rough Diamonds Act
Government Orders

3:50 p.m.

NDP

Peter Julian Burnaby—New Westminster, BC

Mr. Speaker, it stems from how we move this process along. Under the Kimberley Process we have moved from a high of 6% of blood diamonds in the world diamond trade down to 1% or slightly lower, as most estimates have it. We are looking at a review on that next year. The question is, how do we move it along more quickly?

If we are looking at 2006-08 as a window, I would perhaps suggest that given the size and scope of the impact of blood diamonds on the countries that I mentioned in my speech, the quicker we act the more effective it would be. That is why I was suggesting that the review should perhaps take place at the same time that these amendments were brought forward.

The member may agree with that or not, but that was my hesitation. We have a review coming up, but the review is next year and we are talking about amendments now. It would seem to me that the review should be done at the same time.

Export and Import of Rough Diamonds Act
Government Orders

3:55 p.m.

Liberal

Larry Bagnell Yukon, YT

Mr. Speaker, the member's comment was helpful. I am sure the officials are working on this at the moment, on anything we can do. We do have to remember, though, that we are part of an international group of over 40 countries and everyone has to make the changes together. We cannot make changes unilaterally. As the member said, that would take us outside the framework. If we can get our review done so we can put the good ideas into the framework review in 2006, I think that would be useful. I agree with the member that we should do it as quickly as possible.

Export and Import of Rough Diamonds Act
Government Orders

3:55 p.m.

NDP

Peter Julian Burnaby—New Westminster, BC

Mr. Speaker, as I mentioned earlier, members from all four corners of the House certainly agree about the importance of the legislation. It reads very blandly, as most bills do, but its impact is significant.

We cannot minimize or in any way try to limit the immense significance that it would have over time if we could completely eliminate the blood diamond trade and its impact on civil conflicts such as, for example, the conflict in Angola, where billions of dollars were brought in to fuel that civil conflict and the rebels through the sale of blood diamonds.

Given the importance of the issue, I think it is good to see agreement in the four corners of the House. We may disagree on minor points, but on the vast principle of stopping the blood diamond trade we are all in agreement. That is very important.