Evidence of meeting #63 for Industry, Science and Technology in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was witnesses.
A recording is available from Parliament.
NDP
Claude Gravelle NDP Nickel Belt, ON
So why is Canada different? Why are we different? Why do we let these companies come into our communities and rape our natural resources, when we can't even purchase some of their natural resources or their companies?
Partner, Fraser Milner Casgrain LLP, As an Individual
I recognize the inequity when there is lack of reciprocity. On the other hand, the argument used with respect to international trade issues is that if you start closing down and saying you're not open except for A, B, and C, ultimately that is going to result in a—
Partner, Fraser Milner Casgrain LLP, As an Individual
Well, I think we'd probably have trouble investing in many sectors in China as well, but that doesn't mean that Chinese investment in Canada is not beneficial.
NDP
Claude Gravelle NDP Nickel Belt, ON
We're not talking about a Communist country here; we're talking about Australia and Brazil. Why can they invest in our country, but we can't invest in theirs?
Partner, Fraser Milner Casgrain LLP, As an Individual
That's something that can be negotiated bilaterally between the countries. I'm not sure that using an individual transaction is the best way to go about it.
NDP
Claude Gravelle NDP Nickel Belt, ON
We have a couple of companies right now in my riding of Nickel Belt that are foreign companies. They're two mining companies. One is called Xstrata, and they're presently high-grading. Do you know what high-grading is in the mines?
Partner, Fraser Milner Casgrain LLP, As an Individual
It's taking off the good stuff.
NDP
Claude Gravelle NDP Nickel Belt, ON
It's taking all the good stuff.
Their mining resources were owned by Falconbridge, who would mix the good stuff with the bad stuff and take everything out, and the end product was even better than just high-grading.
Xstrata is doing that now. They've closed down some low-grade mines and they're just taking the cream of the crop, the high-grade. When there's no more high-grading, two things could happen: either they're just going to pack up and leave or they're going to come to the government with their hand out for grants to help them extract the lower-grade ore.
Do you think that's right? Do you think that the Canadian public should pay to extract low-grade ore that should have been taken at the same time they were taking the cream of the crop?
Partner, Fraser Milner Casgrain LLP, As an Individual
I can't comment on the reasons for their doing it and what their long-term plan is—
Partner, Fraser Milner Casgrain LLP, As an Individual
It's a difficult question for me to answer without knowing all the facts. The way you've described it, it certainly sounds bad.
Partner, Fraser Milner Casgrain LLP, As an Individual
I just don't know that I have the knowledge base to agree with you.
NDP
Claude Gravelle NDP Nickel Belt, ON
Well, if you're removing the cream off the milk, it's not very good milk, is it?
Partner, Fraser Milner Casgrain LLP, As an Individual
Well, I don't know, but if any company is doing that and is then planning to sell the company in the future, presumably the company will be worth less if all they've got left is the low-grade stuff,.
I can't comment on it in any particular—
Partner, Fraser Milner Casgrain LLP, As an Individual
Presumably they also want to preserve the value of the asset in order to get the highest value for it when they sell it.
Conservative
The Chair Conservative David Sweet
Thank you, Mr. Gravelle and Madam Walker. That has used up the time.
Now we'll go back to the Liberal Party for five minutes.
Go ahead, Mr. Rota.
Liberal
Anthony Rota Liberal Nipissing—Timiskaming, ON
Thank you, Mr. Chair.
I'll start, and then I'll split my time with my colleague Mr. McTeague.
Thank you, Ms. Walker. I'm going to continue a bit on what Mr. Gravelle was talking about.
One term that I'm hearing much more from people--not at a high level, but more at ground level--is reciprocity. Do you believe in such a concept? If you do, how would that work? How would we enforce such a concept, or is it impossible to enforce?
Partner, Fraser Milner Casgrain LLP, As an Individual
Reciprocity is a very big question. That's the reason people negotiate investment treaties. The idea is to open all sectors to investment for the two countries involved, or multilaterally as well.
It's probably erroneous to use the Investment Canada Act to stop investments because the other country wouldn't let us into their country. If you shut down investment into Canada, that may actually hurt Canada, whether or not you get access abroad.
Liberal
Anthony Rota Liberal Nipissing—Timiskaming, ON
Very good. That's pretty well what I expected. Thank you for that.
The other issue I want to touch on is non-compliance. When agreements are made, compliance seems to be an issue, partially because the agreements are secret. I can understand that, because there are certain trade secrets that have to be kept, but with regard to non-compliance, are there any amendments or any changes you would make to make it more effective? Again, you have an agreement that's done in secret and you have to enforce it. How would you see the compliance being enforced?
Partner, Fraser Milner Casgrain LLP, As an Individual
Well, they are monitored. The undertakings are monitored by the government. If you trust the government, then you should trust that they will look at these undertakings. You're dealing with Industry Canada. It's not as if you're dealing with the minister's office directly on that sort of thing.
Liberal
Anthony Rota Liberal Nipissing—Timiskaming, ON
“Directly”, I think, is the key word, and I guess “trust” is the other one.