Mr. Speaker, it is my honour to be able to stand here this evening and address the issue of agriculture, something which I am very familiar with.
I am also pleased to have shared this time slot with my colleague, also my constituency colleague in the fact that he neighbours to my south and we share in many ways similar constituencies with the exception that my constituency is totally agriculture and I do not share the urban aspect that my colleague from London-Middlesex does.
This evening I want to draw some points that I think have already been made today. I want to reiterate a number of points.
I think as we go back and look at the February budget we see included some very tough measures such as cuts for all government departments including the agricultural department. Agriculture grants and contributions were cut by 5 per cent. Because the government was aware and sensitive to the challenges facing agriculture producers, major safety net programs, that is GRIP, NISA and the dairy subsidy and crop insurance programs, were exempt from these cuts.
There are no huge amounts of money for new programs as we all know and we do not want to create new cumbersome bureaucracies. Therefore we must work with the farmers to prioritize our resources and farmers are going to have to decide what they want the limited moneys to be spent on.
Just this morning a committee of rural people met with the farmers representing the corn and oilseed industries with regard to the way they want to see us spend our money in terms of the advance payment programs. Later on this morning they also met with the hon. minister. I understand they had a very congenial meeting.
The agri-food industry is complex and goes far beyond the farm gate. The system provides Canadians with the safest and the most nutritious food in the world and let me suggest also at the most reasonable prices.
We as a government are committed to develop all opportunities for growth and have placed priority on the security of the family farm. This priority can only be achieved by building solid domestic and international markets, staying on the forefront of innovation and in the concentration on stewardship of our natural resources-farmers know this best-soil, the way we revere this ever so important ingredient in the food chain.
I want to move to the issue of trade. Trade is this country's life blood. Offshore markets are expanding especially for value added products. Canada is losing ground to our competitors for a number of reasons. However, we through the minister, the parliamentary secretary and the agriculture committee, are working to reverse this trend. The minister has stated that our government's policy will be to work with the different industries to reach a goal of $20 billion of exports by the year 2000. This is a major increase from the current level of $13 billion.
We are committed to increasing exports and the minister has told the department to shift its priorities and to increase support for export initiatives. The potential for export growth in the agri-food industry falls within value added products. Also key is the development of new markets in Asia and in Latin America.
There has been created a new market, an industries branch that will work with the Department of Industry and the Department of Human Resources Development to produce a single window approach to provide support for market development of agriculture. Agri-food specialists have been placed in selected embassies abroad and to date the response has been positive.
The minister along with the Governor General and private organizations came back from a trade mission to China, South Korea and Hong Kong to promote the agri-food industry. The government wants to find new customers while firming up existing partnerships.
This government has been working hard to cultivate and take advantage of new trade opportunities post NAFTA and GATT. With NAFTA we have the opportunity to jump on new opportunities south of our border in the United States and in Mexico. We as a government did what we promised and made improvements to NAFTA before we signed. These improvements were in areas of labour and environment, subsidies and dumping, water and energy.
NAFTA was agreed upon to ensure that we have secure access to our largest trading partner and greater access to a growing market in Mexico.
To date Canada has accepted 85 per cent of Mexican food products duty free. Mexico maintained high import duties and import restrictions on many food products. NAFTA will correct this imbalance and increase our exports past the pre-NAFTA levels of approximately $215 million. This will help the whole agricultural industry including our food processing sector which
currently employs close to 200,000 people and with a production valued at $40 billion.
Market opportunities in Mexico exist in many food sectors including fish, shellfish, wheat, barley, oilseeds, pork and pork products, potato and potato products, canary seed, dried beans, peas and apples, to name some of the things we export from this country.
There was little time to rest when we were elected. We had to jump into the trade issue right away with the GATT negotiations.
Recently in Morocco, on April 15, 1994 the trade minister along with about 120 other governments signed on to the final act that embodies the results of the Uruguay round of multilateral trade negotiations. Their agreement will put greater fairness and predictability to international trade. New trade rules will apply to all countries equally and differences between trading partners will be settled more effectively through the rules of the World Trade Organization. This is essential to farmers and the agri-food industry.
For the first time in history we have an agreed to definition of the term subsidy. The agreement also sets out a category of government programs agreed upon to be non-trade distorting.
This will not happen overnight, but will be phased in over six years. In most cases this will give domestic industries time to adjust to the new trading rules.
The agreement will help put an end to a disastrous grain trade subsidy war that proved extremely costly to Canadian farmers. In the future Canadian farmers will enjoy greater market access. The red meat industry will also benefit from this agreement. Pork and beef producers will enjoy greater opportunities in the Asian market.
Now allow me to move to supply management. More than 20 years ago this country decided that a made in Canada approach, the supply management system, was the appropriate structure for the dairy, poultry and egg industries. Now supply management is one of the foundations of the Canadian agricultural economy.
Supply management is and was based on three pillars: production quotas, a regulated pricing mechanism and import quotas. After the 1994 GATT agreement one of the three pillars, import quotas, was replaced by tariffs.
Our party's position is clear. We remain committed and support the supply management system and will continue to assure its prosperity. Opposition members are quick to pounce on us and predict the end of supply management. In December the Ontario Milk Marketing Board issued a press release: "Marketing boards have not been dismantled by the recently announced trade deal under the General Agreement on Tariffs and Trades (GATT). The change coming in July 1995 is that border import quotas are being replaced by border tariffs so only the mechanism to keep out subsidized product has changed".
The industry has accepted this. Currently the government is working with stockholders to develop new arrangements that will support the sustainable orderly marketing systems required in the future.
In December the agriculture minister along with provincial agriculture ministers established a small task force to provide advice on changes needed to the supply management system to address the challenges and opportunities resulting from GATT.
The task force was chaired by the hon. member for Prince Edward-Hastings and is looking toward an aggressive marketing approach as key to the future of this sector.
Recently the United States has decided to serve notice of its intention of proceeding with increased tariffs on barley and wheat. We regret the action and despite what the opposition claims we will stand firm in our support of the industry. We will not trade off one industry's interest for the interest of another.
We will try to use the 90-day consultation period to try and negotiate a deal to prevent a trade war. We stand ready and we will not back down. If the U.S. proceeds with unilateral trade action we will have no choice but to respond in kind.
In fact, Canada would have been much worse off had it not been included in the GATT agreement. If this had happened the U.S. would have been free to impose tariffs right away without the 90-day consultation period.
In looking at the future, we have under GATT clear rules and a new system of discipline in trade that can be understood by all parties when developing the new generation of safety net programs. These programs need to be to the best of our ability countervail proof.
My view is that we need to develop long term agricultural policies that will take us well into the 21st century. Farmers need and want that stability.
Farmers have always said they do not want subsidies, they just want a fair price for their goods from the market. However, even with the best trading conditions support programs are still needed because of the inherent instability of the agri-food industry, instability caused by such things as weather conditions and trade wars.
We as a government are committed to replacing the patchwork of current expensive commodity subsidies with a user friendly, whole farm income approach. Farming organizations have given us their strong support in this matter.
To avoid major dislocation we will make future changes over a period of several years. Safety net programs need to be financially efficient, GATT constant and market neutral.
In my closing comments, I want to say that this government has been very positive in the direction that it has taken the agriculture department. In terms of our agricultural committee we have now opened the process where the public has been able to view us in our deliberations, particularly as we deliberated on the BST question.
We have offered and tabled in this House seven recommendations. It is the committee's hope and trust that this House will embrace those recommendations. We encourage all in this House to support us on those issues.
We also think it was positive that in the past week we were able to sit down and discuss the difficulties in marketing and getting our grain to ports on the west coast. A subcommittee of the transportation committee and the agriculture committee was established. It is meeting with witnesses on this issue because it is affecting and impacting on all Canadians. We want to let members know that we had a very successful conclusion to that time. Members will be hearing our responses from those witnesses within the next few days.
I want to say again how important it is that we recognize the values of agriculture. It is a privilege to have been part of this discussion and having allowed Canadians to see that agriculture is truly a part of Canada.