Mr. Speaker, it is now my turn to take part in this debate on the American measures that are penalizing our forestry workers and those who earn a living working in sawmills in particular and in other components of the softwood lumber industry.
I will quote some figures tonight, not a lot of figures, but enough to make members understand what is at stake here. I will talk about Quebec since I am more familiar with the situation there.
There are 40,000 jobs linked to the softwood lumber industry in Quebec. The sawmill industry accounts for 20,000 jobs and the forestry industry, for 10,000. There are 250 municipalities in Quebec whose development hinges on forestry, including 135 towns and villages where all of the jobs are related to this industry. So it has a major impact. It is extremely important.
As a matter of fact, last weekend, I was in Taschereau, in my riding, where a company called Tembec is located. It is one of the companies targeted by the U.S. government in its decision to impose penalties for alleged dumping on the market. People were obviously concerned. To give you an idea of the situation, Taschereau is a small village, but over 400 people showed up to meet with the company president. Of course, there were other themes for discussion, but it showed that not only were people interested in their development, but they were also concerned about the softwood lumber issue and its impact on jobs in their community.
The company president was reassuring. That business can afford to absorb these measures over a certain period, but not in the long term. We must find a solution, and I will conclude with that later.
There is just one solution for us and it is a return to or the establishment of true free trade for softwood lumber.
A coalition was established across Canada and Quebec. A number of businesses gathered around an association, the free trade lumber association, to promote the establishment of real free trade for lumber. Regionally and throughout Quebec, businesses like Abitibi Consolidated, les Produits forestiers Alliance, the Landrienne mill, the Gallichan mill, Tembec, Kruger and many others are involved in this issue. At home, these are names well known by the public, since they create many jobs in our villages, and many people work in forestry.
In the current context of economic downturn, there was no need for this on top of the rest to further fuel the uncertainty that consumers must be feeling at the moment. The economy needs people's confidence. At the same time, it is hard to encourage them with a speech on confidence when they see the threats made by the U.S. government, which is being protectionist in this matter.
I recall the advent of free trade between the States and Canada. I am one of those who believes in the virtues of free trade. We promoted it and said to people “It is a good thing. We must support it”. The public, particularly in Quebec, followed. In the federal election it was the main issue. The party advocating it won the most seats in Quebec. At the time, some people opposed it. Today, I hear people saying “We told you. With the Americans, you can have free trade when it suits them”.
I must say that we sometimes run out of arguments because, where we wanted free trade everywhere, we ended up in a situation in which a few American producers felt disadvantaged compared to competitors in Quebec or Canada. They put pressure on their government, which decided to establish protectionist measures, such as charging duties of 19% and adding another of 12 %, claiming that dumping is going on. All this increases the cost of our products sold on the U.S. market by 30%.
Needless to say, this makes some people skeptical and leads to grassroots feelings that are not very favourable toward the U.S. government. People who lose their jobs and feel threatened by this decision are saying “Hold on, now”.
These same Americans are asking us to liberalize the energy field, for example, because they have a major energy problem. They turn toward Canada, Alberta and Quebec in particular, and say “Oh, you folks have a lot of energy, and we would be interested in greater access to it”. This is being discussed. The government does not always tell us when discussions are being held, but it is clear that there seem to be some in this area. So, in parallel, they would like to have access to our energy. They want to be humoured in that, but then when it comes to softwood lumber, they do not want to buy our products, or not in the context of free trade.
At some point, there has to be consistency. The government must be very firm with the Americans, and tell them “Now, people cannot talk out of both sides of their mouths at the same time. If you are in favour of free trade, then that is what we will have. Period”. That is what will be done for softwood lumber, and no other direction will be taken. The negotiations must not address anything other than the implementation of true free trade, so that this debate will not have to be started over again every five, six, ten or whatever number of years.
This is nothing new. Five years ago, we went through nearly the same thing. The rates may have changed a little, but it is the same American strategy, of imposing taxes on our imports, putting pressure on our industry, and putting us in a position where they can say “Accept a compromise or go all the way through a legal process, and all the time that there is uncertainty will be costly”. So here they are with their threats and attempts to intimidate us, so that we will accept on a more permanent basis to either reduce our exports or impose a rate on ourselves, saying “Yes, that's true. We will set our own export tax”.
We must not head down this path, because that is what we did five years ago. Four provinces were affected by a quota system. Exports from Quebec, Ontario, Alberta and British Columbia to the U.S. were limited. In this respect, the system can often be arbitrary.
When quotas have to be divided among businesses, it is difficult to come up with a process that satisfies everyone. Many members who live in forestry regions know people who would have liked to have export quotas for softwood lumber, but never received any. They had to export while paying the tax. It was a difficult situation. They were not on a level playing field with businesses that were given a quota to sell to the United States tax free. The other provinces were not affected, in the meantime.
So the market is hardly fair. There are frequently highly arbitrary factors, influenced by politics, that define how quota systems are generated. We accepted this, and five years later, we are starting the process all over again. The U.S. is using the same threats: a tax, countervailing duties, and accusations of dumping. They are pressuring us by saying, now we will negotiate. After clobbering us with taxes, they want us to sit down and negotiate.
We need to show them that it is not going to work. Yes, we will carry through to the end on the legal front. It must be understood that we are not just talking about five years. The United States has been complaining about our systems for twenty years, because they claim that we are indirectly subsidizing the market with deflated stumpage fees. That is essentially their argument in court. They have private forests, we have many public forests. This represents our different approaches and our different perspectives. They claim that their system is better and that ours provides direct subsidies to business.
However, whenever they have gone before legal bodies, they have always lost these disputes. So, we must go to the end of the process. When we negotiate about free trade, there is also a dispute settlement mechanism. When we are part of organizations such as the World Trade Organization, there is also a process to settle disputes, but we have to use it. These mechanisms are designed to protect the little ones from the big ones. We must use them. We must go to the end of the process. We must tell the Americans “We will not give up unless you immediately agree to go back to free trade”. Then we will stop. Otherwise, we will go to the very end of the legal process. We will settle this once and for all, we will not go through this every five years. This is what we must do.
I hope that in the discussions that are taking place right now with U.S. government officials, who came to Ottawa, or in the talks between the Prime Minister and the U.S. president, the government is very clear. I hope it is firm and clear. Yes, the government did raise its voice. We noticed it in the past few days. But we have seen this problem coming for a long time. I hope this is not the first time that the government raises its voice and that it has done so in private for quite some time with the U.S. government. We must say “Listen, this is not going to work. It cannot work like this”. We must be very firm. We are not negotiating. We are saying “We want to achieve free trade, nothing else”. We must be very clear and firm, because there is only one solution.
Many jobs are at stake. Forestry workers are watching us and they are concerned. Their jobs are at stake. This affects local economies. These economies are already fragile and they need all the help they can get to make it through the current crisis.
So much the better if the softwood lumber dispute is settled quickly and the U.S. government buys our arguments. Otherwise, the government must go all the way. With all the leeway it has, with its EI fund and so on, this government must come to the aid of the workers affected by the length of this dispute, which might take some months yet to sort out. If it does, the government must put measures in place to help those in the industry, go all the way, and not resume this debate every five or ten years.
That is what the Bloc Quebecois wants. I hope that it is what the government wants as well and that it is what it is going to do. Finally, I hope it is what we will ultimately obtain.