House of Commons Hansard #92 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was leader.
Pierre Pettigrew Liberal Papineau—Saint-Denis, QC
Mr. Chairman, my answer is very direct and very simple: no, our government is not in the process of negotiating with the U.S. government.
Svend Robinson NDP Burnaby—Douglas, BC
Mr. Chairman, I have two questions for the minister. The first is with respect to the issue of enforcement of the Fisheries Act, which is federal legislation. As the minister will know, under NAFTA there is a joint independent environmental panel which has come to the conclusion that there are serious problems in the enforcement by the Government of Canada of the Fisheries Act, problems that have resulted from some of the forestry practices and their impact on salmon bearing streams. That is a preliminary finding by the environmental tribunal under NAFTA. I will ask the minister what action the federal government is taking to respond to this very serious concern.
Second, I will ask the minister the same question that I asked the member for Vancouver Island North. That is with respect to an assurance from the government that whatever agreement is ultimately signed, it will not involve any increased export of raw logs from crown lands or undermine Canada's ability to manage its forests or wood industry in the interests of Canadians.
Pierre Pettigrew Liberal Papineau—Saint-Denis, QC
Mr. Chairman, I will have to look into the answer to the first question. I do not know exactly what the member is referring to and I would not want to speculate on something which I have not been focusing on seriously. The member deserves a better answer than I could volunteer this afternoon so I will get back to him on that issue.
On the issue of log exports, I heard the question to the member for Vancouver Island North. As we know, British Columbia has a policy of log export controls. That policy is actually implemented by my department. We have gone to the WTO to find out its answer on whether U.S. legislation which sees that log export control as a subsidy in a sense is right. The member will know that the WTO panel has given Canada the answer that we already knew was right, which is that our log export controls are not a subsidy. This has undermined a key element of the United States case against Canada. This was a pre-emptive strike that we took some time ago.
Gerald Keddy Progressive Conservative South Shore, NS
Mr. Chairman, my question is for the minister. We are all well aware that the U.S. commerce department brought in a countervail of 19.3% on August 10. What we should remember is that it originally asked for 39.9%, which would have completely crippled the industry, not just cost us 30,000 jobs in B.C. and more jobs in Alberta, Quebec and Ontario.
The issue for me is that we were willing to pay the countervail and we are there now. Did the minister consider at the time pre-empting the countervail with an export tax? If not, why not?
Pierre Pettigrew Liberal Papineau—Saint-Denis, QC
Mr. Chairman, there is absolutely no consensus in our country to go to an export tax. Not one provincial government supports it. It is not the proper thing to do, I think, because we are challenging the American countervailing duties. Doing harm to our own industry is not in my view at all the sort of leadership we like to offer.
Guy St-Julien Liberal Abitibi—Baie-James—Nunavik, QC
Mr. Chairman, this is the first time in my political career that I have witnessed a federal minister stand up and defend the rights of forestry workers in all of the provinces and in Quebec. I am not afraid of saying it.
There are nonetheless causes for concern. The question I am asking is not my own but comes from Ms. France Gagnon, of Barraute, chief executive officer of Précibois. Here is what she said:
As with previous softwood lumber disputes, it was critical that countervailing duties be applied to the primary mill rate. The American decision to impose countervailing duties on the final mill rate means that the non-subsidized primary sector is hit first, and hit hardest. It is a duty that could decimate an entire industry.
We are talking about an entire industry in the Abitibi and in Quebec.
Will the minister be able to exclude the value-added sector from the trade war immediately?
Pierre Pettigrew Liberal Papineau—Saint-Denis, QC
Mr. Chairman, I am absolutely in agreement with the hon. member for Abitibi--Baie-James--Nunavik and I greatly appreciate the question from France Gagnon. She is absolutely right.
I have had the opportunity to tell that directly to U.S. secretary of commerce Donald Evans in Washington on September 10. I found it unacceptable to include, along with all the rest of the softwood lumber industry, the lumber remanufacturers, who are adding value to this commodity. They are not part of the case and ought to have been exempted.
This has been stated very clearly and I trust that Statistics Canada will be able to provide them with figures that demonstrate very clearly just how much they ought never to have been included in the American petition.
Pierre Paquette Bloc Joliette, QC
Mr. Chairman, I do not believe we have been able to discuss the softwood industry much in recent weeks. It is understandable that all hon. members were reeling from the shock of the events of September 11.
I believe it is worthwhile holding an emergency debate, as suggested by the Canadian Alliance, on the softwood lumber industry, since this week there have been three days of meetings held in Washington between American officials and Canadian federal and provincial officials.
What is also interesting to note is that the consensus that gradually developed this past winter and spring to demand for compliance to the free trade agreement immediately seems to have held up over the intervening weeks and months.
That consensus was not built up overnight. Discussions are still being held within the industry in Quebec and at the Canadian Manufacturers Association. The choice offered to us was either to follow the legal approach to the end, something that had never been attempted, or to enter into negotiations with the Americans, and in that context to repeat what happened in 1986 and 1996.
The wise choice that the Quebec industry made, as did the other industries and the governments across Canada apparently, was to use the legal approach all the way. There are very good reasons for this. First, in the United States—this has already been mentioned, but we do not insist enough on this in Canada and in Quebec—we have allies among American consumers and builders. We have a broad range of allies.
I had the opportunity, along with the hon. member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques and the hon. member for Rimouski--Neigette-et-la Mitis to travel to Washington as part of a non-partisan delegation of parliamentarians. I was surprised to see that the U.S. black people's chamber of commerce supports the Canadian position, as do a number of other consumers associations.
We do have allies, even among U.S. parliamentarians. The Minister for International Trade mentioned it. This summer, about 100 parliamentarians from both the Senate and the Congress wrote President Bush to ask him to maintain free trade in the lumber sector, because it was in the best interests of consumers in the various states that they represent.
It is also important to recall that we are now engaged in a negotiation process on a free trade area of the Americas. There is something contradictory in the Americans asking for protectionist measures in the lumber industry when all the nations of the Americas are talking about greater trade liberalization. In this regard, I think that President Bush does have—as the Canadian Alliance member pointed out—a responsibility.
We certainly realize that, following the September 11 events, this may not be at the top of his priorities. However, at some point in time, if he is the free trader he claims to be, he will have to take steps to put a stop to the procedures and harassment by the American lumber industry, particularly since we are now trying to further develop harmonious relations between all the countries. In my opinion, a prerequisite to such relations is to settle trade wars that have no real basis.
Another element, which strikes me as important and enters into the arguments relating to pursuing the legal battle, is the existence of the World Trade Organization. The rules it is in the process of developing—a process not yet complete—did not exist at the time of the last problems, which occurred around 1995-96. Now, with the WTO in place, and involved in this matter, U.S. legislation is now being challenged by the Canadian government, and rightly so, moreover.
From the political point of view, the situation is completely different from what it was in 1996. On the economic level—as the minister has said—the stumpage fees in Quebec have increased substantially in recent years. I also want to point out that a study commissioned by the government of Quebec on stumpage fees in private woodlots reached a very interesting conclusion.
As we know, Quebec has a price setting mechanism. I believe it is along the same lines as the one applied in the other provinces--Ontario, Alberta and British Columbia in particular--which take into consideration the stumpage fees for private woodlots to set the ones for crown lands.
We are often told that since 90% of forests are under public administration in Quebec, the private sector could not be taken into account because it was too heavily influenced by the strong presence of public forest management.
What is interesting is that the study in question reaches the same conclusion, from which I shall read an excerpt, because it seems to me to offer additional proof that there is no subsidy involved in setting softwood lumber prices in Quebec:
Empirical data indicate that there is a single price for wood originating in Quebec, New Brunswick or northeastern U.S., once adjustments are made for the quality and for shipping costs.
What we see is that the price of wood in Quebec is the same as throughout eastern North America. The paradox is that the Atlantic provinces, including New Brunswick, were excluded from the American process, more so because their forests are managed privately rather than publicly. But we can see that price setting comes down to the same thing.
This study clearly shows that prices based on stumpage fees accurately reflect market prices. This is further proof that there are no subsidies.
We are right in economic terms. Our environment, in political terms, is favourable. And yet we face a whole series of legal proceedings and harassment from part of the industry in the United States.
The Minister for International Trade and the federal government will have to take steps to help the industry and those working in it. They will have to ensure the consensus remains, because, obviously, with the latest layoffs in British Columbia, among others, the pressure is tremendous, as we can understand.
The Minister for International Trade and the federal government will have to use their imagination in coming to the aid of the industry to help it get through these turbulent times and through the legal process and come out a winner.
I think the minister mentioned the possibility of the EDC's providing guarantee for the exporters, which corresponds to the interim countervailing duties of 19.3%.
Since the minister spoke of it around the end of August, I think it was August 24, we have heard nothing more. I think this avenue should be explored, and it seems to me it could help the industry get through the period better.
There is also the whole issue of employment insurance. I know that my colleague, the member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques, will elaborate on that. We also have a situation, with the economic downturn, that would allow the federal government to implement measures, particularly with regard to employment insurance, that would help industry as a whole, including the lumber industry, which is suffering the consequences of countervailing duties, and it will only get worse.
Last, and this is very important, the federal government and the Minister for International Trade must play a leadership role. They have done that. I humbly submit that the Bloc Quebecois has supported the government in its initiatives and has even guided it in some instances to ensure that it was headed in the right direction. This must continue.
In this context, it seems important that, following the meetings between the provinces, there be a summit where the provinces, the industry and the federal government get together to assess the situation before the end of October.
I hope we will get through this dispute and that our interests, which are totally legitimate, will be defended in a context where we cannot let the might makes right principle prevail, because that would be contrary to all the work that has been accomplished by Canadians and Quebecers over the last 60 years.
Gerald Keddy Progressive Conservative South Shore, NS
Mr. Chairman, I listened intently to the hon. member's comments and I have a couple of comments and a question.
I think this is an extremely important issue for Quebec because it supplies 25% of all of Canada's lumber exports. Certainly my province of Nova Scotia supplies 7%. Timber is an extremely important industry in Atlantic Canada but at the same time, on a national scale, our part of the pie is not quite as large as Quebec's.
What has always amazed me is our local Maritime Lumber Bureau has always done its homework. We have sent delegations to Washington on an annual basis for many years. We were largely responsible for having Atlantic Canada excluded from the original softwood lumber deal based on our traditions with U.S. trade practices and on our stumpage practices.
The issue I am most afraid of at this time is the anti-dumping legislation that has been imposed. We know we are having a hearing on that on October 15, but how does the member feel the government has reacted to that? I think the government has simply allowed this to proceed almost like a runaway railroad car that is just on the track and moving forward. We have done nothing to counteract the anti-dumping charges, which are much more significant than the countervailing ones.
Pierre Paquette Bloc Joliette, QC
Mr. Chairman, I definitely do not want to criticize the Atlantic provinces for having done their homework, so as to be excluded from procedures undertaken by the U.S.
In my opinion, what the Americans should be criticized for is the main reason that made them go after Quebec and British Columbia in particular, namely the fact that our forests are managed differently than U.S. forests and that, in their eyes, public management, which incidentally gives excellent results, is tantamount to subsidies.
I was able to see this for myself when we met U.S. officials in Washington. In their mind, it was a simple equation: private forests means subsidies. To which Canada and Quebec reply that managing our forests differently does not mean that we do so in an unfair way. I think we must be clear on this.
As for the anti-dumping issue, we know that it is businesses themselves that are directly involved. But I think that the federal and provincial governments have a responsibility to support businesses at a political and technical level.
I know that a lot has been done. I met with Tembec officials, among others, who are targeted by this anti-dumping procedure and they told me that they received very substantial technical support from both the Quebec and federal governments. I think that we should continue in that direction.
In my opinion, the whole anti-dumping process is a measure to increase pressure on the Canadian industry. A settlement based on a return to free trade would put an end to all these procedures.
I am not psychic, but I hope this is what will happen, because it is an extremely dangerous and arbitrary process. The investigation is focused on a few companies but the rights will be imposed on the whole industry.
We will have to keep a very close eye on this situation.
Guy St-Julien Liberal Abitibi—Baie-James—Nunavik, QC
Mr. Chairman, as I said earlier about the Liberal minister responsible for 2 x 4s, who is here today, I appreciate the efforts of the hon. member for Joliette. I want to emphasize that. We are here to protect workers and producers in the forest industry, which is a major part of the economic base of Abitibi-Témiscamingue. I would like to ask this question.
Is the study he referred to earlier the one made by Del Degan, Massé et Associés, in co-operation with the Groupe de recherche en économique et politique agricole of Laval University?
This study has proven beyond any doubt that the timber royalties system in Quebec is in line with all the rules on trade between Canada and the United States and that it cannot be considered an indirect subsidy for our forest workers and producers.
Is that the study the hon. member was talking about?
Softwood LumberEmergency Debate
The Deputy Chairman
I will not ask the hon. member to answer by yes or no, but would he please keep his answer very short.
Bev Desjarlais NDP Churchill, MB
Mr. Chairman, it is a pleasure to rise today in the House of Commons to speak on behalf of the New Democratic Party in today's debate on the softwood lumber industry. It is about time we had this debate because this issue has been dragging for far too long and I am sure my colleagues here in the opposition feel the same way.
I recognize that since our return on September 17 the House has been charged with a number of issues related to the terrorist attacks. I would like to acknowledge the co-operation of all parties to ensure that this debate took place before we take our Thanksgiving week break.
My NDP colleagues and I began raising this issue in the House of Commons last March when it became clear that we were heading into yet another softwood lumber dispute with the United States. At that time I was thinking, here we go again. Why do we always end up in these situations vis-à-vis the United States?
Having recently been appointed the NDP industry critic, I started looking into the matter back in March. Since then I have had the opportunity to meet with many people involved in the industry, from the unions that represent the workers in the industry to the representatives of the lumber companies that operate in the different regions of our country. That is an important thing to note. The softwood lumber industry is a national industry, but the way it is managed and runs differs from region to region. That is why it is important to listen to people from all the regions to get the proper national perspective.
In addition to my one on one meetings, I also had the opportunity to take part in some very good committee meetings on the subject. I have learned a lot about the softwood lumber industry over the past months. I have come a long way toward answering that question I was asking myself back in March, why do we keep ending up in these lumber wars with the U.S.?
The bottom line is that the U.S. is prepared to do almost anything to keep Canadian lumber from capturing more than 30% of the U.S. market. Anytime we do that, and it happens because we have a stronger, more competitive industry than it does, the powerful American lumber companies and U.S. lumber unions take their clout to Washington and the U.S. government starts these trade wars.
Each time the Americans start one of these wars, it ends up getting resolved by a temporary agreement or treaty. The last time was in 1996 when Canada and the U.S. signed a five year softwood lumber agreement, a five year ceasefire. The treaty expired in March 2001 and the U.S. went into its protectionist mode by imposing the 19% tariff on most Canadian lumber. Because of these tariffs, 15,000 lumber workers have lost their jobs since April. We have to stop this situation now.
A lot of people wonder how the U.S. can get away with putting these tariffs on Canadian lumber when we are supposed to have free trade. The North American Free Trade Agreement is supposed to guarantee the free movement of goods and trade between our two countries. This shows how weak and ineffective the NAFTA regime is. Whenever we in the NDP criticize NAFTA for these kinds of shortcomings our political opponents put on their smokescreens and say “You New Democrats just oppose open trade”. Well it is not true. We want open trade with our friends and neighbours in the United States.
The problem is that NAFTA is not good enough. It is supposed to protect us from unilateral protectionist actions by the U.S. and it does not. To prove it, look no further than the softwood lumber industry and the 19% tariff that the U.S. is now putting on Canadian softwood lumber.
I am not the only one who thinks this way. Allow me to quote the president and chief executive officer of the Maritime Lumber Bureau, Ms. Diana Blenkhorn, who told the House of Commons Sub-committee on International Trade, Trade Disputes and Investment that, “The history of NAFTA to date, relative to softwood lumber, shows it has not done the job, quite frankly”.
Here is a quote from the same meeting with Mr. David Emerson, co-chair of the Canadian Lumber Trade Alliance. Mr. Emerson told the committee: “We do not have any faith in the trade litigation framework that exists today because it has been designed by the Americans, for American producers, to be as punitive as it possibly can be”.
NAFTA has not done the job. That is why we have never reached a final, permanent resolution to this issue. Instead we have gone from short term agreement to short term agreement with periods of trade wars and tariffs in between. The last thing we need now is another short term band-aid solution. What we need is a long term solution to provide stability for the industry and the people who rely on forestry for their employment.
Again, I am not the only one who thinks we need a long term solution to break out of this cycle of trade wars. All the business leaders and unions representing forest workers that I have heard from are saying the same thing. I would like to quote Mr. Haggard, president of the Industrial Wood and Allied Workers of Canada Union. This is Canada's largest forest union.
Mr. Haggard told the committee that his union and the forest workers he represents were prepared to live with the short term pain of the current tariffs for up to two years if the federal government used the time to craft a real long term solution so that this would be the last time we have to go through this process.
The unions and business agreed that the solution was open trade with the U.S. The forest industry and unions told us they were prepared to ride out the storm a little longer if we could secure a permanent end to the bullying U.S. protectionist measures rather than another short term band-aid solution.
However the problem is that the Liberal government is not doing that. It should be standing up for Canadian jobs and industry, and instead it knuckles under to the U.S. There is so much it could be doing to help Canadian forest workers and to protect jobs but it is not doing any of it.
Where is the income assistance plan for the 15,000 people who have been laid off? We in the NDP called for that two months ago and we have not heard a peep from the Liberal government. Where are the measures to stop the export of raw logs to the U.S.? Exporting raw logs rather than processing them in Canada is like the export of jobs. We have been calling on the Liberal government for years to help keep these jobs in Canada.
It should be working with industry to develop our processing capacity so that we could export more finished wood products instead of raw logs and keep the processing jobs in Canada where they belong.
We need the federal government to stand up for Canada's right to manage our forests in an environmentally sustainable way. In our federal system conserving and managing forests is a provincial responsibility. In Manitoba most forestry takes place on provincial crown land and each year the province sets quotas for the lumber companies. In that way the provincial government is able to balance the needs of industry with the imperative that we sustain our forests and our environment.
However the maritime provinces manage their forests differently than Manitoba. In New Brunswick, for example, most of the forests are privately owned and not on crown land.
I prefer Manitoba's way of doing it because it is more environmentally friendly, but I recognize this is a decentralized federation. Each province is different and has the right to chart its own course in areas of provincial jurisdiction.
The U.S. has been saying that it likes the way some provinces manage their forests but not others. It wants to force us to change the way we manage our forests to the least environmentally sustainable model. It calls the crown land model used by Manitoba and other provinces to protect the environment an unfair subsidy.
This is unacceptable and the federal government needs to stand up to the U.S. and say that it is not a subsidy. It is environmental management and the U.S. has no business interfering in our federal-provincial division of powers.
The NDP wants to see open trade with the U.S. without compromising our right to manage and preserve our forests for future generations. We need sustainable forest management to maintain jobs now and in the future so that there will always be enough trees for future generations to harvest. We need fair and open access to the U.S. market through effective and balanced trade deals, not unbalanced trade deals like the one we have now.
Marcel Gagnon Bloc Champlain, QC
Mr. Chairman, I listened carefully to my colleague from Churchill who said that she has no confidence in the present system with the Americans to solve the problem. I would tend to agree with her because it is not the first time that we have a situation where we are forced to go to court to see justice done.
This is, however, the system we are dealing with now. Even though we are looking forward to a sustainable solution, as the member said earlier, in the meantime, we have an industry that is being penalized at a time when there is high unemployment and when we know that the immediate future is quite gloomy.
I would have liked to ask the question either to the minister or to my colleague, but I will ask the member for Churchill. Until we solve the problem for good, in my riding of Champlain--as in the Abitibi, which my colleague mentioned, and I know the situation is the same everywhere in Quebec--we are especially penalized since the forest industry is a base industry in our area.
Until the problem is solved, people will be unemployed. Would tit not be possible, for instance, to use the unemployment insurance program or some other program to compensate the industry, to help it survive and to reduce the pressure on the unemployed? It is actually the workers who are paying for a problem that has cropped up between two governments. Does the member think that the government should take temporary measures to help the workers now?
Bev Desjarlais NDP Churchill, MB
Absolutely, Mr. Chairman, without question. We have been calling on the government for some time to utilize the EI program. It was intended to be there for drops in employment and when there are massive layoffs so that we can keep our economy stabilized and provide support for workers.
The EI was not intended as a cash cow for the finance minister but that is what it has been used for. We must make sure the EI program is there to provide support for unemployed workers including forestry workers
Svend Robinson NDP Burnaby—Douglas, BC
Mr. Chairman, I thank my colleague from Churchill for her very thoughtful comments. As members know I am from the province of British Columbia. British Columbia was particularly hard hit by the punitive tariffs of 19.3%. It has been estimated that as many as 15,000 jobs may have been lost since the tariffs were imposed. We want to voice our very strong solidarity with the workers and communities that were affected.
I note that IWA-Canada has launched a national campaign, which we strongly support, to protect Canadian jobs and communities in the face of these bullying U.S. protectionist tactics.
On Wednesday this week the Interfor mill in Squamish announced that it was shutting down. That is another 170 workers out of a job. There are no transitional measures whatsoever for these folks.
The Minister of Human Resources Development indicated today that the employment insurance system was working just fine. It is not working for the airline industry and it is not working for these workers either.
Does my colleague agree it is critically important we make it clear to the U.S. government that access for Canadian manufactured wood products entering the U.S. market has to be a prerequisite to any future trade agreements between our two countries?
Bev Desjarlais NDP Churchill, MB
I certainly agree with my colleague, Mr. Chairman. I will touch on the unemployment issue just to reinforce again the need for the EI fund to be used for what it was intended. Only one in five unemployed workers in Canada is able to access employment insurance in spite of this year's $17 billion surplus in the EI fund. It is irresponsible of the government for not using that money for what it was intended.
With regard to future trade agreements, it is without question that those are the types of issues that the New Democratic Party feels are missing from these trade agreements. Those types of rules must be put in place to benefit our workers, industry and environment. It is better overall for sustainability when we have an enhanced use of our resources. I agree with the hon. member that we must do that.
Gary Lunn Canadian Alliance Saanich—Gulf Islands, BC
Mr. Chairman, I commend the member for Vancouver Island North for bringing forward this emergency debate. The issue has taken a human toll. It truly is an emergency that needs to be dealt with and that is why it was appropriate for him to bring this debate forward.
The Canadian softwood lumber industry exports about $11 billion a year to the United States. Almost half of that comes from British Columbia. The current countervail duty of 20% imposed by the United States amounts to $1 billion a year out of the British Columbia economy and $2 billion a year out of the Canadian economy.
Those are pretty big numbers for people to comprehend, but let us talk about the human toll. We have lost well over 15,000 jobs in British Columbia. The potential job loss across Canada is 25,000 and that number is expected to double by the end of the year. That will be 50,000 jobs in Canada alone.
It is critical that we have this discussion and move the ball forward to find a solution. Throughout the interior of British Columbia and on Vancouver Island we have many single industry communities that rely solely on the forest industry. These communities cannot survive and will become ghost towns if the issue is not resolved quickly.
The human toll will be enormous. It goes much deeper than just people losing their jobs. The 50,000 lost jobs can be exponentially increased to hundreds of thousands of Canadians that would be affected: workers, families and their children. Economic hardship is incredibly difficult for families.
The situation is in crisis proportion and it is an emergency that needs to be dealt with. We have been to the WTO and various international tribunals on three separate occasions. We have won every time but we need to do more.
Canada has a strong case. We are fighting this through every process. I applaud the minister for the pre-emptive strikes in regard to the raw log exports. That argument has been successfully taken away from the Americans. However the issue is so serious that our Prime Minister has to become directly involved with the president of the United States.
The current United States administration claims that it is a free trader: Robert Zoellick, the U.S. trade representative, Secretary of Commerce Donald Evans and President Bush.
Now is the time when our Prime Minister should be holding their feet to the fire. We have every right to be going at them quite aggressively on this issue. Our Minister for International Trade and our Prime Minister had conversations with U.S. representatives. Our Prime Minister spoke with President Bush. He has even raised other issues such as energy, which was probably the appropriate place.
It is bad economic policy to start linking various commodities. We would go down a slippery slope if we were to look at the kind of overall trade we have with the United States.
Definitely we need to do more. The human toll is enormous, absolutely phenomenal. We have to be more aggressive on this issue and look for solutions.
The events that happened on September 11 have shaken all of us. They have affected our lives, how we feel and what we do. They have affected this dispute as well. It was not appropriate to discuss this issue in the weeks following the attacks. We needed to deal with the aftermath. We needed to support our friends to the south, to be there shoulder to shoulder. However I think this issue should be brought back to the table.
I thank the Minister for International Trade for being present for this debate. I also commend the member for Vancouver Island North who brought the debate forward. It was questioned earlier whether it should have been an emergency debate. It is an emergency. This is a crisis. Look at the job losses and the communities that are affected. Throughout British Columbia it is enormous.
There are a few hurdles in front of us as well. The protectionist forces in the United States will go to great lengths to lobby their government. We need to take them on.
The anti-dumping issue is coming up on October 15. We are expecting some kind of decision on the anti-dumping issue and if they come forward with that, it will be catastrophic against our industry.
Some $2 billion has been sucked out of our economy, but more important than the money, it has affected thousands of jobs, some 50,000 jobs. That is what hits home. It is creating a turmoil for hundreds of thousands of Canadians and their families.
I encourage the minister to do more at the head of state level and the ministerial level. The Prime Minister and the president, and the minister and his counterpart must be creative in finding solutions. We cannot back down. We know we are right, as he has stated before. We have been to the international tribunals.
If it takes a year or 18 months for the issue to wind its way through the international tribunals, I am afraid there will be nothing left to recover in some of our industries and the remote communities in Quebec, Atlantic Canada and British Columbia. That simply will not be good enough. Our government will be faced with a much greater crisis.
There are things we can do in getting involved at that level. The Americans are looking for help in oil and gas. I emphasize that it is not good public economic policy to make these direct links, but they are desperately looking for help in those areas. We should give it to them, but at the same time we should expect them to honour free trade and be the free traders they claim to be.
James Lunney Canadian Alliance Nanaimo—Alberni, BC
Mr. Chairman, I appreciate the comments by my colleague who also is from Vancouver Island.
I want to pick up on something the minister said earlier. Perhaps the member would have a comment on it. It had to do with 1994. We heard the minister talking about how we went to dispute resolution at that time and we won. The Americans were obliged to pay us back $1 billion. That was great.
This is not 1994. British Columbia has been through a terrible economic turmoil since that time, particularly in the forest industry. We still had a very substantial Asian market in the early 1990s but when the Asian flu hit and knocked the socks out of our western forestry exports to the Asian market, suddenly the American market became much more important.
In my riding mills have gone down. A lot of the mills that were there in 1994 have not made the cut. There has been a devastating effect. It has created a new sense of urgency. There are hundreds of mill workers in my riding.
Would my colleague comment on the effects of the Asian flu and what it has done to the B.C. economy?
Gary Lunn Canadian Alliance Saanich—Gulf Islands, BC
Mr. Chairman, the member talked about the decision of an international tribunal in 1994.
The real challenge that faces this dispute is that we are fighting U.S. domestic law. That is the problem.
As the minister of course will know, with the Byrd amendment, basically all the countervail duties being collected under this new U.S. domestic law is paid to the U.S. forestry industry. Talking about subsidies, the Canadian industry which is in tough shape is directly subsidizing the U.S. industry.That is why we have to be aggressive and stop this.
Our industry cannot survive a year, two years. We have to get aggressive on this and find solutions. I sense there is a willingness by some of our counterparts in the U.S., but it is time for us to get tough on this issue. We have to move forward and find a solution.
Pat O'Brien LiberalParliamentary Secretary to the Minister for International Trade
Mr. Chairman, I think my colleague has made a good point but I would note that fortunately, President Bush has suspended the Byrd amendment. It is very important that we clarify that.
The member mentioned head of state consultations. Maybe he is not aware that when the Prime Minister met President Bush on September 24 on the terrible attacks that took place, even then he had an opportunity when it was appropriate to raise softwood lumber.
What more does the member think the Prime Minister and the Minister for International Trade could possibly do? They continue to raise the issue at their appropriate high levels, given the reality that the tone has changed somewhat in light of the atrocious attacks on the United States.
Gary Lunn Canadian Alliance Saanich—Gulf Islands, BC
Mr. Chairman, I acknowledge that it was absolutely appropriate to change the tone.
I know that the minister had discussions in recent days with his counterparts in the U.S. I know that the Prime Minister has met the president of the United States on numerous occasions. I am also aware that the Minister for International Trade within the next two weeks will be meeting face to face with the U.S. trade representative Robert Zoellick. I am sure this will be the first issue that comes out of his mouth.
Why is this an emergency debate? I want to bring it back to the human element. Hundreds of thousands of Canadians and their families are affected. This is tearing them apart. It is going to devastate communities. That is why this is an emergency debate. That is why it is appropriate. The situation is critical.
The minister knows that the Prime Minister is talking to President Bush. The parliamentary secretary knows. We have read about it in the papers. But all that the people in these industries know is that they got their pink slips and they have no jobs. Their lunch pails are empty. They are not bringing anything home to their families. They want a solution. That is all they care about. They want to see something happen.
I know we have a tough road ahead of us, but we sense there is a willingness by some of the people in the United States to resolve the issue. If ever there were a time for our government to ratchet it up, that time is now. I do not think we should concede anything. This is about the families. It is about the jobs. It is time that we put the pressure on again. I look forward to the government doing that.
Softwood LumberEmergency Debate
The Chairman
I want to remind everyone that the conclusion of this first round also concludes the question and comment period following the speeches.
Stockwell Day Canadian AllianceLeader of the Opposition
Mr. Chairman, as has already been alluded to, much of our attention over the last few weeks quite rightly has been absorbed by the tragic events of September 11. That goes without saying. The aftershocks that have followed those events have impacted our economy in a very serious way. They have contributed to large scale layoffs in the airline industry, just as one example.
These last weeks, there has been more and more bad news. Thousands of job cuts have been announced, particularly in the Montreal area, with the closing of the GM plant, massive layoffs at Air Canada, many job losses in British Columbia, bad news for the aviation industry, and so on.
It is important to recall that before September 11 the Canadian economy was already facing a huge and looming crisis due to the government's inaction in settling the Canada-U.S. softwood lumber dispute.
There has been a great deal of concern expressed in the House, and quite rightly, about the loss of some 5,000 jobs at Air Canada. We should be concerned about that. However, we have seen far less concern from the government on the loss of jobs for some 30,000 people who have been laid off due to the United States' imposition of the 19.3% softwood lumber tariff. The effect of this has been huge.
On October 15 we expect another ruling on the alleged dumping of Canadian softwood. That could impose even more devastating tariffs and devastating results on the industry. Some people have said that in the minds of many Canadians, the lumber industry seems to be treated as an afterthought by the government. They wonder if it is because it is not located in the industrial heartland of central Canada. Many people are asking what the problem is.
It is a great opportunity for the government to show with action and not just words that it really does care about this industry. These kinds of questions are being asked by Canadians. It is a great opportunity for the government to show its concern with action.
Lumber is Canada's largest industrial sector. It is bigger than automobiles. Canadians especially in rural communities rely heavily on the lumber industry. They expect the federal government to give this number one industry a number one priority when it comes to trading relationships.
Frankly one of the reasons we are in this crisis is that the government was asleep at the switch on this file. Members of the Canadian Alliance and before that the Reform Party stood right here in the House literally for years warning that something had to be done before the agreement expired last April 1. Nothing was done. We can check Hansard . Time and time again the warnings went out. We knew that the softwood lumber agreement was temporary. The federal government knew it was a temporary agreement. The government had five years to lay the groundwork for when the agreement would come to an end and it did not happen.
The groundwork needed to be laid so that based on the principles of free and fair trade, this issue could be settled as the agreement ended. The government delayed taking any position on the agreement until it was too late. While we were calling for the government to openly push for free trade in lumber, it was not focused on the issue at all. That is a matter of history and it is a matter of fact.
Rather than spending four or five years building a coalition for free trade with the United States by getting down there and talking to consumer groups and home builders and senators, the government in the time before April 1 did nothing to explain the Canadian case in great detail especially to elected representatives on the U.S. side.
Last spring I was in the United States and met with Vice-President Cheney on this issue. Later the same day I met with U.S. Senator Larry Craig of Idaho. He was one of the leaders in petitioning the president of the United States to go along with this countervail, this tariff against Canadian lumber. Vice-President Cheney has a reputation for being up on all the issues and I believe he is. To my amazement, he and Senator Craig seemed to lack an understanding of many of the pertinent details relating to Canadian lumber.
When I explained to them the details of our having won this case three times before, by the types of questions they were asking they seemed to be interested. Obviously Senator Craig, being a senator, listens to his constituents who are appealing to him to impose some kind of tariff.
The lack of preparation by the federal government was evident. It simply was not done. I would have expected the government and our embassy to have been down there not just days and weeks but months and years before the agreement came to an end preparing and putting in place rules based on free and fair trade for the future. It appears they have been sitting on their hands. Some industry groups have come together to try to deal with this issue.
What should we be doing as MPs? Certainly constantly raising the issue here is important, but we could do more. Members of parliament in a non-partisan way should put together a group and go to the United States. They should talk to those key senators, talk to the representatives and make sure they understand the issue. They should talk to the consumer groups down there.
It is never too late for us to pursue the work that should have been done beforehand and push this issue on a parallel side, in a non-partisan way, with members of parliament from all sides of the House. We have to.
Obviously, this issue could go all the way to the World Trade Organization. However, it would be far better if we could convince the United States administration and the U.S. congress to drop this case, not by cutting some kind of a side deal that will lead to ongoing export tax but in fact by dealing with it. It can be done. It is possible. I would suggest that this post-September 11 environment in which we now live may actually give us a new opportunity to pursue this.
In a meeting I had with the U.S. ambassador a few days after the awful events of September 11, we talked about this particular issue. I said that we would in very appropriately and dignified way handle the issue, that we would not let it go. Obviously while our American friends were going through this terrible time, we would not politically pound away at something. I shared with him the issue of jobs and livelihood for 30,000 people, and it will be in the tens of thousands more, being absolutely critical. We talked about that.
The minister is saying that we will plod on, work our way toward WTO and hope to win that one, and believes we will. However, the devastation in the industry and among families will be huge. We recently saw the Bush administration, virtually with the stroke of a pen, remove a tariff on some products from other trading partners to build coalitions.
In that context of debate, Indonesia had duties removed from plywood exports to the tune of something like $200 million a year. I am sincerely glad for the people of Indonesia and their industry. What about Canada? Where are we on this particular file? We need to be there.
The government is not prepared to go to the United States, and I do not mean through the meetings that are being set up now with the industry groups, and take the initiative in a way that is visible and dignified but forceful, even at this particular time. It is not prepared to put together a non-partisan team so that the United States will know that this is not political, that we are concerned about our constituents and that believe we are standing on the principles of free and fair trade.
A non-partisan delegation recently went to New York City to send a message of sharing grief and condolences, not just for the Americans but also for Canadians. We need to and we can put together a non-partisan delegation the same way.
This non-partisan delegation of representatives of the people in Washington will allow us to clearly establish our country's commitment to free trade, particularly in the softwood lumber industry. Quebec and British Columbia are the two provinces most affected by losses in the softwood lumber industry. Thousands of families are waiting for us to act quickly to defend their interests with our American friends and allies.