Foreign Affairs Committee on Nov. 24th, 2009

[Romina Picolotti]

Yes.

First, though, if you will allow me, perhaps I can answer the last question a little better. Did I have contact with the Canadian government? As the environment secretary, I did not have contact directly with the Canadian government, but there were demonstrations before the Canadian embassy in Buenos Aires by the communities that were affected by this project. There was engagement, a lot of engagement, between the mining secretary of Argentina, the mining secretary of San Juan, the Governor of San Juan, and the Government of Canada. They were invited to Canada. They went to Canada many times, at least once a year. So there was engagement between the two governments, but there was not engagement between the environmental parties of the governments.

Turning to how this law can help, I would say it's very important, as I said before, to have collaboration between governments to control this economic giant. That seems to work much better, as it did in Shell case. The Netherlands government collaborated with us on that, and suddenly Shell had to change.

This is something that you need to be very aware of. Everything you do to control the way they operate from their headquarters obviously will have a good impact on the way they operate in their subsidiary country. It is extremely difficult for a government that is building its democratic institutions to build properly and with strength toward these big economic powers. There are many dimensions of control. I think countries should not only be promoting but also be working together on controlling.

That's what this bill is about, basically.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much, Ms. Picolotti.

We'll now move to the government side. Mr. Abbott.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you to both witnesses for excellent testimony.

Ms. Picolotti, I'd like to enter into a quick question and answer so that we can get through a lot of material.

First, I'd like to point out that from the perspective of the Canadian government, we support CSR and the intent of Bill C-300. The intentions are valid and worthwhile. However, sometimes we end up with unintended consequences.

What is your expertise on Canadian law? And this is not.... I just want to qualify what it is we're talking about here.

[Romina Picolotti]

I'm not an expert on Canadian law. My background is that I'm a lawyer, but I'm not an expert in Canadian law.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you very much.

How much money a year does Argentina make from Canadian mining companies? Do you have any idea?

[Romina Picolotti]

I can talk about some of the projects, but the amount will be around.... Let me check the numbers; I have them here. I want to give you exact numbers.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

An estimate would be fine.

[Romina Picolotti]

It's around $8 billion.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Is that Argentinian dollars?

[Romina Picolotti]

No, it's American dollars.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Eight billion American dollars?

How many people are employed in Argentina by Canadian mining companies? Do you have any idea?

[Romina Picolotti]

That varies, because the projects have different phases. I cannot tell you for sure. For example, on the Veladero Pascua Lama project, the company says it will hire around 3,000 people.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

So would it be in the tens of thousands?

[Romina Picolotti]

That doesn't mean that all of them will be Argentinian.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Yes, but of Argentinians, it would be in the tens of thousands?

[Romina Picolotti]

It could be.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

You spoke about the Barrick veto. It was interesting that Ms. Lalonde brought up the issue of colonialism. I have to say that I see this as being very much a colonial law whereby, if I understand you correctly, you would hope that the effect of this Canadian law would be to achieve results in Argentina. To me, that is a kind of colonial perspective.

[Romina Picolotti]

I would not say so. When you define “colonialism”, it's to override the jurisdiction and maybe take over the resources of a country, and this is not what the law is about, as I understand it. I think this law is about controlling how and in which companies the government invests and ensuring that these companies behave according to international standards. We're talking about international standards, so I would not see this law as a colonialist law. I think what is happening right now, and the consequences of not controlling, of not abiding by international standards, is colonialism, but not the application of this bill.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

But it's interesting that Mr. Tougas said the government of the Congo is not up to snuff; that is, not up to standard. I think you have said that the Argentinian process in place in Argentina is not up to standard. Therefore, you would be looking to Canada to apply law to bring the Argentinian or the Congo results up to standard.

[Romina Picolotti]

No, no. I'm sorry I didn't express myself very clearly. It's not my language.

As in many developing countries in the world—and I will set Congo aside, because really Congo is a different situation—those countries that are in the process of constructing democracy, in Argentina our institutions sometimes have not become strong enough to deal with these giant economic powers. This needs time.

What I understand is that the application of Bill C-300 will provide necessary help to these countries, because you control these companies at home. That will of necessity have an impact on how these companies behave abroad. This is what I'm talking about. I'm not talking about you coming to my country and taking over the jurisdiction to apply the law; this is not what I'm talking about.

What I'm saying is that applying this law in your own jurisdiction will necessarily have consequences in my jurisdiction. This is the case in many other areas too. If I control pollution on my side, that may have effects on your side: the application of the law in my jurisdiction will have a positive effect in your jurisdiction. That doesn't mean colonialism; it doesn't mean overriding jurisdiction. It's just the application of law in your own jurisdiction that has effects in others. That's normal, I think. It does not seem uncommon.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

If 60% of the world's mining companies are registered in Canada and a certain percentage of them said they didn't like Bill C-300 but still wanted to continue to work in Argentina and so were going to change jurisdiction and simply pick up and pull out of Canada, as far as their head office was concerned, then there really wouldn't be any net positive result, from your perspective, in Argentina, would there?

[Romina Picolotti]

No, but they could have done that already, without the application of the bill, because there are many countries with laws that are less severe than Canadian laws. So they could have said that.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Perhaps you make my point, that the standards of Canadian companies are possibly not as high as they should be, and there may be some problems in many distant situations around the world, but the fact is that with the standard that we have, I don't know that we would necessarily want to see people fleeing Canadian jurisdiction to go to a lower standard, because it wouldn't be a net result of benefit to Argentina or to the Congo.

[Romina Picolotti]

I don't think so, because these companies then would not be able to receive taxpayer money from Canadians. If I were a company, I would think twice about that, because I understand that if I were to leave Canada, then I would not be able to receive the pension funds from the Canadians to operate, isn't that right? So it's a trade-off.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much, Ms. Picolotti. Thank you, Mr. Abbott.

We'll now move to Mr. Dewar.