Madam Speaker, since 1982 the Department of Foreign Affairs has administered the federal government's program for the promotion of Canadian exports.
In recent years this program has been criticized by academics, the private sector, provincial governments, government employees and others for the following reasons.
First, employees and the workings of the TCS have been integrated only imperfectly into the culture and operations of the Department of Foreign Affairs. The pursuit of mundane commercial interests is not a natural activity of individuals who joined foreign affairs and were trained to become diplomats dealing with international politics, war and peace and the nation's external security. While there are many career officers who work hard on their assignments in the commercial field, such assignments continue to bring little prestige and opportunities for advancement in the institutions hierarchy.
Second, the private sector has expressed discontent with the lack of input into the work of the federal trade promotion work. The Department of Foreign Affairs is heavily bureaucratized and never has had a tradition of working with the private sector in the pursuit of its traditional mandate.
Efforts to rectify this situation through the creation of consultative committees have not been a great success. One aspect of the criticism by the private sector is that the operational objectives of the trade commissioner services are often linked with political goals.
The promotion of political and military alliances, of human rights and democratization and of international development efforts can and often do interfere with the promotion of international trade.
Third, the work of foreign affairs duplicates and overlaps with that undertaken by provincial governments. In major countries abroad, trade representatives from the two levels of government compete with each other. Further duplication occurs as federal trade offices throughout Canada deal with the private sector and promote exports in competition with provincial officers.
Fourth, even within the federal government there are at least 15 other departments that undertake trade promotion activities of their own. CIDA-INC as it is known is one of them. In some instances its activities are better financed than those of the Department of Foreign Affairs.
Efforts to co-ordinate the different federal departments' offices through foreign affairs have not been totally successful. Time does not permit me to dwell further on the negative assessments of the Department of Foreign Affairs trade promotion efforts.
Instead, I must now turn to some positive suggestions for reform of Canada's program. Suggestions for change involve different models of organization based mostly on real world experiences. There is a proposal to create a crown corporation independent of direct political influence.
The Government of British Columbia recently created such a crown corporation. Another model envisages the complete privatization of the service. This best describes the system used by Britain where executive agencies with independent management have been established on a contractual basis.
The removal of the bureaucratic culture from these agencies has resulted in substantial performance increases. This precedent can be applied to the trade commissioner service offered by our federal government. However there is also great merit in an approach I am investigating now in the context of preparing a private member's bill. The approach involves the use of a commercialized service to deal with the problems of the present system.
The following represents my preliminary thinking on the subject and I welcome suggestions for improvement from anyone interested in the subject.
I propose to call the new organization the Canadian Trade Organization. Let me call it CTO for short. Its headquarters in Canada will be located in one of the large commercial centres like Toronto, Montreal or Vancouver with branches in other cities. The CTO will have offices in foreign countries with headquarters in the capital like Rome and subsidiary offices in major cities like Milan.
The responsibility for the Canadian operations will be in the hands of a board of directors consisting one-quarter each of representatives nominated by the federal government, the provincial governments, private sector organizations like theCanadian Manufacturers' Association and the Exporters' Association, and general membership consisting of Canadian, foreign and multinational firms.
The day to day operations of the CTO are undertaken by a private staff, the executive director of which is also on the board of directors. Governments can have liaison officers on the operational staff.
Financing of the CTO will come one-quarter each from the four groups represented on the board of directors. In addition the organization is required to sell its services to private firms and administer Canadian involvement in trade fairs throughout the world. This is important.
Profit sharing or bonus payments to employees successful in such private sector sales will assure that the CTO is responsive to market needs. Such needs often involve Canadian governments in their roles as diplomats and makers of industrial policies. The proposed links of these government offices with the CTO through the board of directors and liaison officers assures that the public interest will adequately be reflected in the employees' work.
Periodic meetings, the publication of a newsletter and social affairs arranged in different cities will provide a constant link among directors, staff and the private sector in Canada. Contacts through such arrangements will provide the proper environment for the flourishing of commercial activities of CTO.
I now turn to the business offices of the CTO abroad. They will have advisory councils consisting of representatives from the local Canadian embassy or high commission and from local industry. The latter will most likely consist of multinational corporations, Canadian firms with representatives abroad and local firms interested in trade with Canada.
The operations of the foreign business offices will be in the hands of Canadian managers who work with staff consisting predominantly of persons who speak the local language, have local contacts and are familiar with the country's business practices.
Financing for these offices will come from the same sources as that for the operations located in Canada, that is federal and provincial governments as well as interested parties in the private sector.
In addition special efforts will be made to obtain financing through contracts with private sectors abroad and in Canada. These contracts will involve market research, establishing commercial contacts, assuring representation at fairs and exhibits, keeping an eye on technological and product developments and many other activities that would help promote international trade and Canadian competitiveness.
In many smaller countries CTO offices will be attached to local embassies or consular offices. In larger countries they will be housed in separate quarters though a close link with the diplomatic representative is essential.
The preceding is only a rough and preliminary sketch of the institutional, financial and operational characteristics of the proposed replacement of the international trade promotion system which is presently operated by the Department of Foreign Affairs.
My sketch should suffice to show how the commercialization of these trade promotion services will first, eliminate the currently existing duplication of government services. Second, it will permit its governors and operators to concentrate on commercial issues while it retains the benefit of access to and advice from Canada's professional diplomats in foreign affairs. Third, it creates private sector incentives for professional staff to serve the needs of Canadian business. Finally, it removes domestic and international political agendas from the trade promotion program.
In conclusion, I note that it should be possible to structure the CTO so that the government cost of providing trade promotion services will be lowered considerably. Such savings should be welcomed by the federal and provincial treasuries and departments like foreign affairs during this period of extreme financial restraint.
The commercialization of the service would permit governments to focus better on the delivery of services in which they have a competitive advantage. The financial and operational involvement of the private sector would increase operational efficiency of the service. It would also raise general interest in international trade.
I believe that out of the shortcomings of the current trade commissioner service in foreign affairs arises an opportunity for change that will produce nothing but winners.