Debates of March 22nd, 1994

Human Rights

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, we always raise this issue, and we did. We have an international policy that is different and does not depend on the position of the United States, and I think Canadians want Canada to take an independent position in this respect. For instance, we were the first country, well before the United States, to recognize China. It was not until after Canada recognized China that the United States did so.

I think Canada has always raised the issue of human rights and has always traded with China. Under the Diefenbaker government, we were already selling wheat to China. We have had trading relations with the Soviet Union, and we always raised the issue of human rights. We did not change our priorities, but we know, and we say this quite frankly, that it is no use being holier than thou. If I told the President of China, who represents 1.2 billion people, that the Prime Minister of Canada was telling him what to do, he would laugh in my face. I think the best way to accomplish something is to help this country develop its potential, and once they have had many exchanges with the Western world, they will understand the benefits of democracy and respect for human rights and economic progress in a market economy.

[Lucien Bouchard, Bloc, Leader of the Opposition]

The Chinese leaders are not going to be impressed by our dollars. What they will respect is an international conscience which Canada has always brought to bear throughout the world and on which its present prestige in the world is based.

There is a clear lack of continuity between the great international accomplishments that are largely the work of the Liberal Party, and its heirs here in the House today, who are frittering away that legacy.

I would like to ask the Prime Minister whether this means that on his trip to Mexico, he will not raise the issue of human rights violations in the province of Chiapas with the Mexican President, although as a trading partner, he will be in a position to do so.

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, as soon as we were informed of the problems in Chiapas, we sent a note of protest to the Mexican government. If you read the notes that came from Mexico, you would see that we were one of the first countries to do so and one of the countries that protested most vigorously.

Nevertheless, we believe that it is normal to have trading relations with Mexico. I am surprised to hear the Leader of the Opposition say we should not have trading relations with Mexico and China because we do not like the way they govern their countries.

We have always had trading relations, and it would be hypocrisy to claim that we can cut off our trading relations with countries with whom we disagree on the issue of human rights. We have always traded with China, the Soviet Union and Mexico. We intend to continue and to raise the issue of fundamental freedoms at the same time.

Government's Credit Rating

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, as expected, the Dominion Bond Rating Service of Toronto lowered the federal government's credit rating yesterday, justifying its move by the government's inability to put its fiscal house in order. This lower rating, which will translate into hundreds of thousands of dollars in costs to the taxpayers of Quebec and Canada, revives the spectre of major hikes in interest rates, a scenario which occurred before under the Liberals in the early 1980s.

Does the Minister of Finance not agree that this lower rating is tantamount to an unequivocal condemnation of Canada by the financial community, signalling the failure of his budget with regard to public spending control?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, in lowering this rating, the

DBRS was following the lead taken by another agency last year, that is to say before our budget. So, no connection can possibly be made between our budget and what has just happened.

Second, this rating relates to only 2 per cent of our debt, namely foreign currency. As for the budget, it is very unequivocal. Our goal is to bring the deficit down to 3 per cent of the gross domestic product within three years. We will achieve our goal and ultimately eliminate the deficit. That is our goal and we will achieve it.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, the Dominion Bond Rating Service quotes explicitly the budget as the reason for lowering the credit rating.

Does the Minister of Finance not recognize that failing to take seriously our proposal, the Bloc Quebecois proposal, to review and cut the fat in federal government expenditures was a bad move and that such an irresponsible move could end up costing the people of Quebec and Canada hundreds of thousands of dollars, while at the same time causing job losses and allowing interest rates to skyrocket?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, I have not heard the Bloc Quebecois propose any cuts. All I heard was: "Do not touch military bases. Do not touch unemployment insurance. No reform. No restructuring. Do not do a single thing." That is the Bloc's position. So, we have no lesson to take from them.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, last week we asked the Prime Minister if he would respond to the falling dollar and rising interest rates by making a stronger commitment to deficit reduction.

The Prime Minister refused to do so and now just yesterday, as has been mentioned, the Dominion Bond Rating Service downgraded its credit rating on the federal government foreign currency debt.

The DBRS said in making its downgrading that the federal government policies are not stringent enough to get the government out of the debt trap and if it wants a better rating it will have to include some meaningful spending reductions in the 1995 budget.

Is the Prime Minister now prepared to direct the finance minister to bring forward a stronger deficit reduction program before the government's credit rating is further downgraded?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development -Quebec]

Mr. Speaker, what the DBRS said was that we have a high level of foreign debt at the federal-provincial level, that is the corporate level. That is true. That is the situation. We as a country are heavily indebted at the federal and provincial levels and it is going require co-operation with the provinces which we have already begun, and that is true.

The Dominion Bond Rating Service said that our productivity is up, our inflation rates are down and there is great room for strength within this economy. It also said that it was putting the downgrade on but 2 per cent of our foreign debt and it maintained the triple-A level on our Canadian debt.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, I have a supplementary question.

Surely the finance minister is not suggesting that this downgrading was done lightly or frivolously. Surely members across the way know that the eyes of investors and borrowers are on the frontbenches of government, looking for signs as they are worried about the government's fiscal situation.

Is not the minister concerned that this downgrading could be the beginning of a trend and what steps is he taking to prevent downgrading of all of Canada's outstanding debt?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development -Quebec]

Mr. Speaker, first of all our budget was well received by the majority of the rating agencies.

Second, we very clearly set out that in the first stage of our budget that we were going to arrive in three years at a deficit target of 3 per cent of GDP and it will be the first time in the last 15 to 20 years that that has been attained.

Furthermore, we said this is the first stage of a two-stage budget. We also said that cutting at the margins and nibbling at the edges does not apply. Fundamental reform to unemployment insurance, to defence, and the way the government operates is what is required and that is what this government is going to do.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, it is not how members of this House, either on this side or that side, react to the government's signals. It is how the money markets react and that reaction has been negative.

Increasing scepticism that the federal government is not really prepared to come to grips with the deficit problem is now leading to concerns that the government may attempt to inflate its way out of a portion of its debt and cause interest rates to rise, the bank rate today rising from 4.25 per cent to 5 per cent.

Will the minister assure the House that the government will resort to deeper spending cuts before it will allow inflation rates to rise above present levels?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, the only inflation I hear about in this House is that party that wants to inflate the number of members of Parliament who are in this House.

Let us be very clear. Prior to Christmas the Government of Canada and the Governor of the Bank of Canada arrived at a set of monetary targets which we did within the first month of taking office, something that it took the previous government two and a half years to arrive at. Those monetary targets are among the most stringent of any industrial country in the world and we are very proud of them.

This is a low inflation country. We have paid a great penalty to get there. We are not going to lose the benefit. We are going to remain a low inflation country.

Publishing Industry

[Suzanne Tremblay, Bloc, Rimouski—Témiscouata, QC]

Mr. Speaker, my question is for the Minister of Canadian Heritage.

Yesterday the minister encouraged us to continue reading the Toronto Star . Well, this morning I took him at his word. I learned that at least five Canadian publishing houses had already expressed an interest in acquiring control of Ginn Publishing.

How does the minister explain the fact that the CDIC has not responded to Canadian publishers interested in purchasing Ginn Publishing? Furthermore, will the minister recognize the need to conduct an inquiry into the actions of the CDIC, which has systematically rejected all efforts made by Canadian publishers to buy Ginn Publishing?

[Michel Dupuy, Liberal, Minister of Canadian Heritage]

Mr. Speaker, yesterday we were fortunate to have a few documents tabled. They clearly indicated that certain Canadian publishers were interested in buying Ginn. However, I did not see a specific purchase offer in these documents.

We are not so much concerned about events which took place nearly 10 years ago as we are about what has happened since this government took office. And I have seen no direct offer to purchase Ginn since this government has been at the helm.

[Suzanne Tremblay, Bloc, Rimouski—Témiscouata, QC]

Mr. Speaker, it is surprising, nonetheless, that no purchase offer has been made. The CDIC had promised to issue a monthly prospectus and it has not done so. Therefore, the minister must admit today that while no offer has been made, some interest has been expressed nevertheless. An offer can be made if there is a prospectus. But this government never issued one.

[Some hon. members]

Hear, hear.

[Suzanne Tremblay, Bloc, Rimouski—Témiscouata, QC]

How can the Minister of Canadian Heritage seriously continue to claim that the CDIC was determined to sell Ginn to Canadian interests, but received no serious offer, when the evidence he has points to the contrary? Will he not agree that he is losing all personal credibility as far as this matter is concerned?

[Michel Dupuy, Liberal, Minister of Canadian Heritage]

Mr. Speaker, I am not the manager of the CDIC. I do not have the financial skills to take on that job. Moreover, I do not think it is up to the Minister of Heritage to start doing some advertising outside his field.

My area of responsibility is Canadian cultural policy. Regarding this matter, I have stated clearly on several occasions that I consider Ginn to be an exception. While admittedly this may not have been a particularly fortunate transaction, the policy itself is sound. It calls for supporting and protecting the Canadian cultural industry, including the publishing industry.

Aluminium Industry

[Mike Scott, Reform, Skeena, BC]

Mr. Speaker, my question is for the Minister for International Trade.

I wrote to the minister several weeks ago expressing objection to his announcement of a $60 million U.S. credit arrangement to finance a new South African aluminium smelter.

In his response the minister stated that several Canadian companies either received or retained business contracts as a direct result of this export credit.

Officials from the South African embassy informed my staff that only one Canadian company, SNC-Lavalin, is directly contracted on this project, that they secured their contract almost two years ago and were well under way prior to the federal government's credit deal.

Will the minister be forthright and tell the House precisely what motivated the government's decision to extend almost a $100 million Canadian credit for this South African smelter project?

[Roy MacLaren, Liberal, Minister for International Trade]

Mr. Speaker, when I spoke on a previous occasion about the number of companies participating it was under the umbrella of SNC-Lavalin in Montreal which has the contract for the design of the plant.

The other companies that are gaining the benefit are suppliers to and associates of the principal contractor.

[Mike Scott, Reform, Skeena, BC]

Mr. Speaker, I have a supplementary question. Does the minister not acknowledge that the use of Canadian taxpayers' funds to assist in the construction of aluminium smelters in South Africa is extremely unfair to the British Columbians and Quebecers employed in the aluminium industry who pay those taxes?

[Roy MacLaren, Liberal, Minister for International Trade]

No, Mr. Speaker. It is our expectation that any excess supplies on world markets will disappear by the time the proposed refinery comes into full operation. We do not believe it will have any adverse impact on the Canadian aluminium industry.

Publishing Industry

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, the Minister of Canadian Heritage decided to allow the sale of Ginn Publishing to Paramount only for fear of being sued by Paramount.

The Star quoted Paramount's lawyer, Mr. Grover, who yesterday ruled out the possibility of Paramount suing the minister if only the minister had stood up to them.

My question is for the Minister of Canadian Heritage. Now that I have reassured the minister that he no longer has any reason to fear being sued, will he do what he should have done from the beginning in the Ginn Publishing case and cancel the sale to Paramount?

[Michel Dupuy, Liberal, Minister of Canadian Heritage]

Mr. Speaker, I am surprised to discover that our colleague's advisors are Americans. Mine are Canadians and I believe what they tell me.