Bill C-2 (Historical)

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 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.

Canada–EFTA Free Trade Agreement Implementation Act

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, I am pleased to rise on Bill C-2, which is the Canada-EFTA trade agreement but could also be entitled the “bamboozled by Liechtenstein act”, because here again we have a Conservative government that, as we saw with the softwood sellout and as we have seen in every single negotiation that it has undertaken, basically sat down at the table and was outplayed, outnegotiated and bamboozled, in this case by the Principality of Liechtenstein and the other members of EFTA.

What EFTA wanted access to our shipbuilding industry. As members know, Iceland and particularly Norway have an extremely strong industrial sector in shipbuilding. The Norwegian government has invested and protected its shipbuilding industry for many years and has built up an extremely strong shipbuilding industry.

They sat down at the table, and the Conservative government, which was outplayed and outnegotiated, basically handed over our shipbuilding industry without attaining much more than the ideological platitudes we heard from the Minister of International Trade just a few short minutes ago. The government simply handed it over in the same way that it did in the softwood sellout, when it handed over a softwood industry without being the tough negotiator that I think the vast majority of Canadians would have wanted it to be.

Essentially what we have seen from the government is a steady drumbeat of wanting to sign trade agreements at whatever cost. In this end of the House the NDP stretches right across the aisle, because after the last election and the increase in NDP MPs we now occupy the whole end of this House. We decided to look at what is actually in the agreement. Before we decided to support it or not, we wanted to see what the actual impact of EFTA would be.

I am going to read into the record what those who best know the shipbuilding industry in Canada have had to say about this agreement. I am going to start with Mr. Andrew McArthur, who, as a member of the board of directors of the Shipbuilding Association of Canada, appeared before the Standing Committee on International Trade on this agreement and on this bill. Here is what he said about the negotiations around this agreement:

From day one, we said the Norwegian industry has been totally supported by its government to build up a tremendous infrastructure. It is a good industry with a lot of government help, and now they're looking to see what else they can do.

So our position from day one has been that shipbuilding should be carved out from the trade agreement.

We know that did not happen.

He continues:

We butted our heads against a brick wall for quite a number of years on that and we were told there is no carve-out.

We were bamboozled by Liechtenstein.

When asked how the Americans can carve out on the Jones act from NAFTA and other free trade agreements, as I believe the Americans are doing today or have done in carving out shipbuilding with Korea, and why Canada can not do the same, he continues:

...we feel we were sold down the river on NAFTA. We cannot build for American shipowners, but American shipbuilders can build for Canadian shipowners and import the ships into Canada duty-free. There has never been such a one-sided agreement, to my knowledge. It's totally ludicrous that they can build for Canadian owners, come in duty-free, and we cannot build for American owners. On the repair side, it is even worse. We used to be able to do some repairs for American Jones Act ships. Today it's very, very difficult. There are a lot of restrictions, and that work has basically disappeared.

Those were comments from Andrew McArthur of the Shipbuilding Association of Canada.

What did the marine workers say about this bill? We had Mr. Karl Risser, representing eastern marine workers, who said the following:

Other governments, Norway for one, have supported their shipbuilding industry for years and have built them into powers, while Canada has not. We have had little protection, and what little protection we have left is a 25% tariff on imported vessels into Canada, which is being washed away by government daily through agreements such as this and the exemptions being negotiated with companies.

I encourage all members of the House to read the testimony before the Standing Committee of International Trade. We cannot just have Conservatives simply approving government actions by rote when it means the elimination of Canadian jobs, many of which are actually in the ridings held by Conservative members. They will not read the agreement. They will not look at the impacts. There has been no economic impact analysis of this agreement. How any Conservative member could sell out their own constituents by voting for this agreement is beyond me.

Karl Risser continues:

With all these statements, you'd think the government's action would be to put into place national strategies to ensure a viable shipbuilding industry, but we have seen no sign of that. What we have seen is the EFTA agreement, which we feel will further devastate the shipbuilding industry.

He continues:

But to get back to this agreement, the Norwegians have built their industry into a very powerful industry.

So this EFTA deal is a bad deal for Canada. I'd love to see someone answer the question, what is Canada going to get out of this agreement? I know we're going to destroy our shipbuilding industry, a multi-billion-dollar industry in Canada. It's on its last legs now and needs a real boost. We have that opportunity in front of us, but whether we take it or not is the question.

I am going to continue on this because I think it is important that these voices, people who understand the shipbuilding industry, who are raising these concerns, are heard in the House of Commons and the members vote accordingly. We have heard the Liberals and Bloc say they are going to vote for this agreement. Beyond my comprehension, the Bloc is voting despite the fact that Davie Shipyard has completely shut down. Over 1,000 workers out of work, and yet we are playing with fire in trying to push through an agreement that witness after witness said very clearly will devastate the industry.

Les Holloway, representing marine workers in eastern Canada and referring to the Standing Committee of International Trade, said, “How in good judgment and conscience can your committee recommend anything other than that this agreement should not go forward?”

The president of the Shipyard General Workers' Federation of British Columbia, Mr. George MacPherson, said:

The Canadian shipbuilding industry is already operating at about one-third of its capacity. Canadian demand for ships over the next 15 years is estimated to be worth $9 billion in Canadian jobs. Under the FTAs with Norway, Iceland, and now planned with Korea and then Japan, these Canadian shipbuilding jobs are in serious jeopardy. In these terms, this government's plan is sheer folly and an outrage.

How could any B.C. MP, especially after the softwood sell-out, vote to eliminate shipbuilding jobs in British Columbia? How could any Nova Scotian or Atlantic Canadian MP vote to eliminate jobs in Atlantic Canada? How could any Bloc Québécois MP vote to eliminate jobs in Quebec?

In The Chronicle-Herald, Mary Keith, the spokesperson for shipbuilding in New Brunswick, said that under the EFTA agreement: “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”.

Here we have case after case after case of those who know shipbuilding best saying that this is going to be disastrous. This is not some sort of ideological debate we are having because some of us in this House think that protectionism is bad and free trade is great so let us just sign an agreement and not worry about the consequences for Canadian jobs.

The Conservative government has finally admitted that we are in economic crisis, yet it adds this fuel to the fire and says we are going to slap our own shipbuilding industry. It is a strategic industry that every other government in the world, including Norwegian, Asian and Europeans governments, is actually supporting, yet three of the four parties in this House seemed prepared to sell it out and throw those jobs away.

We have by far the longest coastline in the world and to eliminate the last vestiges of our shipbuilding industry makes absolutely no sense. That is why the NDP caucus is saying no. It simply does not make sense to bring this agreement in when we have not provided the necessary supports to our shipbuilding industry. It makes absolutely no sense at all.

My colleague from Sackville—Eastern Shore will back me up on this. He will agree that our shipbuilding industry has to be of fundamental importance. We need a strategic plan in place. We should not be signing trade agreements that simply give our shipbuilding industry away. I know my colleague agrees with me and I appreciate that. That is why we are saying it makes no sense to put this forward. But there is more.

We also had testimony from the National Farmers Union before the Standing Committee on International Trade about the possible effect on supply management. Lip service has been paid to supply management. The Conservative government has said it is in favour of fighting hard for supply management. The infamous David Emerson, the former international trade minister, always said the government supports supply management and it will never walk away from the table. The Conservatives have said they support supply management. The National Farmers Union said in testimony that this essentially undermines our supply managed sector. That does not make a whole lot of sense either.

The arguments we have heard in favour seem to be ideological, so let us get back to the basic fundamental tenets of the economic policy, or the lack thereof, of the Conservative government.

Since the Conservatives came to power we have seen them progressively sell off our country in a whole range of areas. First there was the softwood lumber sellout. We had won that case in the U.S. Court of International Trade. David Emerson, with the support of the Conservatives and Liberals, supported the softwood sellout that literally blew up our softwood industry across the country. Tens of thousands of jobs were lost within days of implementation because of the self-imposed punitive tariffs. We gave away $1 billion that the American court said the American government had to pay back.

The Conservative government tried to say it was not a conclusive judgment, but it was. The Conservatives simply were not telling the truth by pretending that the court judgment was meaningless. That court judgment compelled the U.S. government to pay back every single cent it owed Canada and that court judgment also ensured tariff-free access in to the U.S. of our softwood products.

Politically, the Conservatives were in too deep. David Emerson decided to push the agreement through just the same, and the result was catastrophic. Many softwood communities in British Columbia, Alberta, Saskatchewan, Manitoba, northern Ontario, and northern Quebec have paid the price for what was sheer folly.

Warnings are now coming from many workers in the shipbuilding industry and many of the companies that are involved in shipbuilding saying, as I quoted George MacPherson, “--this government's plan is sheer folly and an outrage”.

We should have learned from the past mistakes. The softwood sellout was unparalleled folly. It was a sheer outrage and we should have learned from that. We cannot play with the jobs of Canadians simply on the basis of ideological direction. Essentially, the government has a strong ideological bent and come hell or high water, it will put that ideology into place no matter how many jobs are lost.

It is important to note that we are talking about the principles of maintaining Canadian jobs. It is important to look at the economic consequences of what the Conservative government has done, which has enacted exactly what the Liberals put into place over the last 20 years. It is important to ask the question: What has happened to average family incomes in Canada over the last 20 years?

We have had these free trade agreements when we have decided that we are opposed to protecting Canadian jobs, that is unless it involves the job of a corporate CEO or a banker and then of course the protectionist Conservative government is willing to weigh in with lots of money.

It will shovel money off the back of a truck to protect a corporate CEO's job and a corporate CEO's bonus, or a banker. It is willing to be fully protectionist. It is the most protectionist government in Canadian history. It is willing to do that for the big guys. It is willing to do that for extremely wealthy corporate CEOs. It is willing to be fully protectionist, but not willing to be protectionist for Canadian jobs even though every other government around the world puts into place protections around their strategic industries like shipbuilding. Every other government in the world puts into place protections over fundamental jobs. Every other government does that, but the current ideological government only wants to protect corporate CEOs and bankers. So what has the result been over the last 20 years?

For most Canadian families their real income has gone down. Canadians know that their real income has declined and it has been particularly striking for the lowest income categories. The Conservatives seem a little bit perplexed and I think it is important that they had a little dose of realism in the House of Commons, for most Canadian families over the last 20 years, real income has gone down. For those families who are in the bottom 20% in the Canadian population, their real incomes declined by over 10%. That is a lot.

It means on average that families have lost about six weeks of real income. For a month and a half of the year, compared to 20% years ago, they are working for free. They are working longer and longer hours, harder and harder, but under the Conservatives and the Liberals over the past over 20 years, their economic geniuses, has meant that for most of those poor Canadian families they have lost a month and a half of income.

What about the people in the middle class? They have lost about two weeks of income. It is like they are working 52 weeks but only getting paid for 50 weeks. For that middle income category, they lost about a week of real income a year over the past 20 years.

We put in place NAFTA. We put in place these free trade agreements and a whole bunch of economic measures such as a lot of corporate tax cuts and a whole range of economic measures designed to help those corporate CEOs and bankers because Conservatives want to make sure they get as much protection as possible from the federal government.

However, for most of those income categories the real income has gone down, not up. Now the wealthiest 20%, which is what the economic policies of the Conservatives and Liberals are oriented toward, such as EFTA, essentially now take half of all real income in Canada. This has not been seen since the 1930s. We went through the Great Depression. We had that type of income inequality. The foundation of the CCF, the NDP's precursor party, fighting in the House of Commons and fighting across the country, made a real difference. We had a much more balanced economy and much more balanced economic approaches. That worked for us very well until about 20 years ago when the Conservatives and Liberals moved to the right which has essentially meant for most Canadian families that their real income has gone down.

This is important to note because it shows that the strong ideological drive that we see from the right, that we see from Conservatives and Liberal parties, has not worked on the bottom line. It has not worked for communities. It has not worked for family income. It means that most people are worse off now than they were under the so-called protectionist agenda.

That is why other governments around the world are actually acting to protect jobs and their economies. Those examples are what we in the NDP side of the House believe that the government needs to look at, to be forthright and protect Canadians. The EFTA agreement does exactly the opposite. I have cited quotation after quotation of those in the shipbuilding industry who say that this will be a devastating agreement. This will eliminate jobs. How could any member of Parliament, representing their riding, representing their region, representing Canada, vote for an agreement that we know will devastate the shipbuilding industry? That is why we are voting no.

[Laurie Hawn, Conservative, Parliamentary Secretary to the Minister of National Defence]

Mr. Speaker, I listened with interest to the member for Burnaby—New Westminster. I was difficult because it was, frankly, mostly rubbish. He talked about what was beyond comprehension. I will tell members what is beyond comprehension to me. It is the hypocrisy of the NDP members who accuse others of not reading an agreement when probably eight weeks ago now, before the budget was even written, they had already decided they were not going to bother reading it, they were just going to vote against it.

He talked about selling out constituents. How about the hundreds of thousands of constituents those members are selling out by voting against the economic action plan, the Canadians who need jobs and they would take them away?

He talked about shipbuilding. We are building 98 new Coast Guard ships and refurbishing 40 more.

He talked about opportunities in front us. There is an opportunity in front of us, the economic action plan.

He should talk to his colleague, the member for Sackville—Eastern Shore, who at least said that he would have the common sense, the decency and the professionalism to read the budget before he passed judgment on it. I know the member for Sackville—Eastern Shore understands shipbuilding and understands the requirement from it. It is too bad the party as a whole, and certainly the member for Burnaby—New Westminster, does not seem to understand that by not reading the budget and by taking the action he and his party are taking, they are in fact selling out Canadians, not this party nor the other party opposite.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, it is surprising. Obviously the member was not listening at all. He should be aware, and you should actually call him to order, that we are not talking about the budget. The NDP has a lot to say about the budget, but we are not talking about it. We are talking about the EFTA agreement and shipbuilding. I am sorry the member was awoken from his slumber, was a bit disoriented and was not aware of what we were debating. We are debating EFTA. We are debating shipbuilding.

The point is I just quoted, I guess when the member was distracted, a number of people in the shipbuilding industry who said, and I will quote them again, that this would be “sheer folly and an outrage”. They also said, “What we have seen is the EFTA agreement, which we feel will further devastate the shipbuilding industry”.

This is the testimony heard at the Standing Committee of International Trade. I guess Conservatives in that committee were asleep as well rather than hear the testimony, not only from Atlantic Canada, not only from Pacific Canada, not only from British Columbia but from across the country, of the shipbuilding industry, the marine workers who are concerned about the loss of jobs.

The Conservatives are not interested in reading the agreement. They are not interested in looking at the impacts. That is why they are out of control and that is why they are trying to push through a bad agreement.

[Guy André, Bloc, Berthier—Maskinongé, QC]

Mr. Speaker, I listened with pleasure to my colleague from Burnaby—New Westminster, with whom I had the chance to work for a few years. Certainly, we do not always agree with the NDP on free trade, but I agree completely with his position on shipyards.

The Bloc Québécois tabled a motion in the Standing Committee on International Trade urging the Conservative government to introduce measures to support the shipbuilding industry. Hon. members will know that Norway has made huge investments in its own industry, and this agreement could threaten shipbuilding in Quebec and Canada.

I would like to raise a point, though. This agreement gives us cause for concern about the shipbuilding industry, but it contains other provisions that we feel are very good for Quebec, especially as regards the pharmaceutical industry. Quebec is developing many pharmaceuticals with Switzerland, and this agreement could be very good for trade. Norway imports Canadian nickel. One area of Quebec, Ungava, is a major nickel producer, which could lead to further trade. As for Iceland, it imports aluminum, an important product of Quebec. This agreement will promote more exports.

So we support free trade in Quebec, whether it is with the Americans or when other agreements benefit us. Of course, agreements like the one signed with Colombia that do not respect rights—

[The Deputy Speaker, Andrew Scheer]

I must interrupt the hon. member to give the hon. member for Burnaby—New Westminster time to reply.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

I want to come back to Davie shipyards, which has laid off 1,100 workers since December. As I said earlier, we do not know when they will return to work.

I know that the member worked hard on the Standing Committee on International Trade. He knows that shipbuilding across the country is facing a challenge. In Quebec, as in Atlantic Canada and in British Columbia, there is a major problem. A complex economic crisis is raging because of the lack of action and the poor decisions made by this government and the previous one, among other things.

I would like to say to the member that the Bloc must join the NDP in opposing this agreement. We have already seen the outcome, a massive job loss. The industry experts and the workers are warning us. If we want to keep these jobs and truly establish a strategic policy for shipbuilding in Canada, the three opposition parties must unite. I hope the Bloc will join us.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Mr. Speaker, my hon. colleague from Edmonton is correct. The budget did contain $175 million. We consider that the canoe budget for shipbuilding.

The Conservatives know very well, and they have been advised many times, that we require a $22 billion investment. That is just to replace and repair our military, Coast Guard and ferry fleets, let alone brand new ships.

I remember the former defence minister used to say that we would have three armed icebreakers. That promise is gone. We heard about the Diefenbaker, but we do not know where that is. That is at least a three-quarter of a billion dollar project.

We have very clearly asked for sound strategic investment by the government, not just on a domestic procurement but also to aid and assist our shipyards, the five major yards and the smaller ones, to protect and promote the trade jobs that are required. At least 5,000 to 7,000 full-time highly skilled jobs could be created on a long-term basis.

The number one recommendation of a 2000 unanimous report called “Breaking Through: Canadian Shipbuilding Industry” was structured facility financing and accelerated capital loans. We did get it for one year. Another time we got it for two years. We have asked that they be combined to assist this industry. If we had that, then quite possibly EFTA might not be so damaging. Without it, EFTA is completely damaging to the industry.

Could he comment on that?

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, the hon. member for Sackville—Eastern Shore has been the foremost advocate for the shipbuilding industry in our country. I think members in all corners of the House recognize how persistent he has been in trying to maintain and build a viable shipbuilding sector in Canada.

We have the longest coastline in the world and we have a shipbuilding industry that is dying through government ineptitude, government mistakes and government negligence.

He pointed to the commitments that have been broken. The Conservative government has broken promises in the shipbuilding sector like it has broken all its other promises such as appointing people to the Senate when it said it would not, breaking the fixed election date laws and in budget after budget, getting commitments from the House and then refusing to enact and put in place the money.

In the shipbuilding industry we have had commitments made and commitments broken repeatedly. I would expect it would be the same thing with the relatively small amounts. As he pointed out, $22 billion as opposed to $175 million is needed to catch up over the next few years. I predict that relatively small amount will not even be put in place because the government has broken every other commitment it has made to these kinds of investments. It is a real shame for those who work in the shipbuilding industry across the country.

[Gerald Keddy, Conservative, Parliamentary Secretary to the Minister of International Trade]

Mr. Speaker, it is a pleasure to rise in debate today on the European free trade agreement between Canada and the countries of Liechtenstein, Switzerland, Norway and Iceland.

I listened with great interest and respect to the opposition parties and certainly to the interventions by the Liberals and by Bloc.

The European Free Trade Association countries are significant economic partners for Canada, with Canadian merchandise exports totally $5.2 billion in 2007 and incoming investment to Canada totalling $18.2 billion in 2007.

Some members of the House would like to ignore that. Some in the House would like to twist the facts with their own rhetoric into something that does not resemble this free trade agreement at all. I caution these individuals that there is nothing secret. Anyone watching this debate throughout the country can go on line. Copies of the agreement are available. There will be continued debate. It will go back to committee.

This is a straightforward free trade agreement between Canada and our European countries, the first free trade agreement between Canada and any European country.

Those numbers on imports and exports, those dollars, will increase not decrease in the years ahead. To go further, under our Conservative government's free trade agenda, we will expand free trade. We will move forward, and never mind the critics.

Intelligent debate is fine. Reasonable, rational debate is positive, but we need to have that and we need to have a willingness to listen. We have to be able to sit down at the table and move forward in a positive way. We cannot get stuck in the rhetoric of the past, as some of the parties in the House are prone to do.

I congratulate the minister and the departmental officials on the important achievement of moving forward to sign this agreement and bringing it finally to the House of Commons. It will strengthen Canada's position in the global economy, it will strengthen jobs and opportunities in Canada and it will strengthen trade.

We are not an island. When I listen to some of the parties in this place talk about protectionism and building barriers, first, they would spend every dollar in our country. Second, when the dollars and the jobs were gone, then they would look for someone else to blame. Some of the economic rationale and the discussion is so far overboard and the hyperbole is so outrageous that it really takes away from the debate in this place.

As the Prime Minister indicated, current global economic uncertainty highlights the importance and the urgency of expanding international trade, investment relationships and improving market access for Canadian products. Canada is and always has been a trading nation.

The recent throne speech confirmed that trade and investment was a priority during these challenging economic times. Free trade allows Canadian business to compete in international markets.

As the member of Parliament for South Shore—St. Margaret's, a rural riding in Nova Scotia, I understand how heavily our producers and manufacturers rely on secure, predictable access to the global marketplace.

Consider also that half of what we manufacture in Canada is exported. It is absolutely essential to guarantee that this 50% of our manufactured items have a market in the world's economy. Consider that one-fifth of all Canadian jobs are in part linked to international trade.

In my riding of South Shore—St. Margaret's, I would say that it is even larger. I would say that 75% of the jobs in this riding in rural Nova Scotia are linked to international trade.

Our forestry sector is all value added. There is the AbitibiBowater paper mill. Louisiana-Pacific has a hardboard plant. It is all export oriented. Sure, some products are sold locally, but the majority of them are exported.

As for our fishery, the majority of it is exported. On our agriculture products, many are sold locally, but there are a lot of exports. All of the manufacturing, whether it is by Composite Atlantic or a furniture manufacturing company, is for export.

We are a coastal riding. We grew up in and go back to the days of the schooner in international trade.

Without trade, there would be no jobs in many parts of Canada.

Be it with this new agreement, our negotiations with Jordan, or, in accordance with our government's goal of renewed engagement in the Americas, the signing of free trade agreements with Peru and Colombia, the Conservative government has demonstrated its commitment to giving our producers and exporters the access they need to succeed around the world.

If we level the playing field--and it is our job as government to level the playing field--our manufacturers and producers will compete anywhere in the world and succeed every single time. If we put up artificial barriers, we will always be stuck where we are. We will never be able to compete internationally.

The Canada-EFTA free trade agreement places an emphasis on tariff elimination, specifically, the elimination of duties on all non-agricultural goods and the elimination of or reduction in tariffs on selected agricultural exports.

On the agriculture side, Canada's producers and exporters will benefit from the elimination or the reduction of tariffs on key agricultural exports, from durum wheat to canola oil, pet food, blueberries, and a wide range of processed foods.

On the non-agriculture side, the free trade agreement will eliminate all tariffs on Canadian exports to the EFTA countries, on everything from aluminum to cosmetics, clothing, prefabricated buildings, and coldwater shrimp.

Canadian manufacturers will also benefit from lower cost manufacturing inputs for their own products.

Canadian companies operating in EFTA countries will benefit from the new trade ties forged by this agreement, which will allow them to move goods more readily between their operations at home and in the treaty countries. As well, these companies will be better positioned to exploit the benefits of value chain business relations throughout Europe.

Recognizing the importance of the broader European market, the agreement will also provide a strategic platform that Canadian companies can use to tap into value chains all across Europe.

This free trade agreement proves that our Conservative government and the Prime Minister are serious about helping our businesses thrive in the global economy.

We are also serious about listening to the concerns of the provinces, territories and industry as we negotiate these agreements. The EFTA agreement is a perfect example. Negotiators consulted extensively with industry and provincial and territorial stakeholders to ensure that their concerns and interests were fully understood and considered during the negotiations. This kind of open, consultative approach will continue as Canada continues to fight for market access around the world, whether it is at the WTO or with our bilateral and regional trading partners.

Allow me to take two moments to remind members of what happened with Canada-EFTA in the previous Parliament. The Canada-EFTA free trade agreement was the first treaty to be tabled in the House of Commons under our government's new treaties and Parliament policy.

The Standing Committee on International Trade chose to study the agreement and issued a largely positive report. In terms of market access, the committee found that benefits of this agreement to Canada would be largely in the agriculture and agrifood sector. Some industrial sectors would benefit as well. The committee recognized that gains in trade could pave the way for an extended agreement that would include services and investment.

The committee also highlighted the testimony of several witnesses, indicating that the very presence of a free trade agreement could create interest within the business community in exploring economic opportunities in Canada and the EFTA. The committee's report recognized that the Canada-European free trade agreement, in addition to reducing tariffs, could act as a catalyst for increased trade, investment and economic cooperation between Canada and the EFTA countries.

While the report outlined concerns about shipbuilding, it also found that Canada was able to successfully obtain tariff phase-out periods of 10 years and 15 years on the most sensitive shipbuilding products. The 15 year phase-out period is the longest phase-out period ever of any free trade agreement signed in Canada's free trade history. Both the 10 year and 15 year tariff phase-out periods include an initial 3 year bridging period during which current tariff levels would be maintained.

Our government negotiated favourable product-specific rules of origin for ships, as well as special provisions for repairs and alterations.

Finally, the Canada-EFTA free trade agreement does not in any way alter the government's buy Canadian policy for ships. It does not alter in any way our buy Canada policy.

The Canada-EFTA free trade agreement implementing legislation was tabled in May and passed second reading by a vote of 200 to 21. While the bill was reported to the House of Commons Standing Committee on International Trade for further study, it ceased to exist when the 39th Parliament was dissolved. We are now reintroducing the implementing legislation.

These free trade agreement negotiations were initiated in 1998. They were put on hold for almost six years by the previous government. The conclusion of negotiations was finally announced in June 2007.

This is an important piece of legislation. It has a long history in this place. I certainly encourage my colleagues in the other parties to engage in the study of this bill. This is a good bill for Canada and I would say that it is a good bill for our four trading partners in the EFTA group.

There is a larger issue at stake here. This is all part of our government's global commerce strategy. It is all part of reaching out and seeking free trade agreements around the world.

Certainly if we look at the free trade agreements we signed with Peru and Colombia, our re-engagement with the Americas and our work with the CARICOM countries, the Central American four and Panama, and the technology agreement we just signed with Brazil, all of those agreements are important for Canada. There are hundreds of billions of dollars of Canadian foreign direct investment in the Americas, let alone the rest of the world, and we are certainly pursuing closer ties and more free trade agreements within the Americas as well as the rest of the world.

Since coming to office in 2006, we have signed with Peru, Colombia and the EFTA. We have a free trade agreement with Jordan that has been initialled. We are working on the CA4: Guatemala, El Salvador, Nicaragua and Honduras. There are also Panama, Korea, the CARICOM group and Singapore. The EU agreement is in the exploratory stages. We are also in exploratory talks with India.

These types of agreements will carry Canada's manufacturing sector and producers into the future, where we will have guaranteed access to foreign marketplaces. With these agreements, we have put in place a dispute mechanism system that will allow our producers and manufacturers to compete on an even threshold, so to speak, with manufacturers in other countries.

I listened with some interest to the interventions and discussion by the Liberal and Bloc members. One of the concerns about this piece of legislation, of course, is shipbuilding. I think our Canada first policy on procurement should easily lay those concerns and worries to rest. At present we are building 98 new coast guard vessels and refurbishing another 40. We are looking at a world class icebreaker. We are going to refurbish our frigates.

The shipbuilding sector of our economy is resilient. I feel that our shipbuilding sector can compete and that our workers are some of the best in the world. I fail to understand why one party in the House does not have any faith in the shipbuilding sector and is not willing to allow it to compete in the international marketplace. Somehow that party thinks this sector is going to fall by the wayside if we engage in these free trade agreements. Nothing anywhere that I have seen and no report that I have read proves any of that.

Once again, I encourage everyone in the House to have a free and open debate on this free trade agreement. It is a good free trade agreement and a progressive free trade agreement. It would lead Canada in the right direction and would provide jobs and opportunities well into the future.

[Guy André, Bloc, Berthier—Maskinongé, QC]

Mr. Speaker, I listened to my colleague's remarks, and I would like him to answer my question.

As everyone knows, we moved a motion in the Standing Committee on International Trade to provide additional support for shipbuilding and for our marine policy. I would like the member to comment on that. Will the Conservative government heed the recommendations in that motion in this free trade agreement?

In its budget, the government is investing $175 million in acquiring new Coast Guard vessels and refurbishing aging vessels. We know that, under the agreement, the government can give preference to suppliers from Quebec and Canada. I would like to know whether the Conservative government plans to support the marine industry here in Quebec and Canada by doing what Norway has already done. That country is absolutely ready to deal with this agreement and with free trade. When making new investments, will the government give preference to suppliers from Quebec and Canada?

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Mr. Speaker, the agreement of course does address the concerns of the Canadian shipbuilding industry. It addresses industry concerns on tariff phase-out, the 15 year phase-out on the most sensitive shipbuilding products and the 10 year phase-out on the other sensitive shipbuilding products.

Certainly with respect to repairs and alterations, the industry was concerned about the phase-out schedule on ships temporarily exported to EFTA countries for repairs and alterations. We have addressed those concerns.

In the draft agreement, we addressed the industry's concerns on the rules of origin applicable to ships and they are precisely as requested by the shipbuilding industry.

With respect to government procurement, we are supporting the industry by making sure that government procurement is Canadian first, just as we have defended Canadian procurement in other free trade agreements.

The federal and provincial governments will continue to have the right to restrict their bids to Canadian shipyards for the purchase, lease, repair or refit of vessels such as ferries and frigates.

This also recognizes the importance of Canada's domestic government procurement market for the shipbuilding industry.

What is probably more important, we renewed the structured financing facility in 2007 by providing $50 million over three years to reduce the cost of purchasing vessels built in Canada.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, the member stated that the Conservatives have done what the shipbuilding industry needed and that they have answered its concerns. Could he provide any letters from the shipbuilding industry saying that? So far, all the letters that have been read in the House from the shipbuilding industry have indicated that it would not be satisfied with such an agreement.

Second, because the member listed a number of negotiated free trade agreements, I want to emphasize what our critic said. We are not convinced that the government is dealing sufficiently with human rights in some of the free trade agreements, but not the one in question. We think the Conservatives should revisit that with particular countries.

My question is related to concern brought up during the debate about the lengthy subsidy of the shipbuilding industry in Norway. What would Canada do to help out our shipbuilding industry to respond to that if we sign such an agreement?

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Mr. Speaker, it was certainly an interesting comment on human rights. With every free trade agreement that we negotiate on Canada's behalf, we automatically look at human rights and labour practices. That is a given. There are no free trade agreements negotiated where we do not take into consideration human rights, labour practices and labour rights. That is guaranteed.

Again, we did consult widely with the shipbuilding industry. I am sure there are sectors which will never agree to the final document, but as parliamentarians, we have to judge the entire document. This document is put together to work toward tariff phase-out between the EFTA nations and Canada. Iceland, Liechtenstein, Switzerland, Norway and Canada will all benefit from increased trade and increased reduction of tariffs.

There is a real concern throughout the world that the old policy of protectionism will rear its ugly head especially in this economic downturn. It is easy to find someone to blame. It is easy to say that we are not doing enough. If we allow protectionism to take over the world as it did prior to the Great Depression in the 1930s, then everyone will lose. We would not have to worry about protecting jobs because there would be no jobs to protect.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Mr. Speaker, the hon. member from Nova Scotia indicated he could not understand why we in the NDP do not understand some of the aspects of what he is discussing. I would ask him to read Andrew McArthur's presentation to the international trade committee on April 2, 2008 and he will understand exactly why we are very concerned about what is happening.

When we negotiate trade deals we have to give up something to get something back. We believe what has happened is that we have given an awful lot of access to the shipbuilding industry in exchange for pharmaceuticals and other products. The reality is that since 1924, the United States of America has entered into free trade agreements around the world and in every single circumstance it carves out the shipbuilding and marine sector. The United States is our largest trade partner. Roughly 75% to 80% of our trade is directly with the United States. If the United States can go around the world and sign trade deals and carve out that very strategic industry of shipbuilding and marine services, then why cannot Canada?

Why is it that after Norway heavily subsidized its industry for well over 30 years, now even with the declining tariff scale, the reality is it is going to put tremendous pressure on our shipbuilders? If the hon. member thinks we do not have faith in our shipbuilders, we do. He is right that we need to have trade deals around the world that open up exports, that allow us to exchange ideas. Trade deals by nature should be of benefit to both parties.

There are some good aspects to EFTA which we agree with. The problem is that a very vital industry like shipbuilding should not be ignored. I understand that in the recent budget $175 million was allocated for various smaller vessels and some repairs, but the reality is that the member and his government know that we require an investment just for domestic procurement and repair only. This is not about private sector oil and gas opportunities and so on. This is just the domestic side where we need an investment of over $22 billion over a 20 year period.

Why did we not ask for a carve out as our American friends have done?

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Mr. Speaker, there is a carve out for procurement for the federal government and certainly for the provinces. There is a three year period where the tariffs as they exist today will remain the same. There is a total 15 year phase-out for the most sensitive shipbuilding sectors, and a 10 year carve out for other shipbuilding sectors.

I do not know what to say. I was at the committee when Mr. McArthur was there, and I do not believe I saw the hon. member there. I would suggest that he should read the witness's report.

I realize shipbuilding has some sensitivities largely because it is an industry that has great potential but has not had a lot of support in the last decade.

I continue to believe that given the right financing opportunities and given the opportunities to access foreign markets, our workers can compete equally with workers anywhere in the world.