Debates of March 15th, 1994

Canadian Foreign Policy

[Joe Volpe, Liberal, Eglinton—Lawrence, ON]

Madam Speaker, I compliment the hon. gentleman on the tenor of the latter part of his intervention which I heard. It certainly exemplifies some very commendable views about Canada and its role in the international sphere.

I am a trifle confused however by his reluctance to see the relationship of both objectives. The commercial side reflects Canadian interests as they might develop anywhere in the world. That might reflect positively on the more humanitarian or altruistic-if he would accept that term-side of the equation as it more appropriately relates to Canada's political and humanitarian objectives everywhere in the world. I do not understand why one must preclude the existence of the other.

I accept that we should renew and continue to reinforce those initiatives which have made Canada stand out for its humanitarian or relief work, which is the term I think the member used. However Canadian interests are served on both the philosophical side and the strictly pragmatic business side when the two interests are married under one administration.

I am wondering whether the hon. member would clarify that for me. I have difficulty understanding why we would have to separate the administration of two departments under one roof when the objectives of both give us the results Canadians seem to want.

[Chuck Strahl, Reform, Fraser Valley East, BC]

Madam Speaker, the problem is twofold. One is the idea of separating the mandate or giving CIDA a mandate. What is the purpose of CIDA? The management of CIDA has been flipping every 18 months. It is in a total state of turmoil not knowing what its mandate is, which should be to protect the purpose of our humanitarian aid and to help the poorest of the poor.

That was the mandate suggested by the Winegard report. We need to focus in on what is the role of CIDA. That role should be brought under the authority of Parliament through enabling legislation.

I also have budgetary concerns. CIDA's budget is too large. There are too many tentacles, too many countries, too many purposes. It needs to be restricted and that is another reason to focus our attention on a few countries.

On the other question of whether commerce and humanitarian aid would be looked after together, I believe that may be possible. As one parliamentary secretary mentioned earlier today it is almost impossible to dissociate international trade,

foreign policy and defence policy. All of them go together often under trade policy which is really the commerce aspect of what the member was talking about.

Trade must be left to the international trade people. We need that commercial process to develop arrangements, agreements, free trade agreements and so on with other countries. It would allow them to pursue trade opportunities in Canada and would allow Canadian businesses to pursue trade agreements with those countries. It is a trade issue.

Our humanitarian efforts need to be focused without expecting commercial return. In that sense we target our money and say that whatever the amount is, the money is given without strings attached. It is done as a humanitarian gesture because we want to help that country so that in the coming years it is not dependent on foreign aid.

One of the critiques in the Auditor General's report is that countries that have received $1 billion or $2 billion from Canada over the last 20 years are as dependent or more dependent on international aid now than they were when we started what we thought was going to be short term assistance.

We need to focus our humanitarian aid for that reason. International trade is a separate issue. Although sometimes it will overlap and it is a good thing if it does that should not be the focus of CIDA. It should be a foreign aid and humanitarian gesture.

[Joe Volpe, Liberal, Eglinton—Lawrence, ON]

Madam Speaker, I want to clarify one further item with the hon. member.

We do not differ on the philosophy but I think the member is aware when he speaks on the question of giving aid especially through CIDA we are not talking ultimately of a cash transfer. We are talking about providing a service. We are talking about providing goods. We are talking essentially about purchasing the same for the benefit of a third party. That does not necessarily mean we are taking a large budget item and transferring it in cash to a recipient country.

Because of that I do not see why we would want to separate from the philosophical objectives of any of our activity the possible consequences which can all be positive.

The fact that we would be giving aid does not necessarily mean that there are no commercial benefits or that there are commercial benefits that we should eschew. The fact that we would be providing or stimulating trade does not necessarily mean that we would not be disposed to providing further assistance because it is not a question, unless the member's understanding of the Auditor General's report is different from mine, of taking dollars out of our pocket and handing them over to somebody else whom we have defined as needy.

[Chuck Strahl, Reform, Fraser Valley East, BC]

Madam Speaker, I thank the hon. member for his question.

I realize that often it is not just money that is being transferred in our bilateral systems. Often money is part of it. There was a budgetary figure not this year but last year or two years ago where we spent tens of millions of dollars in direct transfers to help other countries with their national debt problems, for example.

To me that is not a purpose for CIDA. That is not something that Canada should be doing at this time, giving other countries direct assistance to help with their national debt problems when we have the biggest national debt problem we have ever had in our history. There are times when direct money is transferred. In those cases we have to restrict the mandate of CIDA through legislation to eliminate that abuse.

Second, there are times when instead of thinking of strictly humanitarian reasons, we start to think of Canada's commercial interests. Madam Labelle mentioned the other day that 60 per cent of our money is spent here in Canada, sometimes for buying foodstuffs and so on but sometimes for reasons that are more commercial in nature and not particularly geared for the poorest of the poor whom we should be helping.

In those cases, I am concerned. The Auditor General this year did not specifically identify any horror stories. He tried to zero in on the process and the problem within CIDA that he identified by a lack of legislation and some other things but tried to avoid the horror stories as I have tried to avoid them today in my presentation. However those horror stories still exist. We can go back through the last 10 years of Auditor Generals' reports to see them in their fullness.

That is why we need to restrict it to humanitarian aid. I realize that sometimes it is goods and services that are also exchanged but by and large we need to restrict it to the poor, make the mandate strict in legislation and we will not only enhance CIDA's reputation within Canada, which is very important at this time as it is flagging, but improve our opinion abroad as well.

[Jesse Flis, Liberal, Parliamentary Secretary to Minister of Foreign Affairs]

Madam Speaker, I enjoyed that last exchange between the hon. member for Eglinton-Lawrence and the hon. member for Fraser Valley East because both members are on the foreign affairs committee and in developing an independent Canadian policy on foreign affairs.

This is the kind of interchange we need on the floor of this House. Therefore I congratulate the two gentlemen for contributing to the debate and to helping us develop an independent Canadian foreign policy.

Canadians have seen the world change dramatically in recent years. In many ways change has been the defining characteristic of this decade. Nowhere has this been more true than in central and eastern Europe and the former Soviet Union.

The fall of the Berlin wall, which I witnessed personally, the collapse of communism and the Soviet military threat and the emergence of the new independent states have reshaped Europe. We are faced with challenges and opportunities unparalleled since the end of World War II.

The last five years have shown that the first dramatic steps are sometimes the easiest to take. The hard work begins when ideas must be transformed into reality. Democracy cannot simply be proclaimed. Free markets cannot just be willed into existence. Fundamental reform requires courage and patience. Canada has an important role to play in central and eastern Europe. We must seize this tremendous opportunity.

I would like to focus my statement today on Canada's foreign policy challenges in that part of the world. It is obviously in Canada's best interests that reform in the region succeed. The opportunity to build a more stable world order based on democratic governments and free market economies cannot be squandered.

Central and eastern Europe is a new economic frontier. Trade is the lifeblood of the Canadian economy. The region's largely untapped markets represent an exciting opportunity to generate exports and create new jobs and prosperity in Canada.

Canada's historic, cultural and human links to eastern Europe are an advantage that few of our so-called competitors, European or otherwise, possess. We must use our advantage wisely.

Almost 20 per cent of the constituents in my constituency of Parkdale-High Park and 10 per cent of Canadians generally across Canada can trace their roots to central and eastern Europe and the former Soviet Union. This is an unparalleled bond. We have tried to foster relationships with these countries. A number of Canadian entrepreneurs or academics have gone there to offer their expertise and knowledge, to offer training and assistance. It is a difficult task where progress is measured in little steps, but whose rewards for Canada are great.

The linguistic skills and the cultural ties of Canada's ethnocultural communities enable us to support a number of people to people initiatives, to bridge cultural barriers and to deliver training and assistance. The impact of this direct contact cannot be overestimated. I know from years of personal experience working with the Canadian Polish community, with travel study programs for Canadian students in Poland, how personal links can bring countries together.

The countries of central and eastern Europe and the former Soviet Union are trying to create in months and years institutions and systems which have in some cases developed over centuries in the west.

While we should seize the opportunities presented by change, we must recognize that there will be setbacks and avoid impatience and unrealistic expectations. Political and economic reform take time.

Last week the President of Georgia was in Ottawa, Mr. Shevardnadze. I had the honour of greeting him at the airport and bringing him to meet the Prime Minister and the Minister of Foreign Affairs. I asked Mr. Shevardnadze if he had an opportunity to relive his life would he again push the economic, political and democratic reforms as he did with Mr. Gorbachev. He thought about it for a while and said: "Yes, but I would do it much more slowly". His argument was that the problems they were having in many of the east European countries today were because they were not ready for such rapid change.

Therefore, if we want Canada to have a prosperous and beneficial relationship with central and eastern Europe then we must start today and patiently wait for the results. In countries like Poland, Hungary, Slovakia, the Czech Republic, the memory of democracy and market economies have survived 45 years of political repression and state control. But in what shape? There is enough intact to provide the basis for a successful transformation but the task remains daunting. With strong support and investment from the west we are seeing encouraging signs.

Poland became the first country in the region to record growth in gross domestic product with an increase of 4 per cent last year. It was Europe's fastest growing economy in 1993. Who would have predicted that 10 years ago?

In Hungary the private sector generates close to 45 per cent of the country's GDP. The Czech Republic has low inflation and unemployment rates and has launched a second phase of a successful privatization program.

In the former Soviet Union the first steps have been taken, but with virtually no history of democracy and free markets to draw on we should not be surprised that change is slow and difficult. The challenge is large but it is not insurmountable. Countries such as Russia and Ukraine are central to the historic transformation of Europe. Canada must make a commitment for the long term.

We are encouraging Russia's president, government and parliament to work together to develop a new reform consensus. Canadian assistance remains contingent on a continuing commitment to democracy and economic reform. I should draw to the attention of newer members that the foreign affairs commit-

tee was in the former Soviet Union, Russia and Ukraine twice. Maybe it is time to revisit that region.

Yesterday I had a lengthy meeting with the new ambassador of Ukraine, Ambassador Batyuk, to discuss Canada's special relationship with Ukraine. About two hours ago the Minister of Foreign Affairs met with the Ukrainian Canadian Congress under the presidency of Oleh Romaniw to discuss such matters as political issues, technical assistance, trade and economic issues, consultations with the Minister of Foreign Affairs and immigration issues as they pertain to Ukraine.

This is the kind of input that we welcome, not only input through parliamentary standing committees but meetings such as the minister had just prior to my speaking here.

Government commitment to enhancing this relationship is in every spirit political, economic and social. We will be at the forefront of helping Ukraine in its democratic and economic transformation. A stable, secure and prosperous Ukraine is vital for European security.

We are encouraged by President Kravchuk's desire to submit the non-proliferation treaty to his Parliament for ratification.

Since 1989 Canada has provided substantial support to central and eastern Europe in the form of technical and humanitarian assistance. It is important that we continue to do so. The people of the region must clearly see that the west is supporting them in practical and direct ways during the difficult period of transition.

That is why one of the major components of Canadian assistance to the region is an ongoing program designed to promote democratic development, to support the transition to market economies and to increase Canadian trade and investment links with the region.

In pursuing these objectives we have adopted a partnership approach both with recipient countries and Canadian partners. This is partly a reflection of limited resources. It is also a recognition that government does not have all of the answers. The program draws on the expertise to be found in all sectors of Canadian society.

The assistance program matches Canadian skills and technology with the priority needs of partner countries. We have done this successfully in fields such as energy, agriculture, private sector development and the environment. Our sophisticated financial and legal systems and our respected public service have also provided unrivalled expertise.

This approach not only ensures that Canadian assistance is of high quality but also helps to develop long term commercial opportunities for Canadian companies.

Canadian assistance is having a practical impact on the process of reform. It supports the transfer of critical knowledge and technology and fosters the emergence of small and medium sized enterprises. Western economic practices are being adopted and democratic institutions are being strengthened.

The assistance program also increases the capacity in Canadian firms to compete effectively in central and eastern European markets. Two examples of projects in my parents' homeland of Poland illustrate the range of our involvement and give us a good reason why we should continue to be involved in the region.

One, a Canadian company advised the Polish Ministry of Health on health care reform in 1992. It subsequently won a World Bank contract to manage a $200 million U.S. health sector loan in Poland. Another example, more than 100 Polish dairy farmers and veterinarians have so far upgraded their skills and received management training in an ongoing program at the international livestock management school in Kemptville.

There are those who think that Canada spends too much on foreign aid, as we heard from some of the Reform Party speakers, and that it is a waste of money. As we embark on this foreign policy review process we will have to look at our aid programs, but aid is not simply money. It is also expertise, knowledge and skills that we can share with those who are seeking to build in modern society.

Let me cite a few examples of where Canada has taken the lead in setting up successful programs with very little money. The Federal Business Development Bank took the lead in establishing an independent Romanian loan guarantee fund for small and medium enterprises in 1993. A contribution of $775,000 will provide on site staff and management training until June 1995. Canada without providing capital in the fund has provided much more: a credible reputation and confidence in the abilities of its managers. Thanks to this the fund has attracted a $5 million contribution from Germany.

In Hungary we are establishing regional vocational and labour retraining centres. Our involvement in the project started in 1991 with a $400,000 contribution to the Association of Canadian Community Colleges for one pilot project. The association and an Irish partner then secured a $1.5 million World Bank contract to establish close to 20 such centres in Hungary.

Just yesterday Ambassador Gedai of Hungary was in my office expressing appreciation for the co-operation and assistance from Canada.

Russian oilfield workers and managers are benefiting from training in Russia and Canada. A $10 million Yeltsin democracy fellowship program managed by the University of Saskatchewan in my province brings Russian officials to Canada to work in ministries at all levels of government.

In Ukraine Canadian support for a professional public service training institute is helping to build the institutions that modern independent states require.

Canada is contributing its expertise in agricultural economics, social policy planning and communications. Already 21 deputy and assistant deputy ministers from Ukraine have participated in Canada in a two week executive management program at the Canadian Centre for Management Development.

Canada's assistance program also provides funding to Canadian business on a cost shared basis to develop joint ventures in trade and investment opportunities. As a result Canadian companies have established a strong presence in Russia, the Czech Republic, Hungary and Ukraine. Trade and investment are key to the long term growth of these fledgling market economies.

As I said earlier, and my colleagues have also pointed out, trade is also essential to Canada's continued growth in the next century. Canada is encouraging collective, decisive action on the part of the west. The government supports stronger links between NATO and central and eastern Europe through the partnership for peace program. Canada has encouraged the CSCE to play a more active role in central and eastern Europe, particularly in the area of conflict prevention and crisis management.

We are proposing to focus high level G-7 attention on Ukraine. Already Canada is playing a leading international role in assisting Ukraine in its upcoming elections through technical assistance and election monitoring.

I am pleased to announce that the Minister of Foreign Affairs has asked me to lead a delegation to Ukraine on its request to monitor the elections there.

Canadian soldiers are serving as peacekeepers with the United Nation protection force in the former Yugoslavia and the government increased Canada's contribution to relief operations there with the announcement of a $10 million package of humanitarian assistance in November 1993. This brings Canadian contributions of humanitarian assistance for the war affected populations of former Yugoslavia to $50 million since 1991. We will continue to monitor humanitarian needs throughout the region and to respond generously and compassionately.

Had the former Yugoslavian conflict been resolved in an institutionalized way through compromise, tolerance and agreement, as recommended by Lester B. Pearson, billions of dollars could be used today for development rather than for humanitarian assistance. Again, in response to the people who say we should focus on only giving assistance to the poorest of the poor, if we only give humanitarian aid when do the countries get assistance to develop so that they can stand on their own feet? Our ideology should be to help the people in those countries to help themselves.

The course of reform in central and eastern Europe and the former Soviet Union may continue to be unpredictable and fraught with danger but we cannot withdraw. Canada must play a role in turning this period of turbulent change into an opportunity to create a more stable and prosperous world. The government is committed to providing creative international leadership to ensure that we achieve this vital goal.

I am very impressed with the work of the parliamentary standing committee represented by the three parties sitting in this House and I am looking forward to criss-crossing Canada, hearing views from grassroots Canadians in helping us develop a unique, independent Canadian foreign policy.

[Leon Benoit, Reform, Vegreville, AB]

Madam Speaker, I have one question for the hon. member.

During the election campaign I heard from people in my constituency, and I think others did across Canada, that Canadians want this country to take care of Canadians first. They said we have to cut down substantially on the amount of money spent on foreign aid. That is what recent polls have shown as well.

I want to know how the member would answer these people when they ask if that is what this government will do.

[Jesse Flis, Liberal, Parkdale—High Park, ON]

Madam Speaker, this is a question that we as parliamentarians get. I get it in my own riding and it is a very fair and honest question, knowing the deficit and the public debt we have. The comments I get are that charity begins at home.

We have to point out to Canadians that we are all brothers and sisters on the same planet. When someone says charity begins at home, Somalia, Ethiopia, Cambodia are also home for Canadians.

I was in Cambodia observing its elections. I learned that only one in five children reaches the age of five and the lifespan is only around 50 for adults. How can we say no?

Those are our neighbours. When we hear charity begins at home I have to remind myself that is part of my home as well and I have to help those children so that they can live past the age of five.

The other answer that we can give our constituents is that if we had global security we would spend less money on defence, we would spend less money in humanitarian aid. That money could go toward helping these countries develop their economies rather than looking for handouts.

I concentrated on central and eastern Europe because I believe very strongly that with a little help there it is more an investment for the entire world. These countries that I have mentioned will and some are already helping the developing countries. Poland,

Hungary, the republics of Czechoslovakia and others are already helping third world countries.

That will ease the burden on Canadians. Canada cannot do it alone, whether it is in peacekeeping, whether it is in humanitarian aid. That is why we have to look for partners around the globe.

It is a tough question. We will get this as the committee travels across Canada. We have to look at it as investment for the future. We have to look at it as global security.

When I was in Honduras recently with our overseas assistance, we brought in a water system to a rural community fed by gravitational force, no motors, no engines.

I was there talking to the barefoot children and to the local inhabitants surrounding me and I said that we were pleased that Canada could help in a small way. I said I was sure that if disaster struck Canada those people would be the first to come to our help and they all applauded.

I saw the coffee and the bananas growing in the fields. I am sure these same countries we are helping, should a disaster strike Canada tomorrow, we do not know, would be the first to come to our assistance.

[Jack Ramsay, Reform, Crowfoot, AB]

Madam Speaker, I have two questions for the hon. member.

He has made comments that I find very inspiring and uplifting. At lunch we have a meal served here and we do not pay for it as members of Parliament. At supper I understand there is a meal out there and we do not pay for it although we are being paid to work through these hours.

I would like to ask the hon. member if he would be willing to pay a small fee for the food we eat here and have that given to countries that are in need.

My second question to the hon. member is what does he feel will be the impact on our foreign aid program as a result of the addition of $100 billion to our national debt over the next three years?

[Jesse Flis, Liberal, Parkdale—High Park, ON]

Madam Speaker, in answer to the first question, I was on duty all day today. I paid $76 for my lunch today. How much did the hon. member pay?

I think these are piddly little things that we bring in as red herrings to take us off the real issue. The real issue here is developing an independent Canadian foreign policy, not whether we are spending $2 or $5 on our lunch. I do not want a free lunch. I happened to take some of my constituents out for lunch today to the tune of $76.

As I say, let us not waste taxpayers' money by pulling in these little red herrings to deflect us from the real issue.

The second question is the real issue and if he would look at our budget we are trying to reduce the deficit. We are trying to reduce the public debt but gradually so not to hurt Canadians too much.

If he looks closely at the budget over the next three years we will be reducing the deficit by over $3 billion just in the way we are operating the government.

In the PMO and in the ministers' offices, et cetera, I feel the pinch now. I was parliamentary secretary in the 1980s and when I became parliamentary secretary I received additional staff and resources. Right now I am not receiving anything extra.

When the Prime Minister told me to go to Hungary to represent Canada at a state funeral because its Prime Minister suddenly passed away, I was a one person delegation. Normally there would be three people representing each party. I was a one person delegation. We cannot run government any leaner than that.

A month later the minister asked me to go to Norway for another state funeral. I was a one person delegation.

I went to the inauguration in Honduras. I could not even take my wife. It was embarrassing because representatives from all the countries were there with their spouses being presented to the president. I was there all alone, a one person delegation.

If the Reform Party cannot accept that I would say it is at the wrong level. It had better go to municipal politics because it does not know what international politics is all about.

[Jake Hoeppner, Reform, Lisgar—Marquette, MB]

Madam Speaker, I appreciate the comments of the hon. member. I would like to fill him in a bit in that I know something about Russian history too. Those are my roots. My great-grandfather fourth removed negotiated the land deal with Catherine the Great for the Mennonites to move to the Soviet Union. I know what a prosperous country can look like. That country was the land of milk and honey as far as the Mennonite people were concerned at that time. They prospered tremendously but corruption and mismanagement set into the Czarist regime and finally some of the people started immigrating to the United States.

In 1874, when the first Mennonite people came to the United States, they brought new strains of wheat along with them which were used pretty well until the 1930s. That was a prosperous country but now it has turned around. Through mismanagement they have lost everything. This is what Reform is really worried about, that this not happen to our country. That is why we are concerned that we have decent management, that we look after the wealth, and that we share it with other people.

[Jesse Flis, Liberal, Parkdale—High Park, ON]

Madam Speaker, I am glad the hon. gentleman shared his experience and his roots because it is members like him who understand.

We are not here to throw money around. My parents came from Poland in 1930, right into the Depression. They had no handouts. Because they had no relatives they had to work for two years on a farm in Saskatchewan and they ended up working for 22 years. They know what it is like to save for the future, to tighten the belt. Our party knows it too, but we also have to think of the over one million people who are looking for jobs.

I am sure for that member like myself the hardest thing is when someone comes to his constituency office and asks for help in finding a job and there are not any around. I see a lot of members nodding their heads. I thank the hon. member for sharing that with us.

[The Acting Speaker (Mrs. Maheu)]

I would like to advise the House that prior to the vote I recognized two members of the Official Opposition.

I am now going to recognize the Parliamentary Secretary to the Minister for International Trade and revert to the government for this part.

[Mac Harb, Liberal, Parliamentary Secretary to Minister for International Trade]

Madam Speaker, I am honoured to be speaking in the debate on foreign policy. I want to congratulate all the men and women who are serving our country abroad in different capacities, whether in peacekeeping or in a foreign post trying to represent our great country.

I also want to take this opportunity to congratulate the government, the Prime Minister, the Minister for International Trade, the Minister of Foreign Affairs and the Minister of National Defence for undertaking this initiative to conduct both a foreign policy review as well as a national defence review. I am delighted to see that at some point in time both the foreign affairs policy and the national defence policy would go hand in hand. A number of groups have made presentation to me and to many of my colleagues. One issue they have raised with us is that they want some sort of connection between the review of foreign policy and that of national defence.

I quote the National Forum on Canada's International Relations in the second part wherein it is indicated that the government is committed to reviewing the two hand in hand. There will be public hearings across Canada by parliamentary committees on Canada's foreign and defence policies. This is excellent. It is extremely timely in many ways.

We are approaching the 50th anniversary of the United Nations. It is timely for a country such as Canada that has always been on the leading edge internationally to be reviewing its policy in terms of national defence and its foreign policy at the same time. It will coincide with the review of the United Nations policy on its 50th anniversary.

I am confident that once again Canada will play a leadership role on that front and will be on the leading edge when it comes to the international scene in trying to ensure, as the parliamentary secretary for foreign affairs has indicated, that the global village lives in peace and harmony and that humankind never sees the suffering we have seen in past decades.

Madam Speaker, I will take a few minutes to address another issue in this area, and I am referring to trade and the review of our foreign policy. As you know, Madam Speaker, we are all aware of the extent to which trade, and especially international trade, contributes to Canada's economic prosperity. Nearly one-quarter of Canada's GDP is generated by our exports of goods and services. One out of five Canadian jobs is directly or indirectly linked to international trade. Each billion dollars in Canadian exports creates between 12,000 to 15,000 jobs in Canada. This means that exports are extremely important to us as a country.

We have every reason to be proud of our export record, because our exports have continued to post good results despite a slowdown in the world economy in the early 1990s. Finally, in 1993, our monthly exports to the United States, for instance, reached new highs. The latest figures are expected to show that in 1993, exports to our principal trading partners rose 15 per cent over 1992 levels. Canada's exports to the United States are worth $268 billion annually, which means that in 1993, our exports to the United States were worth $4 billion more than in 1992.

However, in an increasingly competitive market, we cannot afford to merely repeat our past results. We have been successful, but we must do better. Intensifying our efforts in this area will create jobs in Canada and stimulate domestic growth.

If we are to maintain our competitive position on international markets, we must act quickly to take advantage of opportunities offered by trade agreements like GATT and NAFTA. We have a chance to strengthen our service sectors, which represent more than two-thirds of our national economic activity, and also to improve our service exports.

As we know, about 75 per cent of our trade is with the United States, and five groups of products represent more than 70 per cent of all exports of goods. We must continue to develop these exports while increasing our market share in other areas as well.

Asia, for instance, has become our second largest market after the United States. It has strong potential and poses a big challenge to Canada's competitiveness.

We must also work with small and medium-sized business to develop an export mentality. As you know, only 15 to 16 per cent of our manufacturing industries export their products, and that is what happened if we look at the large number of businesses here in Canada.

I cannot overstate the importance of exports for Canada, but I would be wrong to suggest that we should concentrate solely on exports. The international business climate changes rapidly, as you know. Businesses must now also consider international investments, capital flow, technology, research and development in developing their international marketing strategies.

We are facing some challenges. We have a $9 billion to $12 billion trade deficit in high-tech products, and our research and development results are less than those of the other G-7 countries and OECD members.

In addition, international business investments greatly help to create jobs and improve the competitiveness of Canadian-based companies. In this regard, we are fiercely competing with other countries to attract scarce investment capital.

I see that I am almost out of time and I would like to know whether I have 10 or 20 minutes. Ten minutes?

So, with all these issues, we must see if we have partners. We have banks, various businesses and manufacturers, and our role as a government is to work together, as a team, to develop the economy for the benefit of Canada.

[Jean-Robert Gauthier, Liberal, Ottawa—Vanier, ON]

Madam Speaker, I would like to ask a question to the hon. member for Ottawa-Centre.

He had started discussing the importance of international trade and I wonder if he could, in the few minutes at his disposal, elaborate a little more on Canada's important role on the international scene, as well as on the usefulness of trade to stimulate employment, support foreign aid and all those other issues raised by the hon. member this afternoon.

[Mac Harb, Liberal, Ottawa Centre, ON]

Madam Speaker, this is a very important issue. Unfortunately, given the time left, I cannot provide a fully satisfactory answer to the hon. member. I will simply tell him that, as I indicated earlier, each billion spent on foreign trade results in the creation of at least 12,000 to 15,000 jobs.

Every time we talk about job creation in Canada, we have to take into account the fact that we must do our best to encourage companies to do business abroad, not only because of the better opportunities, but also because only 10 to 15 per cent of Canadian companies are currently doing business abroad. Consequently, our government should continue to encourage more and more Canadian companies to do business abroad.

Unfortunately, as you know, we have a problem in Canada with private sector investments in the field of research and development. If we compare Canada to other countries, we see that our government invests a lot, or at least enough, in R and D, but that the problem is the inadequate contribution of the private sector.

This is very important, and our government is sending a signal to the private sector. If we want to gain a reasonable momentum, the private sector must invest more in research and development.

As you know, over 80 per cent of new jobs created in Canada are created by small business. So, our government took that into account and developed a policy to support small business.

In response to my hon. colleague's question, when we talk about government policy in the area of job creation, it is very important to bear in mind that we believe in import. It is one of the best ways not only to create employment here, in Canada, but also to generate additional revenue in Canada. To fight a$38 to $40 million deficit and a debt now totalling over $500 billion, funds must be generated. And there are two main sources of funds. One source is taxation, and as my hon. colleagues know, Canadian taxpayers have had it up to here with taxes. So, other means of generating revenue must be sought.

In the end, these means of generating revenue will be provided by small and medium-sized businesses which will create jobs for Canadians here, in Canada, and export their products in other countries.

I hope to have answered the question of the hon. member for Ottawa-Vanier.

[Jean-Robert Gauthier, Liberal, Ottawa—Vanier, ON]

Mr. Speaker, I find it rather telling that today's debate is the fourth major debate on Canada's international relations in the first two months of this new Parliament.

I am no stranger to this House. Having taken part in debates for the past 20 years, I can attest to the fact that I have never before had or been given so many opportunities to debate these issues.

Therefore, the government is taking a new, very important approach at a critical point in our country's history. Against what backdrop is this debate taking place? In my view, there are many great reasons why we have to have this debate.

First, to state the obvious, we live in a very different period of world affairs from the rather more predictable one of almost a

decade ago. That was when the last comprehensive updating of Canada's foreign relations policies was undertaken.

Then we wondered whether Mikhail Gorbachev was for real. Almost no one would have believed or predicted the German reunification at that time, or for that matter the swift collapse of the Soviet power. As Mr. Gorbachev, the last President of the Soviet Union observed rather wistfully during the final throes of that momentous upheaval: "Once again history has accelerated its pace".

In retrospect it is clear that the international community was not prepared for so much unprecedented change so soon. There was hardly time to rejoice at the fall of the Berlin wall and to embrace the prospect of the so-called peace dividend when the rhetoric of the gulf war and the new world order took over.

That too proved to be ephemeral. As sober second thoughts set in other conflicts flared. Foreign policy analysts and pundits turned their attention to the new security risks of the post cold war era.

Most hopes of the 1990s had been pinned on developing new multilateral arrangements and on strengthening forms of economic and political co-operation. However even at this level as we approach the midpoint of this decade there are still many questions awaiting answers.

The United Nations for example will mark its first half century next year as a financially strapped organization that is in demand in a positive sense and more embattled and in need of reform than ever.

Canadians understand that difficult choices are needed in order to formulate a rational plan for managing our common future which is at risk. This brings us to a second important reason for reviewing Canadian policy.

Before the government proceeds to make these choices, as it will have to do sooner or later, Canadians will have to reflect on this issue and share with members of Parliament their views on our country's foreign policy.

Before decisions are made on important aspects of the management of public affairs, Canadians are entitled to be heard in an open and democratic consultation. When institutions responsible for foreign affairs spend Canadians' money, the members of this House, elected to represent their interests and their values, have a responsibility to demand results in return.

We in the Liberal Party were aware of this attitude of Canadians when we began a consultation process several years ago to develop a renewed, more democratic and more independent foreign policy. I hope that such dialogue will enable us to find a consensus among all Canadians on the nature of Canada's key international interests, on what Canada can afford as a nation and on the best way to meet the challenges of the 1990s and of the next millennium.

I only have a few minutes but I would like to elaborate on what in my view is a balance of caution and inspiration in this populist approach this government has taken in terms of consultations with Canadians. There is caution because we have to be careful not to give the impression of doing all things in all places.

This morning the minister responsible for foreign affairs commented that we must learn to do better with less. Canada as we all know has been spending about $12 billion a year on defence matters and about $4 on foreign affairs and trade programs. Given the constraints on those budgets in the foreseeable future it becomes even more important to me to look closely at where and how the dollars are allocated and to get the best value for that in terms of clearly defined, clearly identified priorities and objectives.

Inspiration will be needed. In doing this we will need to look at how key trade-offs should be made and how the different strands of foreign policy can be tied together. How for example should aid, trade, human rights and environmental policies be interrelated? It will be an interesting debate and one that I hope will give us some direction. However it is going to be a tough debate.

Do we have the right structures and institutions for implementing these policies? It may be time to rethink how we organize our foreign policy machinery and processes to meet the new challenges.

The Minister of Foreign Affairs told us that he wanted public consultation to be as broad and as thorough as possible.

I am sure that I speak for all hon. members when I say that we approach this review with an open mind and the desire to hear as many Canadians as time and resources will allow.

As Chairman of this committee responsible for consulting and listening to Canadians, I personally undertake, along with most of the members of the committee I think, to do my best to understand where we are going and to explain in a report to be tabled in this House by the end of October what we will have heard and understood from testimonies and how we see things.

Let Canadians be warned however that we will not be able to meet all expectations. That is impossible. We will do our best however to meet as many as possible and to take as much time as possible to look for a fair and equitable solution. As I said earlier, we cannot please everybody. When all is said and done, we are the ones who will have to set priorities.

When I say we, I mean all of us Canadian parliamentarians. We will be the ones who will have to take into account the representations made to us, the values, the special interests, the day-to-day concerns of Canadians about employment, security, well-being, all of this within the framework of a fair and equitable foreign policy.

That is the challenge facing the members of the Standing Committee on Foreign Affairs and International Trade if we want to lead the way for Canada's international relations at a time when world events not only happen much faster but are sometimes very troubling.

To quote an ancient Chinese curse, we live in interesting times. In this high risk, multi-choice world decisions will have to be taken. That is why it is so important to use this review to prepare ourselves well. We are counting on the knowledge, experience, common sense and the goodwill of Canadians to help us as their elected representatives to carry out this task.

I hope we are successful. I pray we will be successful. I will give it my best.

[Mac Harb, Liberal, Parliamentary Secretary to Minister for International Trade]

Madam Speaker, I first want to congratulate the committee chairman, the member for Ottawa-Vanier, on an excellent speech. I commend him for his commitment to the cause of Canada here and abroad.

The committee will be travelling from one end of the country to the other. Representations will be made by groups interested in the issues of foreign aid, foreign policy and so on. At what point in time will the committee which is dealing with defence policy issues and other international and foreign affairs issues present its report to the House of Commons? Will the members of the committee be the same members who are now sitting on the foreign affairs committee or will others be joining it?

[Jean-Robert Gauthier, Liberal, Ottawa—Vanier, ON]

Madam Speaker, some of the answers I will be giving are my own. The steering committee of the Standing Committee on Foreign Affairs and International Trade has not yet set its agenda for work and consultation.

I hope we will be ready to go by the end of this month. We will be consulting with Canadians as individuals but also as groups. There will be interest groups and people with a special message to give us. The schedule of meetings has not been established as yet. I wish I could give that schedule tonight. It would save some money on advertising.

The second question was on the work of the defence committee which is presently holding its meetings. It has started work on its order of reference. I believe there are areas which overlap.

Foreign policy first and foremost is the why issue of this exercise. Why Canadians would like to participate in peacekeeping rather than peacemaking is a debate; why Canadians tie environmental issues to the questions of aid and human rights and so on.

Defence is more or less the how we do things and that is a special study that defence will be doing as to how best to put into effect the why decision, the policy issues, decided by government and proposed by parliamentarians. I see foreign affairs as the committee that decides why we should be doing these things and defence on matters of defence telling us how best to do that.

I see all the other agencies such as CIDA telling us also as professionals in the field how best to put into action the why decision, the policy issues, that this House will recommend in its report.

I do not know if I answered the member in a satisfactory manner but I tried to address some of his points.

[Bob Mills, Reform, Red Deer, AB]

Madam Speaker, I would like to thank the hon. member for the confidence he places in the committee and the members on that committee.

I have one question. How are we going to prevent as a committee the dominance by special interest groups, the sort of overwhelming influx of special interest groups in many areas and how are we going to actually get down to the grassroots of this thing?

I wonder if the member could address that question.

[Jean-Robert Gauthier, Liberal, Ottawa—Vanier, ON]

Madam Speaker, it is a very hard question to answer.

I believe there are two aspects to our study. One of them is the collective aspect of interest groups that have a particular message to put to the committee. We would invite those people to send us their written presentations and we could go through them. I expect the committee will get many of those.

The other aspect is the individual approach, the grassroots approach, the individual Canadian who has ideas and who wants to put them to the committee. We will have to hear those persons.

I am going to propose that we hive off smaller subcommittees of this large committee of 22 people. I do not know yet and I may be doing this in anticipation of the decision but the proposal before us today is that there be 15 members of the House and seven senators. I take it if that happens then we could hive off

smaller groups of say five or six parliamentarians and really go into the grassroots areas of this country, the communities, and hear how they see our direction in the coming few years and possibly into the next century.

Having said that, it will be up to us to give them a fair chance to be heard but as far as the groups are concerned I see them presenting us briefs, as we call them, memoirs-

[The Acting Speaker (Mrs. Maheu)]

I am sorry, the member's time has expired.

[Bob Ringma, Reform, Nanaimo—Cowichan, BC]

Madam Speaker, I will be splitting this 20 minutes segment with my colleague, the member for Saanich-Gulf Islands.

I want first of all to urge the people of Canada to accept the offer made by the hon. member for Ottawa-Vanier, who chairs the committee, to listen to what you have to say because it is essentially the point of my speech today.

I do welcome the opportunity of addressing the House on the topic of Canada's foreign affairs policy.

My feeling is that the more our foreign policy is reviewed publicly, such as in this discussion, the more the policy will be understood and supported by the public. To go a step further, if the discussion is carried outside the House in communities across the country the more accurately will our foreign policy reflect the majority opinion of the electorate. This is particularly important, in my opinion, when it comes to revising or formulating defence policy, which should be a subset of foreign policy.

The Canadian public is very supportive of its armed forces in time of war, but it is less interested in time of peace. However, what Canada has experienced in the nearly 50 years since the end of World War II cannot properly be called peace. We have had relative peace within our boundaries but that was so, in large part, because Canadian troops were engaged overseas in smaller wars such as in Korea and in the cold war.

Throughout this half century as well Canadian forces were engaged, as they are at the moment, in peacekeeping operations around the world. The public must realize, therefore, that the terms war and peace are subject to redefinition. It should also accept the responsibility for engaging in this debate on foreign policy including defence and peacekeeping.

In asking for public consideration and input, it might be helpful to do several things. We should probably define peacekeeping, then examine what we have been doing in that field. We should also postulate our ideals of foreign policy. What should Canada's policies be and why? It might then be instructive to compare the ideal with current policy to see if there are anomalies or gaps in our policy.

Finally, we should zero in on defence policy and the specifics of peacekeeping.

Concerning definitions, the Canadian public should at least be aware of the difference between peacekeeping and peacemaking. Peacekeeping implies that there is an agreement in place, as is the case between Serbians and Croatians in parts of the former Yugoslavia. Peacemaking implies an action to bring hostile parties to agreement, which is the case in Bosnia.

In reviewing our foreign and defence policies, the public should decide if it supports both activities and under what circumstances.

If we examine Canada's participation in peacekeeping and peacemaking operations over the years, we find that changes in operations and our commitments have taken place without our necessarily having changed policy. Through an apparent zeal to participate in all peacekeeping operations, we have gradually become immersed beyond the intent of our policy and almost beyond our resources.

We have also learned some lessons over the years. I cite as an example our experience in Indo-China. Canada was part of a moribund commission there for many years. It was a wasted effort. However, when it came time to help the Americans extricate themselves with their prisoners of war from Vietnam in 1973, Canada wisely joined the new commission with much revised terms of reference but pulled out after six months when the main part of the job was over. It made good sense.

We said that we should postulate our foreign policy ideals. What do we believe in as Canadians and therefore what should our foreign policy be?

I believe that we are a generous people who believe in democracy and the rule of law. We do not believe in imperialism and we do have strong humanitarian feelings.

We are also pragmatic enough to believe in collective security. All of these beliefs shape our foreign affairs and defence policies. I do encourage the public to think about these basics and to add its own ideas.

A comparison of our ideals with what we have been doing as a country in peacekeeping should tell us how far off our policies are. My personal conclusion would be that we are fairly close but that a review is very necessary. As said earlier, the public should participate to the maximum extent in that review.

In addition to encouraging public participation in the review process, I would like to leave the House with these thoughts. First, the Canadian forces, through years of efforts overseas, have created for Canada an international reputation of real value. We should do more as a country to capitalize on our

standing by taking a greater leadership role in the shaping of international peacekeeping policy and procedures.

Second, in reviewing our foreign and defence policies we should take full account of the work of previous House standing committees. Some of the reports I have read have been excellent and should not be wasted.

Third, if as expected the review reaffirms the role of aid of the civil power for the Canadian forces, it must be confirmed that the forces are of sufficient strength to meet that commitment as well as their other obligations.

In a similar manner, the equipment state of the forces should be checked after the forthcoming review to ensure that it is adequate to perform the given tasks.

Finally, policy review of foreign affairs and defence, including peacekeeping, should be an ongoing process by the departments concerned, by Parliament and by the public.

[Mac Harb, Liberal, Parliamentary Secretary to Minister for International Trade]

Mr. Speaker, I would like to congratulate the member on his comments, many of which this government subscribes to in the sense that from time to time we have to revisit any policies in order to ensure they truly reflect the modern age and the needs and aspirations of all those who are affected.

My question to the member is quite specific. Could he tell the House and all Canadians what percentage of assistance his side of the House would support in terms of gross domestic product, in terms of foreign aid that Canada should give to other countries around the world, taking into consideration Canada's position internationally as a member of the United Nations where we have a commitment to fulfil when it comes to the international scene? Also, would his party support the continuation of that level of aid?

[Bob Ringma, Reform, Nanaimo—Cowichan, BC]

Mr. Speaker, in responding to the question, my address was specifically on peacekeeping. The question directs itself to foreign aid as well as peacekeeping and so I will try to respond to those two issues.

First, consideration of foreign aid should not be done in isolation of the fact that Canada is spending a great amount on peacekeeping. That should be part of balancing the ledger for us.

On foreign aid, I will not give it as a measure of percentage of the gross domestic product but my reckoning is that $2.5 billion per year at this moment with Canada's vulnerable economic state is too high.

We must continue to give foreign aid, there is no question, particularly for some of the things that we have heard of today such as pure water systems and the like. That is good. That is direct aid to people and we need that.

What we must get away from is some of the government to government aid which finds its way into bottomless ratholes. That we do not need. My response in summary is keep up the peacekeeping. Bill it as part of foreign aid. Cut foreign aid by a measure below $2.5 billion a year and direct it in the right channels.

[Jack Frazer, Reform, Saanich—Gulf Islands, BC]

Mr. Speaker, I too want to address the foreign affairs review from the standpoint of its relationship with and to defence considerations.

As we have heard before in this place, the end of the cold war and the reduction of the antagonism it engendered between the two superpowers has unhappily not resulted in a world that could look forward to an extended peaceful coexistence.

The world today is probably more volatile and unstable than it was when the Warsaw pact and the iron curtain were alive and well. As a result there continues to be a need for effective defence forces and co-operation in defence matters between like minded people.

There are those who would disagree with this assessment, those who think that Canada should show the world the way by dramatically reducing the Canadian Armed Forces and concentrating those that are left on peacekeeping and community assistance projects.

As idealistic as I am, I cannot agree with this philosophy. Canadians enjoy an excellent way of life and an excellent standard of living. One of the reasons this is so is that over the years we have been willing to commit Canadian support to assist in maintaining democracy and freedom not just at home but in almost every part of the world.

As my colleague pointed out earlier, we are involved in several such endeavours at this moment. Unhappily there are those who mistakenly think that the people in the armed forces tend to be war minded and supportive of belligerent or strong arm policies.

I am here to assure members that while they may be many things, Canadian service men and women are not stupid. They are fully aware that if as a result of deliberate escalation or inadvertent error, a shooting war should develop they as trained members of the armed forces will be first in the line of fire.

No, the men and women of the Canadian forces are very much in favour of keeping the world at peace. They also know that the awareness developed between people in co-operative defence forces often spills over into many other aspects of international relationships.

Thus defence considerations can have considerable impact on foreign relations. As evidence let us examine some of the relationships that have come about as a result of our participation in two world wars, the Korean war, NATO, NORAD, the gulf war and other co-operative military efforts.

In so doing, we find that these affiliations have enabled or helped to enable a level of trust and comradeship which has led to a better relationship between our countries, to increased interest in our problems, to more understanding and willingness to accept our position even on matters totally unrelated to things military and finally to increase trade and co-operation between the nations concerned.

For instance, although it is now 50 years since Canadian forces liberated Holland toward the end of the second world war, there is still a special place and warmth in the minds of Netherlanders when they think of, relate to and deal with Canadians today. This special relationship extends beyond those who were physically there during the liberation. It has been taught in school and passed down, so that no matter the age that good feeling is there.

This does not mean that the hard-nosed Dutch businessman or woman will not attempt to drive the hardest bargain and extract the best deal when dealing with his or her Canadian counterpart. It does mean that there will be an underlying warmth and some assurance of fair play in the negotiations.

Moving north, our relationship with Norway is favourably affected and influenced by the many Norwegians who took their flying training in Canada during World War II. Not only did they take their flying here, many of them took Canadian wives back to Norway with them after the war.

Unquestionably, these experiences have resulted in a far better relationship between our two countries than would have prevailed had they not occurred. These relationships have been further deepened and strengthened by our mutual participation in NATO. In fact, it would be fair to say that Canadian defence forces operating with or in some cases against other countries have substantially enhanced Canada's stature in the world.

While we are examining how we should shape and conduct our foreign affairs, it would be an expensive and ill-advised oversight to overlook the lucrative opportunities and benefits to be achieved through military co-operation.

Ideally this foreign policy review should have been completed prior to the commencement of any defence policy review. After all, defence policy should be a logical and supportive extension of foreign policy.

Because it has been necessary to convene and conduct these two studies concurrently, it is vitally important that the two committees work closely and co-operatively with each other, exchanging information and keeping updated as the reviews progress.

Moving away from North America and Europe for a moment, I am certain that in their considerations the joint standing committee on foreign affairs and international trade will appreciate that not all democracies are the same and that unlike Canada, in many countries the military is an integral part of government. For example, this is so in Tanzania.

When Tanzania was first establishing independence and requested assistance, Canada dispatched a Canadian forces training team to Tanzania to carry out in-country training there and brought the Tanzanian peoples defence force members to Canada to attend Canadian military training schools here.

Many of those Tanzanian trainees are now experienced senior officers who have considerable influence in their government and who still harbour feelings of warmth and respect toward Canada as a result of their experience with our military personnel. Although now on a much smaller scale, this co-operation continues today.

Make no mistake. These people are Tanzanians first and foremost but a good relationship has been established which can positively influence any negotiations between our two countries.

Considering our interest in and increasing trade with the Pacific rim, it would seem appropriate for the committee to look carefully at the utility of establishing mutually advantageous defence relationships with the countries there. The same rationale applies to our relations with Central and South America.

Whether it be an exchange of military attachés, making training teams available, or opening Canadian forces training schools to their use, good military contracts are an excellent way to improve understanding and co-operation between countries.

One of the often overlooked benefits Canada reaps from Canadian forces involvement overseas is the ambassadorial role that our personnel play. They and in turn our country are liked, respected and in many cases emulated by those they encounter. Also, because these military interrelationships occur across the rank spectrum and thus involve all social walks of life rather than just the relatively high diplomatic level, the effects are far more broadly based.

The results, advantages and benefits of such programs can often far exceed the costs of participation.

To a large extent Canada's prosperity and way of life depends upon international trade and thus on world stability. No one can say that world stability is totally dependent on military defence or assistance pacts. But history has shown that such agreements and particularly those in which Canada has been involved have fostered a better, more predictable and more secure world. In conclusion, while it would be a mistake for the foreign affairs review to concentrate too much attention on defence related

activities, it would be an even bigger mistake to overlook their value.

To reiterate, it is vital that there be continuing close contact between the joint standing committee on foreign affairs and the joint standing committee on defence.