International Trade Committee on May 26th, 2008

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

I'll be very brief, Mr. Chairman.

Thank you, gentlemen, for being here today, both live and on camera. It's good that you've taken the time.

Mr. Wright, I want to congratulate you and the other Canadian companies that we talked to while we were in Colombia. I think it speaks to the quality of companies and their ability and confidence to go out in the world and compete and do a great job. We met with a lot of different groups--from displaced Colombians, people from civil society, and certainly some business people from Canada--while we were down there, and we heard some real success stories.

There was one thing that was very prominent in all groups--civil society and displaced people. There was a comment from Ms. Murray, from the opposition party. She asked a question of the displaced people we met on our first day there: Would a free trade agreement with Canada and Colombia benefit or harm your people? The answer was unequivocally, “absolutely”. That was the word they used. Although there are concerns down there with Colombia's past record in some areas, we all know and we heard while down there that they've made great improvements.

Another comment I heard down there that really stuck with me was by one of their ministers. I stand to be corrected, but I think it may have been the justice minister. He had been kidnapped for six years, escaped, and came back as a member of Parliament, and he had shown a lot of fortitude to do that. He said to us that Colombia has come a long way; that it still has room to grow, and he recognizes that, but at some point other countries around the world, including Canada, have to put some trust in Colombia.

Would you gentlemen agree with that assessment, that comment, by this gentleman? I don't know who wants to go first.

[John D. Wright]

I'm happy to jump in. I hope, by the way, the answer was unequivocally yes.

To be clear, in the time I started going to Colombia in 1992, in the time of Pablo Escobar and the Cali cartel and all that, the absolutely palatable difference in the atmosphere and in the vibrancy of the people is potently clear to anyone who has lived in the country or spent any time in the country. Yes, Colombia has a long way to go, but there is no question they're doing the right things to move down that path. To focus on things that have happened 20 or 30 years ago is a ridiculous way to predict what the future is going to be like in a country like Colombia. They're moving into the first world. Their economy is booming at a rate that would be the envy of almost any economy in the world. They have a highly motivated, highly educated workforce.

There's a joke in Colombia--but it's true--that there are two rush hours: one at five o'clock when everyone goes home from work and another one at 10 o'clock when everyone goes home from night school. The roads are literally clogged with people bettering themselves. So it's the right place for us to be doing business.

[Jean-Michel Laurin]

I agree with Mr. Wright. Colombia seems to be doing the right things, from an economic standpoint, and trying to improve the situation in their country for their people.

When you asked that question, or one of your colleagues from the opposition party asked that question...I understand the woman when she said it was totally a good thing for her and for her country, and she saw the trade agreement negotiations very positively. The main reason why you have poverty is because you have the absence of economic opportunities for the poorest. It's probably one of the main reasons why so many of them turn to the illegal drug trade, because for some of them it's the only economic opportunity they have. By providing them with other economic opportunities, to trade more freely with Canada and with other countries with which they're negotiating, I think it can only help the country move forward in the right direction.

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

Thank you.

[Dean Allison, Conservative, Niagara West—Glanbrook, ON]

John, my question is for you, sir, because you've certainly spent some time down there. My concern is that oftentimes we hear the Bloc and the NDP talking about the deaths of trade unionists. I'm not saying they've said this, but we have heard from others that it's almost the companies' fault. It almost seems, in that breath, that not enough has been done by the government, etc. We've even had some civil society groups and unionists say that Canadian companies are a problem. I have a hard time believing the testimony when they throw out that blanket statement, that all Canadian companies....

When we ask for some specific examples, there's not one. There's not one specific example about what Canadian companies are doing or not doing in terms of corporate and social responsibility. As a matter of fact, every example we have of Canadian companies clearly demonstrates the fact that not only are you guys doing the right thing, but you're setting the example; you're setting this money aside. So in that context, I have a hard time believing anything that comes out of their mouths, in terms of it being sort of everyone else's fault, and unionists...we're not sure what's going on.

My question to you is this. Because you've been down there, and it may not be directly...is it possible that some of the unionists who are involved or have been killed...that it doesn't relate to unionism at all, but it relates to crime or some of the other issues that are going on down there? We've been led to believe by some of them that it's because they would not get along with the companies. It's almost implied in some cases that it's the companies' responsibility. We have also heard that maybe it has nothing to do with the companies whatsoever, that there is an issue because of the drug crimes, etc., that go on down there. Has your experience given you any insight into some of that, or have you heard of anything that might even relate to some of these things?

[John D. Wright]

I don't think I'm the right person to provide a lot of insight into the union business in Colombia. I will say this. We jointly operate a field with the state oil company, Ecopetrol. Ecopetrol's field operators are unionized under something called USO. We have great relationships with them. It's not my impression that they're a bunch of hard-line guys trying to make some changes. But there have been times in the past when certain unions have been involved in fairly nasty sabotage operations, and there have been corporate fights and so forth.

I think if you look into the history of any industrialized country, there's been a stage where the union movement has gone through a phase like that, and I believe Colombia has gone through a phase like that as well.

As far as linking it back to the drug trade or to some of the illegal elements of society there, I can't imagine that there wouldn't be a statistical relationship, because there'd be a statistical relationship between almost any group of people and that group in society. So there probably is one, but I'm not the guy to make that assessment.

[Dean Allison, Conservative, Niagara West—Glanbrook, ON]

Thank you.

Mr. Laurin, in your experience, based on your companies that have been doing business with Colombia, is there any indication of that?

[Jean-Michel Laurin]

I would just like to refer to the first part of your question to Mr. Wright. You said you have so many good cases of companies going into Colombia--and you've seen some of those first-hand--doing the right thing and helping the country develop itself both economically and socially. That's my experience with companies, whether it's in Colombia or in any other developing country. It has been pretty good, and those cases never get put forward. I hope in your report you will document some of those cases you've seen or heard about in testimony here at this committee. Too often, all we hear about is that there are cases of companies that misbehave, and we never put a name forward. There's a lot of hearsay about the behaviour of Canadian companies in developing countries, and I think it's unfortunate, because all those who are members of CME....

We actually had a conference in Vancouver last week, called International Development Days, which is an annual conference we do in partnership with CIDA and the multilateral development banks. There are so many examples of companies doing business in South America, in Asia, and everywhere around the world, and doing the right thing. They are partnering with NGOs, partnering with social groups, and partnering, for example, with EDC, which has corporate social responsibility guidelines, an environmental assessment, and environmental requirements that they ask of Canadian companies.

Canadian companies are doing the right things mostly all the time, but we never hear about it.

I think there are some issues with the labour unions there. I think Mr. Wright has talked about that quite well. I wouldn't have a lot to add to what he said, but I think they're moving in the right direction, and that's what matters.

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Laurin.

We're going to try to get another quick round in, and that would be one question from each party. So I'm going to try to keep it to five minutes--tight--if we can. We're not even going to get through five minutes if we can't.

I have Mr. Dhaliwal on the list. You can do two and a half minutes each, if you want to. It'll depend on the length of the answers.

Mr. Dhaliwal.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

Thank you, Mr. Chair.

Mr. Chair, when we were in Colombia, we raised this issue that Dean Allison was mentioning, which is that the multinational companies in Colombia are accused of supporting and providing funds to paramilitary, military, and guerrilla groups. When I asked questions to all the people who appeared before the committee, none pointed out a particular Canadian company.

I would like to find out about your experience in Colombia when you were first there in 1992. Have you had to deal with the paramilitary, Mr. Wright?

[John D. Wright]

No. We've never ever had to deal with the paramilitary.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

The other issue is the gap between the poor and the rich. Even though we're saying this treaty will help the Colombian people, when we're looking at the most vulnerable of that society, how would they, in particular, benefit, and not only a certain small number of rich people, from signing this agreement?

[John D. Wright]

Just to be clear, I think every society has a wealthy sector. That isn't the sector of society we do business with. We're hiring technicians, engineers, clerks, geologists, field workers, cooks, and truck drivers. We hire across the whole economic spectrum. If we're providing employment, investment, and growth, then I have to believe that we're increasing the worth of the economy from the top to the bottom and that it pulls everyone along. And I think we've certainly had that impact in regions where we've operated.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

I have to commend you for spending 10% on corporate social responsibility, because other companies we talk to are spending in the range of 6% to 7%. That's what they mentioned for Columbia.

How do you make sure the money you spend on corporate social responsibility goes towards the well-being of the poor people or other people who really deserve it and not into the hands of those corrupt politicians or corrupt administrators who are facing charges?

[John D. Wright]

Unfortunately, I did pull the 10% number out of the air. I'm confident it's correct today, but it will change over time as our investment portfolio changes. I just want to be clear about that.

It's always a big issue, and whether we're investing in northern Alberta or in the southern part of the Llanos Basin in Colombia, it's the same issue. If we're going to put investments into the local economy, we want to make sure they have an impact and don't go into the pockets of the wrong people. We can focus on doing infrastructure-type investments. There's a clear response to an infrastructure investment. We can also focus on ensuring that as the education process goes forward, there are checks and balances and accountability associated with any kind of investment that goes into a region.

Just as a small example, we've been trying to improve the outreach capability of the local communities by providing a radio tower and a transmitter so they can transmit their own frequencies and get their message out. I'm not sure how we measure the value of that. We get feedback from the local community that it's a positive thing, and they're availing themselves of it, so that's an indication.

[The Chair, Conservative, Lee Richardson]

Thank you.

Mr. Maloney.

[John Maloney, Liberal, Welland, ON]

Are the labour and environmental standards of your Canadian operations similar to the operations in Colombia? If not, how do they differ and why?

[John D. Wright]

I would suggest that Colombia has a more rigorous labour law in place. Because it's under the civil code, a lot more specifics are spelled out. There are a lot more institutionalized social programs, particularly for people who receive income at the lowest level of the pay scale. That means there are subsidies on employment income, and additional salaries are paid if you earn below a certain level. There's a clothing allowance and a food allowance--provisions that aren't typical in a Canadian environment.

From an environmental perspective, the environmental regulatory and oversight system is very similar to what we're subject to in Alberta. There are certain differences between the Alberta example, which I know best in Canada, and the Colombian example. One of the specifics is that the Colombian example actually has specific time periods for environmental reviews to be conducted within and answers to be delivered from the government, which gives us some certainty that we're going to get an answer within a certain period of time. You'll also find that the standards themselves are very comparable.

There are certain things we're doing, and I'll give one example. We are making sure we are a world leader in providing an example for everyone in Colombia about re-injecting produced water into the aquifer in our oil field operations. That isn't a common practice down there because the water is essentially fresh, but it's standard practice in Alberta. It's a practice that we believe Alberta and Canada should be exporting all over the world.

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Maloney.

Monsieur Cardin.

[Serge Cardin, Bloc, Sherbrooke, QC]

Thank you, Mr. Chairman.

Mr. Wright, my question is for you.

I would like to remind Mr. Allison that during the course of our trip to Colombia, we were made aware of the fact that there are millions of displaced persons. Some people talked of 3.2 million and the number could reach as high as 4 million. The displacement of a good many of these people could be attributable to oil production or mining. We know that resource development takes up vast expanses of land.

Are there any Canadian companies that you are active in or that you know of that have caused the displacement of people? In what conditions have these displacements occurred?

[John D. Wright]

I can tell you first-hand that I'm not aware of a single Colombian who has been affected by any of our operations and is now considered to be a displaced person. In fact, our investments have had the opposite effect. We've attracted people to areas where we're working. We've created all the trickle-down industries in regions and built up local economies to the point where we've seen a net influx of people into areas where we're operating.

Certainly to my knowledge--and again I'm not an expert--the huge majority of displaced people in Colombia are those who've been threatened by the criminal elements of the society, predominantly the FARC, the ELN, and the narco traffickers. It has next to nothing to do with the oil industry, as far as I'm aware.

[The Chair, Conservative, Lee Richardson]

I think we have time for one quick question from Mr. Keddy, and we'll wrap this session up.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Thank you, Mr. Chair.

Welcome to our witnesses. I have a question for Mr. Wright.

You mentioned that you attract individuals into an area. Obviously they're looking for jobs, and they're looking for the spin-off jobs from people who end up depositing in that area. That's very commendable, and that's a story we heard from other companies working throughout South and Central America.

You said you recently travelled to Colombia. You've been down there since 1992, but you recently travelled with your wife and your four-month-old baby. I expect you consider Colombia safe enough for your family, which is commendable. Certainly we had a lot of security with us. I think that's normal procedure when we're down there, that the government wants other governments to be safe.

But overall, with your nearly eighteen years of experience down there, what have you seen vis-à-vis security of the Colombian countryside?

[John D. Wright]

Certainly my four-month-old daughter is welcome in Bogota any time she wants to go, but my wife insists on travelling with me every time I go down there, because she loves it.

The city has changed. It wasn't always like this. I think you have to be very clear that there has been a very distinct transition. The ex-pat people we post in Bogota typically don't want to leave. They like it there, and they really love the lifestyle.

The best anecdote I would suggest is that the traffic has decreased on the weekends because everyone is travelling to their country homes, which was impossible in the 1990s, for example. The FARC was very prevalent in the countryside, and they'd kidnap people from the side of the roads. That doesn't happen any more.

People are moving into the suburban regions. They're building country homes. The lifestyle is really improving for everyone there. It's palpable. You can feel it in the air. People are very, very invigorated.

I think it's a return to the Bogota of old. I never knew it when it didn't have the issues, but I imagine that's what it used to be like.

[The Chair, Conservative, Lee Richardson]

Great. Thank you very much, and I thank you for keeping the answers tight.

We're going to have to wrap it up. I very much appreciate your appearance here today following our visit. It's a very positive response. I must say it's very similar to what we were hearing in Colombia, as opposed to what we may have heard before we went there. This is a great follow-up, from that perspective. Thank you for your time today.

Mr. Laurin, thank you as well.

I think we've already signed off with Mr. Wright, but, John, if you're still there, thanks for doing this.

We're going to adjourn for a moment while we revert from the teleconferencing.