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

[The Acting Speaker, Conservative, Barry Devolin]

Order, please. The hon. member for Abbotsford has the floor for questions or comments.

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, I am very disappointed with the member and the Bloc for not supporting this free trade agreement. Canada is one of the great free trading nations of the world. We heard earlier today that in order to grow our economy to ensure our future prosperity it was critical that we continue to find new trading relationships.

The member has highlighted certain concerns about this agreement as well as some of the issues taking place in Panama. Why would he not at least allow the bill to go to committee so there can be a thorough review of it to ensure there are the protections that he would like to see in the bill?

My guess is it is simply a matter of ideology. He does not share the ideology of the present government of Panama. Is that not correct?

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

Mr. Speaker, once again I would like to say that we live in a democracy where I can express my feelings and also say that I do not necessarily agree with the ideology of the Conservatives who sit across from me in this House.

As I mentioned in my speech, the issue is always to improve competitiveness through free trade agreements and to accumulate more wealth, but we have seen that these types of agreements do not make our population richer. Since we have started signing free trade agreements, the poor are getting poorer and the rich are getting richer. The statistics prove this. Let us not kid ourselves.

I would like the Conservative member to answer this question in his speech: How can we say that doing business with a country that generates five times more imports than exports will help our workers and improve our living conditions, and all of this in a country that allows tax shelters?

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

Mr. Speaker, I am saddened to rise in the House on Bill C-46, which could be more aptly called the drug pushers, money laundering act. It is absolutely shameful what the government has brought forward.

Panama is ranked as one of the top drug pushing, money laundering, tax havens in the entire planet. The Panamanian government has done nothing to resolve that. There is absolutely nothing in Bill C-46 to deal with the drug pushing and money laundering that the Conservatives are promoting. It also would do absolutely nothing to address the tax haven status.

People who watched CBC or heard Radio-Canada last night would have seen the impact of tax havens and money laundering and how that impacted on our social programs in Canada. It impacts how we as Canadians can deal with some of the fundamental issues.

This widespread money laundering and the use of tax havens so drug pushers and folks who earn money illegally can get around existing tax laws are not small issues.

Hard-working middle-class Canadians, poor Canadians, work very hard and they pay their taxes. They do what they must do as Canadians to support our society. Yet the Conservative government is going to shamefully sign an agreement with a drug pushing, money laundering tax haven paradise without even addressing one word of it in this agreement. It is absolutely shameful. It is a symbol of what is dysfunctional about the Conservative government on trade policy. The NDP is the only national party to stand up in the House against this completely dysfunctional trade policy of the Conservatives.

We have seen the kind of bills the Conservative have brought forward. They brought forward the softwood lumber sellout. As a result, two thousand jobs were lost in my riding. Tens of thousands of jobs right across the country were lost as the Conservatives deliberately shut down the softwood lumber industry. It was appalling and incompetent. People from the industry, except the CEOs who wanted to take their operations across to the United States, told the government very clearly that it would be disastrous. The NDP was the only national party to rise in the House and say that it would be disastrous. The Conservatives rammed it through, with the support of their Liberal cohorts, and we saw the results.

We saw the results with the shipbuilding sellout. Shipbuilding workers from British Columbia, Nova Scotia, Newfoundland and Labrador and Quebec all said that this would have a negative impact on the shipbuilding industry. As a result, hundreds of jobs have been lost in the shipbuilding industry.

In the springtime, after what was an appallingly ridiculous debate, the Conservatives and the Liberals pushed through the Colombia free trade deal, essentially putting an X on Canada's reputation of standing up for human rights.

This present deal would provide a stamp of approval on the drug pushing, money laundering, tax haven paradise. This deal says that it would be okay to do this kind of activity, that it would be okay to have whomever, Hell's Angels, drug pushers, getting around Canadian income tax laws by having their money in Panama. Panama has strict rules about ensuring that Canadian authorities cannot find out a wit about the illegal money laundering taking place. The Conservatives say that is okay.

Each member of the Conservative Party, each member of Parliament who has made a great speech about cracking down on crime, is now going to stand and give his or her stamp of approval to a government that has not cracked down on fighting money laundering and drug pushing, one of the worst in the world.

[Ed Fast, Conservative, Abbotsford, BC]

You should be embarrassed.

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

Mr. Speaker, I hear the Conservatives reacting, as they normally do. None of them have read the agreement. There is not a single word in the entire text that deals with money laundering or the tax haven status. It is appalling. This is a symbol of a completely dysfunctional trade policy pushed by the Conservatives and supported, as we have seen every time, by the Liberal Party of Canada.

The Conservatives will say that by doing this they are actually contributing to the growth of our export industries.

The NDP has pushed for fair trade rules. We are the only national party speaking out against the hemorrhaging in our manufacturing sector, the loss of half a million good-paying manufacturing jobs. We are the only national party speaking out against the chronic under-financing of our major exporting industries.

I am pleased to say that this week some of the export associations have finally heeded our call. They are actually going to go to the government, with the support of the NDP, to get substantial increases in product promotion support.

Why? Because Canada, quite frankly, just plays lip service to exports. We have a trade minister who loves to cut ribbons and sign fancy agreements that do not deal with the fundamental issues.

Let us compare what Canada invests to support our export industries abroad with what other countries spend. We spend $12 million to $13 million in product promotion. Australia spends half a billion dollars. The European community spends $125 million for their wine export sector alone. That is 10 times what we spend for all industries right across the board. For the United States market, our most important trading partner, we spend $3 million or $4 million, which is the equivalent of promotion support for marketing a medium-sized enterprise in the lower mainland of British Columbia. We do that as a nation for the entire U.S. market.

The Conservatives, on the one hand, love these camera opportunities and these signatures but have done absolutely nothing to stimulate export growth.

What has been the result? If the Conservatives say that, although their actions might encourage some money laundering and drug pushing and use of tax havens, they are really doing this for exports, then they are going to have to explain that in this House. They have been mute so far in this debate. They have not spoken to these issues at all. In fact, it appears that they do not want to stand up and defend this deal. This should indicate to the public, those who are looking for work but have taken a brief break and are tuning in to CPAC today, that if the Conservatives are not willing to speak to the issue it is because they know that they do not have a leg to stand on, that they simply do not have any basis for supporting this dysfunctional deal.

If we look at the export figures, what do we see? If we move from the realm of inflation-devalued current dollars to constant dollars, which actually reflects a constant value over time, what we see is that after we sign these bilateral trade deals our exports actually go down. Let me cite a few examples.

With Israel, before we implemented a free trade agreement, we had exports of $270 million a year. In 2003, seven years later, we had gone from $270 million to $239 million in exports. What is wrong with this picture?

It was the Liberal government at the time that starved our export industries. But at the same time they had the big song and dance about how this was going to be terrific for our export industries. What happened? There was a decrease from $270 million to $239 million.

Let us look at another example.

I can see the Conservatives waking up now. They are saying, “Gee, nobody told us that. Gee, we should have done our homework., Gee, we should have actually looked at the export figures Maybe we'd know what we were talking about if we actually compared the figures”.

I am the glad the Conservatives are waking up, because these are important issues. We are talking about lost jobs. We are talking about half a million manufacturing jobs lost. We are talking about an actual net decrease in income for most Canadian families. The Conservatives have not understood that; the Liberals certainly did not. For 20 years, this so-called free trade regime has proven very costly to the average Canadian family.

These are important figures. I am glad they are taking note.

Look at Chile. We had $467 million in exports, before the implementation of the magic free trade agreement. Well, the exports to that market have gone from $467 million to $433 million. That is after the FTA, after the song and dance, after all of the pretensions about how this was going to stimulate our export industries, even though Liberals and Conservatives have done nothing to stimulate our export industries beyond the photo ops and signatures on bad trade deals. With Chile, after 10 years of free trade our exports were down.

Let us move on. I could continue. I will not cite the EFTA figures, because we already had this debate. It was the famous shipbuilding sellout. Since we signed that deal, our exports have gone down. There has been a huge decrease in the EFTA market, and yet we had Conservatives and Liberals standing in this House and saying this was going to be a magical day for Canada. Our exports went down the toilet.

At the same time, we opened up our shipbuilding industry, and it lost a large number of jobs. Here again is an example of the dysfunction and incompetence of the Conservative government when it comes to trade policy. It is dysfunctional.

They are not reflecting Canadian values. They are selling out human rights, our softwood industry, our shipbuilding industry. Then, as we sign the bilateral agreements, we see a decrease in exports to these markets .

The final bilateral agreement I will mention is the one with Costa Rica. We have talked about the others; let us talk about Costa Rica. I think it is an important one to flag.

There again we saw a decrease. We had $77 million in exports before the implementation of the deal. Seven years later, in 2009, we had gone from $77 million in exports to $73 million.

I rest my case. The Conservatives have strange pretensions. It does not matter about endorsing money laundering. Forget about that, Canadians. Do not worry about drug-pusher tax havens, and these fiscal paradises for the wealthy, where they do not have to pay taxes as ordinary Canadians do. Do not worry about that, because we know what we are doing.

Clearly, they do not. In case after case, our exports to those markets, after we sign these FTAs, go down, not up. They fluctuate up and down, it is true. However, in case after case, we see that in constant dollars our exports to those markets have gone down.

The Conservatives might even be forced to admit that the exports went down, and that we are selling out human rights and the softwood industry. If so, however, they are giving a rubber stamp to drug-pusher money launderers.

But what about Canadians' incomes? They have gone up, right? Well, unfortunately, even that is not true.

Statistics Canada has essentially told us what has happened to middle-class and poor Canadians since 1989, since these free trade pacts came in, which in almost all cases have led to a decline in our exports to those markets.

We have the most recent figures. What has happened to the poorest Canadians? The poorest Canadians, viewed in terms of market income, have neither gained nor lost. Fortunately, that is because of the advocacy of the NDP, which has worked to ensure that some social programs have been maintained.

What about the middle class, the hard-working people who support their families and pay their taxes? Well, the second-income category has actually seen a 5% reduction in real income over the last 20 years. What is 5%? It is like going without a paycheque for a couple of weeks a year. This has happened on the watch of the Liberals and Conservatives over the last 20 years.

We were told that these so-called free trade agreements would not be costly to the Canadian middle class and poorer Canadians. It would not be costly for manufacturing jobs. It would not cost us a bit. Well, it has been extremely costly. It has hit middle-class Canadians hard. Even the upper middle class has seen a net reduction in real income.

If we think about that, it is very sobering. We have heard all the pretensions, spin, and flim-flam from Liberals and Conservatives about their having some idea of how to make sure we stimulate export growth and family incomes. Then we look at the hard facts. None of these facts have been studied by Liberals or Conservatives, because they do not even track this stuff. They do not track going in what the economic impacts will be on these trade deals, and they do not track going out what has actually happened. There is no tracking at all. It is simply a photo op.

We have a trade agreement that is negotiated badly, written badly and does not deal with any of the real issues. Then there is a photo op and the minister goes on his next little trip. There is no evaluation, no homework, and no sense of what the real impacts have been on ordinary Canadians.

There is, however, one group of people that has benefited over the last 20 years. Their income growth has skyrocketed by 25%. Corporate CEOs and lawyers now take 52% of all income in the country. Income has gone down for the middle class and stagnated for the very poor, but the very rich are taking a huge and ever larger piece of the pie. A hefty 52% is now going to the very wealthy. Yes, they will support these trade agreements. They move their money offshore. They invest in low-wage factories. They can afford to. However, government should be looking to stimulate the Canadian economy.

Government should be looking to make sure middle-class Canadians are taken care of. They say that through hard work poor Canadians can raise their living standard, that over time there will be progress, and that we can build local economies where small businesses thrive as we forge a national economy where nobody is left behind. But exactly the contrary has occurred over the last 20 years, because Conservatives and Liberals in the House are simply not doing their homework.

What have we in the NDP been proposing? We have been making proposals like many of our allies in places like the U.S. Congress, which now has a fair trade act before it. It was interesting to note the comments of the Minister of International Trade in Europe when he said free trade was looked down on there. He is right, because Europe is trying to move to a more progressive trade model.

This is perhaps a discussion for another day, but we have a completely dysfunctional approach to negotiations with the European Union. We went to them and said we were going to sacrifice supply management. Supply management is on the table. We sold out the softwood lumber industry in northern Canada, northern Ontario, and B.C. We sold out our shipbuilding industry on both coasts. What can we sell out this time? Let us sell out the prairie farmers in the west, farmers in Ontario and Quebec, rural Canadians. We have a dysfunctional trade approach with the European Union, and we are saying that this time it is farmers who have to pay.

We in the NDP are saying a fair trade model has to be put into place. We are saying that what we need to do is economically boost all Canadians and make sure nobody is left behind.

This Panama trade deal, this drug-pusher, money-laundering, tax haven, fiscal paradise act does not do it. The government did not do its homework. It shows a complete lack of regard for the valuable opinions of the Canadian public. We have a dysfunctional government that is trying to foist a bad policy on Canadians without having done its homework. That is why in this corner of the House we will be voting yes for the hoist motion and no to this bill.

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, the hyperbole coming from the member is breathtaking. Canadians have seen why they elected a Conservative government to protect the economy and prosperity of this country and why the NDP has no hope of ever leading Canada.

He suggested that our government does not track the figures of our free trade experiences with other countries around the world. Let me quote Statistics Canada. Regarding our free trade agreement with the U.S., after 10 years there is 150% growth in bilateral trade with that country; with Israel, 133%; Chile, 250%; Mexico, 157%. I do not know where he is getting his statistics, probably from far-left think tanks who continue to spout these untruths.

My question for him is this: how can he stand and defend protectionism when the G20 arrived at a consensus that protectionism was going to ruin economies around the world?

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

Mr. Speaker, the member for Abbotsford cannot get me started on the billion dollars the government wasted on the G20 with the fake lake and thousands of dollars spent on bug spray. It was absolutely irresponsible

However, it is interesting to note that the Conservatives are again trying to spin the figures and not put them in constant terms.

The member is right that, over time, we could have a growth in trade if the dollars are worth less, which is a little trick the Conservatives have used yet again from their talking points. They want to pretend that a dollar now is worth the same as a dollar 15 years ago but not one of them has actually tracked it. I know this because we asked the people at International Trade about it and they said that they do not do that. We had to commission a study. That is why we now have apples compared to apples, constant dollars, and we see a net decrease in exports.

Again the Conservatives have not done their homework. Canadians are owed more than just that ridiculous spin from the Conservative PMO.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I thank the member for his input into the debate again on a bilateral trade proposal.

One of the reasons I acknowledged the member when he stood to speak was that he has the conviction to put on the table where he stands on some of the issues that he thinks need to part of the conversation. If we talk about bilateral trade in a vacuum, that this is trade, we trade with them, they trade with us and it is a win-win situation, we do not have to consider the ripple effect of other things that are going on.

The revelations on the Swiss bank accounts, with Crédit Suisse and HSBC, raised the fact that even in Canada there were almost 1,800 private bank accounts, only two of which, they discovered, had ever reported income. There are some bad things that are going on and some of those things are facilitated by other countries, as the member has raised, whether it be in Colombia or in this case here.

I would encourage the member to present this dilemma where, yes, we want to do trade but we cannot do trade at any cost. There must be a point at which we need to have those other arrangements also addressed as a part of the trade deal. There must be other conditions. I ask the member if he wants to comment on how we can do trade ethically.

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

Mr. Speaker, I wish the member for Mississauga South was the trade critic for the Liberal Party because, when he rises on trade issues, he makes a great deal of sense.

Those are exactly the kinds of questions that should be asked in the House. He is absolutely right. Here we have one of the most notorious, drug-pushing, money-laundering tax havens on the planet and the government says that it is okay, that it is going to give a stamp of approval to the actions of that government and that it will not address any of the money laundering, not a word on the tax haven status and not a word on money laundering.

As the member for Mississauga South has mentioned, Canadians' values are profound. Canadians are honest, hard-working people who pay their taxes and it is not reflected by the dishonest action by the government. To try to pretend that it is in some way dealing with the drug-pushing, money-laundering, tax haven status of Panama, when any member reading through this will see that there is not a word addressing that issue, is simply hypocritical. There is no other way to put it. I think Conservative voters will punish Conservative MPs for this kind of hypocritical action.

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

Mr. Speaker, first of all, I would like to clarify something our colleague said in his speech when he said that his party was the only one that speaking out for the manufacturing sector. The Bloc Québécois has done a great job of defending the manufacturing sector and, of course, workers in recent years. So I wanted to make that clarification.

I agree on some level with my colleague's comments. The Bloc Québécois does not understand why the Conservative Party always favours bilateral agreements, especially with right-wing governments, as we saw with Colombia, and as we are seeing with Panama. Often, in these countries, workers and environmental standards are not respected. We believe that we should favour multilateral agreements, which would mean that a group of countries—and Quebec should be its own country one day—must respect the working conditions, environmental standards and labour standards of the group. We must oppose child labour. In bilateral agreements, it seems as though this government often favours mining companies and certain companies at the expense of the collective good.

I would like to hear what my colleague has to say about that.

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

Mr. Speaker, I thank the member for Berthier—Maskinongé for asking a good question.

I did say that we are the only national party standing up for these issues. However, on the Colombia file, the Bloc Québécois has been a major ally. That may not have been the case with respect to the softwood lumber agreement and the shipbuilding agreement. So today, it is important for us to work on this issue together.

Yesterday, our labour critic did a great job talking about another aspect of the agreement. I had only 20 minutes to talk. She talked about the fact that there is ongoing union suppression in Panama and that union members have been killed. The Conservatives seem to think that is a good reason to sign another agreement, as they did with Colombia. The Conservatives do not seem bothered by the fact that people have been killed. In fact, they seem all the more eager to sign an agreement. I think that is a terrible approach. We should be taking a multilateral approach instead. I think everyone can find common ground on that. We should be holding multilateral negotiations based on fair trade, not free trade, because free trade has cost Canadians dearly.

It is interesting to note that even the Minister of International Trade avoids using the term “free trade agreement” when he is in Europe because the term lost so much value during the Bush era in the United States that nobody uses it anymore. We should focus on fair trade. The NDP is ready to work with all other parties in the House to implement a functional international trade policy based on fair trade.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, I want to thank the hon. member for Berthier—Maskinongé for his enthusiasm. His riding and mine are neighbours.

From the outset, I want to remind the House that the Bloc Québécois does not have an ideological position on matters of free trade, liberalizing trade, or open markets. We think that open markets and liberalized trade are conditions for economic growth. That is true for Canada and Quebec and for most industrialized and emerging countries. It is perhaps less true for some countries, especially African countries that, despite measures to open up borders, have seen their situation deteriorate.

Accordingly, knowing that liberalizing trade can be a way to increase wealth, we also have to consider that wealth is often poorly distributed around the world and within industrialized societies. In his book The Conscience of a Liberal, Paul Krugman points out that in 1980, 1% of the American population had roughly 8% of the total wealth and total revenue. In 2007, that same 1% of the population held 24% of total American revenue. This situation has not been seen since 1928. It is interesting to note that inequality of wealth contributes to economic instability.

The recent and ongoing economic crisis for which we are calling on the government to continue providing stimulus measures, namely by pushing back the deadline for the infrastructure programs which is currently March 31, 2011, was originally a financial crisis, of course. Nonetheless, income inequality in the United States caused a major portion of the American public to go into debt, to buy property in particular. The entire chain reaction that brought in the unsound financial products that provoked this crisis was caused in part by income inequality.

Therefore, we cannot simply open our borders, move forward and hope for the best. That is why, since its inception, the Bloc Québécois has always wanted the opening of markets to be regulated by the state. That is one of the reasons why we want Quebec to become a sovereign country. It would allow Quebec to take part in international forums during which basic rules must be formulated in order to avoid uncontrolled globalization and problems like the ones we encountered during the financial and economic crisis that originated in the United States and spread across the globe. We examine all agreements negotiated by the government through that lens. When agreements are negotiated on the basis of equality and mutual respect, we support them.

For example, we recently supported the Canada-European Free Trade Association free trade agreement. This association consists of Iceland, Norway, Switzerland and Liechtenstein. Members will say that, until recently, at least two of these countries were considered to be tax havens, which is the case for Panama. However, these two countries—Switzerland and Liechtenstein—were removed from the OECD list because they agreed to co-operate and transfer tax information to at least 12 other countries.

It seems that their economies are somewhat similar to Canada's, not in terms of industrial composition, but level of development. There was no chapter 11—I will come back to that—as there is in some free trade agreements recently signed and ratified by Canada. Therefore, we did not have a problem with that agreement.

The same goes for Jordan. The free trade agreement did not provide for the protection of investments beyond what is normally covered. Once again, I am referring to chapter 11 of NAFTA. I will have an opportunity to come back to this because some of Canada's free trade agreements include investment protection.

We did not have that problem with Jordan. I also believe that we must send a message to Middle Eastern countries that Canada has a balanced policy with respect to countries that may not be openly at war, but are in a conflict situation. I am obviously referring to Israel, with which we signed a free trade agreement in 1994, if I recall correctly. We are not challenging that. Having a free trade agreement with Jordan balances Canada's position in the region. Thus, we had no problem supporting the free trade agreement with Jordan.

However, we were fiercely opposed to the free trade agreement with Colombia because of the human rights situation, and we were quite right. It is completely wrong for Canada to sign a trade agreement with a country where human rights are widely violated.

For example, in my riding of Joliette, there is a community of new Quebeckers of Colombian origin who had to leave their home country because of violence. These people told me that they did not understand how Canada could sign a free trade agreement with Colombia, when the country does not respect human rights and people are victims of violence, particularly at the hands of paramilitary organizations that have ties to some Colombian political leaders. They told me that they did not understand how Canada, which is trying to improve respect for human rights around the world and at home, could sign this free trade agreement. Many of us regularly take action to address human rights violations, such as those the first nations suffer in many areas.

Therefore, we opposed that free trade agreement, as well as the agreement with Peru, because of chapter 11 on investment protection and the lack of a framework to make mining companies, specifically Canadian ones, accountable.

In looking at the free trade agreement with Panama, we can see that there are some problems. We do not think it will benefit Canada or the people of Panama. I am not necessarily referring to some industries here or in Panama that could benefit; I am referring to the people of Panama, Canada and Quebec.

How about the infamous chapter 11? I remember that NAFTA was the first free trade agreement to include that provision. The provision allows foreign companies to directly sue the Canadian, American or Mexican government before a special tribunal. That did not exist before. Any trade disputes between countries were resolved at the WTO.

This meant that multinational companies became a new entity, a new player on the international law scene. That makes absolutely no sense. It is extremely dangerous, and I think that the increase in the number of lawsuits and complaints filed under chapter 11 of NAFTA is proof of that. So far, there is not much jurisprudence, but the free trade agreement is relatively new. I believe that we opened a Pandora's box, and we need to close it up.

Unfortunately, the Canadian government decided to use this model as the inspiration for its bilateral agreements, in particular those with countries in the global south. That was the case with Colombia, Peru and Chile. We believe that it is completely immoral to allow companies from Canada, the United States or any other country to take governments to court over public health, environmental issues or industrial policies.

We cannot accept that Canada includes such investment protection measures in its bilateral agreements, particularly with more vulnerable countries in the global south. That is the main reason we are opposing this free trade agreement. The second reason is because of the issue of respect for human rights and workers' rights, as was brought up by my NDP colleague earlier.

Again just recently, in June 2010, there was a protest against changes to the labour code. These repressive changes were decried on July 14 by the International Trade Union Confederation, which is made up of practically the entire labour movement on the planet. We are not the only ones who are concerned about respect for workers' rights. If we move ahead with this free trade agreement, we will be accomplices in contravening certain international conventions of the International Labour Organization. I am specifically thinking about convention no. 87 regarding the right to freedom of association.

So, after this chapter on investment protection that gives too much power to multinational companies—or that gives them power that they should not have—there is issue of respecting workers' rights, which is the second reason we oppose this agreement.

There is a third very important reason: the fact that Panama is a tax haven on the OECD's grey list. It signed co-operation agreements with a number of countries, but does not abide by those agreements. So here we are signing an agreement with Panama, which has signed agreements to disclose and exchange tax information, but does not follow through on those obligations. And we are not even talking about the fact that the corporate tax rate is insignificant, that there is a lack of transparency—as I mentioned earlier—and that there is a lot of information missing about what is going on with tax treatment, especially for foreign companies.

I am not leaving out the other two issues I mentioned, but we think it makes perfect sense for Canada to start by signing a real tax information exchange agreement with Panama, at the very least. If that works, then we can figure out what comes next. The problem is that the Conservatives included in this tax information exchange agreement a provision making subsidiaries located in jurisdictions with which we have agreements tax exempt.

Panama's corporate income tax rate is insignificant. If Canadian companies report profits made in Panama there, they pay 1%, 2% or 3%, as in Barbados, and they can transfer that capital without paying tax in Canada. Once again, this is a manoeuvre that found its way into Conservative budgets that were passed in collusion with the Liberals because they were too weak to oppose them. Not only do we want a tax information exchange agreement, but we also do not want exemptions for profits taxed in Panama because the tax rate there is just too low.

We should take our cue in this matter from France. The French president decided that French companies, especially banks, located in tax havens that appear on the OECD's grey list had to divest their assets. This is how it happened. In a September 30, 2009, press release, the French economy and finance minister announced that companies, banks in particular, operating in jurisdictions like Panama would be penalized. Bercy implemented retaliatory measures in early 2010.

This made the banks think twice, and a few days later, the banks announced that by the end of March 2010—so a few months ago—they would divest themselves of all assets in any tax havens still on the OECD grey list. So as I said, on September 30, 2009, the French finance minister announced his intention to take retaliatory measures and the next day, the banks themselves, through the Association Française des Banques, announced that by March 31, 2010, they would divest themselves of all branches in any tax havens still on the OECD grey list.

We do have the means, and this is a perfect example, but it takes political will. Unfortunately, despite the fine words of the Minister of Finance, the Prime Minister and the government on this issue, what we are seeing is quite the opposite.

The government has made it very easy to use tax havens. Do people know who bought the French bank branches in those tax havens? Most of them were purchased by Canadian banks. Clearly, our banks are confident that they have the support of the Conservative government to invest more in these tax havens, particularly Scotiabank, the Canadian bank that uses tax havens the most. This has already been criticized in this House. We now know that it is one of the banks that purchased many of the French bank branches in these tax havens. That is unacceptable.

In closing, I would remind the House of the point raised by my colleague from Berthier—Maskinongé, specifically, that the bilateral approach to these trade agreements is not beneficial for Canada or for emerging and developing countries. This strategy was imposed by the Americans in the Bush era, which is now over. President Obama has said he would like to return to multilateralism. It was reminiscent of Mao Zedong's strategy in the 1940s, before his successful revolution in 1949, of encircling the cities from the countryside.

How does it work? We attack the weak, like Panama, and we get them to sign a free trade agreement that suits our vision of unbridled liberalization, what we call neo-liberalism, which has now been completely discredited by the financial crisis and the economic crisis. We impose our view on the weak to try to encircle countries like Brazil, which is currently putting up resistance at the Doha round, as are India and China. The Doha round is at a standstill because industrialized countries like the United States and Canada do not realize that the old negotiating process does not apply in this new climate. China is a major player. Brazil, in South America, is a major player. They have managed to make the point that the agenda the industrialized countries wanted to set does not serve the interests of the vast majority of countries around the world. As long as Canada, the United States and Europe do not understand that, it is quite clear that we will not make any progress on issues related to multilateral negotiation at the World Trade Organization.

I find it particularly ironic that Canada is in such a hurry to sign a free trade agreement with Panama and that we are being presented with a bill to ratify the agreement as quickly as possible, when this is dragging on in the United States and in other countries, where the long-term effects of these bilateral agreements are assessed more seriously than they are here.

This is an ill-conceived and outdated bilateral negotiation strategy, and we are not in favour of this free trade agreement.

We think the future is in multilateral organizations such as the World Trade Organization. Obviously, we have to go further. People are starting to talk about it. We support the idea of second-generation free trade agreements. What is more, Europeans do not like the expression “free trade” whatsoever. They prefer to talk about partnerships. The agreement currently under negotiation is a partnership agreement. This goes far beyond free trade. This partnership must include more than just trade. Second-generation agreements absolutely must take into account the effects of trade liberalization on industrial sectors. There need to be conversion periods for industrial sectors that might otherwise be left out in the cold.

The Bloc Québécois thinks that agriculture should be left out of trade negotiations, as culture is or should be, because these are not commodities as other things are. Culture is not simply about entertainment. It is a nation's signature, a country's signature. So we must ensure that there is a convention to protect these cultures, and more specifically cultural diversity.

Canada and Quebec were driving forces behind the convention, and I congratulate everyone on that. For agriculture, it could be the same thing. We should perhaps exclude some sectors, give them the time to adapt and include mechanisms so that respect for environmental rights recognized by major international conventions, such as the Cartagena convention, which Canada has still not signed, and the major conventions of the International Labour Organization is a condition for opening our markets.

The Canada-Panama free trade agreement is a bad example; it is not the right way to go. I can assure this House that we will continue with the debate and that we will vote against this agreement if we do not see some considerable improvements. I think that there are far too many improvements needed for them to be made here.

[Ed Fast, Conservative, Abbotsford, BC]

Madam Speaker, the member and his party are going to oppose this free trade agreement, as they have opposed so many other free trade agreements before, but he mentioned that one of the reasons he is opposing it is because he believes there is a failure to protect labour and the efforts of workers to get proper living conditions and wages.

I do not know if he is aware that there is a supplementary agreement to this free trade agreement, called the agreement on labour cooperation between Canada and the Republic of Panama, which actually addresses those very issues and is tied into the international treaties relating to labour. This declaration covers specific things such as the abolition of child labour; the right of freedom of association, for example, unions; the right to collective bargaining; elimination of discrimination; and the elimination of forced or compulsory labour. These are all protections that are built into this free trade agreement.

I wonder if the member is aware of those protections. Secondly, if he is and is still concerned, why would he not at least allow this agreement, which is good for Canada because it builds on our trading relationship, to go to committee where he can review it, together with other members of the committee, and perhaps make amendments that would satisfy him?

[Pierre Paquette, Bloc, Joliette, QC]

Madam Speaker, on July 14, 2010, the International Trade Union Confederation joined its affiliates in Panama in condemning the violent repression of the strike movement by workers and in demanding the repeal of the controversial Law 30, which has become a licence to kill for the police, creating a climate of extreme violence. Those are not my words; they are the words of the International Trade Union Confederation.

There is likely a side agreement about the environment, too. As the member just said, there is one concerning labour. There are side agreements in NAFTA and in the agreement with Chile, but we have yet to see any concrete results because they are not binding agreements.

As a bit of an aside, I would like to say that even Canada disagreed with including side agreements on labour and the environment in NAFTA in 1992. When Bill Clinton was elected as president in 1992, the Canadian government, which was Conservative at the time, had to accept this inclusion. They are strictly co-operation and training agreements that are in no way binding. And if they did not work with the United States, Mexico or Chile, I would be surprised if they work with Panama.