Bill C-46 (Historical)

Canada-Panama Free Trade Act

An Act to implement the Free Trade Agreement between Canada and the Republic of Panama, the Agreement on the Environment between Canada and the Republic of Panama and the Agreement on Labour Cooperation between Canada and the Republic of Panama

This enactment implements the Free Trade Agreement and the related agreements on the environment and labour cooperation entered into between Canada and the Republic of Panama and done at Ottawa on May 13 and 14, 2010.
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 related agreements themselves, without the consent of the Attorney General of Canada.
Part 1 of the enactment approves the Free Trade Agreement and the related agreements and provides for the payment by Canada of its share of the expenditures associated with the operation of the institutional aspects of the agreements 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 related agreement on labour cooperation.
Part 3 of the enactment contains coordinating amendments and the coming into force provision.

Canada-Panama Free Trade Act

[Malcolm Allen, NDP, Welland, ON]

Mr. Speaker, my colleague who sits on the agriculture committee as the NDP agriculture critic does a wonderful job on behalf of farmers across this country.

Farm trade policies are probably one of the most difficult pieces of trade policy we can enter into because it is food. There is intrinsic value to that, obviously, because it is something we all need. Some of us may not need a car, but we certainly need to eat. So the policy becomes extremely difficult. What happens is that we do not have the ability to work back and forth. It is not just us in this country who make impediments; we see them across the world. When we develop those types of policies, there always seem to be winners and losers.

Ultimately, for some small countries, in the fact that we are larger than them, especially small countries such as Panama, et cetera, there is the potential for them to be a loser, just as we have been a loser in some of the free trade deals that have come at us from the bigger countries.

[Jason Kenney, Conservative, Minister of Citizenship]

Mr. Speaker, what we see here is yet again the unmasking of the NDP's real agenda on the economy and trade. We sat here for dozens of hours listening to the NDP invent bogus facts about the supposed systematic human rights violations in Colombia.

I went down for the inauguration of the new president of Colombia last month in Bogota. The NDP has continually talked about assassinations of union leaders. I learned from the United Nations human rights representative in Colombia that most of the labour union assassinations were people such as local teacher union leaders assassinated by the FARC, the communist far-left guerrillas.

What this demonstrates is that the NDP was not really concerned about human rights in Colombia, because it is not raising human rights in one of the more relatively stable democracies of Central America, Panama. It is opposed to trade. The real question is this: why is it that the NDP refuses to raise the living standards of people in these developing countries who know that the best way forward to higher living standards is access to external markets?

Why is it that the NDP criticizes our dependence on the United States' export market but opposes every single effort to expand and diversify our export markets through additional trade agreements? Why?

[Malcolm Allen, NDP, Welland, ON]

Mr. Speaker, I thank the minister for his question. I did hear it and I appreciate his comments.

I said at the beginning that we were not opposed to free trade, if he wanted to talk about trade policy. We said, basically, that we do not believe in the model the government presents to us, which is a free trade model. There are other models of trade out there that we would be happy to sit down, investigate and discuss.

Clearly we understand we are a trading nation. We understand that we need to continue to trade. We are saying there are other ways to do it besides the free trade model, and we would like to explore them on this side of the House.

The government, in its wisdom, if we can call it that, has decided with its friends in the Liberal Party that the only model it wants to look at, the only model it would use for a template, is the free trade model constructed in 1988 by Brian Mulroney. That is the decision the government has made.

We are asking government members to bring forth some others that we have suggested and let us explore them. Why not do that? It seems to me that if this is a House that wants to make Parliament work and wants to cooperate, let them bring those forward and let us sit down as part of the trade committee and actually have a discussion about trade models. Why is it always assumed that the one model fits all situations and somehow it is good for all of us, all of the time? No one lives their life that way. There is not one of us in the House who does the same thing every day, all the time, always. We do not do that, but we seem to be struck in this rut when it comes to free trade.

I suggest that the government bring forward another model that we have suggested we might want to look at, and perhaps it will find an agreement from this side.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, it gives me a great deal of pleasure to speak to Bill C-46, the Canada-Panama bilateral free trade agreement.

We all know that in August 2009, the present government concluded negotiations with the Republic of Panama for a comprehensive free trade agreement designed to augment a previous agreement, the foreign investment promotion and protection agreement, called FIPA, that was signed between the previous Chrétien Liberal government and the Panamanian government in 1998.

The agreement before the House for debate includes service trade liberalization, principles and government procurement provisions, as well as one of the government's favourite processes, which is to sign side agreements on labour co-operation and the environment. I will say that we New Democrats are proud to say that those two things ought to be in the main text of any agreement, not in a side part of any agreement.

On September 23 of this year, the minister tabled the implementing legislation, Bill C-46. It behooves us to review the four main components of this, which include: free market access in goods and services, and that includes government procurement; investment protection provisions; labour agreement sections; and then an agreement on the environment.

I hasten to point out that we in the New Democratic Party are all eager to support trade agreements that benefit a majority of Canadian workers, farmers, small businesses and consumers. We all want trade agreements that work to achieve the larger societal goals of economic justice, poverty alleviation, healthier communities, pollution reduction, human rights and a healthy environment.

Unfortunately, my review of this documentation and the facts that surround it lead me to conclude that the Panama free trade agreement does not meet these goals.

I will review a couple of general thoughts before I go into some of the details.

First, it is important to point out that this deal is not about trade. I hear many members on the other side of the House comment that if one opposes this deal, one must therefore be opposed to trade. That is simply a red herring and it is a strawman argument. That is not the case at all and anybody who has any intellectual honesty will recognize that at once.

Canada trades with many countries of the world. We trade all the time. We trade with Panama and have been for a long time. The statistics that we have covered many times in this House show that we have an annual trade allotment of about $140 million a year with Panama. That is a small amount, of course, but it shows that trade is going on between the two countries.

Trade goes on between Canada and many countries.

The issue before this House is one of to whom we should advance the preferential concept of free trade. Let us pause and just reflect for a moment about what free trade really means. Free trade means the mutual elimination of tariffs on goods and services between the two countries. It allows goods and services to flow across the border into each other's country with no duties whatsoever attached to them.

In my view and in the view of the New Democratic Party, we have to take a very considered and judicious approach when we consider to whom we should advance such a powerful and preferential concept as free trade. We should decide very carefully with whom we will have this relationship because, of course, these agreements do not operate in a vacuum. They do not operate in theory. They have tangible, practical effects that would actually affect the lives of Canadian businesses and consumers.

I want to talk a bit about why I personally oppose this agreement.

First, there is the concept of understanding Panama's current labour situation. This past July there were reports of a new wave of anti-union repression in Panama. This resulted in several workers killed, over 100 injured and over 300 trade unionists arrested, including leaders of the SUNTRACS and CONATO trade unions.

This followed the government of Panama's reaction to protests against new legislation that restricted the right to strike and freedom of association, and that sought to enact provisions that would lead to jail for up to two years for any workers who took their protests to the streets. I am going to pause here. That is a country which, this past summer, enacted legislation that said it would jail its own citizens if they protested a governmental action peacefully in its streets.

I have heard some talk about how Panama is an emerging democracy. I have not heard any member of the opposite side explain how a government that is pursuing legislation that jails its citizens for expressing their views in their communities is a country with which we should hasten to do business.

The fact that that happened while this negotiation was going on, I would argue, does not bode well toward thinking that any labour protection that is in this agreement would provide any real protection of labour rights in Panama, as it lacks any effective mechanism for enforcement and the Panamanian government, quite clearly, intends to ignore it. Despite what it may have said or paid lip service to, its actions this past summer certainly cause one to think that its actions may not be consistent with its words.

According to the OECD, Panama is an offshore banking centre and is considered one of the most notorious tax havens in the world. Nothing in this agreement deals with the tax haven or the lack of transparency issue. A NAFTA-style free trade agreement would broaden the effects of FIPA and increase the corporate incentive for tax evasion. It would also provide multinationals with additional tools and incentives to challenge Canadian regulations.

I am going to talk for a minute about why that might be important to us on a societal level as opposed to on a financial level.

I am the New Democrat critic for public safety. I am engaged in many discussions with all members of this House, but particularly with my hon. colleagues on the government's side, about the need to have safe communities. I have done a bit of research on this issue. I would like to share that with my colleagues in the House and I hope they will pay attention to what I am about to say.

I did some research through the Library of Parliament and found out that a study was done and it was published this year by Cornell University, not by a trade union group or a left-wing think tank. This is an academic study that was published by Cornell University. It quotes research which says that some 75% of all sophisticated drug trafficking operations use offshore secrecy havens. The studies also show that drug money, and not the Euro market, was the principal cause for the phenomenal growth of the Caribbean havens in the 1970s and 1980s.

The study says that it is evident to all who have studied the offshore banking business that the growth has been fueled by the phenomenal increase in cash from the U.S. drug trade. Of the criminal cases identified by IRS investigations, that is the Internal Revenue Service in the United States, from 1978 to 1983 that occurred in the Caribbean, where, I would point out, Panama is located, 45% involved illegal transactions derived from legal income, that is tax evasion and otherwise legitimate trade. In the other 55%, illegal income was involved and 161 cases dealt with drug traffic. Of those, 29% involved the Cayman Islands and 28% involved Panama.

The government, stands in this House every day and lectures everybody sanctimoniously about caring for communities and cracking down on drug trafficking, just proposed in this House a free trade agreement with a country that is the number two launderer of drug money in the Caribbean. I have not heard any member say anything about that. The government wants free trade with drug traffickers. Of course, anybody who reads the paper would have known that, because Manuel Noriega, the ex-president of that country, is still serving time in jail after being convicted of massive narco-crimes.

That is the country with which the government wants to hasten to sign a free trade agreement and says that we are just opposed to trade. No, we are not. I am opposed to trade with drug havens and tax evaders, where drug money from drugs sold on the streets of the United States and Canada ends up in Panama, gets laundered and sent back here, and the government wants to make it easier.

I read something else that I want to share with my hon. colleagues. I read what this agreement does. Under the investment transfer provisions of this free trade agreement, it specifically says that nothing should impede the transfer of funds, either into or out of each country, from investments covered by this agreement.

Therefore, money between Panama and Canada under this agreement would actually flow without any controls whatsoever. Has anybody considered that if we sign this agreement, we will be making it easier for drug money to flow between these two countries? Are there any facts I have stated that any member in the House would dispute? Do they dispute that Panama is a known tax haven? No. Do they dispute that drug and narco-traffic occurs in Panama and it is one of the major sources for that in the Caribbean? No, I do not hear that. Do they dispute Cornell University academic research? I would be interested to hear their arguments about that.

I also want to talk a little bit about agriculture because I heard some members opposite talk about how this agreement would be good for farmers. When I read this agreement, it states that Canada would not eliminate over-quota tariffs on supply managed goods such as dairy, poultry and eggs. Additionally, Canada would not eliminate its tariffs on certain sugar products. Therefore, when it comes to dairy, poultry and eggs, this agreement does not even deal with that issue.

Nothing in this agreement will affect tariffs between the two countries on those issues at all. It is a complete red herring to mention that this agreement has anything to do with increasing or improving the lives of farmers because the agreement does not cover it. It retains the tariffs. If members want to sign an agreement that removes tariffs, they can do that, but this one does not.

[An hon. member]

Not on supply management.

[Don Davies, NDP, Vancouver Kingsway, BC]

Not on dairy, poultry and eggs. Dairy, poultry and eggs, I might point out, are three of the major sources of income of many of the farmers across this country.

I also want to talk a little bit about free trade, the concept in general, and this is about the relative labour market. When we allow products to come from one economy into another, it behooves us as parliamentarians to ensure that our businesses and workers are competing on something like a level playing field.

The average wage in Panama is $2 an hour. If people are making goods and setting up businesses in Panama and they want to export products, the archetypical widget, into different countries, where would they set up that business? Would they set it up in Winnipeg, in Saskatoon, in Vancouver, in Toronto or in Kitchener where they might pay $15, $16 or $20 an hour, wages that Canadians need to raise a family, or will they set up that business in Panama where they pay $2 an hour?

I was in the private sector for 16 years working for a union and we dealt with hundreds and hundreds of private sector employers. I listened at bargaining tables many times as those business people explained their businesses. I will tell the House exactly where they will set up their business. They will set up their business in Panama. Something else those businesses would say to me, because they have said it to me many times, is that they cannot compete with businesses that are setting up and paying their workers $2 an hour.

I want to hear someone from the government explain how Canadian businesses, which are expected to pay living wages, workers compensation premiums, employment insurance premiums, private pension contributions and training costs, leaving their wage costs to be probably up around the $20, $30 or $40 an hour mark, sometimes more, will compete with Panamanian businesses if we allow products from Panama to come into our country tariff-free?

That is why New Democrats oppose this deal. It is not because we are opposed to trade. By all means, let us continue trading with Panama, but let us not give up the important social policy tool, the economic lever of putting tariffs at the border on certain goods that are coming in so that we can ensure that our Canadians businesses and our Canadian workers are competing on a level playing field, because that is all they want.

Canadian businesses and workers are some of the best in the world. We do not need preference. We do not need hand-outs. All they ask for and all we ask for is a level playing field or something similar to that.

My colleague in the Liberal Party said that if that were the case, we would never sign a trade deal with anybody because nobody pays those kinds of wages. Actually, many countries in the world do. All of the EU countries do. We should be looking to the many countries in South America that are bringing their standards up. We could also be looking at a phased in reduction of tariffs. As those countries start bringing up their labour standards, their wages and their environmental protection, we can start phasing down our tariffs.

There are many other mechanisms and policy levers that I refer to as “managed trade”. Some of my colleagues have called it “fair trade”. I believe those concepts are prudent, conservative, moderate and they give our economy time to absorb goods and services that come from very different economies. It also acts as an incentive to those other countries to raise those standards.

I want to talk briefly about what this agreement says about the environment. It says that both Canada and Panama would be required by this agreement to not weaken their environmental regulations. I have done a bit of research and the environmental legislation and regulations in Panama are, and I will charitably say, not world-setting. Its environmental standards are weak and all this agreement does is obligate it not to weaken them further. Does it require that country to improve its environmental regulation? No, but it could.

Under a New Democrat proposal, sitting at a trade table, that is exactly what we would do. We would sit down and say that we would talk about giving the country preferential access to our market on a number of conditions, and one of the conditions would be that it work with Canada and we would both commit to improve our environmental standards.

What kind of agreement asserts progress when it just says that we are not going to get any worse? That is not progress. That is the status quo. That is stagnancy.

One of the excuses the Canadian environment minister and the government uses for not implementing the Kyoto accord, or any of these numbers, is that they cannot do it unilaterally if the rest of the world does not do it. The government will not do it if China and India do not do it.

Why then does the government sign a trade agreement with a country that does not obligate that country to raise its environmental standards? One would think that would be the logical trade policy the government would take if in fact its rhetoric about not improving our environmental standards were true.

Coming from a prime minister who said that Kyoto was a socialist plot, I am not sure I believe the government has any real commitment to climate change amelioration, or any real attempt to improve the environment of this world.

I want to conclude by talking a little about Canadian businesses and what trade policy should consist of.

I come from Vancouver where we have a vibrant, healthy business sector with many small businesses that are actively engaged in trading goods and services around the world, primarily in Asia. I talk to these businesses on a weekly basis. They explain to me what their challenges, ideas and dreams are. What they want is managed trade. I do not have any business person coming to my office saying that he or she wants a complete tariff-free agreement with a country.

Tariffs have been around in this world for a long time. The reason they have is because they serve a purpose. Tariffs allow us to use policy levers to encourage good behaviour and punish bad behaviour. To sign an agreement in an organic world, a dynamic world, one would want to maintain those levers.

I encourage the government to utilize those levers for the kinds of issues and policies with which I think all Canadians agree. We want to improve the standard of living for Canadian workers and their families. We want to improve the business opportunities for Canadians, particularly the small and medium business sector so they can compete on the world stage. However, I want them to compete on a fair basis, not on one that is based on untrammelled access to our markets where we have to rely on the good graces of a country that has a poor record on just about every measure we can think of, and that is Panama.

I encourage all members of the House to think seriously about this agreement and to vote in a manner that encourages our workers and businesses to prosper on the world stage.

Notice of Time Allocation Motion

[John Baird, Conservative, Leader of the Government in the House of Commons]

Mr. Speaker, an agreement could not be reached under the provisions of Standing Order 78(1) or 78(2) with respect to the second reading stage of Bill C-46, An Act to implement the Free Trade Agreement between Canada and the Republic of Panama, the Agreement on the Environment between Canada and the Republic of Panama and the Agreement on Labour Cooperation between Canada and the Republic of Panama.

Under provisions of Standing Order 78(3), I give notice that a minister of the Crown will propose at the next sitting a motion to allot a specific number of days or hours for consideration and disposal of proceedings at the said stage.

Second Reading

[Steven Fletcher, Conservative, Minister of State (Democratic Reform)]

Mr. Speaker, I will address some of the disappointing comments that the member from the NDP has raised not only about free trade with Panama, but also free trade in general. The NDP seems to always approach these issues as a zero sum game, that somehow by helping other countries it is to the detriment of Canadians. In fact, when countries work together, it benefits everyone. It is a non-zero sum, when the rising tide raises all boats.

The best economic choices that Canada can make is through free trade. This was demonstrated spectacularly with the free trade agreement with the United States, which the NDP opposes still to this day, in spite of everyone recognizing that it was good. The NDP also fails to recognize that not only do Canadians benefit by trading with countries like Panama, but the Panamanians benefit. The best social policy, the best foreign aid is to invest in countries like Panama to help those people improve their quality of life. The best environmental program, the best foundation for democracy is economic development. This is simply what the free trade agreements do around the world.

Will the NDP members recognize this is an ideological issue for them, that they do not support free trade with the United States, Panama or anyone else and it is harmful to the entire world? We would end up all poor if we follow the NDP philosophy.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I would like to express my great disappointment that a minister who is responsible for democratic reform would not be concerned about or address his comments to the fact that this summer the Panamanian government proposed legislation that would jail citizens for protesting policies in the streets. That does not sound very democratic to me and it certainly is not consistent with what I think is the minister's mandate, which is to try to pay attention to improving the democratic conditions in our country and around the world. That is the point.

The minister talks about ideology. I have not heard a more ideological commentary than I just heard from him. The Conservative government has been pursuing what can only be described as an ideological approach to trade. It is not really interested in improving the lives of people in different countries. What it is interested in doing is signing free trade agreements with countries whose ideologies it supports.

I will quote the Prime Minister. This is from the prepared text of his speech when he was in Panama. He said, “You talked about the need, especially during these difficult times, to open doors to neighbours and allies”. The Prime Minister is the one who is seeking out trade agreement with allies. What does that have to do with establishing human rights? What does have to do with establishing trade agreements with countries if the real goal is to raise the living standards of people in those countries?

This is really about, and Canadians are not fooled, the Conservatives are picking countries to sign trade agreements with to bolster their ideological relations. That is why they picked Panama with a right-wing government. It is why they picked Colombia with a right-wing government. I do not see the government proposing a free trade agreement with Venezuela or Bolivia. Maybe it should look at that.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, the very first lesson we learn in economics is normative and positive and that the rule of economics is not to describe what should be, but only to describe what is. Yet whenever we stand in the House and describe what is, the Conservatives say that the New Democrats are spoilsports because we talk about the murders of union leaders, environmental devastation and the fact that Panama is one of the dodgiest drug havens on the planet. They tell us to believe in free trade and everything will be all right.

It is the Conservatives' blind faith, as G.K. Chesterton said, in the horrible mysticism of money. As long as money can travel around the planet, as long as capital gets what it wants, we are all supposed to believe that things will be better. However, we have said consistently, time and time again, that for a trade deal to work, we have to look at the effects of that trade deal and we have to look at whether it actually works on the ground. Economies should be about that. We should be looking at what really is, not what Conservatives think should be in their neo-con Milton Friedman flat earth society in which they live.

Having seen this group week after week, month after month, year after year with its failed ideology, how can it have the nerve to lecture anyone else about the economy? Could he comment on that?

[Don Davies, NDP, Vancouver Kingsway, BC]

That was very astutely put, Mr. Speaker. Let us talk about accountability because this is a word that the government tends to use a lot, but I am not sure it knows the meaning of it.

The neo-liberal policies of the government, which were put in place by the Liberals in the early 1980s, has really been in place in North American for the last 25 years, for a generation. Therefore, let us take stock. Let us hold them accountable for those policies.

What has happened in 25 years. The gap in wealth distribution in Canada is wider, and that is a fact. The government does not like to talk about facts. It is more about ideology and argument, but check the facts. If any member on that side can tell me that I am wrong, show me the numbers. Statistics Canada and every reputable economic group will tell us that more people are poorer today than they were 25 years ago and the rich are richer.

Also, there is no question that the average industrial wage in 2008 was lower in per capita terms and lower in real terms than it was in 1980.

I worked for a trade union until 2008. I know what people made in 1992 and I know what they made in 2008. In some cases they made less money. In most cases, even with their minor increases in real terms, Canadian workers are worse off today. To boot, and this is the third factor, most Canadians in 2008 worked more.

We work longer, for less pay and the distribution of wealth in the country is worse. That is the record of 25 years of neo-liberal economics.What I have heard today from the government was said 25 years ago. It did not work then and it does not work now. Let us hold the government accountable.

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

Mr. Speaker, I have listened to the NDP talk about free trade, and I appreciate the intervention by my hon. colleague. This the reality, and it is quite simple. That party has never supported a trade agreement. Free trade, fair trade, it all means no trade to the NDP members. They are not interested in jobs and opportunities for Canadians. They are not interested in raising the standard of living for their fellow Canadians. They are interested in keeping everyone in poverty and in the dark. That way those members get a host of people who actually believe that misinformed and ill-informed rhetoric. The only thing worse than the misinformation and the rhetoric is the condescension and the patronizing tone that delivers it.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, the lowest form of argument is an ad hominem attack, where all the member does is use rhetoric and attack the other member and characterize the argument, instead of using facts and figures to show where the debate does not make sense.

I did not hear one fact in the hon. member's comments to dispute a single thing I said.

I would like Canadians to hear that intervention and hear the intervention of my speech and determine which party really sounds like it is trying to take a back faced logical approach to this trade agreement. I hope the members take a more thorough, sober and realistic view of the facts than he just did.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I thank my colleagues, who have held a very important debate in the House of Commons and have spoken very eloquently on many of the trade issues we have with these very difficult countries the Conservative Party has chosen, in its wisdom, to work with.

Once again we have another free trade agreement on the discredited NAFTA model of trade and investment that enshrines investors' rights over democratic processes. The country, of course, is Panama, a real model of progressive and enlightened government.

In a February 2009 letter to U.S. President Obama, 55 members of the House of Representatives warned of the danger of getting into a free trade agreement with Panama. The representatives said:

We also believe that Panama is not an appropriate U.S. FTA partner. A Government Accountability Office study identified Panama as one of only eight countries—and the only current or prospective FTA partner— that was listed on all of the major tax-haven watchdog lists. Panama has long been the key target of both the Organisation for Economic Co-operation and Development and other tax transparency entities for its resistance to international norms in combating tax evasion and money laundering. Indeed, Panama is one of few countries that has refused to sign any tax information exchange treaties.

The representatives go on to say that they support designating Panama an offshore secrecy jurisdiction under U.S. law, which would place restrictions on the use of this country by American corporations as a way of avoiding taxes. The representatives end their comments by pointing out that Panama is one of the top locations in the world used by multinational corporations to avoid taxes.

This agreement would make it easier for a Canadian company to avoid taxes by simply setting up a shell company in Panama. I am sure that the Prime Minister's business friends give two thumbs up to this type of arrangement so that they can quickly move into these types of tax havens. Let us allow the rich to avoid paying their fair share of the taxes in this country. Why not?

What else is Panama well known for? It is the second most important country for flags of convenience. Panama does not pay attention to the importance of maintaining secure and proper ships around the world. Instead, it allows companies to register their ships, which may or may not be rust-bucket, single-hulled oil tankers that are a danger. Panama has a habit of doing things that are not in the interests of the civilized world but are in the interests of the corrupt side of the corporate world.

What is the government thinking by getting into bed with this type of government at this point in time? We should be reaching out for fair trade agreements with South American countries that want to build better lives for their people. We should be supporting that kind of effort.

Most South American countries would not get along with the kind of agreement being proposed here. Most countries in South America want control of their own resources. They want to build their own states. They are a little tired and turned off by 30 years of imperialism on the economic front throughout South America, which quite clearly has led, in many countries, to democratically elected governments that are now saying that they want their right to control their resources and economies. They want to make the right moves so that their people can move ahead. That is the nature of the South American movement.

It is quite clear, when we talk about getting into arrangements with larger countries in South America, that they are not interested in these types of free trade arrangements. They want to protect their people and build their countries, as we should be doing.

Today in the Calgary Herald, Premier Brad Wall talks about the Potash Corporation takeover. He is starting to realize what we told him months ago, which is that this deal is not what it is made out to be, that when we give up control of a resource to a huge multinational corporation, it has the ability to transfer taxes out of this country. Mr. Wall said:

We don't have the final estimates yet, but there's a real risk in terms of a substantial, potential decrease in corporate income taxes. We will balance the desire that we have for a positive investment climate with also the need to think long term.

What good words from the premier of Saskatchewan. How does that fit together with what is going on in this investment deal with a major tax haven in the world?

Perhaps we are on the right track looking for a hoist motion on this particular free trade agreement. Perhaps the world is changing. Perhaps there is a consciousness developing among other parts of our political society. Perhaps people are beginning to realize that the free trade arrangements they have counted on as a panacea for our development are not as good as what they thought they were going to be.

When we postponed moving this free trade agreement forward, just as we worked so hard to forestall the free trade agreement with Colombia, we are trying our best for Canada. We are trying our best to move past the type of thinking that characterized the eighties and nineties and to move toward the type of thinking that most resource rich countries are now taking toward their resources.

Canada is the only energy-exporting country in the world without a national presence in its own energy field, in its own oil and gas industry. This is just another example of where we are as a country in terms of where the rest of the world thinks it has to go. Bright, intelligent people around the world know, in this day and age of declining resources, the importance of holding onto those resources. That does not speak well for free trade agreements that have been the dominant ideology for so long in this country.

In 1991, Argentina, Paraguay, Brazil, and Uruguay negotiated a regional trade agreement. They wanted a common market in South America. They wanted to work together in that region. Why are we not supporting that effort? Why are we not reaching out to those countries under the conditions they want to put forward and that they see as important? These are bigger markets.

The Mercosur pact represents 270 million people. It is a massive market, but we have to go to that market on its terms. Those countries have made that part of their development. Cleverly and carefully, those countries have created their own ideas about trade. If we want to participate with them, we have to do so through their own ideology.

The NDP works hard in the House to stand up for Canada, to stand up for things that we see as important for our economy. I respect what the Conservatives have tried to say. I wish they would respect our point of view as well and recognize that the world is changing and that we must adapt to that change.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Speaker, I am always interested in listening to my NDP colleagues talk about trade, but I am never quite sure what they are arguing about the economics of it.

Is my colleague arguing that the Panama trade deal will be bad for Canada's economy, or is he arguing that the trade deal will be bad for Panama's economy?

If he is arguing that the agreement would be bad for the economy of Canada but Panama would gain from it, then it would be good for Panama's development as a third world country. If he is arguing that Canada would gain from it, why does he think I should vote against the economic interests of my constituents, since agriculture will be the predominant beneficiary of the reduced Panamanian tariffs, thereby permitting better access and more competitiveness for Canadian agricultural products?