This bill is from the 40th Parliament, 3rd session, which ended in March 2011.
Peter Van Loan Conservative
Third reading (House), as of Feb. 7, 2011
(This bill did not become law.)
This is from the published bill.
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.
All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.
Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-46s:
Harold Albrecht Conservative Kitchener—Conestoga, ON
Mr. Speaker, I want to repeat a question I asked one of the member's colleagues earlier today, and that had to do with the support that the bill would give to Canadian agricultural producers.
When we think that 94% of the agricultural exports from Canada would be exempt under the bill, I cannot believe the member's party would be opposed to this kind of access to markets for our farmers.
Could he explain why his party opposes a plan that would support Canadian agriculture?
Bruce Hyer NDP Thunder Bay—Superior North, ON
Mr. Speaker, it clearly will not be a big deal for Canadian agriculture for exports to this very tiny country.
I have two questions in response to the hon. member's question.
First, why, if the Conservatives cared about agriculture in Canada, did they try to kill the Grain Commission, the inspection of Canadian grain and eliminate the grain inspector jobs across Canada, including Thunder Bay?
An even bigger question is for all the Conservatives. In this day when good, fair trade deals with prosperous, forward-thinking and visionary countries might be a good idea, why are the Conservatives making deals with the losers, instead of the winners?
Pat Martin NDP Winnipeg Centre, MB
Mr. Speaker, I was interested in my colleague's comments on the peculiar choice for a bilateral trade agreement with that particular country given that it is one of the world's worst and most well-known tax havens where tax fugitives go to stash their money so it is free from the reach of the tax man.
I was shocked to learn that over 400,000 corporations are registered in tiny Panama, which is actually four times the total number of corporations in all of Canada.
Would the member care to comment on the idea of tax fugitives using what they call tax-motivated expatriation to avoid the reach of the Canadian tax authorities and so that they do not need to pay their fair share? Why is the government encouraging any involvement with a country that has that kind of a reputation and record?
Bruce Hyer NDP Thunder Bay—Superior North, ON
Mr. Speaker, it is very clear that the Conservative government is tying its aspirations and its image to the coattails of the United States. The United States has been seeking multilateral free trade deals around the world for a long time and has failed to achieve them, including at the latest round in Doha.
It is quite clear that, having failed in multilateralism, the United States and now Canada are pursuing, one by one, these bilateral trade deals with anybody who will make them, including some of the less honourable countries in the world.
Canada-Panama Free Trade ActGovernment Orders
February 4th, 2011 / 12:45 p.m.
Cypress Hills—Grasslands Saskatchewan
Conservative
David Anderson ConservativeParliamentary Secretary to the Minister of Natural Resources and for the Canadian Wheat Board
Mr. Speaker, I was a little bit concerned. We are all familiar with the battle that the NDP has with free trade agreements and its opposition to virtually all of them. We have seen that in the past here in the House.
I was struck by my colleague's comments as I came into the House. He talked about the fact that we are only picking losers for the deals in these free trade agreements. We are working on free trade agreements with dozens of countries, including countries like India and Morocco. I do not know if the member is familiar with the announcement last week that we are initiating a free trade agreement with Morocco and of its importance for western Canadian durum and wheat producers.
Does the member consider India and Morocco as loser countries as well?
Bruce Hyer NDP Thunder Bay—Superior North, ON
Mr. Speaker, I have little doubt that the Conservatives and I would have different definitions of the kinds of countries with which we should be signing free trade deals.
In response I will just say that we should be signing free trade agreements and fair trade agreements with countries that have basic human rights, basic democracy, sustainable economies, sustainable fiscal policies, sustainable banking situations, sustainable ecosystems and that are fair and honourable to labour.
Alexandra Mendes Liberal Brossard—La Prairie, QC
Mr. Speaker, I am pleased to speak today in support 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.
I am pleased to participate in a debate that, unusual for this House in recent times, we had hoped would be relatively free of heated partisan rhetoric. It is not so, but we had hoped. I support the passage of the bill for many of the same reasons that members sitting on the government side of the House support it.
Unfortunately, before we discuss the meat and potatoes of Bill C-46, we need to deal with the amendments put forward by the NDP. I appreciate that the NDP does not support the bill. I can also appreciate that it put forward amendments following the rules and practices of the House. However, this is simply a last ditch attempt to halt a bill that would allow for better economic relations with Panama.
Let us look at what the NDP is asking for and why this 11th hour effort is just another example of that party's inability to accept that free trade is not a bad thing.
The NDP began by proposing that clause 7 be deleted but that is the clause that sets out the purpose of the bill. If the description of the purpose of the bill is taken out, that poses a bit of a problem. It would be similar to a car with no driver. Maybe those members are trying for a revival of the TV show Knight Rider but most of us like to have a driver behind the wheel. They are also asking that clause 10 be deleted. That clause contains institutional and administrative provisions and, without those kinds of clauses, there would be no bill.
I know members of the NDP want to ensure that the bill does not pass, so it is not a major surprise to see such amendments, but this total disdain for the possible benefits of free trade is very disappointing. Why these stall tactics without some truly constructive amendments?
They are also asking that clause 12 be deleted. This clause deals with panels, working groups and other people involved in administering the bill, particularly in terms of labour and the environment. It seems to me that these matters are important to NDP members, so I question their objective in opposing clause 12.
In addition, they are asking that clause 63 be deleted, the coming into force provision.
Without those clauses there would be no bill. Are my NDP colleagues playing political games here in the House rather than having an informative and intelligent debate? Many of these issues have already been discussed in committee.
I can safely say that I will not support the amendments, but I will take a bit more time to talk about the bill as currently drafted.
In spite of the global economic decline, Panama's gross domestic product increased by 10.7% in 2008, which is one of the highest rates in the Americas. It is expected to increase by 5.6% in 2010. In 2009, bilateral trade between the two countries totalled $132.1 million; Canada's exports were worth $91.4 million and imports from Panama totalled $40.7 million.
Canada's main exports to Panama include machinery, electronic equipment for vehicles, pharmaceutical equipment, leguminous seeds, and frozen potato products. Services related to export that Canada offers include financial services, engineering services, and communications information and technology services. Goods that Canada imports from Panama include precious stones and metals, primarily gold; fruit and nuts; and fish and seafood products.
The Panama Canal is essential to international trade. Its expansion should be finished by 2014. This $5.3 billion project could create opportunities for Canadian companies to provide services in the areas of construction, environment, engineering and consultation on capital investment projects, as well as in many other areas.
Some of the issues covered under the trade agreement include market access for goods, cross-border trade services, telecommunications, investment, financial services and government procurement.
Panama maintains an average most favoured nation applied tariff on agricultural products of 13.6%, with tariffs reaching peaks as high as 260% on some products. The free trade agreement will eliminate those tariffs on 90% of products immediately, and on the other 10% little by little over the next five to 15 years. This should enhance the competitive position of Canadian agricultural exports such as frozen potato products, pulses, pork—which is currently taxed at a rate of 47%—malt, processed foods and beef.
Panama maintains an average most favoured nation applied tariff on non-agricultural goods of 6.2%, with peaks of up to 81% applied on several key Canadian exports. The free trade agreement will completely eliminate those tariffs, which will certainly help Canadian exporters of fish and seafood, construction materials and equipment, industrial and electrical machinery, paper products, and vehicles and parts.
Canada would immediately eliminate over 99% of the tariffs imposed on current imports from Panama.
The free trade agreement will also address non-tariff barriers by adopting measures to ensure non-discriminatory treatment of imported goods and the promotion of good regulatory practices, transparency and international standards.
We live in a global economy and our survival as a nation depends on our ability to work with other nations around the world. We have seen the disadvantages we incur when we are slow to interact with growing economies.
The fact is that Canada today has a trade deficit. For the first time in 30 years, we are actually buying more than we are selling internationally. That is ominous for a small, open economy like Canada that has depended disproportionately on external trade for our standard of living and our wealth as a country.
If we look at where the world is headed and where the growth will be over the next five to ten years, we see that it will be in China, India and in the Asian economies. We also see a lot of opportunities in Africa, despite the governance concerns in certain countries. We see a lot of progress in Africa and we see a tremendous amount of growth and opportunity.
Then we look at the Latin American countries and, increasingly, it is becoming clear that being dependent on the traditional economies of the U.S. and Europe is not where we want to be. We need to think outside the box. We need to look for new partners and facilitate trade. We need to provide tools both at home and abroad that will make Canada a country that others want to invest in and trade with. If there are problems between the two, we will work it out. Simply saying “no deal” because no country is perfect is a pretty obvious sign of a very narrow-minded party.
Yes, I agree that Panama represents a small trading partner compared to the government's missed opportunities with China and India, but it is still a real and obvious partner. I strongly believe that there is strength in numbers and, even if the government has failed to truly engage our largest trading partners, we must never forget about the smaller ones. They provide unique opportunities and highlight Canada's place on the world stage as a country open to all.
In closing, I must remind the House that the 21st century is here and we cannot close our doors to the world. We need to be looking at partnerships with any and all governments while promoting our values and strengths abroad.
Pat Martin NDP Winnipeg Centre, MB
Mr. Speaker, I am happy to enter into the debate on Bill C-46. If we are to use trade as an instrument to elevate the human condition and not just to exchange goods and services, then we must consider the fact that trade with Canada should be viewed as a privilege and not as any kind of right. In fact, we should be choosing trading partners who earn the privilege of trading with a great nation like Canada.
If it is our intention, even as a secondary goal, to help elevate the standard of wages and living conditions of the people with whom we are trading, if we are indeed to be global partners in the globalization of capital, then we must also consider that with the globalization of capital must also come the globalization of human rights, labour rights and environmental standards. We should use our capacity as a trading nation to achieve those secondary goals.
I would go further and argue that we should not enter into any country that will not stipulate to those lofty standards that seek to elevate the human condition. We owe it to our global partners and we owe it to the global efforts to eradicate poverty and create a planet that is sustainable for the future.
I note, not by any kind of coincidence, that the driving force behind this trade agreement is the mining industry. It is the greatest lobbyist that came forward to try to justify and defend a bilateral free trade agreement with a country like Panama that does not meet any of the standards I just pointed out. Panama does not meet any of the tests of a country that has taken active steps to recognize and protect human rights. Also, it is a country that has actively taken steps to undermine the health and well-being of the global economy by proactively creating itself to be one of the largest tax havens in the world.
We have to ask ourselves as parliamentarians why we would want to participate in a trade agreement with a country whose actions and actual practice we abhor, or claim to abhor. The members in this chamber often raise the fact that we criticize and chastise those tax fugitives who would avoid paying their fair share of taxes by harbouring their activities and funnelling their profits in dummy shell companies around the world even though the corporate taxes in this country are going down to 15%, one of the lowest in the developed world. It is estimated that we lose $7 billion a year in lost tax revenue by allowing situations to exist where countries can move their taxable profits and income into these dummy companies.
Are we not acquiescing to, or even encouraging this international behaviour by recognizing these countries with a free trade agreement? Canada, I am proud to say, does not tolerate this kind of thing lightly. It seems a contradiction to me.
In recent years we have had this debate over and over again. Even though the parliamentary secretary said we are engaged in negotiations of free trade agreements with countries such as India and Morocco, those are not the ones that come forward in the list of priorities for the government or before this chamber. We end up debating free trade agreements with Colombia and narco-states overrun by criminals, gangsters and people who murder trade unionists in the streets. Panama is not much better. It is a sanctuary and refuge for some of the worst actors in the world.
What business do we have welcoming them into our family of trade when we try to pretend that we operate at a higher standard of behaviour? Why should we stoop to that level of behaviour? Why would we be sullied? Why would we let them darken our towels until they clean up their own act?
If we are to elevate the human condition of our trading partners, it should be a prerequisite that they come up to our standards, not that we lower our standards to theirs. With globalization comes the risk of harmonizing to the lowest common denominator, not the highest common denominator. We must be ever vigilant, as parliamentarians, to ensure that the latter does not happen.
It is difficult to put the brakes on something that sounds as innocuous as free trade. I think the words were chosen very carefully. But, our negotiating history in free trade agreements has been poor. They are not fair trade agreements. The NDP is always being accused of not being in favour of free trade. Nothing could be further from the truth. If it truly were free trade, if it truly were fair trade, it would have our enthusiastic support and endorsement, but we never see that.
We always send Department of Justice lawyers and globe-trotting representatives to negotiate these free trade agreements. I do not know who gives them their mandate, but they keep coming back with pretty bad packages. Our history has been appalling in negotiating to ensure that the best interests of Canadians are paramount before these trade agreements are signed. It seems we will sign anything with anyone. We are too easy. Our bargaining stance is on our knees. We beg them to leave us with a bit of dignity when they are finished with us. That has been our experience. We wind up with deals that cost us a fortune, that do not protect and defend our standards on an issue such as supply management regime, for instance. All these things are at risk when we enter into these deals and arrangements.
I notice in this deal, again, we have made a classic mistake regarding most favoured nation treatment and national treatment. Again, foreign investment from the partner country should receive the same treatment as domestic investment or investment from any third country. The same language keeps popping up in all these trade agreements. Even after the NDP reminds the government of the day not to do that, it keeps doing it again. It does not listen to us. Sometimes I am concerned that Conservatives are not listening at all.
It boggles the mind, really. I lived through the great free trade agreement debates in 1988. I watched as we allowed section 11 in NAFTA. We leave ourselves vulnerable time and time again with our eagerness to appease and please our trading partners. We seem willing to sacrifice the best interests of Canadians.
It is like Margaret Atwood said about the Canadian beaver. It seems as soon as there is any stress at all, we get backed into a corner and we bite off our own testicles. I agree with Margaret Atwood. It is not an image that we like to dwell on, but we do not show the kind of strength in our bargaining position that we should when we are at international bargaining tables.
Now we are faced with yet another free trade agreement to debate. We debated ones on Peru and Colombia. Now we have Panama. Where are these big trade agreements with the big actors that the Conservative government says it is negotiating? I would argue it is at the negotiating table, but probably kneeling at the negotiating table, begging to please, please sign a deal with us. It will give away whatever other countries want, never mind the best interests of Canadians, never mind the best interests of the people who sent us here. The government will sign anything with anyone anytime, if it can get it through the House of Commons.
It is a good thing this is a minority Parliament. We are going to keep fighting this bill as long as we can.
Dennis Bevington NDP Western Arctic, NT
Mr. Speaker, I am having trouble with the deal that is being struck with Panama. It is different from the deal with Colombia. Human rights are very important to my party. We can understand perhaps why the Conservatives were not so big on labour unions, but with regard to this one, I have had to listen to their pious pronouncements on being tough on crime and getting rid of the drugs in the schools and on the streets and so on. This is a situation where we are legitimizing the world's largest launderer of drug money.
What is in the minds of the Conservatives? How can they go to sleep at night when they are so hypocritical? Why do they not wake up to what they are doing and recognize what the problem is with Panama and why an agreement should not be signed?
Pat Martin NDP Winnipeg Centre, MB
Mr. Speaker, in the province of Manitoba we have learned that if we want to get tough on crime, the profits of crime must be choked off. If we take the ill-gotten gains away from a criminal there is a fighting chance that we will stop the practice because we want to make the point that crime does not pay. That is why we put in place the proceeds of crime bill, where we could seize the assets and ill-gotten gains of a criminal more easily.
We can do the same internationally by choking off sanctuaries such as Panama that are used by international drug dealers to launder and warehouse their money. However, we do not do that by legitimizing the country and its practices.
There are 400,000 corporations registered in Panama. That is four times all the corporations in Canada. None of them produce a single thing because they are just shell companies that are being used to house and launder money, and to avoid taxes. Tax fugitives and drug dealers make up the entire chamber of commerce in Panama. Why would we sign a trade agreement with it?
Alex Atamanenko NDP British Columbia Southern Interior, BC
Mr. Speaker, on a number of occasions I have seen a film narrated by Mary Walsh called Poor No More, which touches on the whole issue of poverty. One of the reasons for poverty, of course, is the tremendous influence the Council of Chief Executives has on government policy. This organization is made up of 150 of the biggest corporations in Canada and some of its members use tax havens so they do not have to pay so much money to the government. As a result, the government has less revenue to do the things it should be doing.
I was wondering if the hon. member could comment on this aspect of the trade deal.
Pat Martin NDP Winnipeg Centre, MB
Mr. Speaker, chartered accountants call it “tax motivated expatriation”. We call it “sleazy, tax cheating loopholes” and it is appalling.
I read a five-part series by Diane Francis in the National Post, not exactly a right-wing rag, that denounced and decried the federal government for allowing tax loopholes to exist where wealthy Canadian families and wealthy Canadian CEOs of corporations can be tax fugitives and avoid the arm of the Canada Revenue Agency. They do not have to pay their fair share which means we have to pay more. Even a right-wing journalist like Diane Francis says it should not be allowed.
The Conservatives not only turn a blind eye to it, but they ratify, endorse and legitimize it by entering into a trade agreement with a country that makes its living by sheltering drug money and offering tax havens for tax fugitives like members of the Canadian Council of Chief Executives headed by John Manley, the rich guys.
Alan Tonks Liberal York South—Weston, ON
Mr. Speaker, I am pleased to have the opportunity to add my own reflections with respect to Bill C-46, the bill to engage in free trade with the Republic of Panama.
For just a moment I would like to reflect anecdotally on my insights on the role I think Canada should be playing in a hemispheric sense.
The globalization of capital reminds us that we live in a very competitive economic environment where the barriers to the flow of capital and investment should be reduced. The economic and fiscal corollary is that is necessary for us to reduce barriers to investment in our own economy. Traditionally, we have had high tax barriers as part of our national policy. Those particular approaches cannot be part of the character of a modern economy.
As a young person, I had the opportunity to work in the Caribbean and to travel extensively throughout Latin America. As a result of that experience back in the mid-1960s, it was my perception that because Canada was not a colonial power and not a country with a reputation for exploiting economies and people, as had been characteristic of history, we had a natural affinity and responsibility, in fact an opportunity, to develop hemispheric relationships, particularly with the Caribbean, Latin America and South America, whereas European countries had a natural affinity, a responsibility and accountability for development in Africa and Asia.
I do believe that the free trade agreement and the movement to free trade had their roots in those perceptions, those senses of what Canada's role could be in developing the kind of relationships that were more in keeping with the 20th century, the 21st century and, in fact, the future.
I will give the government credit for its outreach to the Caribbean countries, the conferences that have been held with CARICOM, the development of relationships that are non-exploitive in an historic sense, which are opportunities for the Caribbean, and now for Latin American and South American countries, to start to deal with the very issues that are residuals of the isolationism that we have had in a hemispheric sense.
Thus, while I acknowledge the points that have been made with respect to labour and human rights legislation, I also acknowledge the irrelevancy, the acrimonious base, in fact, that is established through tax haven approaches, which have been very competently described. These are the residuals of tax regimes and outlooks and viewpoints that have created the kinds of problems that have existed in social, humanitarian and criminal terms.
If anyone is to argue that we can go forward by looking backwards, that we can go forward in dealing with these humanitarian, labour and fundamentally criminal issues related to taxation, which are in fact anachronisms in today's global community, then the place where we should begin to deal with those is in our own backyard, in our own hemispheric relationships, where we have patterns of immigration, investment and reciprocity that are stronger in human terms, in fiscal and economic terms, and in terms of our own self-interest.
If we argue that what goes on in Mexico with respect to the criminal activity around drugs is only happening in Mexico, if we argue that the issues with respect to Caribbean countries and their being used as turnstiles to subvert Canadian youth in our cities, and if we argue that those are going to be addressed by isolating those particular countries, we are in fact going in a very wrong direction.
Using that as an introduction to the premises that I hope the House will use in establishing a framework for evaluating our economic outreach, I would indeed hope that, per Maslow's hierarchy of needs, self-interest and self-preservation are at the top.
What we are doing is that we are dealing with countries in a hemispheric sense, where we have historic and huge issues that are either going to be a foundation for progress or are going to continue to drag us back, and we and our children and our children's children will suffer for that.
I look at free trade agreement with Colombia, the outreach to the Caribbean, and I look at Panama now and hope that the House was sensitive to the characterization of “losers”. I have great respect for the member and I know that in the heat of the moment, that was the characterization. I know that is out of character for that member.
Here we have a country that was subject to the criminal activity of a man who is now incarcerated but was the president of Panama and who exploited that country and who characterized all that is bad, and now we have a new, free and democratic government that has thrown off the shackles of control of the United States and the Panama Canal and has now inherited its rightful heritage. We have a country that characterizes in every way the hope and aspirations of its young people.
We hope that those aspirations do not find themselves expressed on the streets in rioting in Panama City, as they are in Egypt, Tunisia and other states, where young people look down at the United Arab Emirates, at Abu Dhabi, and at the tremendous development in technology and the luxury cars and so on, and they ask what is happening to them with the unemployment in Egypt and Cairo?
The young people are saying there has to be a change. That change in Panama has been remarkable over the last few decades. That is not to say there are not problems in Panama, but they are representative of the kinds of issues we all have to deal with.
Again, reflecting on that, here I see a treaty that I am going to call a fair trade treaty because it takes the remarkable growth in Panama and reduces the high tariffs reciprocally, as other speakers have talked about.
In terms of the labour and human rights issues, while it would be better that they were entrenched in the agreement, which we would all support, this is a starting point. This is neither the beginning of the end nor the end of the beginning. It is a threshold that we can cross with the people of Panama, as we should with many other countries hemispherically, with whom we share a huge future relationship.
The time to start that is now.
Bonnie Crombie Liberal Mississauga—Streetsville, ON
Mr. Speaker, I wonder if my colleague might comment that in fact ratifying the Canada-Panama free trade agreement is a good thing because Canada is a trade-dependent nation and it will lead to growth. In fact, if we get ahead of the United States, it leads to a comparative advantage and will create jobs for Canadians.
I want him to comment on the NDP's concern that Panama is a tax haven. In fact, we have agreements with many tax havens. We trade with many tax havens. I wonder if the NDP thinks we should eliminate those agreements with countries like the Cayman Islands, Switzerland, Liechtenstein, et cetera.
It is criminals who launder money. It is criminals who do not check whether a free trade agreement is in place before they conduct criminal activity.
I wonder if the member thinks this is just a red herring and, in fact, ratifying this treaty is not actually good for our economy.
Alan Tonks Liberal York South—Weston, ON
Mr. Speaker, I do not think it is a red herring.
There are the sidebar agreements. The issue with respect to criminal activity is one that is of huge concern. It is equally concerning that our colleagues in the New Democratic Party have, from time to time, concentrated on the whole issue of human rights, labour relations, the right of free association, and so on and so forth. The sidebar agreements are not stand-alone silo agreements. They must come under the principles of the international federation of labour and the International Labour Organization.
I am confident that the professionalism, capacity and expertise of those organizations and the opportunity to use them in the manner in which labour organizations and activists have indicated is a good match. We should help them in that respect because it will reinforce the principles of the free trade agreement as they relate to on-the-ground implications and the impact on the citizens of Panama.