Mr. Speaker, again it gives me pleasure to speak to Bill C-57, the enabling legislation to implement Canada's participation in the WTO. To introduce more or less some of the ideas I would like to put forward, the big thing we all have to remember in the developing world and in a country like Canada is that globalization is an important part of what is happening in the environment in which we now have to do business.
We all have to recognize that the European Union is growing, is becoming more of an entity, more of a functioning trade part of the world. It was interesting this morning in talking to the President of the Czech Republic to hear him saying that they are an associate member of the EU, how they hope to become a member and by the turn of the century how that will be a very important part of their trade in the world.
As well of course we have the Asia-Pacific and the developing tigers with all of the power and strength in trade there. Then we have the Americas as the third major trading unit. As Canadians we are making a terrible mistake if we do not realize that we must become major players in the OAS and in all that means to the developing of Canadian business and Canadian jobs.
We have had a number of people tell us about some of the negatives, some of the concerns that we will not be able to compete, that our big brother to the south will gobble us up. I do not see that as being a fear. In fact I see the WTO as opening up things so that we now are dealing with a much more level playing field, as the hon. member across the way mentioned. That playing field will become even more level and we will do better when competing with the U.S. and with other countries.
We must become very aggressive. We have an inferiority complex and have not always been as aggressive as we could be in the world of international trade. We should assure the people who have concerns that there is a review mechanism and that the dispute settlement mechanism will work much better than anything we have had up to this point. It will be an opportunity to review the issues that affect the steel industry, the beef industry and those industries that have some concerns. We should reassure them by telling them they will have the ability to question the areas of their greatest concerns.
According to this legislation and similar legislation being passed by other governments of the world, WTO members agreed to reduce or eliminate tariffs and other trade barriers. This is pretty good stuff and is the kind of thing we need going into the 21st century. It is the kind of forward looking legislation that is going to create jobs and provide Canadians with a way of life to which we have grown used. It is the only way we are going to maintain that way of life.
Before I get into the main part of my speech, I would like to quote briefly from a chapter on international trade in the Canadian foreign affairs review, of which I and other members were a part. The chapter called for building shared prosperity. I put emphasis on the word prosperity. We are threatened with losing our position, our status and our quality of life and this is a way to turn things around.
I hope the Minister of Foreign Affairs will pay particular attention to this chapter and this section. One of the statements in the chapter reads as follows: "The wealth, prosperity and well-being of all Canadians depend in a decisive fashion on international trade, on foreign investment and on financial arrangements that facilitate or hinder trade and investment". We should hang on that for a minute and think about what it means to us going into the 21st century.
It goes on to state: "In the next century the key to Canada's involvement in the global economy will be its ability to build mutually rewarding trade and investment links with the new trading giants who will be our neighbours to the east, the south and to the west". We must look far beyond our borders for trade. It is one of the most important areas for our economy and therefore legislation that deals with it clearly affects the lives of every citizen.
I am sure it is no surprise to anyone that I am a free trader and that in my previous life, before I was elected to this position, I was a businessman. I believe that the WTO presents us with a singular opportunity to gain access to many new markets.
As already mentioned by several of my esteemed colleagues in the House, some new areas which have been added under the WTO over the old GATT agreement are services, trade related investment and intellectual property. These new areas are vitally important to our future prosperity since trade and services alone account for approximately one-quarter of the total $4 trillion in global trade. What better country to provide these services around the world, banking services, all kinds of services like that, than a country like Canada.
As we know, services are the largest sector of the economies of the industrialized world and in many countries one of the fastest growing. As a result of these new rules, the OECD has estimated an increase in world trade of at least $360 billion annually to the world economy. In addition the gains for Canada are estimated at $3 billion annually when the agreement is fully phased in. This is not chicken feed. Beyond this the extension of a rules based, multilateral system through the creation of the
WTO will also expand Canada's ability to ensure that the largest world traders do not use their economic power to unilaterally pressure Canada in any trade disputes which develop.
This new dispute resolution mechanism will also increase Canada's bargaining power in our trade relationship with the U.S. While this trade relationship is a good one and has allowed Canada to become the seventh largest trading nation even though we are only 31st in population size, it is not without its problems. I am certain the WTO will help us to manage this relationship over the coming decade and will promote prosperity within both countries.
I will now switch to the more general theme of trade and its benefits for Canada. Over 20 per cent of Canadian workers depend on exports for their jobs. That is over two million jobs. In addition over 30 per cent of Canada's gross domestic product comes from exports. Last year this amounted to around $181 billion in goods and services.
Therefore it is vital that Canada aggressively promote itself throughout the world. If we do not face up to the trend of globalization, then we are all going to be in big trouble. A country like Canada cannot afford to be protectionist in the mid-1990s. Therefore it is essential that the House support Bill C-57. We just do not have the people to do anything but.
The WTO offers Canadian businesses a great opportunity to continue building sales abroad. While we also have to open our markets to others I do not see this as a fundamental problem. While there will be an adjustment period for certain industries Canadian businesses can compete with anyone in the world. Let us not have that inferiority complex that I spoke about earlier.
All we want is a fair and open international system with a level playing field. The WTO goes a long way in accomplishing this. When it comes into effect next year the WTO agreement will commit some 120 countries to gradually reducing trade barriers. This will have the long term effect of increasing world trade dramatically.
As we know any increase in world trade means more exports for Canadian business and more jobs for Canadian workers, over 11,000 for every $1 billion in new exports. This means greater prosperity for Canadian families.
If we take the figures of the Department of Finance which it claims are conservative-I hate using that word-the WTO will lead to an estimated annual gain of $3 billion. This would translate into roughly 30,000 new jobs per year for this agreement alone. The WTO will also help us to diversify our trade patterns which are currently dominated by the United States. It buys some 80 per cent of our total exports.
One of the most exciting growth markets for new Canadian trade under the WTO will be the Asia-Pacific region which within five years could represent 40 per cent of the total global consumption of exports. To date we have had some success. Japan for instance is already the second biggest trade partner and purchases more Canadian exports than the U.K., Germany and France combined.
In addition China has the fastest growing economy in the world. With its huge population it is predicted that by early in the next century China could be the second largest economy in the world. At the present time there are still some problems with China's participation in the WTO but it is not a matter of will China join, it is a matter of when will it join.
We would like to see greater trade with Latin America. I have mentioned the OAS and the importance of Canada taking a leadership role there. While we would like to see the expansion of NAFTA which has already given Canada unprecedented and preferential access to Mexico's growing market of 85 million consumers, until such time as the Americas also decide that an expanded NAFTA is in its interest the WTO will certainly be an in for Canadian businesses. This is not to say that it is unimportant for the Canadian government to push for NAFTA accession. It simply means that the WTO will help in the meantime.
As I mentioned a few minutes ago, under the WTO a new dispute settlement body will police international trade disputes and ensure that legitimate complaints about unfair trade practices get resolved according to a clearly established schedule. This dispute mechanism will likely be much more effective than the one we have under NAFTA. This should help us considerably and help to allay the fears of some of our industries.
In my work as critic for foreign affairs for the Reform Party, I have heard time and again about the importance of such a rules based multilateral system. While the WTO does not solve all of the problems which exist over international trade, it does take a giant step in the right direction.
Hopefully in the years to come Canada will play a leadership role in promoting the strengthening of this rules based multilateral system by promoting the WTO to effectively deal with the questions of trade remedies and anti-dumping actions.
Another area which the WTO will have to tackle is the whole problem of agricultural export subsidies. While the WTO does good work to promote Canadian interests, clearly a great deal remains to be done to straighten out the mess of agricultural subsidies that have developed over the years. The Reform Party would like to see the government take a constructive and
aggressive role in this respect and the WTO is a vehicle through which it can happen.
I would now like to speak to the related topic of internal trade barriers. I heard the previous speaker talk about that a little bit. It is incredibly ironic that we are making good progress in eliminating our international barriers and yet we are stuck with the barriers within Canada.
Under the current system Canada's domestic market is seriously split by provincial trade barriers. This not only affects our competitiveness internationally but it reduces our collective prosperity at home. Provincial impediments to free trade add around $6.5 billion annually to the cost of doing business. This is absolutely unacceptable. It amounts to approximately $1,000 per family.
While we have taken some steps forward, nobody has really attacked the problem as we feel it should be attacked. We would press the federal government to push harder on the provinces to eliminate these trade barriers because this is going to slow down our ability to take advantage of the WTO.
If we could eliminate barriers to trade at home it would increase the efficiency of Canadian businesses and also expand their ability to trade internationally. What better way is there to improve our position in the international marketplace? This is especially true for small and medium sized businesses which are suffering under the current system.
To conclude, Canada must aggressively promote free trade throughout the world. This means eliminating provincial trade barriers, becoming a leader in the WTO, becoming a leader in the OAS and fulfilling our international commitments.
The first goal can be accomplished by working with the provinces. The second one involves working with other countries to ensure that the new World Trade Organization operates in a way that is genuinely universal and multilateral, with the widest possible membership consistent with generally accepted standards.
It is obvious that support for the WTO and the involvement is there. We can see the prosperity it will bring for all of us. It is just a matter of providing information to people about all of the positives that this new trade agreement will provide for us.