Mr. Speaker, it gives me great pleasure to enter the debate on Bill C-57, an act respecting the World Trade Organization. This is an extension of the Uruguay round agreement.
It is appropriate to consider why we need free trade. As the history of the world has developed different countries have created trade barriers. We have used all sorts of tariffs in our country to protect local industry.
We support and protect quite often inefficient industries all over the world. In other words when somebody can make widgets a bit better in Africa then we can and should allow them to do it. We may well do better some of the things we are strong at such as the pulp and paper industry. This is why free trade is good.
The important part for Canada is to realize that by freer trade we are making the trading mechanism more efficient. We are also increasing the actual trade in business that goes on in the world. Canada will have a percentage share of a larger pot. We will all be better off. Basically free trade is a win-win situation.
Another aspect in our economy and in the world is that bigness in industry is going out of vogue. Large industries throughout North America, Europe and other industrialized countries are under constant pressure to downsize, to be smaller, to be more effective and to be more efficient to deal with specific niche markets in their own communities. These two factors have a big role to play for Canada.
Canada has been very much involved in the resource based sector. I think of iron mining, steel fabrication and forestry products. All these industries, it would appear to me, are somewhat in decline in the sense that we have to put more value into our products. We have to add more value to them to be more efficient and attract world trade. It is no longer good enough to sell raw logs to China, for instance. We have to fabricate them in our country.
Earlier my colleague talked about the grains industry. It is important that we value add in the prairies before they go into the final markets.
In addition Canada has been typified as a country that has very specific trade alliances. Historically it started with the United Kingdom. It has since switched in the last century primarily to the United States. We talk about Canada being a world trader but in reality our major trading partner, the United States, accounts for something like 90 per cent of our trade. We are really not a world trader; we are a North American trader.
It seems this has to stop. We have to look at the world. We have to look at other markets. There are a number of reasons for it. It could well be that the U.S. market will not be expanding as rapidly as some other markets in southeast Asia, possibly Europe or even eastern European countries. These could well be the trading partners that will push Canada and its economy toward prosperity.
The World Trade Organization gives Canada an open door, a chance to do something different, a chance to trade differently. As we approach the 21st century it is a good time to look at our industrial policy and how it can change.
I talked about small and medium sized businesses. These businesses are growing rapidly and can attract world markets. They are the biomedical research industry, software development, telecommunications and geomatic engineering. These are some of the areas our country excels in. One of the problems is
that Canadians do not realize how good they are. They do not realize that people in other countries think Canada is a world leader in some of these areas.
The smoke stacks are growing idle all across North America. The smoke stack economy is falling into decay. For instance, a recent book by Nuala Beck states that in British Columbia more people are engaged in communications and telecommunications than in forestry. In Nova Scotia more people are engaged in education than fishery, forestry and construction put together. This should turn on a light. It should tell us that things are changing in our own country.
How can the government assist and make Canada a world trader? Small and medium sized business will be the engine of the future fueled by brains. It will be driven by a new set of entrepreneurs. These people will be the new employers. They will be the wealth creators. Statistics Canada recently showed that job growth was almost entirely related to companies with fewer than 50 employees. Those with greater than 50 employees were actually net job losers. When we talk about creating jobs-and indeed our government is committed to it-we must focus on where those jobs are being created. Clearly it is in the small and medium sized business sector. Employment growth in these companies averages 3 per cent to 10 per cent a year.
Canada has been historically a trading country. Thirty per cent of our gross domestic product is related to trade and most of the trade occurs with only a few companies. These are the companies that are downsizing about which I spoke before. Often they are the old industry companies.
We must create a new impetus to move the small and medium sized businesses into the international trading environment. Government can play a big role in this. Indeed the Department of Foreign Affairs and International Trade has some new ventures going with our banking community which are located in most of our international environments.
They are studying what it takes for these small and medium sized businesses to effectively access international trade. They have aggressive training sessions and are looking at new, intuitive ways to finance export trade for the small and medium sized business sector. The Export Development Corporation and the Canadian Commercial Corporation will be retooled and redefined to provide funding and capital support for small and medium sized businesses to access international markets.
We need to restructure our foreign missions. I had the advantage of being in Beijing in early May and visiting our embassy there. I was surprised at the attitude of some staff. Their orientation seemed to be to continue on in the international environment. They were going to move from Beijing to Africa and were never coming home. Quite frankly I took offence to their attitude toward Canada. This has to change. These people have to relate more to how we are going to expand trade for small and medium sized business rather than the IBMs of this world.
As you know, Mr. Speaker, the Prime Minister and others recently came back from the Team Canada mission. I would like to say one more thing about my own mission. Incidentally China is not a signatory of GATT but we feel that it will be in the near future. While I was in Beijing I was able to make a contact for some of the people in my riding. I note that the township of Whitby has entered into an economic alliance with one of the provinces of China. Eighty-five million people live in this province. Some of the small and medium sized businesses in Durham are now trading with these people. This has created employment. This is happening now. This is not an intellectual exercise.
Sometimes governments are the worst enemies of small and medium sized businesses. For instance the small and medium sized business community is assessed high taxation, both commercial and business taxation, meddlesome provincial standards and regulations, the dreaded GST and high levels of personal and corporate taxation.
The deficit has hemmed us in. It has also created a crowding out in the capital markets. The small and medium sized entrepreneurs cannot get the capital they need to establish themselves. Our best commitment to the small and medium sized businesses will be to reduce deficits, to reduce demand on borrowing to allow capital markets to form and be available to small and medium sized businesses.
The government has done some things. They involve the Small Businesses Loans Act, venture capital programs, but there is much more we can do.
I am concerned that the small and medium sized sectors do not have adequate capital markets. We need to create an over the counter small market for small and medium sized businesses, one that is easy to access. It should not be like the TSE which requires five years of financial statements and a fairly substantial track record nor like the Vancouver Stock Exchange of which a lot of the investors of this country are a little afraid.
What we need is a regulatory process that will allow Mrs. Smith at the corner who would rather invest in GICs to invest in those small and medium sized businesses.
In conclusion I would like to reiterate that it is small and medium sized business, together with the GATT negotiations and Bill C-57, that will provide Canada a new future as it moves into the 21st century.