International Trade Committee on March 30th, 2010

[Peter Van Loan, Conservative, York—Simcoe, ON]

Obviously I came here to speak about the Buy American provisions, but I'm happy to raise that. Obviously the Canadian government does take human rights seriously. We have made it a cornerstone of our foreign policy that we have a principled approach that puts human rights, democracy, freedom, and the rule of law at the cornerstone. That includes in our decisions about who to negotiate free trade agreements with and how we go about doing that.

The Canada-Colombia free trade agreement had with it parallel provisions dealing with labour rights and environment, both of which ensured that rights of Colombian citizens were secured and protected. That is an illustration of that principle at work. There was a suggestion from others, including from the Liberal Party, that there was a need for some additional protection in this case. The Colombian government has indicated that they are comfortable with that requirement from them. We, as a result, had no difficulty agreeing to that provision in this case.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

If you acknowledge that there are human rights problems in Colombia, since you agreed to such an amendment, how can you give any credibility to a report that will be produced by a country that does not have this situation under control? That is the big question. Colombia does not have its human rights problems under control and you agreed to—

[The Chair, Conservative, Lee Richardson]

Excuse me, Monsieur Laforest. The question is out of order.

It is my job as the chair to keep order. We are on the topic of procurement. I asked you once to refrain from deviating from the topic of the day, and the minister was kind enough to respond to your question anyway. You're burning up your clock on questions that aren't relevant to this meeting. I'm sorry, but it's my job to remind you that you are out of order.

If you have a question on the subject of the day, please continue.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

That is my question, if the minister wants to answer it.

That is all for me.

[Peter Van Loan, Conservative, York—Simcoe, ON]

I'll simply restate what I said before. Obviously we do take human rights seriously. We were satisfied with the human rights situation in Colombia, where we believe the government has made tremendous progress in challenging circumstances, facing an insurgency, and improving the human rights conditions.

We also believe that free trade agreements, such as the Canada-Colombia free trade agreement, are important to improve the living conditions and the human rights conditions of the citizens in the countries with which we make such agreements. That is again a lesson of history. The free trade agreement in this case will have that kind of salutary effect and benefit for the people of Colombia.

As I understand the proposed Liberal amendment--of course, it has not yet made it to committee to be tabled--you would have Canadian officials assessing the Colombian human rights situation, as well as Colombian officials assessing their own human rights situation, so it's not merely a question of self-assessment. But we've already had the benefit of that kind of assessment from our officials. That is why we were satisfied with the human rights conditions there and why it is beneficial to enter into the agreement at this time.

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Minister, and thank you, Monsieur Laforest.

We'll now move to Mr. Julian for seven minutes.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you, Mr. Chair.

The study is actually on Canada-U.S. trade relations, so I'll have a couple of questions on Buy American and a couple of other questions related to Canada-U.S. trade relations, just to flag that in advance.

Thank you, Mr. Minister, for coming forward.

We've heard from witnesses. One of the witnesses, Carl Grenier, who is a trade expert, as you well know, stated that the Buy American agreement is only the second-worst agreement that Canada has ever signed; the first one was softwood lumber.

I think we were all surprised around the table, Mr. Minister, when members of your department came forward and we asked them the question Mr. Brison referenced earlier about evaluations, estimates, and impact analysis. Apparently nothing had been done to actually show the impacts of this agreement, as far as where we would gain and where we would lose. It all seemed to have been done on the back of a napkin.

So my question to you today--a few weeks later--is have you done your due diligence? Can you provide any impact analysis reports or estimates to the committee? Is there anything that shows what the government, in a leadership role--and you're absolutely right that the federal government has a leadership role in this regard--has done to show what the impacts are of this agreement?

[Peter Van Loan, Conservative, York—Simcoe, ON]

The impact of the agreement is to open up markets or keep markets open in the United States that would otherwise have been closed under the legislation.

As far as what was on the other side of the equation--and that's what you're driving at when you talk about an analysis and what Canada gave up--the reality is, nothing. The municipalities participating through the Federation of Canadian Municipalities and the provinces all indicated that their procurement processes were unrestricted, by and large. Any restrictions they had were reflected in this agreement in the carve-outs under the WTO procurement agreement provisions. As such, to the extent that they had sensitive sectors they wished to protect within procurement, that was done. As a result, every single dollar benefit, every single gain made through contracting with the United States subsequent to this agreement, represents a net benefit to Canada, Canadian workers, and--

[Peter Julian, NDP, Burnaby—New Westminster, BC]

My question was very specific: do you have any figures to share with us? Are you saying no?

[Peter Van Loan, Conservative, York—Simcoe, ON]

I'm giving you a figure, which is that every dollar that will come through contracts in the future will represent a net benefit. It's not a complicated analysis that needs to be made. That's why the agreement was so strongly supported by the provinces, the Federation of Canadian Municipalities, the industries affected, the Canadian Chamber of Commerce, and the Canadian manufacturers. They all stood to gain.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Minister, thank you for that. I beg to differ. I think the more the information comes out about this agreement, the more people seem to be concerned.

Now, a senior official with the Quebec Ministry of Economic Development estimated the value of unallocated funds of these seven U.S. programs that we supposedly had access to at $1.3 billion, and the value of the contracts that we're giving up, opening up to American businesses, are estimated at more than $25 billion, and some estimates range even higher.

So my question to you is very specific. If you don't have the figures to share with us, do you have any idea about how many jobs will be lost in Canada as a result of this? If we are having access to $1 billion and giving up $25 billion, there are very clearly concerns about what the government is giving up.

My related question is this. How many programs of the seven actually had full commitments already made--in other words, all the contracts were signed and no money was available except for re-tendering? How many of the seven were in that position?

[Peter Van Loan, Conservative, York—Simcoe, ON]

With respect, Mr. Julian, your question presupposes a world that does not exist, a world where Canadian provinces and municipalities had imposed across-the-board prohibitions on contracting with American companies. That was simply not the case. In fact, they almost all ran broad, wide open procurement with a few very small exceptions, which are reflected--

[Peter Julian, NDP, Burnaby—New Westminster, BC]

No, many of them have local preferential--

[Peter Van Loan, Conservative, York—Simcoe, ON]

--in the exceptions they put on the table in what we offered on the World Trade Organization government procurement agreement provisions. So to say we're suddenly opening up $25 million of access--

[Peter Julian, NDP, Burnaby—New Westminster, BC]

It was $25 billion.

[Peter Van Loan, Conservative, York—Simcoe, ON]

--or $25 billion of access that was not there already is simply wrong.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Well, I beg to differ, and most of the witnesses begged to differ as well. But I'll go on, Mr. Minister. I do have two more questions, so if you don't mind....

[Peter Van Loan, Conservative, York—Simcoe, ON]

It is simply wrong, and as a result, anything that flows from that presupposition seriously.... What we gave up was not $25 billion of access. We gave up the right to close our markets. We gave up the right to engage in a ruinous trade war--

[Peter Julian, NDP, Burnaby—New Westminster, BC]

And local procurements and fair wage policies--

[Peter Van Loan, Conservative, York—Simcoe, ON]

--in a country where two-thirds of our economy is trade-based; that means we gave up the right to shut down two-thirds of our economy and--

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you, Mr. Minister. I'd like to move on to my final two questions, if I might.

The first one is regarding the softwood lumber sellout. There is currently, as you know, yet another case before adjudication around Quebec and Ontario forestry practices, and there is the apprehended case around B.C. stumpage. The anti-circumvention clause seems to be tailor-made for the United States. How is your ministry preparing for additional fines in addition to the $68 million that we're currently paying?

My final question is around the NAFTA secretariat. The government has announced that it's eliminating the Canadian section of the NAFTA secretariat. Does this mean the government is giving up any possibility of a fair dispute settlement mechanism through NAFTA?

[The Chair, Conservative, Lee Richardson]

Sorry, Mr. Minister, you have just one minute. You may want to pick one or the other.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Okay, well, I'll start with the NAFTA secretariat. We're talking about one position that was not filled, that will not be filled because the functions are being carried out by other officials--and will continue to be carried out by other officials, quite capably and competently, I might add.

In terms of the softwood lumber agreement, I'll simply say this. The softwood lumber agreement has been strongly supported by the provinces and strongly supported by the softwood lumber industry. The reason for that is it has provided them with security of access that otherwise might be lost, with opportunities that otherwise might be lost.

Of course, we face a very aggressive lobby on the American side. The softwood lumber agreement has provided a significant measure of protection against that. Of course, it requires that we still continue to meet that counter lobby at every opportunity and aggressively advance our industry's interests, which we will continue to do.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Do you have any plans on how to fund these additional funds?

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Minister.

Sorry, Mr. Julian, we've passed seven minutes, but thank you, that was pretty close today.

We're going to move now to this side of the table and the parliamentary secretary, Mr. Keddy.