Foreign Affairs Committee on April 23rd, 2012

[David Tennant]

It was a project around a product that was indigenous to South Sudan, called gum arabic. It's a hydrochloride and it's harvested similar to the way you harvest maple syrup; that's the closest I can get to it. It has wide-ranging, myriad uses in industry. It grows in a very narrow band across north Africa.

The quick version of the story is that we developed that industry. We developed an association for the Sudanese, with an American company, one of the largest processors of gum arabic in the world. When we had taken it as far as we could take it, we introduced the two parties. Subject to the world economies, in terms of whether it's a commodity.... That is now being run by the Sudanese.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Wonderful.

I want you to tell us again, you're all volunteers? Everybody has just given their time?

[David Tennant]

I have two of my volunteers here today. Jeff Lang is our chairman, and the young blond guy across there is now known as the “Birdman of Jebel Lado”. We had a problem with bird infestation over there. We like to think we're creative in solving the problems. He went over there and captured some hawks. He owns a company called Predator Bird Services. He scared away all the pesky birds. We did not go to South Sudan to feed birds; we went to feed people.

We have a tremendous group of volunteers, and nobody is paid.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Incredible story.

Are you familiar with Masara in Ghana, a corn company?

[David Tennant]

No, I'm not.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

We visited that a year ago, and it's much the same. They've introduced different practices and they've increased....

One of the areas they're very strong in, and you mentioned that, is the storage. Obviously you can produce corn, but if you sell it right at that time, you're going to get the lowest price. Of course, the best thing to do is to store that corn and then to trade.

What other countries in the area, or in the world—I guess I'm looking broadscale, down the road—would become hard-core customers of the corn that you produce in Sudan?

[David Tennant]

It would include Somalia, Eritrea, many of the sub-Saharan countries, and Ethiopia.

If I may say as well, Mr. Van Kesteren, one thing that's happening in some of these countries that bothers me—I'm European, so I can perhaps say this—is I think the European influence, where they're against hybrid seeds.

Here's a very quick comparison. A farm that has opened is owned by the president's nephew and joint-ventured by a Thai company. Their methods have created a yield of half a tonne per acre. They have all of the equipment and all of the money they need. Our yield is two tonnes per acre, and we can get to three and a half tonnes per acre.

These host countries must understand that in North America, in both Canada and the United States, we've been using hybrid seeds for years. Our yields this year were because of one thing: we used a seed that was capable of resisting the pesticide that we used to kill the weeds that are completely intrusive.

That's something I think the Canadian government should be working on.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

That leads me to my final question. When MPs come to visit, and I'm suggesting that some of the MPs just go out there, what can we do to help you? You mentioned Ridge college, which is actually Ridge campus in my riding. Art Schaafsma has been working with your project too.

What can we do as members of Parliament when we visit the government and try to alleviate some of those problems? Where can you direct us? And is that a suggestion, possibly, that you'd like to see some help in that area?

[David Tennant]

Yes. As a matter of fact, I carry a request from the Minister of Agriculture for the Republic of South Sudan. I met with her before I left in January. She asked if we could sponsor even one student to come to Canada, to someplace like Ridgetown college or the University of Guelph, to study agriculture and to study our methods.

With respect to our American guests, North Americans do agriculture better, I think, than any country in the world and any continent in the world. If we can take the people from over there and bring to them our Canadian methodology, our seed development, our pesticide, our fertilizer development, I think Sudan can become, although perhaps not in my lifetime, the breadbasket of Africa. It was once.

[The Chair, Conservative, Dean Allison]

Thank you very much.

We'll move back over to the opposition and Mr. Dewar, sir, for five minutes.

[Paul Dewar, NDP, Ottawa Centre, ON]

I just have a quick follow-up question for Mr. Baker.

I was intrigued by your comments about the Dodd-Frank approach. You mentioned the EU. I was just wondering if you would recommend that approach to us here in Canada. We're doing a report. I was just wondering what your comments and opinions are on that.

[Raymond Baker]

Yes, I recommend the publish-what-you-pay movement, the efforts by the extractive industry's transparency initiative, and what is incorporated in Dodd-Frank. I'm less concerned about whether the accounting is done on a project-by-project basis or a country basis. I think that is a question that remains to be most effectively answered. But I don't think there's any question that extractive industries need to account, in very careful terms, for what they are paying to the governments where they are established. They need to move toward full reporting of sales, profits, and taxes paid in countries in which they're functioning.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you.

Madam.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Thank you very much.

Obviously, all this money that flows out of developing countries, in particular in relation to extractive industries, is a major impediment to their development. You said that it's a two-way street. There are things developed countries can do.

I would like to know a bit more about the things developing countries can do, some of which you mentioned, inside their countries to prevent that outflow. Do you have any views on how we can help them do that?

[Raymond Baker]

Most developing countries can certainly strengthen their anti-money laundering legislation, which is not particularly effective in many countries.

Another area where many countries can be strengthened is in their financial intelligence units, their FIUs. Many countries in Africa have FIUs that are functioning only very, very marginally. South Africa happens to have a superb FIU that has indeed offered to be of assistance to other African countries establishing financial intelligence procedures.

With the availability of online pricing data I think there's adequate opportunity to strengthen customs administrations. They can look at imports and exports and see if that invoice conforms to a reasonable measure of world market pricing. That kind of data is becoming much more available, and customs officials and ports officials and tax officials can make use of that kind of data. We've certainly advocated that this kind of information, which is becoming more readily available, be taken up by the developing countries themselves.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Thank you very much.

Mr. Tennant, thank you for your interesting presentation. I have a quick question for you.

You mentioned something about companies exiting a country and what happens afterwards, but you didn't have an opportunity to go into great detail about this. I was wondering if you could talk a bit more about that and if you have any examples to give us.

[David Tennant]

I'm not sure I can give you specific examples. One of the things that bothers me in South Sudan is the operators of the oil fields, who, in my opinion, will take the money and take the oil with very little benefit to the people of South Sudan.

There are large tracts of land, I believe in the north, being leased to companies out of China that will simply take the product to China. I know that in Juba, where the Chinese are heavily involved in construction, they use convict labour from China. You get a choice: you can go to jail in China or you can go to work in South Sudan.

The training programs are non-existent, which means that when the oil fields are depleted, none of the local indigenous people are trained. That should always be the objective of the international community, whether the business is large or whether the business is small. Maybe not so much in developed countries, but when you're dealing with developing countries, there must be a moral imperative for large or small companies that are working in these areas.

[The Chair, Conservative, Dean Allison]

Thank you.

We're out of time, but I know that Nina wanted to ask a quick question to wrap up.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Thank you.

Thanks very much to both of you for testifying before our committee and sharing your knowledge with us.

Mr. Tennant, like you, I have spent a lot of time in Africa. I have lived in a country called Liberia and have travelled extensively both as a private citizen and as a parliamentarian in visiting Kenya, Rwanda, Burundi, and Nigeria, among many others. From these travels, what I have gained is a better understanding of the great potential of both the African land and the African peoples. There is a tremendous economic opportunity just waiting to be realized.

The Sudanese people need jobs. They need employment. Can you give us some insight into what can be done to encourage companies to take risks and to go into countries such as Sudan?

[David Tennant]

Well, if you're talking about the private sector, I think it's the opportunity to make returns, to make a profit. I think that's number one. I'm not a tax expert and I'm not an international money expert, but I think if you can give incentives for specific areas, for specific areas for training and for specific areas that allow the indigenous people to take over....

The other thing that we should also realize is that the indigenous people have a responsibility here and the host governments have a responsibility. We're seeing it in Sudan, where people are saying: “You're the international aid. We demand this. We demand that.” You have to at some point say, “You have to work for it.”

We can help build nations. For years Canada has helped through CIDA, through its governments, in building nations, but we can't do it.... We can help and we can create an environment, but the people who have to build their nation are the indigenous peoples of that nation, just the same as Canada built this nation.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Mr. Tennant, from your experience in Sudan, what kinds of opportunities do foreign corporations provide to local populations in Africa?

[David Tennant]

As an entrepreneur myself, if I were a lot younger.... It's like an entrepreneurial sandbox in that there are opportunities in almost all of the sectors. I think the biggest opportunity for Canadians is in the agricultural area. I'd love to be able to promote to Canadian farmers the opportunities in South Sudan.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Thank you.

[The Chair, Conservative, Dean Allison]

Thank you.

Madam Laverdière, one last question.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Thank you very much, Mr. Chair.

Thank you very much again. The way I understand what you're saying is that it is not to rely so much on foreign companies that come in, maybe for drilling, and then move out, but to rely on building the local entrepreneurship as a means of development. That brings up a question for me, because we've heard from some extractive mining companies, for example, that were talking about doing training around their activities. But obviously the training cannot be training in the extractive industry or in the mining sector, because when the mine closes, all these people have no means to reintegrate into the market forces.

I would like to know if you have any comments on that.