Canada-EFTA Free Trade Agreement Implementation Act

An Act to implement the Free Trade Agreement between Canada and the States of the European Free Trade Association (Iceland, Liechtenstein, Norway, Switzerland), the Agreement on Agriculture between Canada and the Republic of Iceland, the Agreement on Agriculture between Canada and the Kingdom of Norway and the Agreement on Agriculture between Canada and the Swiss Confederation

This bill was last introduced in the 40th Parliament, 2nd Session, which ended in December 2009.

This bill was previously introduced in the 40th Parliament, 1st Session.


Stockwell Day  Conservative


This bill has received Royal Assent and is now law.


This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment implements the Free Trade Agreement and the bilateral agreements between Canada and the Republic of Iceland, the Principality of Liechtenstein, the Kingdom of Norway and the Swiss Confederation signed at Davos on January 26, 2008.

The general provisions of the enactment specify that no recourse may be taken on the basis of the provisions of Part 1 of the enactment or any order made under that Part, or the provisions of the Free Trade Agreement or the bilateral agreements themselves, without the consent of the Attorney General for Canada.

Part 1 of the enactment approves the Free Trade Agreement and the bilateral agreements and provides for the payment by Canada of its share of the expenditures associated with the operation of the institutional aspects of the Free Trade Agreement and the power of the Governor in Council to make orders for carrying out the provisions of the enactment.

Part 2 of the enactment amends existing laws in order to bring them into conformity with Canada’s obligations under the Free Trade Agreement and the bilateral agreements.

Part 3 of the enactment provides for its coming into force.


All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.


March 30, 2009 Passed That the Bill be now read a third time and do pass.
March 30, 2009 Failed That the motion be amended by deleting all the words after the word “That” and substituting the following: “Bill C-2, An Act to implement the Free Trade Agreement between Canada and the States of the European Free Trade Association (Iceland, Liechtenstein, Norway, Switzerland), the Agreement on Agriculture between Canada and the Republic of Iceland, the Agreement on Agriculture between Canada and the Kingdom of Norway and the Agreement on Agriculture between Canada and the Swiss Confederation, be not now read a third time but be referred back to the Standing Committee on International Trade for the purpose of reconsidering clause 33 with a view to re-examining the phase out of shipbuilding protections”.
March 12, 2009 Passed That Bill C-2, An Act to implement the Free Trade Agreement between Canada and the States of the European Free Trade Association (Iceland, Liechtenstein, Norway, Switzerland), the Agreement on Agriculture between Canada and the Republic of Iceland, the Agreement on Agriculture between Canada and the Kingdom of Norway and the Agreement on Agriculture between Canada and the Swiss Confederation, {as amended}, be concurred in at report stage [with a further amendment/with further amendments] .
March 12, 2009 Failed That Bill C-2 be amended by deleting Clause 33.
Feb. 5, 2009 Passed That the Bill be now read a second time and referred to the Standing Committee on International Trade.

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:15 p.m.
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Megan Leslie NDP Halifax, NS

Mr. Speaker, I rise to speak to Bill C-2, the Canada-EFTA free trade agreement implementation act.

If passed, this bill would seriously impact my riding of Halifax and could have devastating consequences for Canada's domestic shipbuilding industry. Earlier, my colleague, the member for Sackville—Eastern Shore, was asked by the hon. member for Kelowna—Lake Country what free trade agreement the NDP would support.

I would like to point out that the NDP believes that member nations of the EFTA have strong social-democratic traditions and they are actually ideal trading partners for Canada. They have great human rights records. They have great environmental records. The Canada-EFTA free trade agreement implementation act as a whole is a good piece of legislation. We welcome this kind of trading relationship with these countries. The only issue here is that of shipbuilding.

The trade agreement on which we will be asked to vote contains provisions that would remove one of the only tools remaining that protects our shipbuilding industry from being ravaged by unfair competition from foreign builders. Those same European industries were very generously subsidized until recently.

If this bill passes, in just three short years we would see import tariffs begin to be lowered, allowing an influx of foreign-built ships to enter our market. This change would sound the death knell for shipbuilding and it would significantly damage the economy of Nova Scotia. In the interest of standing up for our Canadian shipbuilding industry and the local shipyard workers whom I represent, I must voice my opposition to this bill without an amendment to protect our shipbuilding industry.

As any Atlantic Canadian will tell us, shipbuilding is not just another industry; it is tied to our nation's history. From the earliest days of Confederation, our wealth of forests and hardy labour created hundreds of wooden ships that helped bring much prosperity to Atlantic Canada. It is well known that in those days people could look out at the harbour and see nothing but a sea of white sails moving goods from the great port of Halifax.

During the first and second world wars, Canada stepped up to build hundreds of new ships, punching above its weight when the need was greatest. Between the wars and after, the industry was fuelled by domestic procurement policies to expand our fleets, and by government investment. Those investments created a robust industry and they made a lot of sense, given our enviable coastlines.

Unfortunately, the importance of the industry has not been as clear to recent governments in Canada. Add to that a series of bad trade agreements and we can see how the industry went from being a top producer to the critical situation in which it finds itself now. For years shipbuilders have been calling for a comprehensive strategy to return the industry to competitive standards. Our shipyards simply cannot compete with the heavily subsidized industries in places like South Korea and Norway.

In 2001 the national partnership project, consisting of members of the Shipbuilding Association of Canada and the shipyard workers, presented a breakthrough report called, “Breaking Through: Canadian Shipbuilding Industry”, after they held a series of consultations across the country. This report is notable because all stakeholders were in agreement about what needs to be done.

In the section, “Issues and Recommendations, Subsidies and Unfair Trade Practices”, the following recommendation was made:

That the Government of Canada: ... resist any requests from other countries to change provisions of the Canadian shipbuilding policy until such time as the Canadian industry has been able to overcome the long-term effects of the subsidy and unfair pricing policies of other countries--

We must remember that this document was produced by shipbuilders and manufacturers, the Shipbuilding Association of Canada and the workers.

This change in provisions is exactly what the CEFTA is asking us to do. Norway has invested heavily in shipbuilding, making it one of the strongest in the world despite its relatively modest share of the world market. Those subsidies increased in the early part of this decade, and although they have been reduced now, they resulted in a strong industry capable of filling a variety of orders and competing on the international stage.

Here in Canada there has been a lack of meaningful investment, resulting in an industry that can only be described as being on life support. This is despite the incredible work of the men and women I represent who work at the Halifax shipyards, and that rich maritime history that I just spoke about. Bill C-2 would effectively “pull the plug” on a struggling industry by removing the only protection that exists for it.

New Democrats have called for two things: first, that shipbuilding be carved out of the CEFTA; and, second, that the government take up the challenge and bring this industry back to full health through a comprehensive and meaningful plan.

I want to thank the member for Burnaby—New Westminster for the hard work he has done to see that this trade agreement is fair. He made every effort in committee to see that the shipbuilding section was removed from the bill. I also want to recognize the work of the member for Sackville—Eastern Shore, my neighbour, who continues his tireless campaign on behalf of Canada's shipbuilding industry.

Having failed to secure a carve out in committee, it is now up to the House to do what is right and take shipbuilding off the chopping block.

To turn once again to the impact of this trade agreement, I would like to reinforce the fact that good jobs are what fuel our economy. As I have said before in this honoured place, one shipbuilding job creates four spinoff jobs. A collapse of this industry, ushered in by this trade agreement, would throw hundreds out of work in Halifax alone, and with the loss of those jobs, there go four supporting positions.

We are seeing unprecedented numbers of people becoming unemployed because of this recession. We need to do whatever it takes to prevent the remaining jobs from being lost. Passing this bill would only accelerate that process.

My party has repeatedly asked government to look ahead, look to the future, and make decisions that will foster the development of a global economy, one that is sustainable economically and environmentally, and where Canada can actually play a lead role. Shipbuilding can be a part of that new economy, first by rejecting just this part of the CEFTA and then through the implementation of a national strategy on the industry that will prepare it to compete with subsidized foreign industries on a level playing field.

Just a few short months ago, the member for Sackville—Eastern Shore and I joined shipyard workers. We joined them along with Independent and Liberal MPs to show support for the shipbuilding industry and call for attention and investment from the government. It was a cold day in Halifax harbour but we all gathered, despite party lines, to say this was an industry that was important to us.

As we debate Bill C-2, workers are actively calling on us to take the support that was voiced in January and turn it into action by carving out shipbuilding from this agreement. As one of the hundreds of letters from shipyard workers makes clear, “All stakeholders in the industry, including owners, operators and unions from coast to coast have emphasized the need for support during the many committee meetings that were held on the use of free trade talks”.

These letters call on Liberal members of the House to withhold their support for this bill until this section is removed. I share their concern and hope that all members will fight for their jobs and for a truly Canadian industry.

In closing, I would like to share another fact about Halifax and its tradition of shipbuilding. It is a fundamental connection to the sea that we have. After the 1917 Halifax explosion decimated much of the city and its industrial sector, one of the first things to be rebuilt was the smokestack at the Halifax shipyard. Everyone could see at the bottom of it stamped “1917”. This underscores the importance of the yards to my community and the central role that community has played in our history.

Recently, that powerful symbol was torn down. At this time in our nation's history, when we are witnessing the ongoing collapse of our manufacturing and forestry industries, let us not add shipbuilding to that list by signing a bad deal. Let us not allow the tearing down of that smokestack in Halifax be a symbol for the future of the industry itself.

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:25 p.m.
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Tony Martin NDP Sault Ste. Marie, ON

Mr. Speaker, again, another passionate and knowledgeable member from Nova Scotia speaking about an industry that seems to be, by design of both the previous Liberal government and now this Conservative government, a sunset industry.

I remember in Sault Ste. Marie, in the early nineties, when Algoma Steel found itself in some difficulty and needed to be restructured. The comments from many commentators, Liberal members of Parliament and Conservative members of Parliament, and the member for Toronto Centre will remember this very clearly because he was involved in some of the most intimate discussions and negotiations that went on around that time to save that industry, were that it was a “buggy whip industry”, something that we should cast aside and forget about and perhaps ask the people of Sault Ste. Marie to just get retrained and enter into some other industry or economic activity that nobody had yet defined for us at that particular point in time, and we fought that.

I was a member of the government of that day and we came up with a plan for Algoma Steel that was homegrown, that had contribution from all kinds of stakeholders. The workers, the union, the community itself, the NDP government of the day all came to the table and came up with some very creative and innovative ways to save that industry. In fact, it was some of the good work done then and the seeds sown then that gives us reason to be proud today to say that even in this difficult economic time we are still making steel and selling it in Sault Ste. Marie. Nevertheless, it is owned by a company out of India that so far has acted as a good corporate citizen and that is serving us well, but certainly not as part of the kind of free trade scenario that is being proposed in the bill that we are debating here today. It would give away literally all of the very good and profitable industries that served Canada for so long in the shipbuilding sector.

I would like to ask the member, being from Nova Scotia and seeing the impact of free trade agreements over the last number of years on so many of the resource-based industrial sectors of our economy, how has that affected her community, particularly, and her province? It we pass this bill, what would that do to the people of her riding?

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:30 p.m.
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Megan Leslie NDP Halifax, NS

Mr. Speaker, I had the opportunity about a month ago, maybe a month and a half ago, to do an economic stimulus tour of the riding. This was for the media. We went from place to place to look at shovel ready projects, and one place we went to was the shipyard. We met there with Karl Risser, who is president of CAW Local 1. He talked about the fact that these jobs, as I mentioned earlier, are great jobs, are good paying jobs, and that for every one job, there are four spinoff jobs. However, referring to the point that my colleague raised, a lot of those men and women are out west now. They are not able to work in Nova Scotia. The work just is not there. They are fleeing. They are looking for work. They need to support their families.

Karl talked about the repairs project for shipbuilding. He said, “That's going to be a good thing. We'll certainly put some folks to work. But it's not good for the long-term because the men and women who have left Nova Scotia, looking for work, are not going to come back for a one month contract or for a three month contract”.

The issue here is that they have skills. This is extremely skilled work. We really need to bring those people back to Nova Scotia and have them working in the industry in which they are trained.

I would like to address what my colleague said about how in his riding the industry, the unions, the workers and the community worked together to come up with innovative solutions, and I will bring us back to the breaking-through report. I actually have a letter here from Jamie Vaslet who is with the Industrial Union of Marine and Shipbuilding Workers, in which he talks about this report as well. He states:

We have, along with all other major stakeholders in the shipbuilding industry, including owners, operators and the Shipbuilding Association of Canada, all expressed the need for a carve out of our industry. But it seems to have fallen on deaf ears yet again.

He says as well that it is quite unbelievable that we are in a situation now where this amendment, and we have been listening to what all the stakeholders are saying, is the perfect solution. It is so simple, but yet we are not listening to the key stakeholders. We are not listening to the people whose jobs are at stake and we are not listening to the employers as well

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:35 p.m.
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Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, as always I was delighted to hear the member for Halifax speak up in favour of Nova Scotians and shipyard workers. She raised a very interesting point, which is the NDP's fair trade approach as opposed to the Liberals and Conservatives and their tired old Bush-style unregulated free trade approach that sells out Canadian jobs. In agreement after agreement, we have seen the Conservatives just walking up and selling out whole industries. We saw that with the softwood lumber sellout that killed tens of thousands of jobs and continues to kill jobs, as the judgments based on the softwood sellout come through, another $400 million anticipated in the next few weeks. It is appallingly irresponsible bad policy, bad negotiating. It is like the Conservatives are just unable to get their minds around the Canadian public interest.

Now we have the shipbuilding sellout, which is unanimously described by people in the shipbuilding sector as a sellout. Unanimously. There is not a single representative from the shipbuilding industry, whether owners or workers, who said this was a good deal, who said the carve out should not happen.

My question to the member for Halifax is this. Given the unanimity from the industry, given the strategic importance, and given that Canada has the longest coastline in the world and should be reinforcing its shipbuilding industry like every other long coastline country, why are the Conservatives and Liberals conspiring to sell out thousands of shipyard workers and our shipbuilding industry despite the fact they have received hundreds of letters in the past few days telling them not to?

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:35 p.m.
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Megan Leslie NDP Halifax, NS

Mr. Speaker, I would like to thank the member for Burnaby—New Westminster for his question. If I knew the answer to why, I think we would all be better off. I cannot possibly understand what is going on in the minds of the Liberals and the Conservatives on this one, other than free trade is good trade, therefore free trade must be holus-bolus.

We want to look at what is fair trade. As I said earlier, the NDP believes that this is a good trade deal with the exception of the shipbuilding portion. These countries have strong social democratic traditions. They are ideal trading partners for Canada. Although these members have not joined in with the European Union, they have provided an excellent model for how to build strong working relationships with their neighbouring countries. We will only benefit from working with these countries. They really set an example for us about how to strike a balance between trade and national sovereignty without having to sell out the latter.

My colleague talked about this being a sellout, and I actually agree with him. I would like to read into the record what was said by Andrew McArthur from the Shipbuilding Association of Canada and vice-chairman of the Irving Shipbuilding Corporation when he testified before the Standing Committee on International Trade on March 3, 2009. He said:

If it's not a sellout, it's getting close to it. It certainly doesn't enhance the survivability of the industry. It jeopardizes it. It would be pretty hard to say it's an absolute sellout, although it's getting close. It's not only EFTA that concerns us. The ground rules may be set. We're negotiating with Singapore. We're negotiating with South Korea. Once we've set the ground rules, if we then get the same with all these other countries, the industry will be in very tough conditions and it will be able to survive only with government contracts--

Pushed a little further with questioning, George MacPherson actually said, “Yes, I would. I would use those words”. The words he is using are “sellout”. I absolutely agree with the member for Burnaby—New Westminster.

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:35 p.m.
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Brian Masse NDP Windsor West, ON

Mr. Speaker, it is important, when we look at the context of trade, that we look at the current deals that have been signed and, as part of our due diligence, to review what is happening here.

With respect to Bill C-2, the hon. member for Burnaby—New Westminster has requested the aspects to shipbuilding be carved out, which is a normal process of trade arrangements. In fact, in the history of trade arrangements they have had these elements in a series of different ways. For example, the United States has the Jones act and procurement policies with a number of different defence contracts. It also has policies in manufacturing, for example with the bus industry, where there are provisions that require content assembly in parts manufacturing in the United States. In fact, Canadian companies had to go into the United States and open up assembly plants so they could bid and win contracts for those.

As well, the United States has a buy American clause that is part of its overall procurement policy and always has been. It reached some feverish discussion in recent months but the reality is that it has been in American law for a number of years. The clause has been part of its ordinary procurement policy and has been part of the state and municipal procurement policies.

The request that is being made here is part of negotiation tactics. Unfortunately, we have a history of bad negotiations when we look at the past Liberal government and the Conservative government. This deal here was arranged by David Emerson, a Liberal minister for the Martin administration who crossed the floor after an election and continued with his policies. One of the policies was with regard to European trade and another one was with Colombia. Another deal that has not seen the light of day, thankfully, is with Korea.

If one looks at those policies, the government offered up a significant number of different iconic Canadian industries as bait to bring in trade negotiations and then it caved and gave them away later on.

One of the reasons I have been opposed to the South Korea trade deal, which some bureaucrats will admit, is that something had to be offered up. In this agreement, the government has offered up the automotive industry. It is a terrible position to start with because one knows right away where one's negotiating strength is. Unfortunately, the government comes back with deals that really sell out certain segments of Canada's industrialized capacity.

It is important to note, for example, that the United States has its own defence procurement policy and we do not begrudge it that. We know the United States has certain aspects it wants to continue to have in its country as part of its overall strategic way to deal with civil society, as well as international affairs, which is why it has the capacity to ensure it can respond to certain things.

Sadly, Canada has done the exact opposite. We have basically abandoned any type of sectorial strategy approach and only through a budgetary process year by year scrambles around to try to find some programs or aids that come and go for the aerospace, automotive or shipbuilding industries. The government does not really create concrete plans of action.

We are looking at Norway for particular reasons in this debate because it spent over a dozen years building a shipbuilding industry through heavy subsidization and a national policy. It had over a generation of public policy geared to design and build ships. not only for its domestic industry but also international industry. When Canada enters into an agreement like this with no terms and conditions to protect Canadian industry, it is at a natural disadvantage.

I have had a chance to see some of the work that has been done with shipbuilding. I have been at the Irving yards in Halifax and have spoken with the workers. Interestingly enough, the government's position has always been the issue over labour mobility. It says that if workers cannot build ships because there is no work, then they need to go out to Alberta or somewhere else to find a job.

The first thing one may say to that, even I as a young parent, is that people will do what they need to do, there is no doubt about it. However, when we have thriving communities that will continue to be there, it is important for families to be held together, which is the creation of a bond the community requires to deal with everything, including social programs, crime, education and innovation.

It is not just about workers going away for a couple of months and returning. Canadians will do those things if they need to, as they have done in my riding, but the preference would be to have a job in their own community, especially communities that historically have been around and will be around for the foreseeable future. We should be looking at building that capacity. It is about those communities with a high industrialized component for shipbuilding, for example, as we are talking about today specifically, to be part of a program and plan to create stability. We are going to win from that.

Other organizations or other countries will not be complaining about Canada being protectionist because this is done in other countries, and that is why it is important to have this component carved out and move forward with the rest of the trade agreement that would be more balanced. It would be progressive in the sense that shipbuilding would be removed, but it is not, which, unfortunately, is why we are back here today.

I will again talk about the Navistar truck plant in Chatham, Ontario, where a $200 million defence procurement offer went out to International Truck, which is located in Chatham and in Texas, and it decided to put all the work into Texas. That is not acceptable because a number of years ago International Truck was having problems and it was given a $35 million loan guarantee and for the last several years it has been producing trucks and doing quite well. In fact, when it tried to move production to Mexico, the trucks had to come back to Chatham to be audited and repaired because the quality was not up to what the client needed.

As a Canadian politician, I do not get upset when the United States buys its trucks from Texas for its military. I understand that it has a plant with people working there. If it were going to buy trucks, it would be a good idea if it were to buy them here in Canada. We are always hopeful to gain that type of business. However, I can understand that it wants to have certain segments of its military protected to be able to do procurement there because it actually gets it. It also understands that having development capacity gives it control over who gets those at what time. It actually has that in it its contracting, which means that the United States can cut the line whenever it wants, which would reduce our capability to have our own sovereignty addressed.

It is interesting to note that the plant can produce that truck for around $800,000. With the layoff of workers about to take place, we are looking at about $17 million to $19 million in unemployment insurance benefits. This makes no sense whatsoever on an economic scale. If we were actually going to have that investment, the retooling would be done by Canadians, the equipment allotted would be Canadian and the people doing the work would be Canadians. We would have the next future base of taxation policy from those who are making money in that area contributing back to the coffers of Canada. We would have a net win. Why we would send our truck development to Texas and basically backhand Chatham, Ontario, which is struggling right now, does not make any sense.

It goes to a deeper issue that ties with the essence of shipbuilding and the history we have with the water. Canadians know we have been a maritime nation serving ourselves quite capably during the first and second world wars where we had one of the largest merchant marines and navies by the conclusion of the war. We has a real sense of pride and dignity when we were able to procure much of our own development and had the capacity to do it.

People having the type of work where they actually produce something of net value and that they can relate to is such a value added component to our society. It is an extra added benefit to those who are part of the actual experience. In terms of shipbuilding, there is that element. Similar to that, in Chatham, Ontario, it is what the Conservative government has said, which is that they will not be producing ships for our men and women serving in the military, that it will be done by someone else.

Canadians miss out on that relationship of getting up every day, going to work, getting a paycheque and contributing to the Canadian development experience. It is important for people to have a job because it gives them a meaningful sense of worth. However, the Conservatives have told them that they are not good enough, that the work will be done somewhere else.

What is so important about this debate in terms of the economics behind the shipbuilding industry and how it connects to ourselves as a people is when we see the outsourcing that is going on, which becomes very frustrating. Workers and others are starting to feel the anguish. I worry about the elements that will come next. Being from the auto sector, many of the workers are frustrated that the government is not there for them and that they are having to do things on their own.

In one of the more recent cases that we have had is the issue over Aradco. I want to congratulate Gerry Farnham, president of CAW195, and his workers who fought an American company that pulled out of Canada and left 80 families out of jobs with no severance package. The workers took it upon themselves to occupy the plant and ensure they received a better severance package, which they negotiated by themselves with no help from the government. Those people are working class heroes. They are men and women, some of whom are in single parent families, who took this action to protect themselves and their families livelihoods.

The message the government should take about what happened in that one plant at this particular time is that it must be more responsible when it has the tools and the resources behind it to make a difference in this country.

Those are the reasons we should be carving out this element and protecting our shipbuilding industry and the workers who have the skills and the training, which is important. When we look at the Aradco workers, they were some of the most productive workers but, through no fault of their own, they were usurped. It is the same for the shipbuilding industry, which has some of the best trained and most experienced workers. We will abandon them in some type of an experiment that does not make any sense.

We need to turn this around. People are looking to us and at the examples that we are setting. They are asking what can we do with their taxpaying dollars that will benefit not only just in terms of the immediacy of the tax expenditure that we are doing right now but later on in terms of public policy. That is what a national strategy for shipbuilding and an auto strategy would be and all those other things where there is value and traceable elements of where the money goes to. That is what could be done in this particular element.

Workers will continue to feel frustration as they have done everything right and then they do not have the government behind them.

It is disappointing that we are here by ourselves as New Democrats on this issue. I think we will be looking back later, not only in terms of what we have lost, but in terms of a missed opportunity to reinforce at a time when there is that motivation that should be even bigger to restart an industry and ensure it will thrive. The connection to that is critical, especially when we can look at the incredible opportunities.

We can look at the Great Lakes, not only as a treasure environmentally but also a trade corridor that is significant. The Great Lake freighters will soon need to be replaced but those will all be built in China, Norway or somewhere else when they could be built here.

Sadly, we let the shipbuilding facility at Collingwood go, but we could plan this out to ensure that Halifax, Montreal and other shipbuilding areas where we still have that capacity are preserved. For those who are not aware of it, Collingwood has now become a resort. It is a very beautiful location with a lot of positive things there but we did not plan another deep water capacity port. What we have lost now is the opportunity to have a thriving industry return.

Therefore, we need to think about that in the context of what is happening right now and, with what is going on right now, this is the perfect opportunity.

It is important to look at what the message would be for Canada if we were to carve this out. It would tell the other countries that we are interested in doing this and I do not think we would have a hostile reaction. I do not think any country would challenge us.

When we look at some of the European policies for defence and other procurement, it is quite similar. When we look at the United States, it is very clear that it has decided that it is going to have this at its capacity, and we are very much integrated with the United States.

Ironically, even as we have had some of these elements, the United States has gone to the extreme where, under the Patriot Act and other types of legislation, many Canadian workers are not eligible to work on some contracts in the United States that are defence procurement.

The United States has even challenged the workers who are part of companies that are integrated. This is going to become a bigger issue because we have a number of different procurements that are going to take place over the next few months. We will hear about some of them, including search and rescue planes that need to be replaced. There are concerns already being expressed that the government is going to skew the bidding process basically to give an Italian company the contract. It is sad, because we actually have a number of different consortiums here in Canada, with up to 50% Canadian ownership, that could do that type of work. They should be part of that process.

We are going to continue to see this type of debate emerge. This is not a one-off issue. We are going to see the return of discussion of the South Korean trade deal. That is another one that I mentioned, where the automotive aspect of it is being offered up as an element that basically could be seen as the carrot to bring us in, and then later on we suffer the consequences of that.

It is important to note also that it is not just the New Democrats here on their own who are bringing this issue forward. It is interesting, because we have not only the labour aspect, which is traditionally part of our party and our relations and so forth, but we also have the associations, as well as companies such as the Irvings.

There are some interesting quotes that have come out of this debate that really reinforce the fact that it is going to be costing us as a country a lot of jobs.

One quote is from Mary Keith, a spokeswoman for Irving Shipbuilding Inc. The company has actually put this in a release, so it is not something that was just said off the cuff or thrown out in a media comment. This is an actual release that was put out, so they thought very carefully about what they were going to say.

Ms. Keith said:

The government of Canada is continuing its 12-year history of sacrificing Canadian shipbuilding and ship operators in the establishment of free trade agreements with other nations.

International trade minister David Emerson said at the time that a free trade agreement in principle had been reached with the countries of Iceland, Norway, Switzerland and Liechtenstein.

They were looking at it through a 12-year lens when she made that comment. I think that is significant because a number of different operators or companies out there are seeing this as systemic. When we see something as systemic, we defeat the option of other people who are interested in actually investing or moving into that field.

The people making those comments are indicating that this is not just one-off bad policy from the Conservative government or the Liberals before it. What they are saying is that if people want to get into this business, they'd better buckle up, because the ones who are in it right now are completely dissatisfied with the relationship they have with the government. They feel that not only is it not neutral, it is actually against the flow.

I want to point that out because what we have happening here is a continued pattern of behaviour, the assumption that we can just reduce trade barriers or regulations, whether it be in regard to food or other types of industries such as the airline industry, and we will see natural improvements to the consumer and to civil society. That is not the case. That has not always happened.

What we need is a carrot-and-stick approach. The carrot is good public policy, and the stick is to make sure that the jobs are going to be created here, especially when taxpayers' money is involved.

Canada-EFTA Free Trade Agreement Implementation ActGovernment Orders

March 23rd, 2009 / 12:55 p.m.
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Guy André Bloc Berthier—Maskinongé, QC

Mr. Speaker, I was listening to my colleague speak on the motion for this bill currently before the Standing Committee on International Trade. First, I would like to know what his party proposes to support the shipbuilding industry and what are the main aspects of this bill that will support the industry.

Second, if this motion is adopted by the House and we are unable to make the government improve and provide more support for the shipbuilding industy that could be threatened by this type of agreement, should we simply forget about the agreement? It does nevertheless have certain advantages for Quebec's pharmaceutical industry. What position will the New Democratic Party take?

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March 23rd, 2009 / 1 p.m.
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Brian Masse NDP Windsor West, ON

Mr. Speaker, we know the industry will be abandoned in Canada. I would be surprised if the Bloc thinks if the industry has trouble later on we should not worry because the Conservatives will rescue it at the end of the day. I would be surprised if the Bloc believes that would happen, because I do not sense that from the government. Traditionally it has not been there. I would not give the Conservatives that type of credibility or that type of responsibility and think it is real.

It is important that when we have a trade agreement, it is fair and balanced. It should not be done at the expense of one particular group or segment. That is the whole point, I suppose, of a united Canada, because we can be stronger and more successful.

There is nothing wrong with carving out a piece of this deal and then negotiating a better one. There is certainly a lot of benefit from other countries when they come into the markets in Canada. It will be more balanced and fair trade. However, we cannot ignore that Norway has provided more than a decade of support for an industry that will destroy that.

I would say that the Quebec shipbuilding industry will also take a hit. It could actually be much more significant but has not been because there has not been that policy in place. I believe Quebec will suffer from that lost capacity and also potentially a shipyard closure, which has been threatened in the past. That would be a setback for the country and for Quebec.

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March 23rd, 2009 / 1 p.m.
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Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, the member for Windsor West pointed out that essentially other countries that have tough negotiators exclude shipbuilding from agreements. The United States has done it for every single trade agreement it has signed. Essentially, under the Jones Act, it carves out shipbuilding.

Referencing the question asked by my colleague from the Bloc, the Bloc should be voting for the amendment because quite simply it means that Parliament is ensuring, essentially, that the work that was not done in the negotiation of this agreement does get done through the due diligence of parliamentarians.

The member from the Bloc knows that many of the letters that are pouring in are from Quebec shipyard workers, but it is not just shipyard workers. Sheet metal workers and boilermakers are writing to us.

I just received on my BlackBerry a message from Jim Fitzpatrick, saying:

I on behalf of my members [of the International Brotherhood of Boilermakers] totally support the exclusion of our shipbuilding industry from the EFTA agreement. We have a vibrant workforce on this beautiful west coast--

He is writing from British Columbia, as we can surmise. He continues:

--and with the unemployment as it is at the moment in our shipbuilding industry we need our government's support with regards to this issue.

We are getting hundreds of letters, emails and phone calls to MPs' offices from sheet metal workers, from boilermakers, and above all, from shipyard workers from coast to coast, and only one party is standing in the House of Commons and allowing that voice to come forward. The other three parties are completely abdicating their responsibility to Canadian workers.

I would like to ask the member for Windsor West why he thinks all these other members are forgetting about the Canadian public interest and Canadian jobs.

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March 23rd, 2009 / 1 p.m.
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Brian Masse NDP Windsor West, ON

Mr. Speaker, quite frankly, a couple of things play into this. First, the architect of this deal was David Emerson, a Liberal. Members have quite clearly hitched the history to him. He was the architect of the softwood lumber deal, and we all know how that is working out. In fact, I was just in the United States and it was questioning Canada's deal itself. So we do not even have a set stability pattern. We basically got taken to the cleaners on that deal. Ironically, we were winning in the courts, and then we pulled defeat from the jaws of victory.

I live across from Detroit, Michigan, which is home to the Detroit Lions, so I am very familiar with that process.

That is what was done with regard to the softwood lumber deal. We see the catastrophic result of it across this country. Who can be satisfied with the status quo in the agreement?

That is part of the problem, as well as expediency. When trade agreements are signed, for some reason they are seen as elements of justification or as a process that shows maturation in a government. That is really worrisome in the sense that the symbolism of it is being presented as more important than what is going to happen to industries after they emerge in this new relationship.

I do not know why the Bloc is supporting this without at least forcing the carve-out. It makes no sense for that party to turn its back on the workers of Quebec, in particular those directly affected. Basically giving up control of the potential shipping industry for the future to other hands without having a public policy is rather peculiar.

Those are some of the reasons I think we are seeing some of the decisions being made and why we in the NDP are the only ones speaking on this issue. I have debated this a number of times and people say I am against trade and moving forward. That is the furthest thing from the truth. What we need is fair trade. This is part of negotiations that have taken place in other bills and other countries and they have those elements.

We should move forward with this, because we not only have examples we can point to, but they are right next door in the United States.

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March 23rd, 2009 / 1:05 p.m.
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Tony Martin NDP Sault Ste. Marie, ON

Mr. Speaker, I commend the member for Windsor West on his presentation this morning in the House. He certainly knows of what he speaks. He has watched the auto industry struggle through a number of difficulties over the last few years, all of it connected to so-called free trade, including the impact of the loss of the Auto Pact in Canada, not only in his own city but in cities across the country—in particular, places like Sault Ste. Marie, which provides the steel. It is all interconnected.

Having been here for four and a half years and listening to some of the discussions in the House about trade, free trade and meetings of Canadian representatives with officials from other countries about trade, it seems to me that we go to those meetings like good Boy Scouts. We are ready to throw absolutely everything on the table in order to get a deal that somebody else thinks is good for us because we have a lot of natural resources, not understanding that at the end of the day, in most instances—and I have not seen one yet where we have not—we come out the loser.

I remember standing in the House a few years ago on behalf of farmers, asking the government of the day, which was Liberal, to stand shoulder to shoulder with farmers, as we yet again caved in and provided more opportunity for foreign products to be brought in and sold in our market.

I ask the member for Windsor West to share with us a bit about the impact of the auto pact on his community and this country.

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March 23rd, 2009 / 1:05 p.m.
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Brian Masse NDP Windsor West, ON

Mr. Speaker, I think the people who negotiate on our behalf either have a self-esteem problem or need to see Tony Robbins, or something. It is habitually the case that they go in with a position to give up something quite significant and we get taken advantage of. People just cannot go in there playing poker with their hands facing the opposite way and pretend and hope things are going to go right. Those types of elements cannot be given up right away.

It important that we actually set the proper policy. I have seen it with the auto industry. It is affecting the entire country right now. All we can do now is hitch on to the United States, because we have given up so much of that sovereignty. I would hate to see the shipbuilding industry suffer the same fate, because it is important not only for our national security but also for the type of work that people can do and the value-added work that goes back into the coffers of this country.

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March 23rd, 2009 / 1:05 p.m.
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Serge Cardin Bloc Sherbrooke, QC

The members of this House know the Bloc Québécois' position on this Free Trade Agreement between Canada and the States of the European Free Trade Association. In our opinion, the agreement would benefit Quebec. And knowing that the Bloc Québécois defends Quebec's interests, members understand that we will support this agreement.

Today, I would like to come back to the shipbuilding industry in particular. Some things have happened in the history of shipbuilding, and some things have not been done.

For 25 years, the Conservatives and the Liberals have shared power more or less equally. However, I would like to refer to an article that appeared in the Canadian Press on November 11, 2008 about comments made by Denise Verreault. I quote:

The president of Groupe maritime Verreault, Denise Verreault, did not mince words yesterday as she condemned what she called politicians' “lack of vision” on the marine industry.

Speaking at the Institut maritime de Rimouski..., Ms. Verreault said that “politicians could not see further than the end of their own noses or...the next election” when it came to shipping.

For more than 25 years, the CEO of this company based in Les Méchins has criticized the fact that Canada has no marine policy, even though shipping will double by 2020.

“Quite simply, there is no political will or vision. The shipping lobby is not as strong as the trucking lobby. The marine industry needs a single association that is very strong, instead of a number of groups. Our politicians think that ships are a vanishing breed and that as a mode of transportation, shipping is too slow. The hidden costs alone of just-in-time trucking are phenomenal, not to mention the environmental impacts,” said Ms. Verreault, honorary chair of the 27th funding campaign for the Institut maritime du Québec.

We can see that Ms. Verreault was talking about a 25-year period, and we can say that she was referring as much to the Conservative government as to the Liberal government of the time.

There was another very interesting article this morning in the newspapers, about comments made by the member for Bourassa. In a Canadian Press report, we can read:

But to win Quebeckers' hearts, the Liberals will have to rely on more than just their leader's relative popularity. [The member for Bourassa] therefore announced the appointment of two new campaign co-chairs: Gaspé businesswoman Denise Verreault and [other people, of course].

Should anything be inferred from what Ms. Verreault said in November 2008 and her current involvement with the Liberal Party? It is clear from her comments that she condemns the Conservative government for its lack of action with respect to the shipbuilding industry. We also know that she condemned the Liberal government of the day for its lack of action with respect to the shipbuilding industry.

At present, the fundamental problem facing the shipbuilding industry is not necessarily an international trade one, but rather a problem with the industry per se. The fact is that our industry has been neglected for many years, while other countries were heavily subsidizing theirs.

The suggested time frame in the accord is 18 years, that is an initial three year waiting period, followed by a progressive phase-out over 15 years to ensure that the trade can really be considered as free trade, with no extra costs.

What matters is to know what the Conservative government will do and, particularly, given Ms. Verreault's involvement, what the Liberals will do in the next election campaign. I want to know whether Ms. Verreault's efforts will have been all for naught, in the sense that, come an election, she will realize that the platforms include no shipbuilding policy, even though, as we know, such a policy is needed.

What I would like to hear today from Conservative members, and of course from the Liberals and even the NDP, is what they suggest as policy for the shipbuilding industry. It was primarily the shipbuilding industry that caused negotiations to last more than 10 years and people to fail to agree. What could these parties advocate or do to come up with innovative options for the shipbuilding industry? These are main points that must become clear through today's debate. We have to know what the government is going to do and what a party that, as we saw clearly on the weekend, was all energized to potentially form the next government, will commit to doing for the shipbuilding industry. Of course, we must not forget that Ms. Verreault is there, probably to provide strong suggestions.

I would still like to raise a number of points. I do not know whether I will have the time to list them all, but the Bloc has proposed a lot of things specifically to enable the shipbuilding industry to improve.

We must not forget that the shipbuilding industry has some very special features, features unique to it, which must be taken into account in working to ensure its development.

The government must realize that, because of the high cost of its products, the industry needs special financial arrangements for sales contracts. Because its products' value often constitutes the lion's share of the buyer's assets, the industry needs special financial regulations.

Because of the significant investments involved in producing the first of a line of ships, the industry must share the risks it faces in research and development and requires special credit access facilities.

There is also the matter of instability. Shipyards regularly do not operate for a number of months between contracts. Because of its instability and the high fixed costs of its considerable capitalization, the industry must have access to a substantial line of credit.

As it is also excluded from most trade agreements, the industry's international environment involves governmental subsidies, protectionism and buy-domestic policies.

Measures offering protection and support are needed to permit fair competition. Because contracts from DND and the Coast Guard are important to the industry, it needs a government purchasing policy that contributes to its development.

Since Canadian shipowners make up its main clientele, the industry needs a policy that promotes the development of domestic marine transportation, in other words, cabotage. Since the law of the sea is inadequate and does nothing to force companies to replace those dangerous, polluting scrap heaps, those poison ships, the industry therefore needs initiatives to modernize international shipping.

In order to bring in a real marine policy, the Bloc Québécois is proposing measures to ensure the development of this industry, which is of strategic importance to Quebec. It is also essential to ensure the protection and safety of the environment. Many of these measures could help the industry. I would remind the House that the federal government has not supported shipbuilding since 1988. Not only are the few aid measures still available very poorly adapted to the shipbuilding industry, but the federal government has even penalized the provinces that have instituted innovative measures, such as the refundable tax credit in Quebec, which for some years was considered by Ottawa to be taxable income under the Income Tax Act. That allowed it to claw back 20% to 25% of the assistance paid by Quebec to the industry.

In any discussion of financing, insurance or loan guarantees involved in sales contracts, it is important to note that purchasing a ship or an oil rig is a multi-million-dollar investment. Access to credit at favourable interest rates is a critical factor for the buyer. Through EDC, the federal government should set up a sales contract financing program to finance the purchase, repair and conversion of ships in Canadian shipyards. The program should provide funds for a significant portion of the value of the contract—perhaps 87.5%—at private market interest rates to low-risk companies that are in good shape. The program should be offered to both domestic and foreign buyers.

One issue is loans and loan guarantees for shipyards that have to invest or provide a financial guarantee in order to bid on new contracts. The tax rules for financial lease agreements have to be improved. We must bear in mind that under these lease agreements, the ship buyer does not take immediate possession. The buyer rents the vessel for several years and does not take possession until some time later. Because the buyer does not own the ship, tax rules allowing him or her to write off depreciation against taxable income do not apply. The government should improve the tax rules that apply to lease agreements for buyers of ships built or refurbished in Canada.

There should also be refundable tax credits for ship owners. The government should provide a tax credit to ship owners who sign shipbuilding or rebuilding contracts with Canadian shipyards. Because operating a ship is typically not profitable during the early years—all income ends up financing the initial investment—the credit should be refundable.

I want to point out that, in 1999, Antoine Dubé, who was the Bloc Québécois member for Lévis, introduced Bill C-213, which contained measures similar to those I just discussed. In 2000, after the bill was introduced, KPMG conducted a study for the Shipbuilding Association of Canada. It showed that, with respect to the 16 shipbuilding contracts between Canadian ship owners and foreign builders in 1999, these measures alone—none of them subsidies—would have, in a worst-case scenario, kept four to six contracts here in Canada, resulting in an additional $100 million to $150 million in annual sales. Their best-case scenario showed that some contracts for foreign ship owners—for the construction of drilling platforms worth from $300 million to over $1 billion—could have ended up in Canada.

The government must systematically favour Canadian companies for purchases to meet military requirements or those of the Coast Guard, and for offshore investments, drilling rigs and, eventually, wind turbines. A few announcements have been made, but more needs to be done.

In establishing its purchasing criteria, the government has to put a stop to discriminatory rules that offload transportation costs onto the shipyards, penalizing those in Quebec more than those in the maritime provinces.

It must also take measures focusing on water transport within Canada. While international seaborne shipping is growing at an exponential rate, domestic shipping, or cabotage, is growing at a slower rate. But Canadian shipping companies make much better customers for our shipyards than foreign companies. Environmentally as well as from an energy standpoint, shipping is the most logical choice and should rapidly become increasingly popular, given growing concerns about climate change and depletion of fossil fuels. In a nutshell, far from being a thing of the past, shipping is a forward-looking transportation mode.

Why do several government practices limit the development of cabotage for the transport of freight? Dredging and icebreaking expenses incurred by the government along the St. Lawrence River are entirely offloaded onto shipping companies. Conversely, the cost of maintaining roads is shared among all taxpayers, instead of being paid by truckers. Such an injustice hinders the competitive capacity of water transportation in comparison to land transportation.

The government should also eliminate the fees charged marine transportation companies that practice cabotage. It should also put in place a major investment program for port infrastructure focusing on the infrastructure needed to develop intermodal transport. In addition, the government should bring up to standard all the ports it left to crumble given that it is responsible for ensuring the best possible use of its own infrastructure. The government should also strengthen the Coastal Trading Act to support Canadian shipping and to ensure that foreign carriers that practice cabotage are subject to Canadian laws, especially those governing working conditions.

As for measures pertaining to international marine transport, we should oppose flags of convenience. Canada must ratify the UN convention on ship registration and lobby internationally for its implementation. We must fight poison ships by strengthening international marine law and creating an agency such as ICAO for marine transport.

This is not an exhaustive list, but it does show both the Conservative and Liberal members that it is possible to put in place measures to foster the development and competitiveness of the shipbuilding industry and the marine industry in general. Today, I would like to know what is the position of the Conservative, Liberal and NDP members, and the measures they are proposing to entrepreneurs and employees in the marine industry. I would like to know and I am certain that Ms. Denise Verreault would also be interested.

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March 23rd, 2009 / 1:25 p.m.
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Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, personally, I very much like the hon. member for Sherbrooke. I know that if it were up to him, he would be willing to ensure that the Bloc Québécois adopted the right position. However, the Bloc leader seems to want to punish the workers in the Quebec City area. I do not know why, but I imagine it is because Quebec City rejected the Bloc Québécois. Thus, the leader of the Bloc Québécois seems to want to punish those workers, because they are asking Bloc members to support the NDP amendment.

Pierre Bérubé, a steel erector at the Davie shipyard, said:

As a worker at Davie Yards Inc., in Lévis, I wish to express my concern about the survival of the Canadian shipbuilding industry if the free trade agreement between Canada and the European Free Trade Association (EFTA) goes through.

That is why I support your efforts to exclude Canadian shipyards from that agreement.

Gaétan Sergerie, a welder at the same shipyard, said: “Like all workers at these shipyards, I am concerned about the repercussions that this free trade agreement will have on the growth of shipbuilding in Canada.”

Paul-André Brulotte, the union president, is saying exactly the same thing.

Quebeckers are asking the Bloc Québécois to support the NDP amendment. Why does the Bloc refuse to listen to them?

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March 23rd, 2009 / 1:25 p.m.
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Serge Cardin Bloc Sherbrooke, QC

Mr. Speaker, we in the Bloc hear these remarks and are listening to them as well. But we must always look at the agreement that was signed. We are at the stage of implementing that agreement. What the NDP would like is to leave out shipbuilding.

As I said earlier, I do not think it is a core problem of international trade as such. Rather, I think the problem stems from a lack of desire by the Conservative government and the previous Liberal government to support this industry. The negotiating process of 10 years ago indicates that the problem was substantial, and that negotiations at the time were primarily focused on the industry, which was the stumbling block.

I repeat, if the industry is not supported, whether or not the agreement includes shipbuilding, there will be no future for shipbuilding. When entrepreneurs and skilled employees cannot succeed in this sector, there will be no future. I believe there are skilled people and dynamic entrepreneurs in this industry. And so the 18 year delay would allow them to go even further.

If the NDP put as much energy into convincing the Conservative government and perhaps one day a Liberal government, with Denise Verreault of Chantiers Verreault as the co-chair of the campaign, I am sure they could eventually persuade the government to implement a real shipbuilding policy.