Bill C-24 (Historical)

Canada–Panama Economic Growth and Prosperity 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 Economic Growth and Prosperity Act

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I rise again to speak to this particular bill, which now has a new title and a new time in the House of Commons. Through the last Parliament we debated the bill at length because we had incredible concerns about our ability to understand what we were doing with our free trade deals across the world. We understand the difference between free trade and fair trade, but we want to know what the government stands for when it makes these types of arrangements with these countries and what drives it forward.

We agree that certain products are going to be easier to move into Panama. That is fine, but do we weaken our integrity in doing so? Do we weaken the direction our country can move in? Do we weaken the state of the world when we make deals that are unsatisfactory? Is that what we accomplish when we reach a free trade deal with Panama, a country dedicated to money laundering and tax evasion? Panama has so many corporations listed there, not because they do any work there but because they take advantage of the very lax practices there. Not only are the practices lax there, but they actually promote tax evasion and money laundering as a basis of industry.

Here we are, entering into a relationship with a country that has those principles and values. Does it bring us down to that level? By going along with these types of relationships, does it mean that we then lower the bar as far as our ability to enhance our prosperity is concerned? Is that what we are doing? Are those the trade principles of the Conservative government? That is our question, and I think it is a fair question.

I would welcome a debate in the House on trade, generally. We see that the government is engaged in trade discussions with other countries. We are all concerned with what the Prime Minister's visit to China means for our country and our relationships. Before the Prime Minister left for China, I remember his interview with Peter Mansbridge on CBC Television, in which he stated unequivocally that our energy policy is made by the free market and that we are an energy exporting country. He was saying that our exports are determined by the free market. That is his point of view. Two weeks later he was off to China, where he set up a deal to move energy, in a certain fashion, to the Chinese. We now see that the government, in its relationship with China, has agreed to terms and conditions regarding the environment and the processing of energy products with China. Those do not strike me as part of the free market, but rather an expression of Canada's need to enter into various relationships with a command economy like China's.

Do I appreciate those relationships? No, I do not, because I think the Prime Minister should have come back to Canada and set up a national energy strategy in which we could actually determine the value of the relationships we are establishing in exporting our products to countries like China. When we do export raw bitumen to China, as is proposed for the Gateway pipeline, we will become a supply link in a chain that can only be filled with that product moving to China for upgrading there. That is pretty clear. At the same time, interestingly enough, we have struck a deal to liquefy natural gas in Kitimat. Natural gas will be shipped over to China where it will be used to upgrade the same bitumen.

In reality, we are taking two energy products that we can use in Canada to increase the prosperity of our economy and do so in an environmentally correct fashion, and yet are moving them over to another country. That is our trade policy. That policy has an impact on billions of dollars of trade.

How does that fit with a free trade agreement with Panama?

That is my point, because we do not have any definition of what the government wants to accomplish with trade. What we have, as the Prime Minister said, is an ideological commitment to a free market. However, that is seriously disengaged from the reality of many of the products we are selling. I believe we are the only energy exporting country in the world that does not have a direct say on those energy exports. Now we have to take it on faith, and by confusion, and have to fill that role anyway.

We cannot be honest with ourselves and look at how the world is actually developing. It is not developing in the direction that we thought it would through the 1990s and the last decade when free trade was the mantra. No, in an era of increasing population and declining resources, command economies are taking over. We are starting to see that is the way of the world now. It is in this context that Canada, with its natural resources and riches, which we should be preserving for our grandchildren, is making decisions that are not correct.

When we come back to the free trade agreement between Canada and the Republic of Panama, we have to ask where the logic of it is. How does it work? Is it really a free trade agreement or is it a free investment deal? Is this really about Canadian multinational companies that want to take their profits out of Canada and invest them in things like the Panama Canal? Is that what this is really about? Is that the underlying principle that we are dealing with? We do not know because the Conservative government very rarely, if ever, presents principles and directions so that we can understand the purpose behind its actions.

When we look at these free trade deals, we have to be able to say to ourselves that, yes, we have followed to principles regarding non-criminal activity in our marketplace. We espouse the need to close down tax loopholes that have starved governments around the world from their rightful share of the riches that are made by corporations. These are things that we espouse, yet at the same time we are quite willing to give them up because some Canadian companies could perhaps invest in the expansion of the Panama Canal, then take those profit and give them to their shareholders around the world.

When we talk about free trade deals, we have to take them in the context of what the world is doing. The world is changing quickly in this new era, in which command economies will play a larger and larger role. We understand that and have addressed it.

[Greg Rickford, Conservative, Parliamentary Secretary to the Minister of Aboriginal Affairs and Northern Development]

Mr. Speaker, at the very end of the member's intervention he commented on the context.

Here is the context: the people of Northwest Territories, who make significant contributions to our supply chain in a number of important areas, are involved as a part of many, if not all, free trade agreements, including with Panama. I wonder if the member can tell us what kinds of products are involved in the Panama free trade agreement.

Why is he not standing up for the interests of the great folks up in the territories who want to contribute to this and produce goods for a number of countries, including Panama, where there are exciting economic opportunities for them and that country?

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, that is a bit of a strange question, but I will try to answer it the best way I can because I appreciate my colleague's concern about the Northwest Territories. In the Northwest Territories right now, our people have all agreed to build the natural gas pipeline. That pipeline would supply the oil sands with needed natural gas to perhaps upgrade bitumen to a synthetic oil.

By aiming to put a million barrels a day across the border with the Keystone pipeline and 800,000 barrels a day out the door from Kitimat in northern B.C., we are basically saying to the Northwest Territories that we do not want to develop its natural gas now because we are going to send this product, unprocessed, to other countries where they can develop their natural gas supplies. In fact, we are going to take the natural gas from northern B.C. and liquefy it at a cost of about 35% of that energy and we are going to send it to China where the processing can be done.

Where does that leave the Northwest Territories in this whole equation?

[Jasbir Sandhu, NDP, Surrey North, BC]

Mr. Speaker, I can assure the House that my colleague speaks not only highly of the Northwest Territories but that he is also a very hard-working member of Parliament for the north.

Trade deals are a reality, as we live in a global society. However, are the bases of these trade deals fair, equitable and sustainable? We know for a fact that Panama has been used as a money laundering state by drug cartels from Mexico, Colombia and other parts of South America.

I am very concerned about the danger of some of the money being laundered through Panama being invested in products or funnelled to Canada. Does the member share those concerns?

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, it is a very good point that my colleague makes. What happens to money laundered in Panama when there are many corporations that have registered in Panama to take advantage of a situation where money can be cheap? When money has to be laundered, there is an opportunity for other companies to pick it up. The more relationships we set up with Panama, the more we legitimize the work that is going on between our corporations in Panama and Canadians. The more we say that the free flow of money between Canada and Panama is going to be unhindered, the more we are saying we support this process. That is the reality of it and it really does not matter what the Conservatives say: reality is reality.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I am thankful for this opportunity to enter the debate on Bill C-24. I thank my colleague for Western Arctic for very capably articulating many of the positions of the NDP and the reservations we have with this bill. I will do my best not to repeat the many legitimate points my colleague made.

However, I will say with some frustration that I have been tracking and following this debate since August 11, 2009. when the government, unilaterally and without consultation from Parliament, concluded its negotiations. I cannot criticize this, as governments do have the right to enter into free trade agreements. However, they then need to ratify them with the Parliament of Canada where the legitimate concerns that the parties may have on behalf of our representatives can be made known. In any serious consultation, there should be some accommodation of the legitimate concerns the other parties brought forward in the context of the free trade agreements entered into.

I raise this only because it has been a constant source of frustration to us that the consultation has not been meaningful or robust and it does not, by any stretch of the imagination, even meet the definition of true consultation if the government side has not accommodated at least some of the legitimate concerns brought forward. I would refer members to recent Supreme Court decisions that dealt with the issue of what constitutes meaningful consultation.

I do not think, by any stretch of the imagination, we can conclude that meaningful consultation took place, because not one of the amendments brought forward by the official opposition were entertained or allowed by the ruling party, even though some of the concerns brought forward would meet the nod test from the general public. A lot of Canadians would be upset to learn that we are entering into this trade agreement with a country like Panama without taking steps and measures to ensure that Panama is worthy of a free trade agreement with Canada.

I do not use that word lightly. Trade with Canada is a privilege, not a right. I am the first one to admit that free trade can help elevate the standards of both parties to a trade agreement. We do not look for mirror image countries. This is not some kind of vanity exercise where we will only trade with countries that are just like us, but surely they must meet some minimum ethical, labour and environmental standards. For Heaven's sake, they should not be the tax haven of choice and the money laundering country of choice for the international drug cartel. Why would we reward bad behaviour?

It comes to mind that Panama is probably dining out on the fact that it has achieved a good housekeeping seal of approval by Canada which has seen fit to enter into a trade agreement with it. It says that maybe all the accusations of being the drug laundering capital of Central America and South America cannot be true because otherwise a nice country like Canada would not sign the agreement with it.

I am here to say that the world is not satisfied that Panama has taken corrective action. It is not a responsible actor in the international financial community. The president of France said so as recently as November 5, 2011. He cited a number of countries that should be shunned by the international community. Guess what countries are on that list? They include Antigua, Barbuda, Barbados, Trinidad and Tobago, Botswana, Brunei, Panama, Uruguay and Venuatu. President Sarkozy threatened that the countries that remain tax havens will be shunned by the international community. How does that jibe with us having this debate today and about to enter into a process that legitimizes and validates the behaviour and past practices of that country.

International tax havens are a scourge on the international financial world and they should be stamped out. They should not be allowed. I go to chartered accountants' websites sometimes to track what is being pushed around here. They call it “tax motivated expatriation”. That is the nice sanitary term for what I call “sleazy tax cheating loopholes” that are ubiquitous among a certain financial class of people.

The OECD has a grey list. Panama was removed from the grey list. It reads:

Panama today moved to the OECD’s list of jurisdictions considered to have substantially implemented the standard for exchange of information when it signed a tax information exchange agreement with France. This brings Panama’s total agreements to the critical 12 that meet the international standard.

Since then, it was when Mr. Sarkozy, in a speech made at the G20 conference in Cannes, named the Caribbean countries and eight others, including Panama, as countries that remain tax havens and should be shunned by the international community.

What is this almost obsession to sign as many of these trade agreements with as many countries as humanly possible without even doing the due diligence, the scrutiny and the oversight that one would expect? These are binding agreements.

The amendments that my colleague brought forward, the terms and conditions under which the government could garner NDP support for these, were reasonable ones that I think would meet the nod test from almost all ordinary Canadians. One was that we address the status of labour rights in Panama. If it is our goal to use our trade relationships as an objective to elevate the standard of living conditions for the trading partners with which we sign these agreements, why do we need to have a side agreement on labour rights that is virtually unenforceable? Why is that not part of the substance of the text of the actual agreement?

Environmental concerns are something that the NDP always wants to see addressed. We should be setting the industry standard, not tacitly endorsing the bad practices of other countries by entering into these legitimizing trade agreements.

There has not been a business case made on how this is categorically in the best interests of a majority of Canadians. Of course we want trade. We are a trading nation and we do rely on trade. We are blessed with natural resources. We export, we extract and export. However, some of us would say that current and recent past practices would indicate a lack of commitment and perhaps a disturbing trend of not putting enough emphasis on value adding our resources before they are exported from this country.

I will give one example as it relates to my own riding of Winnipeg Centre. I used to have 43 garment manufacturers in my riding, the largest of which had 1,800 employees at its peak. Many of them had 300, 400 and 500 employees. Some were small boutique custom made shops. We are now down to nine. I am talking about the period of time that I have been a member of Parliament, from 1997 to today. It went from 43 to 9, 10,000 to 12,000 employees, just in my riding, and that does not include Winnipeg North where my colleague used to have garment manufacturers.

We decided to cut that sector loose. Somebody made a conscious decision to stop the duty remissions and all the efforts we made to keep manufacturing in Canada. Somebody turned a blind eye to the trade provisions. When China was invited into the WTO, the partners to the WTO could have signed phase-in agreements but Canada chose not to.

Therefore, we got the 200% and 300% impact all in one year. Countries like the United States had a 10-year phase-in at 5% to 10% a year. For Canada, it was all or nothing and, believe me, that was the death knell of the garment industry in my city. To whose benefit was that? Those were great entry level gateway jobs, often for new Canadians. They were not big paying jobs but they were good unionized jobs with a day care centre, a pension plan and a dental plan, and they are all gone. The government in its wisdom watched them fly out the window and did not lift a finger to save them. That is the same attitude that we see toward these trade agreements. The government is being irresponsible.

[Greg Rickford, Conservative, Parliamentary Secretary to the Minister of Aboriginal Affairs and Northern Development]

Mr. Speaker, as usual, the member's use of the English language and the emphasis he puts on it is sometimes inspiring and sometimes not so inspiring.

The member said that there was no business case for the Panama free trade agreement. However, let us look at Manitoba with its precious stones and metals, oilseeds, cereals and pork. Farmers working in the province of Manitoba want their member of Parliament to stand up in this place and explain to them why he cannot support an agreement that would do so much for the great people of Manitoba, my next door neighbours, “Mantarians” we call ourselves collectively. The member should stand up for what is right in Manitoba and Mantario. Why will he not do that?

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I thank my colleague, the member from Mantario, for that remark and for the backhanded compliment about my oratory.

Since he raised agriculture, I will point out that the Conservative government just systematically dismantled the most effective export instrument that the Canadian agricultural sector has ever known, the largest and most successful grain marketing company in the world, a $7 billion a year corporation. The Conservative government just legislated it out of business. That was how we used to export the product of the prairie region, 20 million tonnes a year, consistently providing the best rate of return ever. We have the evidence, the Conservatives have none. They were on some ideological crusade because they thought it was Communism or something. When prairie farmers united together to act in their own best interests, the Conservatives systematically destroyed the largest, most effective and most successful grain marketing company in the world.

Canadian farmers will still export their grains and their products but we do not need to do a deal with drug dealers to sell our products. If we want the free movement of goods and services, then we should trade things that are legal, not deal with some narco-economy of money launderers and dope dealers.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I do not blame the member for Winnipeg Centre for getting a little agitated at that last question from the member for Kenora.

I have had the opportunity to work with the member for Winnipeg Centre and I saw how he stood up for farmers in western Canada and others in the Canadian Wheat Board fight. However, the one thing I did not see were the backbenchers on that side who come from Western Canada stand up. They did not allow democracy to flourish. They would not allow a vote. They broke the law in order to implement their ideological position.

My question for the member on the Canada-Panama trade agreement is--

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, I rise on a point of order. There are some things that we can let pass in the House, and the member for Malpeque has a lot of liberalism in the House, but he just stated that the Conservative government broke the law. He knows very well that the court decision that just came down about 10 days ago or less said that the Conservative government acted in full respect of the law in all of the legislation and everything that pertained to it.

The member should correct himself.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, one of the big areas in the Panama trade agreement is the reconstruction of the Panama Canal to allow super Panamanian vessels to go through it. The government has not informed us on this issue but the Panama Canal authority gives preference to Panama nationals and maybe even to the United States in this area.

Does my colleague see that as a concern?

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I absolutely do see that as a concern. I think this might be a half-baked document that we are dealing with. If we have not gone to the greatest length possible to ensure the best advantage to our country and not just to benefit others in this, then why are we in such a rush to do it? We believe that fair trade should be the overarching principle and not just an afterthought of these negotiations.

We should not need to debate these things in the House. Eleven legitimate amendments were put forward at committee and not one was accommodated by the other side. Members cannot tell me that none of our international trade critic's comments had any merit whatsoever. That is not the spirit of open and honest debate and consultation. That is ramming something through for some other vested interest, not the best interests of Canadians and Canadian industry.

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, it is always better to follow the member for Winnipeg Centre because then everybody on the other side of the House is awake and I appreciate that.

I get nervous when I read about free trade deals with countries like Panama. I come from a labour background, working for trade unions. I know when we reach agreements with other countries that have very poor labour relations records and very low wages, generally Canadians suffer. Canadian workers suffer, unionized or not, because we are now trying to enter into a race to the bottom. That nervousness is part of what drives me to want to speak to this bill.

The agreement with Panama does not correct the very shoddy state of the labour relations in Panama. We are not dealing with a country on an even footing. I appreciate the comment of my friend from Winnipeg Centre, that we do not always want to be on an even footing. We want to have agreements with countries regardless of whether they are our equals because we hope that our entering into these agreements will raise everyone's standard of living in both countries.

However, the experience I personally have had is that when there is a low-wage jurisdiction to send jobs to and there is nothing to prevent the products or services that come from that low-wage jurisdiction, Canadian corporations, even big multinational corporations based in Canada, are quick to send those jobs to those other countries, thus hurting Canadian workers. Even in knowledge-based industries, film and television production and in the newspaper business, we have seen jobs move out of Canada into low-wage jurisdictions like Panama because there is nothing the government has done to prevent it. There is no barrier whatsoever. With this bill, we would create even fewer barriers to a low-wage jurisdiction and one that has very little, if any, labour protections for organized labour in that country.

We spent quite a bit of time debating Bill C-10, which had in it some raising of the bar for people who were involved in drug trafficking, with a mandatory minimum five-year sentence those people. Even if that person is growing as few as six pot plants to alleviate symptoms from multiple sclerosis, he or she might go to jail for five years. The good news in that case is that person would not stay in jail for five years because he or she would likely be dead before that.

The problem is we are about to enter into an agreement with a country with a large part of its economic basis being the drug trade. How is it that we are opposed to the drug trade when it is in Canada, but we are in favour of entering into a deal with a country where probably billions of dollars, because there is no way of disclosing how much, is being laundered from the drug trade in that country? That gives me pause and it should give everyone here pause, that we should not be encouraging deals with drug dealers. That is just not on, as far as this side of the House is concerned.

There is no agreement on tax information exchange, so we do not even know the size of the problem. Both the Conservatives and the Liberals have agreed that the tax-doubling agreement is enough. It is not enough. It does not disclose any of the illegal income that is floating around in that country as a tax haven, a tax haven for drug dealers and drug cartels. We believe most of this income is from money laundering that cannot happen in Canada because we have good financial and taxation regimes that prevent it. Now we getting into bed with a country that permits it and will not even disclose it. The OECD had it on its grey list as one of the countries to not do business with, yet we are about to do that.

There are already too many drug dealers in my riding. What kind of a message does it send to those people who are doing harm to our community and our citizens when we are entering into an agreement with a country that is notorious around the world for being a haven for money laundering for drug dealers? I am sure there are a few Panamanians in my riding, although not very many. There are probably far more drug dealers.

Last summer we had the police task force on anti-violence and drugs in my riding. Our riding was showered with many more police officers over the course of the summer to try to weed out some of that drug problem. Yet we are saying that it is okay to do business with what essentially is a country that harbours and is a haven for the drug trade. That does not make sense to me and it should not make sense to my constituents either.

For example, last week I had a meeting in my riding with a bunch of youth from the York Youth Coalition. One of the young folks asked me what he should tell the kids in the riding who could not get jobs. Over the course of the past few years of trade deals all the manufacturing jobs have left the riding. In part, they have gone to the U.S. and to low-wage countries as a result of free trade deals that the government has signed with other countries. These kids who cannot get jobs, or if they do get jobs, they are for 20 hours a week at $9 or $10 an hour, discover very quickly that they can earn $300 or $400 in an hour standing on a street corner selling drugs. He asked what he should tell these kids. He said he told them that it is wrong to sell drugs, but he wanted to know what to tell them about how they could move forward in society, how they could expect to, at some, point make a living that would sustain a family when the jobs had disappeared.

As with my friend's riding of Winnipeg Centre, which had huge and burgeoning textile businesses, we used to have a litany of manufacturing that was part of Ontario's manufacturing industry, to the point where every June the manufacturers would line up in the high schools to solicit the kids graduating to come and work in their factories. The last time that happened was probably 30 years ago. Stores like Wal-Mart certainly do not line up in the high schools looking for kids. The kids come pounding on those doors looking for $10 an hour jobs. It is a very desperate situation where I am. We have only ourselves to blame as a result of some of these trade deals.

I am not saying that we, as an opposition, are opposed to anything to do with trade. That is not the case. However, we need to protect our interests. We need to protect the interests of Canadians in the deals that we do exercise with other countries. We need to protect the labour rights in those countries. We need to ensure that we are not in a huge race to the bottom in which our minimum wage will never go up because we now compete with minimum wages of $1 an hour or $1 a day, depending on the jurisdiction with which we are about to compete. There are no protections from labour unions in those same countries.

We have made proposals in the past to amend these agreements to protect the labour rights of Canadians and to protect environmental rights and they have been rejected by both the Conservatives and the Liberals. Therefore, these kinds of sensible applications need to be made to this kind of an agreement before we enter into it.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, if I understand the member correctly, he is saying that Canada should just ignore countries that have some internal problems with which they are struggling. In the case of Panama, he says that the drug industry is creating an economy there and that there is no hope for it. We should let the good folks of Panama suffer under whatever type of nasty environment is there, cut them loose and forget about them, rather than try to develop a relationship with them through trade and show them that there is another way to improve their economy, which is through good trade practices with a country like Canada. We have many things we can teach countries like Panama.

A few short years ago, Colombia was a country that no one wanted to go to. Look at Colombia now. We have a trade agreement with it. It has a burgeoning tourist industry. It has turned around because there were some people in charge of the government who said that there was a way out, that there was hope for the country and they looked for help.

Does the member, maybe just for a second, think that Panama is asking Canada to give it a hand to get out of that desperation? Is he cutting the kids in his riding loose? I do not think so.

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, the issue is not that we cut these countries loose. The issue is that we insist, when we enter into negotiations, that they clean up their act, that part of the condition for Canada entering into an agreement with a country like Panama is that it prevents the money laundering that continues to go on for the drug cartels, that it enters into legislation that gives workers the right to organize and the right to have their disputes settled by arbitration.

Those are the kinds of things we should do, but for some reason, the government is opposed to those kinds of measures in these trade agreements. I think it is because they are really investor agreements and not trade agreements and the government is trying to protect the investors. I hope I am wrong.