Debates of Nov. 29th, 1994

World Trade Organization Agreement Implementation Act

[Gordon Kirkby, Liberal, Prince Albert—Churchill River, SK]

Mr. Speaker, certainly the existence of interprovincial trade barriers is a very important issue that must be dealt with. As the hon. member will be aware, the Minister of Industry in conjunction with his provincial counterparts has already taken steps to reduce interprovincial trade barriers. This culminated in an agreement which was signed and agreed to some time last summer.

This is also something that has been very important to many other ministers in government, particularly the Minister of Human Resources Development who for many years has advocated much closer economic links among western provinces to reduce interprovincial barriers.

This will take a continued effort to ensure these barriers are removed in a sensible fashion. We have accomplished a lot already; it is a start. We must continue to ensure that the types of barriers which impede economic growth and negatively impact our international competitiveness are reduced to make companies all across this great country more competitive and more able to fight it out on the world scale. This will in turn have a great and positive economic impact all across the country.

[Alex Shepherd, Liberal, Durham, ON]

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.

[The Acting Speaker (Mr. Kilger)]

I am not trying to surprise anybody but the Chair cannot recognize anyone unless the member is standing.

I simply want hon. members to realize that the Chair cannot recognize anyone unless the member is standing in his place.

Perhaps I should explain this in a little more detail. The Chair agrees that the list is a tool that may be useful and it is useful from time to time.

If someone else was seeking the floor I would not hesitate. As your Speaker, entrusted with the protection of all members' privileges and rights in this Chamber, I would not hesitate to recognize that member who would be rising or standing in his or her place.

It is not to surprise anyone. I am not trying to sneak up on anyone or cause anyone any anxiety. But the debate has to follow certain processes, and that one is integral to our business here in the Chamber.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I apologize. Put it down to my lack of experience. I thought you were going to call me at the beginning. I promise I will be there next time.

Today it is my privilege to speak in the debate on third reading of the bill to implement the agreement establishing the World Trade Organization or GATT.

This debate follows the defeat of two motions to amend the bill that were presented by two of my Bloc Quebecois colleagues, the hon. member for Laval East and the hon. member for Longueuil.

The purpose of the first motion, standing in the name of the hon. member for Laval East, was to establish a process for consultation with the provinces when implementation of the agreement relates to a matter within provincial jurisdiction, any matter relating to trade dispute resolution or any economic matter of major international significance. The motion also intended to make prior agreement of the provinces essential before authorizing any change to the agreement in respect of allocation mechanisms for tariff quotas and before establishing or implementing policies for selecting trade partners to receive access to the Canadian market.

According to the same motion, with respect to subsidized exports, the minister shall have regard at all times to actions taken in the relevant areas by foreign competitors. Finally, in respect of agricultural products imported beyond established tariff quotas at a time of shortage of such product in domestic markets, the minister shall take certain measures to ensure that such products are not imported at prices lower than those prevailing in domestic markets.

The second motion, presented by the hon. member for Longueuil, reflected the spirit of transparency and accountability by which we should all be guided today. We hoped to amend the bill to make it incumbent on the Minister of International Trade to lay each year before the House of Commons a report taking into account the priorities identified by the committee of the House of Commons that normally considers matters relating to external affairs. Such matters would concern the implementation of the agreement in Canada, trade obligations and commitments undertaken at the international level by trading partners of major importance to Canada, especially the United States, and finally, the impact of the agreement on Canadian workers and companies.

Unfortunately for the provinces, for the public, for taxpayers and for democracy, both motions were rejected by the Liberal government's silent majority. The bill would have been improved as a result of these two amendments. However, we can conclude from this exercise, whether we are talking about these motions or all the others, that the federal government is not at all in the mood for a real debate on the question, a debate in all serenity, a consultation that would enhance the bill before the House today. All the government wants is to see that this agreement, whose bulk is as impressive as its consequences for our economy, is bulldozed through the House at record speed.

Some people here have a good memory and will remember that parliamentary indiscretion, that breach of good government practices. We will remember how this very fundamental legislation was passed in dreadful conditions. If this bill seems to be an incidental measure, a legislative adjustment to the agreement signed by Canada in Marrakesh on April 15, 1994, the details of that agreement will have impacts which are yet largely unknown.

Perhaps even specialists in the field are still not aware of those impacts. The simple fact that they will not consult with the people who experience the market economy, that they will not listen to their representatives, that they will not listen to common sense and that they only deal in figures and macroeconomic data shows that the government is intentionally eliminating this information and, in so doing, could very well worsen the financial crisis in this country. The government is not assuming its responsibilities by passing this Bill C-57 so quickly.

My colleagues have explained it clearly. Quebec is in favour of free trade and international trade agreements. As the hon. member for Rosemont so rightly said, this is even a very elegant way of confirming the sovereignty of signatory countries while ensuring their association in this globalization of markets and economies. A sovereign Quebec would easily be recognized by

the World Trade Organization according to section XVI(5)c) of the GATT. This would lead to a definite trade association with all other member countries, including Canada.

I am not an expert in this very complex area of international trade. However, I do know that it is advantageous for all nations of the world to agree in order to set a level playing field for the relations between their respective markets, in a spirit of mutual respect. As Gilles Vigneault once said, the complexity of international trade is seven times greater than the mystery of the Holy Trinity. Ordinary people have a very hard time understanding the issue. That is why I feel I should explain the impact of the implementation of the agreement establishing the World Trade Organization with a very concrete and down-to-earth example, the marketing of chicken.

Canada signed both the Free Trade Agreement with the United States and the North American Free Trade Agreement, the NAFTA. Article 706 of the Free Trade Agreement says that if Canada maintains or introduces quantitative import restrictions on chicken products, it will have to allow import quotas equivalent to no less than 7.5 per cent of the previous year's domestic production. The provisions of NAFTA are much the same.

For 1994, the import quota for chicken is 46,488,000 kilograms. This is the maximum nationwide, and within this limit an importer can apply for chicken import permits. This quota seems quite sufficient for this year, since import permits granted up to October 25 represented only 76 per cent of the total quota.

Uruguay Round negotiations have replaced the quota system by a tariff system for agricultural products. This was a way to apply Article XI of GATT. Under this agreement, Canada submitted to GATT, on December 15, 1993, the list of tariffs which will replace the present quotas. According to this schedule, imports of chicken over and above the quotas accepted under free trade agreements will be allowed, but subject to duties amounting to 280 per cent of their value, a tariff high enough to protect Canada and Quebec producers for a number of years.

According to the agreement these tariffs must come down by at least 15 per cent over the next six years. It is, therefore, a new protection system. The previous quota system which restricted imports to 7.5 per cent of domestic production is now replaced by a tariff system.

This new formula still recognizes the notion of quotas, but any import above the quota will be subject to duties amounting to 280 per cent of the value. It is quite likely that this new tariff quota system will be in place by January.

Chicken will remain on the list of controlled imports established under the Export and Import Permits Act, so that all imports will require a permit. The way our domestic market protection system is evolving, in a paradoxical free trade context, is causing a certain amount of friction with our great neighbour. The United States claim that, by imposing new tariffs on bilateral trade, Canada directly contravenes its obligations under NAFTA. A strict interpretation of article 302 of this agreement shows that Canada must abolish all tariffs aimed at the United States by the end of 1998, and that no new tariff can be introduced by either partner. If that were the case, chicken production would no longer be protected.

For its part, Canada is of the opinion that GATT must prevail over NAFTA. Indeed, article 309 of NAFTA recognizes Canada's right to cite article XI of the GATT or any measures that might replace it, to protect its agricultural industry. This debate is still to come.

As far as the chicken market is concerned, we must recognize that there is no drastic change. Whereas we only had quotas per se, under this legislation we will now have quotas plus very heavy tariffs. What concerns our parliamentary wing, excuse the pun, are the provisions in case of shortages.

We do know that the demand for chicken products is increasing steadily. Be it live, eviscerated, cut up, boneless or processed chicken, these products are increasingly diversified and in high demand. While the quota may look quite high, certain sectors, such as the restaurant business, require products that can appear to be in short supply. In that regard, Bill C-57 leaves it entirely up to the minister to determine access and set the tariff accordingly for products considered in short supply.

Like the Canadian Federation of Agriculture, the Bloc Quebecois would have preferred that the minister be required to take action in case of shortage to ensure that the price of imported products is not lower that the one asked on the national market. Ministerial discretion remains a case-by-case approach that leaves the door open to favouritism, if not to circumventing standard, equal and equitable rules. Not to mention the zoning this bill does, a zoning that confirms all the disparity that exists in this beautiful country. This country is united only in its opposition to Quebec.

This creates some concern. How can we protect adequately our farming industry, all the while ensuring continuous supply by diversifying sufficiently this industry's production? That is the question a good many traders who depend on processed products are asking themselves.

The implementation of this legislation will no doubt give us a chance to get a very good idea of what is at stake over the next few months. As stated in the preamble of the bill, free, fair and open trade is essential for the future of this country's economy and for securing its competitiveness and long-term sustainable development.

Trade expansion contributes to job creation, achieves higher standards of living, offers greater choices for consumers and strengthens the economic union of nations.

A multilateral trading system of mutually agreed upon market access conditions and non-discriminatory trade rules applicable to all, is the cornerstone of any modern trade policy that is open onto the world.

The trade agreements resulting from the multilateral trade talks of the Uruguay Round will create an international trade environment much more open and stable for Canadian agriculture, resources, manufacturing, services, technology and investments. The World Trade Organization (WTO) will pave the way for integrated management of the new strengthened multilateral trade system, particularly with regard to trade dispute settlement.

As GATT's successor, the WTO will be a forum for future trade talks on the continued liberalization of global trade and the establishment of new international trade regulations. In this regard, we must bring Canadian legislation into line. That is why this bill, which amends some 31 laws now in effect, will implement the agreement establishing the World Trade Organization throughout Canada.

The future of peoples around the world depends on their economic agreements. That is why we are not worried at all about the inescapable links between the people of Newfoundland and those in Vancouver, between the people of Quebec City and those in Los Angeles, between the people of Halifax and those in Miami. The identity, the authenticity, the necessary differences that expand our horizons are not barriers but bridges between men and women of all ages and cultures.

Recognizing our differences does not mean withdrawing into ourselves but opening up to others. The legendary League of Nations is still an avenue which we must seek without denying others or ourselves. It is in this sense that international trade agreements are a concrete way of recognizing national sovereignty. You can rest assured, Mr. Speaker, that Quebec will be part of this international reality. A sovereign Quebec will be part of the global market.

In summary, the Bloc Quebecois will support this bill. Even though our amendments were rejected, even though we have some reservations, we know that the future of a people depends on its reciprocal agreements. We agree with the basic principles behind this bill. The implementation of the agreement establishing the World Trade Organization is necessary and desirable.

[Charlie Penson, Reform, Peace River, AB]

Mr. Speaker, I listened with great interest to the member who just spoke. I understand his concern for the adjustment that is required for the industries to make the jump to free trade.

The question I have for the member is which would he prefer, the phase down of tariffs over a 10 year period through NAFTA as he talked about earlier, or the system that is currently in place with the GATT where there is a tariff that will be reduced over a period of time? Which would be better for the supply management sector in his province that he is referring to? I would like an answer to that.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I thank my colleague for this question. I am not a specialist in the field and besides you must understand that the application to this field is fairly recent. It is rather difficult for me to say exactly what is good or what should be subject to quotas or to tariffs.

Last week in my riding, the issue of the chicken trade came up.

A businessman came to see me about it. Here again it is rather difficult to say exactly what is good or what might be good in the future, tariffs or quotas. For now, I think that the businessman of course always tries to pay the lowest price for chicken and naturally he does not limit himself to our producers very often. I think that a balance must be found and only time will tell.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, I listened with interest to my colleague's comments, particularly with regard to supply management.

I would like to follow up a bit more. In his presentation the member expressed concern with the implementation of GATT and concerns about which free trade agreement, GATT, NAFTA or CUSTA, really will apply. Canada has one idea in that regard and the United States has another. Certainly these are very important issues.

I would like to ask another question. If Quebec is successful in separating over this next year or so, how would the hon. member rate the harm and damage to the supply managed sector in Quebec because of separation? For example, in dairy they will certainly lose half of their market virtually overnight because right now Quebec has almost 50 per cent of the market with only 25 per cent of the population. Certainly the rest of Canada would not be open to taking this oversupply.

I would like the member to comment on the damage that will be done due to separation as compared to his concerns in regard to the implementation of GATT and the other agreements.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I thank my colleague for his question. When we talk about sovereignty, we must understand that if Canada were completely self-sufficient, maybe it could force its way or dictate to Quebec, but I think that Canada, like Quebec, is a country that needs outside markets and I am sure that Quebec will do very well in this big system of international trade which will be increasingly governed by such treaties.

To give the hon. member a better answer, I might suggest that he refer to what my colleague from Rosemont said in the debate on November 1. Here is an excerpt:

It is largely a matter of international law, the broadening and reinforcement of which the minister praised today. Article XXVI(5)(c) of the GATT agreement provides that a new state carved out of a country which is already a member of GATT automatically becomes a member on becoming a sovereign state, provided it accepts the conditions and requirements applicable to the parent state. It is quite simple and clear. A C.D. Howe Institute study says that most Canadian experts fully recognize that fact.

Quite simply, Canada will respect and work with Quebec just as it works with all other sovereign countries.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, I would like to pursue this matter a little bit further. I think it is very important that Quebec dairy farmers and Quebec farmers involved in supply management really consider this issue. It is extremely important.

I would like to ask the member to pursue this a little further. First Quebec is not a signatory to GATT or the free trade agreements. These agreements would not apply if Quebec were to separate. This is the first thing to consider.

Second, international law has never had a precedent set that would be along the line of Quebec voluntary separation. There is no precedent under international law.

I would like this member to explain how he can go straight faced to the Quebec dairy farmers and say we are not going to have a massive problem in terms of having markets available and with regard to prices falling virtually overnight to world prices, not to the artificially high prices set under supply management in Canada.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I think I may have been misunderstood earlier. The hon. member should refer to the November 1 issue of Hansard . He will see that the member for Rosemont provided a very good answer to that question. This has to do with Article XVI(5)(c) of the GATT, which I could read, but what I said earlier is that a new state carved out of a country which is already a member of GATT need only apply to automatically become a member.

Also, you have to understand that trade is a matter of give and take. The government should not use scare tactics and have people believe that the milk which we sell to English Canada will suddenly no longer be bought by those provinces.

Let us not forget too that western provinces sell 600 to 800 million dollars worth of beef to Quebec. I do not think that the beef industry in English Canada exists merely to help Quebec. That beef is raised because there are profits to be made. And why do they sell it in Quebec rather than elsewhere? Because they have the advantage of selling it right here in Quebec, where their clientele is located.

It will be a matter of give and take. If you refuse to buy Quebec's milk, you might have to consider selling your beef elsewhere.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, when the hon. member makes a comparison between supply managed industry, which is an industry that has an artificially high price developed, and the beef industry, he is fooling no one. Clearly beef trades at world prices everywhere including inside Canada. Quebec has become a much smaller part of the Canadian beef market. Trying to compare the consequences of supply management with that of beef is totally trying to fool someone and it is not going to work here.

I would like the member to respond to that.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, we are not trying to fool anybody. This is simply the reality. This is business. When you do business, whether it is milk, beef or other products, it is a matter of give and take. You negotiate and you strike a deal: I buy your product and you buy mine.

As regards Quebec's sovereignty, if it is so bad for Quebecers, then why is English Canada about to spend hundreds of millions? Already, the government is preparing to air 13 television broadcasts in Quebec, to show the benefits related to being part of Canada.

When I was 14, I was apprised of the sale of our neighbour's business. The buyer asked the following questions: "Do you want to sell your business?" "Yes." "Do you have debts?" "No." "Are you incurring a deficit or making a profit?" "I make a profit." "How much do you want?" The scenario will be the same for Canada. If Canada has a debt of $508 billion and a deficit of $40 billion, this will have to be taken into account. You can be sure that if it were not good for Canada to keep Quebec, it would let us go much more easily than it is doing now.

[Len Hopkins, Liberal, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, I want to say a few words on Bill C-57, an act to implement the agreement establishing the World Trade Organization.

The World Trade Organization which Canada is joining will only work if there is a political will on the part of every nation to make it work. The Americans complain about loss of sovereignty through the GATT-tough bananas. We talked about that in this House during the free trade agreement and we did not get very much sympathy for Canada.

Whenever you join a world organization there are certain things to which you have to agree and as a responsible nation you are expected to fulfil. Therefore, every nation that joins the World Trade Organization had better know where it is going.

Just because we are having a debate in this House, just because we pass this bill does not mean that there are not going to be problems. There are also going to be many positive sides to the agreement.

The hon. member for Malpeque delivered an excellent speech on this a few days ago. He talked about the business pressures that are being brought to bear on the American Congress. Today where there is a Republican Congress and a Democratic president, it probably becomes even more underlined than it was a few months ago.

A business paper presented to the American Congress simply stated: "The only way that international bodies such as the World Trade Organization gain strength is to take power from their member countries. This is precisely what the World Trade Organization does. The World Trade Organization is a stealth-like power grab by international bureaucrats of unprecedented proportions. It diminishes U.S. sovereignty. It shifts control to a world trade system from developed nations to small and undeveloped countries. Most significant, it creates an international autocracy that overlaps United States democratic institutions". That is the kind of pressure that is being brought to bear on the American Congress by its business community.

Let us turn for a moment to what the Senate bill and the House of Representatives bill actually says to implement this legislation on the World Trade Organization.

Section 102(a)(1) states the following: "United States law to prevail in conflict. No provision of any of the Uruguay round agreements nor the application of any provision to any person or circumstance that is inconsistent with any law of the United States shall have effect". How can the United States under that condition sign the World Trade Organization agreement? It is saying it is not going to abide by it before it even accepts it.

Going on to Mickey Kantor who is the trade representative for the United States on the World Trade Organization, he said: "Our sovereignty is more protected under this new agreement than it has been in the 47 years of the old GATT.

Section 102 of the implementing legislation is clear that when there is any conflict between either the Uruguay round agreement or any regulation thereunder and U.S. law, the U.S. law applies in every case".

Those words are very familiar. I remember very clearly, as other members will, having heard those same comments in this same House of Commons when we were debating the Canada-U.S. free trade agreement, that U.S. law would prevail.

Those are some of the concerns that we must have in discussing this legislation. I want to come back to my initial statement that the World Trade Organization will not work unless there is a political will on the part of every nation that signs that agreement to make it work.

I have here an example of an American law that was passed in 1930 right after the great recession started. It dealt with products going to the United States. As an example, I will cite Eddy Match Co. If the match pack had the name of a restaurant on it, the made in Canada logo had to come right underneath the restaurant name. If it had the name of another restaurant, suppose it was a chain of restaurants, the made in Canada logo had to come immediately after that in the same size lettering. Everything had to be in the same size lettering.

When this did not happen, the trucks were stopped at the American border. The trucks were stopped at the American border 62 years later in 1992 because the made in Canada logo was not in the proper place on the package of matches to suit American customs. They were looking for irritants, for ways to keep Canadian products out of the United States. If this is the way they are going to operate, then how can the world receive fair treatment under these kinds of policies?

One of the ways for Canada to go in the World Trade Organization is to follow up on the excellent example set by the Prime Minister, by nine premiers and by about 375 business people, to bombard China in a very friendly way based on our relations over many decades. The visit to Hong Kong and to other Asian countries was a phenomenal success. The same process can be used in other areas of the world. We should be targeting those countries that are developing a large middle class. That is what there is in many Asian countries today.

There is a large middle class developing there that is going to be able to do business with other countries of the world. Business people could go there and talk to them and make

agreements. Selling our technology is a big route. Canada has laid some excellent bases on R and D and technology over the years.

Private industry in Canada has one of the poorest records of the big seven nations in the areas of participating in research and development. In order to make this World Trade Organization a success Canadian businesses are going to have to set more aside for R and D.

If they do not, we will be in trouble in competition down the road. If they do, we will be able to compete with anybody at the industrial level. The sale of two Candu reactors to China is one great example of what can be done.

Here is a developing middle class. Here is a country that is moving ahead very rapidly. It is going to need all kinds of energy. There is an opportunity there for us in the future for more sales. Radioisotopes for medical purposes, there is a whole market opening up around the world, particularly in Asian countries.

There will have to be a lot of emphasis put on eastern Europe. The economies there are in very bad shape. It is to the benefit of the rest of the world to try to help those countries get back on their feet so that they too become very worthwhile trading partners.

I want to conclude by repeating an article from the Globe and Mail dated January 9, 1992. I quote:

As tariffs continue to fall under the Canada-U.S. free trade agreement, Canadian exporters complain that the United States is increasingly turning to the marking rules as a trade barrier to Canadian goods.

"It's a significant irritant", said Jim Moore, vice-president for policy at the Canadian Exporters' Association. "The U.S. is the only country with comprehensive country-of-origin markings."

Those things have to go if we are going to deal with one another on a fair basis. The supply management system, which is very important to Canadian agriculture, will have to be protected in some way by this government. We have high tariffs now. We had better be ready for some strong negotiations down the road because we want those things to remain in place.

Farming is an industry in this country the same as any other. It has to be managed properly and it has to have the support of the Government of Canada.

[Walt Lastewka, Liberal, St. Catharines, ON]

Mr. Speaker, I am pleased to rise today to address the legislation before us, Bill C-57, an act which implements the agreement establishing the World Trade Organization.

As a member of the House of Commons standing committee which studied this bill, I know how important this proposed legislation will be for Canadian business. The government is very aware of the need to provide a positive environment for business in Canada. We know that it is essential for business to have all the benefits possible to compete domestically and in the global marketplace.

Domestically the government has worked to provide an environment where more jobs will be created and business can excel. We have implemented the infrastructure program with the provinces, directly creating 90,000 jobs over two years. We are also outlining an agenda to create a better environment for small business, including working capital for growth, programs to help small businesses expand and create new jobs, the single business registration number to cut paperwork, Canada business centres for one-stop shopping for government services, and the technology incubator, a very important item.

With the co-operation of the provinces we have reached the first ever federal-provincial agreement on eliminating internal trade barriers, an area where much more work needs to be done. The Canadian economy created over 300,000 jobs in the first nine months of this year, most of them full time.

As an example, an upturn in the domestic and export sales in the automobile industry resulted in an announcement at General Motors that it would be postponing the planned phasedown of the foundry operations previously scheduled for December in my riding. The foundry is a major contributor to the employment in St. Catharines and this was very positive news.

We also know the importance of assisting Canadian business internationally. Canada belongs to a continually expanding international market. Making those markets accessible to Canadian companies is vital.

Economically, trade must be one of our top priorities. This is because one in five jobs in Canada is generated by exports. In fact among G-7 countries Canada is second only to Germany in dependence on international trade. Last year during the election this government stated in its red book that trade policy and trade relations are crucially important to the achievement of Canada's economic and social goals.

We noted the importance the GATT has had to Canada in improving access to international markets. We made it clear that we supported a resolution to the stalled Uruguay round talks.

The red book also dealt with the problem of definition of subsidies and dumping and that Canada has been subject to trade harassment due to the lack of definitions in trade agreements.

Dispute resolutions are often lengthy and costly and of no value in enhancing trade or relations between countries. I was a member of the special joint committee reviewing Canadian foreign policy which released its report a few weeks ago. The

report points out the need for creating and promoting an international orientation for Canadian business. This report also states that the World Trade Organization is crucial to the development of a rules based international trade system and should be targeted as a priority organization for Canadian involvement. There is no doubt in my mind that if the world is able to have a rules based trading system Canadians will be able to succeed on the international scene.

The Uruguay round took some seven years to be completed with some 123 countries involved. The agreement reached includes national commitments to lower tariff and non-tariff barriers, thorough reform of trade rules and the extension of the world trading system to cover the areas in services and intellectual property.

The World Trade Organization will implement the achievements of the Uruguay round. It will be a permanent effective institution to oversee world trade policy and settle disputes between nations on a multilateral basis. This is the beginning of a new trade era.

In his speech in the House on October 27, the Minister for International Trade said that the World Trade Organization will finally put international trade on a firm institutional footing by becoming the third pillar of world commerce and financial structure along with the World Bank and the International Monetary Fund.

The WTO is a major step forward in multilateral trade. It will assist Canadian exporters in obtaining fair access to foreign markets. This in turn creates jobs and provides a higher standard of living for Canadians.

Increased openness in markets is also good news for consumers, resulting in greater choices and decreased costs for quality goods and quality services.

Canada must be a leader in helping global organizations to mature. Last week I had the opportunity to tour a fish farm in my area which wants to export fish to Japan. The Uruguay round achieved tariff reductions with Japan of some 70 per cent. We know that historically the export of fish has been subject to harassment from countervail actions. Under the new deal Canadian exporters can expect more secure access to markets for export of fish and hopefully lumber, pork and magnesium, all of which have been controversial in the past.

Another company in my area would like to sell prefabricated housing units to foreign markets. This agreement provides major gains for Canadian exporters of wood and wood products. Negotiators representing our most important offshore markets agreed to phase in tariff cuts on wood and wood products averaging 45 to 50 per cent over five years. In the area of prefabricated housing, tariffs will fall in the European Union, Korea and in Japan.

Recently, as mentioned many times earlier, the federal government led a group of Canadian business people, provincial premiers and others on a trade promotion trip which resulted in great success and gives an outstanding example of Team Canada. Canadian business exporters and potential exporters learned that working together pays dividends.

I conclude by reinforcing once again that with rules based thinking and rules based agreements Canada will not only be better for it by its exports, but Canada can be a leader in having the WTO be good for large developed countries and also for the smaller, less developed countries as they too try to develop their areas.

The time has come for us to be an example to others by proceeding to implement GATT in the manner it was intended. The WTO is scheduled to supersede GATT in 1995. This is a major step for the international community and Canada is pleased to be part of it. As a member of this government and the committee that studied this bill with my colleagues across the way, I look forward to the implementation of the World Trade Organization in the very near future.

[Charlie Penson, Reform, Peace River, AB]

Mr. Speaker, I enjoyed the comments of the member for St. Catharines. Having worked with the member on the foreign policy review, I know that he supports free trade and the move to the World Trade Organization.

I would like to ask this question: Does he also recognize, and I believe he does, there is considerable work that needs to be done at home to improve our domestic environment for business in terms of our internal trade barriers and how that is limiting our ability to trade and to give our small and medium size businesses an opportunity to develop so they can also become part of the international trade environment?

[Walt Lastewka, Liberal, St. Catharines, ON]

Mr. Speaker, I thank my colleague for Peace River. Yes, it was great to be able to work together with all of our colleagues on foreign affairs and trade. The member is absolutely right. We have a lot of work to do in Canada to not only be able to work with our exporters and the new exporters who would like to export. We must be able to provide them with communication networks much faster and much easier.

Likewise, I have had a committee in my area studying the various areas of the U.S. and Canada along the border. There are many free trade zones in the U.S. which export to Canada and other areas of the world.

We will have to look at, and I think the government is proceeding along this way, new ways to make it easier for our manufacturers and our businesses to be on the same level playing field especially with the U.S. as we try to export, not only to the U.S. but to many other countries around the world. It is very important that we work with these organizations immediately.

[Bob Mills, Reform, Red Deer, AB]

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.

[Walt Lastewka, Liberal, St. Catharines, ON]

Mr. Speaker, I want to commend my colleague from Red Deer for his excellent presentation. I was glad that he was able to bring out some of the flaws in NAFTA that have tried to be corrected in the GATT and now the World Trade Organization.

There has to be a lot of training and facilitating of people across Canada in various businesses as far as becoming exporters is concerned. They not only have to know the rules but have to understand what has to be done to export to various areas of the world where the member has travelled, I am sure.

To be able to market these goods, exporters will need to work together perhaps in a Team Canada approach across the country. As far as implementing the WTO is concerned, it needs to be done in a very short term to gain the advantages the hon. member mentioned.

[Bob Mills, Reform, Red Deer, AB]

Mr. Speaker, I thank the member for his question. As I mentioned, information is the key factor. The big problem has been that it is easy to trade with the U.S. Everybody knows the language there is English and the customs are somewhat the same; it is pretty easy to go down and trade there. When things get tight in U.S. trade we start looking internationally and our companies, particularly the big ones, start dealing internationally. The biggest problem has been that a lot of smaller and middle sized companies, once the U.S. market returns, go right back to the U.S. market and forget about their international interests.

I do not want to encourage government to set up more bureaucracy to try to obtain business out of the country. That is not the answer. The answer is to work with business through seminars and joint ventures to get people out there and get them the contacts. Government provides the contacts, much as Team Canada did. It opens the door and then those guys go for it. We have to get them through the door. That is all government should be doing.

It is a matter of encouragement and of helping with the technical aspects but not direct involvement or government agencies doing the work for business. That will never work. It will just become another drain on society.

[Walt Lastewka, Liberal, St. Catharines, ON]

Mr. Speaker, I thank my colleague from Red Deer for his response. Another area I would like the member to comment on is the importance of being able to export in areas where their language is not either of the two languages of our country.

He started to mention that there was work to be done and it takes time. I think he mentioned that it requires training and facilitating to allow exporters to export and that we should not only export south of the border once times get better. He mentioned that areas throughout the world needed to be explored and because of the world being so large we had to take things on a priority basis to facilitate businesses and let them do the work of manufacturing and exporting into those countries.

[Bob Mills, Reform, Red Deer, AB]

Mr. Speaker, again the member for St. Catharines raises important questions. I am sure we could work very well together in terms of what kinds of things we need to do to get business promoted.

We have a lot of people of various ethnic origins in the country and we must utilize them. In dealing with the Asia-Pacific we have a million people of Asian descent whom we can

utilize in the process and who can be an important part of what we do.

Again to go back to globalization, the EU has the advantage of being a more sophisticated market. It basically thinks nothing of knowing three or four languages and understanding much more broadly the cultures of other people. English stands one in fairly good stead in most European countries except for the eastern bloc. That will help us deal in that market.

English is pretty important in the Asia-Pacific but Mandarin is more important. That is where we can utilize Canadians of that descent to help us.

Let us face it. In the Americas there are 34 countries in the OAS and only one of them uses French. That happens to be Haiti. All the rest use Spanish or English. We must recognize the importance of those languages and the importance of using South American Canadians in that regard. It is extremely important. We need through foreign affairs to put a lot more effort into developing and utilizing Canadian citizens of those origins.

[John Maloney, Liberal, Erie, ON]

Mr. Speaker, it is a pleasure to speak this afternoon on the issue of the World Trade Organization.

The Uruguay round of multilateral trade talks under the General Agreement on Tariffs and Trade or GATT was intended to bring world trade law into the 21st century. Negotiators agreed that this could be done by taking three key steps.

First, after painstaking negotiations the means were found to resolve longstanding quarrels over the existing trade of goods including agricultural products.

A second momentous measure decided upon was the creation of a World Trade Organization. The WTO will be a permanent, effective institution to oversee world trade policy and federal disputes between nations on a multilateral basis.

Third, trade services which account for roughly a quarter of $4 trillion in global trade were brought under the purview of global trade law for the first time.

Along with these three key steps, Uruguay round negotiators agreed on more than 25 separate measures which together amount to the most significant package of new trade rules the world has seen since the GATT was created in 1947. These measures include strengthened trade rules, particularly on subsidies and countervailing duties, and a more effective system of dispute management.

New areas have also been brought into the ambit of world trade rules including intellectual property, trade related investments and services. Most of the 120 countries participating in the round have made significant commitments to lower or eliminate tariffs and other barriers to trade.

Throughout the 26,000 page text of the Final Act of the GATT and all its principles, proposals and provisions there is one key theme: multilateralism. It is because the Uruguay round puts world trade law firmly on a multilateral footing that the global marketplace will never be the same. The WTO will put a brake on the tendency of governments to use unilateral trade actions to harass trade from competing countries. That means Canada will be less vulnerable to efforts by larger competing economies to use their size and power to interfere with Canadian exports. It is difficult to overstate how important an achievement that is for Canada where one in five jobs is created by exports.

I would like to talk about the second step. The World Trade Organization or WTO will implement the achievements of the Uruguay round negotiations. By replacing the GATT secretariat the WTO will co-ordinate the functioning of its three new components: the goods council, the services council and the intellectual property council. Dispute resolutions will be accelerated with a strict time limit established for the conclusion of the process once it is under way. Members also make a commitment to avoid using unilateral retaliation.

It is important to note that the WTO administered dispute settlement process will prevent a single member from blocking the adoption of reports of trade dispute panels or on appeal of appellate bodies. This institutional provision is the cornerstone to ensure that the new multilateralism functions smoothly.

As one of the most trade dependent countries in the world, the Uruguay round of multilateral trade negotiations was vitally important to Canada in terms of expanded access to markets and stronger trade rules and institutions. While the negotiation achievement is of historic proportions, the task remains to translate the outcome into reality.

Momentum must be maintained to complete the negotiations in areas such as financial services, telecommunications and government procurement. Clearly these are areas of growing importance to world economic development. We must all strive to realize the greatest possible degree of rules based liberalization. The potential benefits to both producers and consumers should not be denied.

There is a question of accession of new members to the WTO, particularly and pre-eminently China, Taiwan and Russia. Canada is on the record as supporting in principle their accession to the WTO. Broader membership will be positive for the rules based trading system and will offer significant benefits to the countries concerned.

However accession is not a right. Countries acceding to the GATT WTO must be prepared to commit to a transparent market oriented economy, to embrace the basic principles of the multilateral trade system and to provide real improvements in market access. On the other hand we must not impose requirements for acceding countries that are more onerous than those which apply to members.

There is the question of the new trade issues: trade and the environment, labour standards, investment and competition policy. These are questions all trading nations are grappling with. They are complex and do not lend themselves to simple policy prescriptions. However we feel that certain principles must be kept in mind as they are defined, debated and developed.

First, Canada does not support the use of trade sanctions to impose standards of conduct. Quite apart from the question of fairness in a world that is becoming increasingly interdependent where the one common denominator is adherence to a market based system, the costs of authorizing any one country to use its economic muscle to impose its own standards are too high for all.

Second, we must guard against the possibility that new rules can become a vehicle for new protectionism unless they reflect a broad international consensus. In this respect we are sensitive to the concerns of countries, developing and developed alike, that fear the new rules may be aimed at directing barriers to their exports.

Third, Canada wants to ensure that the rules of the multilateral trading system are complementary to and not contrary to the attainment of broader societal objectives. In the case of trade and the environment we are committed to the goal of sustainable development. With respect to trade and labour standards we endorse the need for compliance with internationally recognized labour standards.

There is an ongoing process to determine how labour and environmental issues will be handled by the WTO. At this time Canada is working with its trade partners on these very important matters.

We feel that international bodies such as the Organization for Economic Co-operation and Development and the International Labour Organization should accelerate their studies of these issues and use their findings to help guide discussion in the new WTO. We are concerned that without that kind of background work the World Trade Organization could get bogged down before it has had a chance to establish its institutional footing.

The Uruguay round of negotiations will have a significant impact on Erie riding in such areas as agriculture and steel. The world trade talks under the GATT produced a common set of rules governing world trade in agriculture. Canada's key objective in talks dealing with trade in agriculture included improved access to markets, increased disciplines on subsidies that distort world trade, more predictable and secure border arrangements to preserve Canada's farm supply management programs, and assurance that health and sanitary regulations will not be used as disguised barriers to trade.

Agricultural trade proved to be one of the most difficult issues tackled in the seven years of negotiation under the round. At the end of the day Canada had met its goals. As a result of the round overall tariffs on agricultural goods will fall by 36 per cent and no less than 15 per cent for any specific product in six equal annual steps between 1995 and 2001.

In addition, all GATT countries will open their markets to imports by specific minimum amounts starting next year in 1995, with the level increasing by 2001. Tariffs in place of quotas will also provide the tools to maintain an effective supply management system for Canada's poultry, egg and dairy producers. Producers of red meat, pork and horticultural products will also benefit from the new market opportunities in Asia and elsewhere.

Lower volumes of subsidized exports are expected to lead over the medium term to higher prices for grains and other agricultural commodities, spurring demand in Canada and other markets for agricultural machinery and equipment.

Canada's manufacturers shipped farm equipment worth some $865 million in 1992. Exports totalled $467 million. More than 90 per cent of these exports went to the United States. The United States also accounts for the largest share of Canada's imported farm equipment.

The Canadian industry produces four-wheel drive tractors, combine harvesters, seeding and tillage equipment, hay handling and harvesting equipment, grain handling and storage equipment. This technology is at the leading edge in production of cereal grains from large farms under the dry land prairie farming conditions. Substantial opportunities for export growth exist in Australia, Mexico, Europe, Russia, Ukraine and China. The John Deere plant in my riding, a leading manufacturer of agriculture equipment, I am sure would welcome these increased trade opportunities.

In recent years the Canadian industry has been in the forefront of several technological achievements. Among these is the development of a large capacity four-wheel drive and bidirectional tractors and axial flow combines. Such advances will receive worldwide protection for the first time under the new trade related aspects of intellectual property rights under the agreement reached in the round.

Over five years beginning January 1 next year, Canada and its major trading partners including the European Union, Japan and the United States, along with industrialized countries such as

Finland, Korea, Norway and Sweden, will phase out all tariff and non-tariff barriers for key products in this sector.

Full line firms producing major items such as tractors and combines will benefit as tariffs fall to zero in major markets. Short line firms making a variety of farm implements and attachments such as cultivators, chisel ploughs, seeders and fertilizer distributors will see tariffs fall to zero as well. Both full line and short line manufacturers will enjoy improved access to offshore suppliers of key parts components.

All this levels the playing field for Canadian farm equipment makers. Before the agreement was signed Canada and the United States both extended duty free access to agricultural machinery from all most favoured nation countries under the GATT. Many of these countries maintain tariff and non-tariff barriers against imported farm equipment. Within five years under the Uruguay round agreement these barriers will be history.

Located in my riding is a Stelco plant which is one of the 15 companies operating in six provinces that make up Canada's primary steel industry. My riding also has a productive nickel refinery, Inco, nickel also being a very essential component part in the steel industry.

In 1993 steel industry sales exceeded $8.6 billion. The industry employs about 33,000 Canadians. Another 18,000 Canadians work in pipe, tube, wire and wire products industries, transforming steel into other finished products.

As a result of the Uruguay round most developed countries including the European Union and Japan, along with Korea, will phase out all tariffs on steel and steel products over 10 years.

In conclusion, the establishment of the World Trade Organization is an expression of new realities in the economic and political relationships among nations. The trading system no longer operates as the exclusive domain of a few. As the Uruguay round negotiations unfolded over a seven year period we have witnessed an evolution in the roles of key players.

I spoke about the success of the Uruguay round and how it will positively impact on my riding. In a very real way our work has only just begun. With the all important creation of the World Trade Organization we have taken the first step. Now we must begin the effort of investing this institution with the commitment necessary to take us into the 21st century.

[Jean-Guy Chrétien, Bloc, Frontenac, QC]

Mr. Speaker, I listened very carefully to the speech the hon. member for Erie just made and I was surprised to learn that the John Deere tractor I own was probably built in his riding. I would also like to remind my hon. colleague from Erie that, in 1988, Quebecers showed the most support for international trade, and especially for NAFTA.

In fact, in more than 62 out of 75 ridings, the vast majority of Quebecers elected the Conservative Party which had made NAFTA the cornerstone of its 1988 election campaign. Of course, where agricultural products are concerned, Quebecers are extremely well positioned in supply-managed sectors, like poultry, milk and egg production. To replace supply management, the GATT agreement provides for what is commonly called tariffs that can reach up to 360 per cent in some cases.

As the previous speaker pointed out, these tariffs will be in place for the next six years, and this six-year period is crucial if our farmers are to adjust and take their place on the market.

Of course, in case of disputes, we will be able to present our case to the panel. This panel is fine, but among our representatives we need to have good negotiators who can stand tall instead of crawling in front of our opponents and saying: "We have already lost", even before beginning to defend the interests of the people they represent.

I recall three particular incidents where I have not been impressed at all by the way our representatives have stood up for us. First, there was the softwood lumber dispute, then the hog dispute and most recently the durham wheat business, which especially affected Western Canada.

I am concerned about the guarantee and I would like the previous speaker, my colleague from Erie, to reassure Quebec farmers that the people who will represent them before these panels will be up to our expectations.

[John Maloney, Liberal, Erie, ON]

Mr. Speaker, I appreciate the comments of my hon. friend. I agree with him there is no question that our negotiators have to be firm and strong. I disagree with him on those issues he has mentioned, the softwood industry, the pork industry and most recently the grain situations.

There were panels, there were challenges. In all those cases it was found that Canada's position was the correct position. Certainly the agriculture minister in negotiating in those situations with the Americans-Americans are tough negotiators-has negotiated well for our country. Looking at those situations as an example, as a precedent, I have no concern that the interests of Quebec, the rest of the country will be well taken care of by our Canadian negotiators. We will negotiate strongly and firmly for the benefit of our agricultural industry.

[John Solomon, NDP, Regina—Lumsden, SK]

Mr. Speaker, I was curious to hear the Liberal member for Erie make some comments about the steel industry and the steel producers in his

constituency in light of the fact that he is supporting Bill C-57 before the House today.

He made the argument that the steel industry is quite important in his constituency and that this trade agreement will benefit it. This flies in the face of what the Canadian Steel Producers Association has told us in this House of Commons. It says this bill requires some significant amendments to ensure protection of the steel producers and the producers association in Canada with trade with the Americans.

The Americans have a very strong legislative arm which protects their steel producers. When Canada produces and sells steel to the American economy and to the American business it is subject to some very rigorous and tight regulations. As a matter of fact, there have been a number of occasions when the Americans have levied anti-dumping charges against Canadian steel producers.

Bill C-57 does not address the concerns of the Canadian Steel Producers Association. Yet the member for Erie and the member from the Bloc stood in this House saying they are going to support this bill. They are saying it is going to be good for the steel industry. To the member for Erie, why is he saying this is a bill he is going to support, that it is good for the steel industry in Canada, when the Canadian Steel Producers Association says that it is not good for Canadian producers of steel? It has asked for a number of amendments which the New Democratic Party has put forward in this House to assist it in having a fair level playing field with the Americans.

Mr. Member, why are you supporting this bill? Why are you saying it is going to help Canadians to-