Debates of March 15th, 2001

Supply

[Rick Casson, Canadian Alliance, Lethbridge, AB]

Mr. Speaker, I am not sure that is clear to all members of the House. I want to bring in one aspect that I was not able to bring in in my previous remarks. A couple of weeks ago we had the pleasure of hosting the British prime minister, Tony Blair, who gave what I felt was a very good presentation. I will quote Mr. Blair who is the leader of the British labour socialist party. He said:

Finally on trade—. It is time I think that we started to argue vigorously and clearly as to why free trade is right. It is the key to jobs for our people, to prosperity and actually to development in the poorest parts of the world. The case against it is misguided and, worse, unfair. However sincere the protests, they cannot be allowed to stand in the way of rational argument. We should start to make this case with force and determination.

On the day Mr. Blair was here, I had the opportunity to sit in the front row with the hope of talking to him before he left, and I did. I was able to shake his hand and thank him for his comments, but I was also, in the few moments I had, able to remind him that the subsidies the European Union was giving its agricultural producers were really causing a lot of pain in our country. I asked him if it would be possible to reduce those subsidies to take some of the pain away from our people.

I want to get back to the issue of being more forceful at the negotiating table. I know there have been reports lately, and I am slipping back to agriculture, that the agriculture minister was in Europe. He suggested to the Europeans that their subsidies were hurting our producers. They told him that he could go to the hell because that was the way it was and will continue to be.

Over a billion dollars worth of business goes back and forth across our borders with the U.S. That has to be worth some kind of lever when we sit down and start negotiating an important agreement like the softwood lumber agreement.

[Grant McNally, Canadian Alliance, Dewdney—Alouette, BC]

Mr. Speaker, the forest industry is very important in my riding of Dewdney—Alouette. We have many mills there. The shingle industry is very important. It provides a lot of jobs in the community for many people.

I want to pursue the notion of the quota aspect of the agreement. It really limits individuals from being able to maximize the potential of the industry. It excludes others from becoming involved in the industry. It has, in many ways, hurt a lot of different individuals and has had ripple effects throughout the community within my riding.

What does my colleague think is the problem with the government's response to vigorously pursuing the notion of free trade, particularly in the area of softwood lumber?

[Rick Casson, Canadian Alliance, Lethbridge, AB]

Mr. Speaker, the whole quota system gave an advantage to some and not to others. It was not right. I even became aware of it in my riding in southern Alberta. We do not have a lot of forest, but there was a gentleman with a small mill who was shipping lumber across the border. One day he took a load across and was told that he did not have a quota. Probably not being in the mainstream of business but trying to make a few bucks shipping logs across the border, he came to me, which was when I really became aware of what was happening.

The whole issue has to be dealt with openly and has to be rules based fair trade.

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, it is a pleasure to rise in debate on this very important motion.

First, I congratulate the member for Joliette for having brought forward this motion on behalf of his party. This is a very important issue and I wonder why we have waited until today, 15 or 16 days before the expiration of the softwood lumber agreement, to finally hold a debate on this issue, which is so important for Quebec and Canada.

I find it extraordinary and unacceptable that it is literally on the eve of the expiry of the softwood agreement that we are now having a serious debate in the House. As I said, I congratulate the hon. member for Joliette for having tabled this very important motion.

I need to ask the representatives of the government why it is only now, and it is coming from an opposition member, that there is this kind of opportunity for debate. Why did the government not bring this forward for debate much earlier in the process, well before the date of expiry?

We all knew that this five year agreement was coming up for renewal when it expired at the end of this month. Why did the government not take the initiative to invite all Canadians affected by this agreement, such as the unions, the workers, the environmentalists and others, to make representations and to make their views known about the impact of the softwood lumber agreement? Why did it not to find out their proposals for what should take place when it expires on March 31?

The government has completely failed to show any leadership whatsoever on this very important question.

Others have already pointed out the importance of this industry. I do not have to repeat that. I am a British Columbia member of parliament and the forestry industry is absolutely critical for the people and the communities of British Columbia. We want to do whatever we can to strengthen and support that industry and to ensure that there is even more value added from the products that are produced from that industry. We have to take a look at exactly what is happening in this industry.

The fact of the matter is we were sold a bill of goods when the Canada-U.S. free trade agreement was brought in in 1988 and replaced in 1994 by NAFTA. What we were told at the time this came in, and I remember because I was in the House, was that the free trade agreement would get rid of the barriers that existed with Canadian products entering the U.S. market. This did not happen.

We know very well that when it comes to lumber the United States has always been the bully. It does not accept free trade at all. It is an illusion. Time and again when the U.S. has challenged Canadian practises, it has been told to forget it. Whether it was on countervail, or dumping or other provisions, it lost.

The United States is not at all serious when it talks about free trade and in its approach to free trade. It wants to prevent any meaningful access by Canada to that market. We all know that is what led to the Canada-U.S. softwood lumber agreement which affects the four key provinces of British Columbia, Quebec, Alberta and Ontario as producers.

Sometimes we overlook the fact that it does not affect the Atlantic provinces, which have done very well over the course of the past few years in the absence of any restrictions whatsoever. We are going to want to hear from Atlantic representatives. My colleagues from the Atlantic are concerned that in any new regime the significant benefits that have accrued to the Atlantic provinces not be lost.

The options we face on the eve of the expiry of the softwood lumber agreement are basically threefold.

The first option is to renew the agreement. We could agree once again with the United States to accept a ceiling, whether it is $14.7 billion square feet of lumber a year beyond which quotas are applied, or some other form of ceiling. Basically we could renew the agreement. On behalf of the New Democratic Party, I want to be very clear that is not an option for us. The current agreement must be allowed to expire. I think there is unanimity in the House on that point.

The second option, which is the proposal of the Bloc Quebecois, is to throw softwood lumber wide open to free trade without any kind of restriction whatsoever. This would come under the WTO, NAFTA and ultimately under the FTAA, if the FTAA is negotiated in 2003 or 2005.

That is the position the Bloc is putting before us today. It wants to scrap the current SLA and not renew it. We agree with it on that. However, the Bloc motion goes on to say clearly, unequivocally and categorically to throw it open to free trade with no restrictions whatsoever.

I want to suggest that there is another option and a very important alternative that we as New Democrats want the government to look at.

The government has to recognize that the current agreement must not be renewed. It must be scraped. It clearly has not worked in the best interests of Canadians, particularly those in British Columbia and the provinces that are affected by the agreement. The market is not gone. The other alternative is to replace the softwood lumber agreement with a fair trade agreement that gives Canadians some ability to ensure that some very important factors are taken into consideration in the area of forestry policy. Any trade agreement on softwood lumber should allow the Canadian government, as well as the British Columbia government and le gouvernement du Quebec, to do a number of things.

First, it should maintain employment and community stability, set strong environment protection regulations and develop policies to promote value added production in the forestry industry. Those are the kind of objectives that surely we do not want to give up as Canadians, as the people who own this precious and magnificent resource. That is precisely what the Bloc would do.

I am surprised to hear the member for Joliette, for whom I have a lot of respect, suggest that we are losing our sovereignty, the sovereignty of Quebec and of Canada, by adopting, for example, environmental regulations on the right of the province of Quebec, of my province, British Columbia, and of Atlantic provinces to set environmental standards.

This is precisely what the member for the Bloc is proposing. For this reason, NDP members will vote against this motion.

I find it extraordinary that a party that has spoken out, and I respect the position it has taken, strongly about the right of the people of Quebec to determine their own future should be prepared to throw away that right to make decisions on something as absolutely fundamental as forestry policy, particularly environmental regulation. However that is what it is doing. I am going to show in a couple of minutes exactly why that has happened.

Yes, we say that the current agreement must be allowed to expire. We recognize that there have been many problems with that agreement. The fact is that the way the quotas were originally set was according to 1994-95 exports to the U.S., so-called experience ratings. What that meant was that some companies in some regions were penalized because, quite frankly, they were not concentrating on the U.S. market at that time. Yet they were locked in to those provisions.

Coastal British Columbia, for example, was particularly focusing on selling products to Japan. Because of the quota system there was no flexibility to shift into the United States market. This was simply because they did not have any quota. It was not because they were not competitive or efficient enough to penetrate that market. The current agreement clearly is unfair in that respect.

There is another very serious concern with respect to the issue of raw log exports. This has been a profound concern in the province of British Columbia where we have seen a huge increase in the last couple of years in the export of raw logs. Most of those logs were harvested on private lands on Vancouver Island. The companies that do that are constantly lobbying the federal government to reduce even the weak current restrictions on log exports so they might export even more raw logs.

In 1997 a little over 100,000 cubic metres of raw logs were exported from British Columbia. The average between 1992 and 1998 was around 300,000. Last year the estimates were somewhere between 1.8 million and 2.4 million cubic metres. That is totally unacceptable.

Under the existing provisions of the SLA, the softwood lumber agreement, we know that the restrictions or the ban on raw log exports in some cases is considered a subsidy. Clearly that as well is quite unacceptable. Ironically lumber exports from third countries outside Canada and the United States enter the U.S. duty free.

We do not dispute the position taken by the Bloc or other parties in the House that the current agreement has not worked for Canadians and that it must be allowed to lapse when it expires at the end of this month. We want fair and open access to the U.S. market. We want a level playing field for all Canadian lumber producers.

The question is how do we achieve that. Why not just move to free trade without any restrictions whatsoever, as the Bloc has suggested? This does not particularly surprise me.

I remember quite well that in 1988-89 and the following years, Bloc Quebecois members supported NAFTA. They supported NAFTA, saying that it was good for Quebec and for Canada. Now, after seven years with NAFTA, can we really say that it was in the best interests of the people of Quebec and Canada? I do not believe that.

What the Bloc is suggesting with this motion is that we should effectively throw ourselves on the mercy of the great free market under NAFTA. Under NAFTA there is no free market. The reality is that under NAFTA more and more power is being taken away from governments. Power is being taken away from the governments of Canada, British Columbia and Quebec to make decisions, as democratically elected representatives, about our future.

Look at some of the cases that have been brought under chapter 11 of NAFTA, such as the investor state provision. We know Mexico, for example, has recently been told by a secret tribunal that it has no power to ensure that a toxic waste dump is not put into a small community of Guadalcazar in Mexico. It said it did not want it.

If we were to accept the Bloc motion, we would be effectively surrendering our sovereign right as Canadians, as Quebecers, as British Columbians and as Atlantic Canadians to say that we want to ensure that we have the opportunity to enforce tough environmental standards. We want to ensure more value added in our forests. We want to ensure that communities and workers are respected in the decisions that are made about the forest industry. Under this proposal that would not be possible, so we say no to that proposal.

Look at the Pope & Talbot challenge. This is an American company that is challenging the current provisions of the softwood lumber agreement. It is the ultimate in irony. It is saying that, due to the regional disparities which exist, it is somehow being treated unfairly. An American company is challenging the softwood lumber agreement, which was pushed by the United States, because it cannot make enough money out of it.

That is the regime that the Bloc wants to take us into. We as New Democrats say no. That is clearly not acceptable to us.

We have to do far more in terms of value added. We also have to recognize that there are some serious changes that have to be made in the way we conduct forestry. We do not want to have our hands tied as we attempt to make those changes.

Recently in British Columbia, we learned that some of the biggest multinational forest companies have been using what is called grade setting, which is a practice of harvesting only low grade timber to set the grade for huge cut blocks. That means their appraisal is very low for their stumpage payments. Then they switch to harvesting high grade timber but pay the low grade stumpage rates. That kind of abuse of B.C. forests has to stop.

We have to look very seriously at alternatives. Many of us, certainly my colleagues in the New Democratic Party, and many environmentalists are concerned about a number of the current practices that are the norm in too many parts of British Columbia and elsewhere in Canada.

Instead of this kind of race to the bottom approach that the Bloc is supporting, and apparently other parties in the House are supporting, maybe it is time we looked at tough effective environmental standards that would affect all of the countries that are producing. This includes the United States, Canada and other competitors.

We should be looking at protection for endangered species habitat, biological diversity, fish habitat, water quality and sustainable logging practices. Why not call for a global approach to sustainable forestry that would involve input from communities, workers, aboriginal groups and others? Why not do far more to promote value added and to push for bans on raw log exports which are a direct export of jobs from British Columbia?

I mentioned concerns about clear cut logging. I am pleased to note that more companies are moving away from that. We have to look at other reforms as well, which may very well be deemed to be trade barriers. Under the terms the Bloc is suggesting we would not be able to undertake them.

There is no question that we have to look at tenure reform in the forestry area. We have to look at how we protect the long term ecological health of our forests, how we maintain that biodiversity that I spoke of earlier and how we provide a stream of sustainable benefits to communities, including non-timber benefits. At the same time we must recognize that workers in the forest industry, who are concerned about their futures, should be directly involved in these decisions.

We have to look more at moving tenure away from the big multinational logging companies and locating more community based opportunities such as community forests, locally controlled woodlots, expanded small business forestry programs, licences for small processors and processing co-ops.

I know my time is limited, but the concern I have with the motion is that unfortunately it is in a sense replacing one bad deal with another. As New Democrats, we say there is that other option and that is what we want to put forward in the debate today, an option which would allow us to ensure that we can in fact respect environmental standards, that we can respect the rights of communities and workers to determine their own future, that we are not locked in to this investor state provision, and that in fact we can make decisions as the representatives of the people of this country, as the representatives of the provinces we live in, about the future of this very precious resource.

I hope the government will recognize that we must move toward a much fairer trade system in lumber. I hope it will consider the recommendation of the B.C. forest minister, Gordon Wilson, who recently called on the federal government to send a special envoy to Washington to try to negotiate a newer and better softwood lumber agreement. He points out, in fact, that if we do not do so we will once again be into this endless cycle of countervail, threats of countervail and dumping. We now have a threat that there may not even be any retroactivity if we lose at countervail, that again under the WTO.

In closing, it is important that we recognize, as I said earlier, that the market is not God, that the forests should belong to the people of this country, the people of British Columbia, the people of Quebec, the people of the Atlantic provinces and the people all across Canada. We must not have our hands tied in how we approach those forests. For that reason we say no to the renewal of the softwood lumber agreement and no as well to the unrestricted proposal of the Bloc Quebecois for free trade.

[Bill Graham, Liberal, Toronto Centre—Rosedale, ON]

Mr. Speaker, I congratulate the member for Burnaby—Douglas. It was as usual a very thoughtful speech on this issue.

However, I am kind of curious about the fact that the member for Burnaby—Douglas, who marshalls his facts so well and understands the legal niceties so well, seems to be able to distort the facts in a way that is quite astonishing and to come to conclusions that are so inconsistent with his own party's position.

The member for Burnaby—Douglas knows very well that the minister and the government have been consulting on this issue for the last couple of years. He started his speech by saying there has been no consultation and asking why this is so last minute. The minister has travelled across the country. He has met with stakeholders from every group. He has met with all provincial governments. The government has initialled two WTO challenges to U.S. legislation. In the WTO we are consulting on dumping duties. We have actually challenged their legislation on log exports. The minister has met with the predecessor of Mr. Zoellick and is meeting now with Mr. Zoellick. The Prime Minister is now discussing this issue with Vice-President Cheney.

We have organized a coalition of consumers groups in the United States that support the Canadian position because they understand the need to have lumber at a price that is reasonable and they understand that their own logging industry is driving up prices, which will suppress building in the United States.

All of this work did not happen in the last 20 minutes. This has been happening for a long time, so why is the member taking that position when he knows it is not true? Second, why is he so opposed, then, to the summit of the Americas?

If the hon. member believes in a fair trade agreement, if he believes in an opportunity to get these issues of environment, human rights and all the issues he is talking about on the table, why is he going to protest the summit of the Americas? That is exactly what we will be discussing there. Those are exactly the issues we will have an opportunity to discuss, but the hon. member wants to stymie that negotiation. He wants to kill it before it starts. Where is the consistency in his position?

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, let us cut through the rhetoric and the nonsense here. The member asks why I am going to Quebec City and why I am opposed to the proposals of the government. I will tell hon. members something: we do not even know what the proposals of the government are because it refuses to make public the texts that are being negotiated. It is the height of sophistry for the Liberals to say “trust us, it will be good for Canadian people”.

I have great respect for the member, who chairs the foreign affairs committee, but it is absolutely absurd to ask the Canadian people to simply trust our government to negotiate a good deal even though we still cannot see the text that is being negotiated.

That summit is coming up in a little over a month from now. What we were told by the Minister for International Trade in one memorable declaration was that there is no problem, that these trade deals all look like one another anyway, so if they all look the same and are basically the same idea, what is the big deal if they cannot show us this particular text. That is our concern.

I ask the hon. member for Toronto Centre—Rosedale this: if in fact this trade deal is going to look like the other trade deals, does that mean there is going to be an investor state provision in it? Does that mean we are going to give corporations like Metalclad, Ethyl Corporation, Methanex and others the right to challenge the decisions that we as democratically elected representatives make? We do not know. We do not know because the government has refused to allow us to know. It will not make those texts public.

I want to say one other thing, and that is with respect to the point I made initially about the consultation with members of the House.

As I said, I congratulate the member for Joliette because I believe, though I may be mistaken, that this is the first serious debate we have in the House of Commons on this issue. And it is taking place two weeks before the expiration of the agreement. This is unacceptable. The Minister may have done some consulting here and there, but what have we done here, in the highest forum of Canadian democracy, where the country's elected representatives meet? Absolutely nothing. And this is unacceptable.

[Paul Forseth, Canadian Alliance, New Westminster—Coquitlam—Burnaby, BC]

Mr. Speaker, the member for Burnaby—Douglas talks a great game. I think that both he and I would agree that we certainly want to support our local industries and that from what we see in the larger context the results are not fair.

Besides calling the U.S. some names and not hiding his anti-Americanism and philosophical opposition to trade deals and processes that were not particularly his party's ideas, I am pleased that, first of all, he agrees with the Canadian Alliance that a return to the old formula, the old SLA, is not a preferred course.

To try to clarify his options, what is he really suggesting? Is it more socialism? He says the market is not God. Then who is? Is he saying that a wise bureaucrat somewhere in a ministry is going to solve it? Who will decide? Will it be top down government control in the name of these laudable objectives? Let him spell out how the old style of bureaucratic control, the failures of the past, would work in today's reality. He talks about fair and open access. Is that through a socialist bureaucracy, through departmental mandarins, through replacing markets with edicts and decrees from the czar? Is that what he is talking about?

He talks about standards and sovereignty. We do not get those things through coercion. We get them through co-operation and negotiation. We can make friendly deals and put limits on our behaviour. When we make a trade deal with someone we may decide not to go to war with someone. That means we are limiting our sovereignty or our choice not to go to war because it is of mutual benefit to both of us.

His solution is old style socialism, which is a failure and will not bring us the results he is talking about.

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, the hon. member refers to edicts and decrees from the czar. What we are saying is that we are tired of secret, unaccountable tribunals telling us as elected representatives what we can do about our own future. Those are the real edicts and the real decrees the member should be concerned with.

More and more we are losing democracy and sovereignty to the hands of multinational corporations, which have the ability, under these so-called trade deals, to challenge environmental policies and to challenge our policies with respect to social programs, cultural programs and other programs. My colleague from Dartmouth can certainly speak eloquently to the concern that we have in the cultural sphere with issues like split run magazines and so on. That is the concern.

We are not saying that there is not an important role for rules in international trade. Of course there is, but we are saying that those rules should be set democratically by elected representatives of the people who consult with the communities they represent. They certainly should not be set by multinational corporations whose sole interest is the bottom line.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, while I share the member's concerns with respect to the weaknesses of the North American Free Trade Agreement, I would point out that the Bloc Quebecois position is clearly known. We are in favour of including social clauses in free trade agreements precisely because we have seen the results of previous agreements. We know that they have an impact socially and culturally. I therefore share his concerns.

However this is not the question. The question is which rules will govern softwood lumber trade between Canada and the United States on April 1. Will it be NAFTA, with all the amendments that would require but which has been signed by both countries, or will we have an arbitrary decision by the Americans imposed on us?

Will the member tell us how voting against the Bloc Quebecois motion will help producers and workers in British Columbia on April 1?

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, in fact we are speaking on behalf of communities, workers, and the environment in British Columbia and in Quebec.

If we were to accept the Bloc Quebecois' motion, we would not have an opportunity to challenge the provisions. For instance, we would not be able to oppose the American challenge to our environmental practices and to our practice of not having raw logs exported from Canada.

It is precisely because we wish to speak on behalf of communities, of the environment and of workers that we are rejecting these NAFTA rules, particularly the infamous chapter 11.

It seems to be fine with the member for Joliette if the big corporations are allowed to challenge provisions of the agreement, whether in Quebec, in Canada or in British Columbia. We, as members of parliament, and the representatives of the government in power would have no opportunity to say no. That is what the Bloc Quebecois is proposing and we do not agree.

[Bill Casey, Progressive Conservative, Cumberland—Colchester, NS]

Mr. Speaker, I am pleased to speak on this issue because it is a critical issue to my party, my region and my country. It is the number one issue that has occupied our attention for the last little while. It is not a simple issue and there will probably not be a simple solution.

For one thing, people should understand that it is a very unique situation, where the United States government deals with Canada under three different sets of rules. One is the softwood lumber agreement, which includes the four provinces of Quebec, Ontario, Alberta and British Columbia. Then there are four provinces under the maritime accord, the four Atlantic provinces of New Brunswick, Nova Scotia, P.E.I. and Newfoundland. Then there are Saskatchewan and Manitoba, perhaps the most important provinces.

In any case, it is an aberration in international trade when one country deals with another country under three different sets of circumstances. It does cause a lot of trouble, but there are reasons for the different approaches in these three different areas.

In the case of the four provinces under the softwood lumber agreement, Quebec, Ontario, Alberta and British Columbia, the American industry and the American government perceive that they have subsidy under the program of supplying stumpage or softwood resources from crown land. The Americans have said that they will consider that a subsidy and they want quotas, taxes or some kind of tariff on those four provinces.

In Atlantic Canada, there is a completely different situation. In 1995 when the SLA was negotiated, 61% of all the softwood exports from Atlantic Canada came from private woodlots, much the same as the lumber industry in the United States. The American industry said the four provinces in Atlantic Canada operated the same way as it did, so it said it did not require a quota and would not impose taxes or tariffs.

In fact, over the last five or six years those provinces have increased that percentage from 61% to 74.5% in order to address the concerns of the American industry and maintain their position, because under the maritime accord the four Atlantic provinces have, they virtually have total free trade, exactly as this bill calls for. It is free trade and protection from litigation, which perhaps is actually even better than free trade because of the protection part of it.

The Atlantic provinces are adamant that they keep the same criteria they have now under the maritime accord, which is total free trade.

Manitoba and Saskatchewan somehow evaded the net that was cast by the American industry and government and are under no obligations or restrictions at all. They are not part of the maritime accord or of the SLA, but they are there and do ship smaller quantities of lumber but of an excellent quality, especially from Manitoba.

We would certainly agree with the motion, which reads:

That this House support the government's efforts to restore free trade agreement rules for lumber and inform the United States that it rejects any obstacle to the free trade process.

We would also agree with the amendment, which reads “by establishing quotas and trade barriers”. We are against quotas. We are against trade barriers of any kind, and that includes an export tax imposed by the Canadian government.

We are free traders as a party. We are the party that brought free trade to the country and to the North American continent. As a region we are free traders now in the softwood lumber business. I am from the maritimes and our region is a free trading region. We have free trade now under the maritime accord. The provinces are adamant that they keep that free trade agreement in place.

The Atlantic provinces are very concerned that, under the current scenario of negotiations and all the things that are going on behind the curtains which we do not know about, the government may be trading away some of these things because we really do not know what it is saying.

My biggest fault with the government on the issue is that it has not gained consensus in the country. It has pitted the west against the east. We have two completely different positions and then another one in the middle. I believe that in any negotiation we must get all our ducks in a row on our own side before we can start negotiating with the other side. The government has made little or no effort to reconcile these differences.

The western provinces under the SLA want to do away with the SLA and establish free trade. The maritimes are already under the maritime accord, which is total free trade. It is a different position. There has been no attempt that I know of to try to reconcile these positions.

Meanwhile the B.C. Lumber Trade Council comes to Ottawa to give its side of the position and lobbies hard for it. The Maritime Lumber Bureau comes from Atlantic Canada with Diana Blenkhorn, the chairman and CEO of the Maritime Lumber Bureau, and presents its side. Bob Plecas comes from British Columbia and presents his side. The problem is that we are going into the negotiations divided. The government does not have a clear mandate on what to do because it has not got consensus from the provinces.

The maritime provinces have tried hard to address the concerns of their customer, the American market. They have dealt with the private woodlot sector. They have increased their percentage of production from private woodlots. In my view the maritimes have earned free trade, deserve free trade, have free trade now and should keep free trade as the motion prescribes.

However, this is the motion. The efforts of the government are not clear because the rumours are that the government is negotiating or considering imposing an export tax. One of the rumours is that some of the western provinces' industry representatives are down in the U.S. lobbying them to pressure Canada to apply an export tax. There is even a tentative formula floating around of 10% next year for an export tax, 5% the next year and 0% the next.

There is yet another concern in this whole environment that the government is rushing into something to try to avoid any dispute as the free trade agreement of the Americas approaches. It does not want outstanding issues with our number one trading partner. If we cannot resolve issues with our number one trading partner how can we expand to free trade of the Americas?

We are very much afraid that the government will not get a consensus or an agreement from all the provinces, and that it will dive into something just for the purpose of coming up with a tentative temporary deal to overcome the embarrassment of going into the free trade agreement of the Americas without an agreement with our number one trading partner.

We have just gone through the Brazilian beef issue, which I and most Canadians do not think was handled well. It seemed to be a knee-jerk reaction to another industry's situation completely but the government applied it to Brazilian beef and banned Brazilian beef. However, an hour after the U.S. lifted its ban, Canada was forced to lift its ban. This shows that there is total mismanagement and a total lack of thought and planning.

This agreement and all trade agreements are critical for the whole country but we are afraid the government will take the same knee-jerk reaction approach that it took on the beef and apply it to the softwood lumber issue in order to avoid embarrassment at the free trade agreement of the Americas.

There are so many rumours and proposals floating around now that it is very disconcerting to all of us. Every day in the House, when members ask the trade minister, the Prime Minister or the parliamentary secretary about free trade, whoever stands to answer says that nobody in Canada wants to go back to the previous arrangements and the previous agreements. We take exception to that because it is not exactly right. Four Atlantic premiers, that is four out of six provinces, have written and signed letters to the Prime Minister saying:

Failure to continue the current agreement and arrangements would have a devastating impact on our region's softwood lumber industry.

The four premiers go on to say:

We respectfully request Canada take the steps to—ensure no lapse in this important and strategic arrangement.

The parliamentary secretary, the minister and even the Prime Minister continue to stand and say that nobody in the country wants the agreement extended. There has been no effort to try to reconcile the differences between the different ends of the country. The Atlantic provinces clearly want the maritime accord renewed and continued, yet the minister stands and says that nobody wants the arrangement restored and continued.

I put the responsibility totally on the Minister for International Trade for not reconciling these differences before he goes into trade negotiations with another country. We have a split in Canada that has not been reconciled. I do not know how we can go into a debate with another country without having all our own country's industries onside and going in one direction. There is no leadership.

When we talk about free trade, Atlantic Canada has had free trade with the United States in softwood lumber since 1842. Under the Webster—Ashburton treaty signed in 1842 we have had free access to that market. Atlantic Canada has always had free access to that market. When the dust settles at the end of the little negotiation we are about to enter, we will still want free trade with the United States. We want the rest of the country to have free trade as well.

We do not want an export tax in Canada. We do not want to be subject to countervail. We do not want to be subject to anti-dumping. All these are possibilities if the government does not take action and at least get the Canadian side organized and get some consensus so that we can negotiate from a position of strength.

The issue is absolutely critical to the Conservative Party. Atlantic Canada delivers about $1 billion worth of softwood lumber a year to the U.S., with a total market from Canada of $11 billion. It is a very important market to Atlantic Canada. It is absolutely critical to us. It is critical that Atlantic Canada keep the free trade arrangement it has now. It is important that the rest of the country establish free trade with the United States as well, but not at the jeopardy of the area that already has free trade.

The Conservative Party is not satisfied that the government even recognizes the differences in the two parts of the country. We are not sure the government understands how the maritime accord even works. Government members never acknowledge it when they answer questions in the House. The bottom line is that they have never reconciled the differences between the two parts of the country.

We have all heard the expression, united we stand, divided we fall, and right now we are already divided before we go into the negotiations.

My party supports the motion to honour and respect the rules of free trade. We do not want quotas or trade barriers but we also do not want an export tax charged by Canada on softwood exports to the U.S. Many of us feel the government is leaning that way, providing a tax against our softwood lumber exports to the United States in order to avoid embarrassment at the free trade agreement of the Americas.

The Government of Canada should stand up for free trade but it should not bargain away our right to ship softwood lumber to the U.S. by saying that we will have a 10% export tax now, a 5% export tax next year and a 0% export tax the next year. Some have even suggested that it may be 20% to 22%, which would be absolutely unacceptable.

I call on the government, before it even starts negotiations, which it probably already has started, to pull the industry together in Canada and get a consensus before it tries to negotiate in the U.S. If not, we will have a hodgepodge of agreements again as we do now. We have three different agreements in Canada. It makes no sense. It is very difficult to monitor and even difficult to explain.

In conclusion, my party will be supporting the motion, as amended, which would avoid any trade barriers or quotas and would extend the rules of free trade in the softwood lumber industry.

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, I have been listening to the hon. member talk about the case as it affects the Atlantic provinces. It is called the maritime agreement but it is understood that it also includes Newfoundland. When we refer to the four provinces, we locally call them the Atlantic provinces, but in this case all four fall under the maritime agreement.

The member talked about perhaps renewing the maritime agreement or that we should have complete free trade. Would the member give us an example of the difference, if there is a difference, between what the maritime agreement provides now for the people in that area and what free trade across the board would do?

[Bill Casey, Progressive Conservative, Cumberland—Colchester, NS]

Mr. Speaker, my hon. colleague asked an interesting question about the maritime accord and where the name came from.

The name came from the United States. The United States considers anything east of Quebec in Canada to be the maritimes. However the maritimes consists only of Nova Scotia, New Brunswick and P.E.I. The Atlantic provinces include Newfoundland. In this case there is an aberration where the maritime accord refers to all four Atlantic provinces.

The maritime accord provides the maritimes, the four Atlantic provinces, with total free trade and access to the U.S. There are no quotas, no tariffs and no limit. Not only that, it provides protection against litigation for anti-dumping and countervail charges which could be brought by the American industry.

It is an excellent agreement. It provides access to the American market for Atlantic Canada. It provides thousands of jobs in Atlantic Canada. It has allowed for a vibrant, strong industry that can compete next to American lumber producers head to head under the same circumstances. As I said earlier, 74.5% of our softwood lumber exports come from private woodlots, quite similar to the experience in the United States.

[Rick Borotsik, Progressive Conservative, Brandon—Souris, MB]

Mr. Speaker, first, I congratulate the member for Cumberland—Colchester. He has been a very effective voice on this issue in the House. He has, on numerous occasions, tried to draw out of the government the position it is trying to put forward with respect to the softwood lumber agreement but he has not been successful. He indicated today in his speech that not all the provinces believe what the Prime Minister and the Minister for International Trade have been saying.

However, I will pose a question to the hon. member. We recognize that the position the hon. member has taken is that there should be open borders, free trade, no excise taxes and no quota systems. We all seem to feel that the right way for trade within North America is free trade across an open border between the United States and Canada.

Who is the major lobby group in opposition to this free trade, in the United States particularly? Who is opposing this open borders concept? Who will this have an impact on should an excise tax be placed on softwood lumber going across the border?

[Bill Casey, Progressive Conservative, Cumberland—Colchester, NS]

Mr. Speaker, those are good questions. He is obviously a very intelligent and thoughtful member from Manitoba where there is a lot of clear, cold air.

Who is opposing the free trade agreement in the United States? The industry in the U.S. is opposing it. The system in the U.S. is guaranteed to have opposition from the U.S. industry. If the U.S. industry is successful on April 2, which I think it will be, it will lobby its government to charge Canada or the Canadian industry both countervail duties and anti-dumping charges.

If the U.S. government is successful in imposing those countervail duties and anti-dumping charges, all the money will go to the industry that filed the complaint in the first place. Why would the industry not file a complaint against Canada if we go into free trade? We strongly believe that on April 2 they will file the application for countervail duties and anti-dumping charges unless the Canadian government comes up with some kind of interim agreement.

It is so unfair. The industry in the U.S. has a tremendous incentive to apply for countervail duties and anti-dumping charges. It will get the benefit if the charges are levied.

[An hon. member]

Who is being impacted?

[Bill Casey, Progressive Conservative, Cumberland—Colchester, NS]

A lot of people are being impacted. In the U.S. consumers are now starting to complain because they like Canada's softwood lumber. They like the quality, the price and the availability of it. If Canadian lumber is restricted then it will drive up the price of all American building products and will have an impact on U.S. consumers.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I am pleased to speak today on an issue that is extremely important of course for a region like mine, the Abitibi-Témiscamingue region, but also for the whole province of Quebec and for a number of regions across Canada.

Canada is a major exporter of lumber. Lumber ranks among our greatest resources. We have been engaged in a trade dispute with the United States for some 20 years. Given the escalation in the means used, we should clarify this whole issue once and for all and support our industry to the end, so that this sector like many others is covered by a true free trade policy.

The Bloc Quebecois is proposing the motion today to show solidarity with an industry that has succeeded in building a very strong coalition, which shows that people are prepared for comprehensive and global free trade. These people are prepared to begin to play, on April 1, by rules that should have been in place for quite some time.

I will not review the whole history of this issue, but since 1982 the Americans have challenged on a number of occasions the fact that the Canadian industry was subsidized, using all kinds of recourses in the process. This situation was primarily due to a different approach, since in Canada large areas of forest and land are publicly owned, while in the United States they are privately owned. The Americans have always felt that stumpage fees were perhaps too low and they have used that argument to claim that our industry was thus being subsidized.

They have made that claim wherever they could, including in the United States, but not exclusively. They won a number of cases internally, but when the time came to clarify the matter before organizations other than those pressured by the American lobby or by the U.S. industry, their claims were never validated.

For a variety of reasons, this led the Government of Canada to sign agreements on two occasions with the American government, the protocols of which included acceptance of a system limiting our ability to sell our products freely on the U.S. market. The first of these was in 1991 and the second in 1996. It was to run for five years, terminating on March 31.

For the past five years, the current system has included quotas. Of course, even if the government wanted to recognize past production, a quota system creates problems for us in that it is too discretionary as to who has or does not have the right of production. Some benefit from the quotas on what we are entitled to produce, without falling victim to the drastic American measures.

I do not know how many members have had this experience, but I and many others have heard complaints from people in our regions that they did not have a big enough quota or were not given any at all. This creates problems for new players in the market. Lacking quotas, they are at a disadvantage compared to those who do have one.

As a result, we end up with an economic system in which highly arbitrary choices influence the capacity of certain industries to develop and prevent others from developing.

The time has come for the government to stand up and vigorously defend Canadian and Quebec producers. Just to remind the House briefly, so we understand what we are talking about, the industry in Quebec produces about 25% of Canada's output. I am giving figures for Quebec, but you will no doubt hear members from other areas during the day telling you how important this industry is for their region.

The industry in Quebec produces seven billion board feet. Production is measured in board feet. There are over 30,000 jobs linked to the lumber industry in Quebec. The sawmill industry accounts for 20,000 jobs and the forestry industry, 10,000. This industry is important in a number of municipalities, as we can see from the figures given this morning.

There are 250 municipalities in Quebec where all of the manufacturing sector jobs are related to this sector. There are 250 municipalities. We are therefore talking about something really important to many communities throughout Quebec, and I am sure that this is true in many other regions in Canada. It is very common to have a lumber business as the major activity in a village with, of course, a few other economic activities about. But the manufacturing sector is where we have to keep improving.

Our ability to export lumber does not excuse us from other issues, such as better processing our products, producing more value added products or better using our natural resource. All of this is an extremely important issue we must not lose sight of. But trade rules must be the same for everyone.

I remember that, when I was first elected in 1993, I had the opportunity to have discussions with Tembec Inc., a major player in that industry back home. On the general topic of free trade, officials from that company said “Yes, this is one way free trade. The Americans really like having access to our market, while it is very difficult for us to have access to theirs”. They were referring to all these problems they were experiencing in their industry or foreseeing because of the complex situation and the numerous challenges by the Americans.

Americans are very good at extolling the virtues of free trade. They will do exactly that at the Summit of the Americas. They will make great speeches in support of a market covering all the Americas. But it is another story when they are confronted to realities like the one where part of their industrial sector could be threatened by the very productive companies we have here.

Incidentally, we always talk about productivity gaps between Canadians and Americans, but there are sectors, like mining and logging, where our productivity rates are excellent. We too often forget to mention that. Whatever we may think and despite the fact that traditional economy has been run down and called “old economy”, there have been massive investments in the natural resources sector. Such sectors are often among the most productive in the Quebec and Canadian economy.

People in these sectors want access to the U.S. market just as much as the Americans want free access to ours. That is what free trade is all about. But we are familiar with this tendency of the Americans to say one thing and, in practice, to block free trade. This is one area where the Government of Canada will have to stand behind an industry. There are major legal battles on the horizon.

Certain provinces are being accused of dumping. There is again talk of challenges because this industry is subsidized. The government must not abdicate its responsibilities towards the industry in this battle. It must not negotiate any sort of transitional agreement whatsoever. This is one thing that worries us.

The government clarified its position, but there was a suggestion of hesitation when it said there would be a transition towards free trade. No transition is necessary. On April 1, we will be in a free trade position. This means that businesses will be in a new phase; admittedly, some will have a transition to make, but we do not want a transitional agreement. We want full free trade and we want the government to mount a strong defence of our industry in these battles, to be there for us and to take the lead, so that we do not find ourselves in the situation we have been in for several years now. The result of arbitrary decisions has been that some companies have been able to grow while others have not, and some have been limited in what they could do.

This is an excellent test of the effectiveness of the Minister for International Trade. We will see whether or not he is up to the task. He has everything he needs to succeed. The industry is strong and parliament will be very solidly behind him, I am sure, with the Bloc Quebecois motion moved today. He has a responsibility to succeed. The Government of Canada must succeed because this industry is extremely important to our economy.

Of course things will be heated for a while, because the Americans will make all sorts of threats, but we must follow through so that we do not find ourselves having to make this same argument every five years. We must resolve this once and for all, clarify the situation, and enter fully into free trade.

We have every confidence that our industry will do well in these circumstances and that our economy will be able to grow further.

[Philip Mayfield, Canadian Alliance, Cariboo—Chilcotin, BC]

Mr. Speaker, I compliment the Bloc member on his speech. He described many of the problems Quebec has in the same terms that I would describe the problems in British Columbia. Half of the $11 billion trade in Canadian wood comes from British Columbia.

In addition to what the member said, it seems to me, though, that the main problem is simply the inability of Americans to want to compete with us on fair ground and the inability of the Canadian government to handle a consistent and well thought out trade position.

I think of the farming communities that we represented on the streets in Ottawa yesterday. Their lifeblood is being drained away trying to compete against subsidies. I think of the dumping of apples in British Columbia. I think of the recent Brazilian meat kerfuffle and a poorly thought out position by the Canadian government.

Canada has perhaps the highest efficiency lumber mills in the world. These mills do not only put out a train car of lumber a day. Medium size mills put out a trainload of lumber and know the value of every stick on the train as well.

We are told that we have difficulty with stumpage. This lie is being propagated by those who do not wish to compete on a fair playing field. There is no advantage in stumpages for our producers.

We have long roads over high mountains and deep swamps. We have the high costs of getting the raw materials to our mills. We have a situation now where mills are faced with an unfortunate choice because the weight restrictions are already on roads in British Columbia. The mills have yards full of logs and the unfortunate choice of having to mill them at a loss or leaving them stacked in the mill yards and swallowing the costs of getting them there. No one is making money in this regard.

I call upon the government to think about what it is doing and to understand that the issue is competition. It is hard to compete against people who benefit. It is not hard to understand how they avoid wanting to compete when the duties that Canada pays go as cash into their pockets.

In conclusion, what specific proposals would the member have for Quebec? They may be reminiscent of what we would need in British Columbia. What specific proposals would he have for the federal government as it talks to our U.S. trading partners about the issue?

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I will begin by answering the question, and then I will make comments. The answer is simple. What we are asking the federal government is nothing complicated: true free trade and nothing else. It is the basis for the best solution.

I will pick up on some of the points raised by the Canadian Alliance member. The lumber industry is a highly productive industry, both in Quebec and in British Columbia. I am pleased to be able to repeat this. There has been much talk of the new economy over the past 10 years or so, but our traditional resource sectors are now consumers of new technologies. These are highly productive sectors and perhaps among the best adapted to the integration of these modern new development concepts.

These are, therefore, highly productive sectors. It is not our problem that the Americans cannot compete with us. In the case of Quebec, we know that the figure was, if I remember correctly, 0.01%, the last time we checked the industry subsidy. We are talking of something that is marginal to say the least.

If our prices are lower, it is not because of a subsidy but because of our efficiency. The federal government needs to tell the American government now that there will be no more foolishness of signing agreements right and left, and thus hindering trade in this area.

I remember how the Minister of Industry took pride in announcing, in connection with a trade dispute with Brazil, that it was high time that Canada stopped acting like a Boy Scout in the conflict between Bombardier and Embraer.

It is the same in this case also. It is time for Canada to start acting like a true partner to the industry, to move to true free trade once and for all, and not to bow to the pressures exerted by the Americans during the period of turbulence that is coming when there will be but one objective: for free trade to start up on April 1 and just keep on going and going.

[Marcel Gagnon, Bloc, Champlain, QC]

Mr. Speaker, like my colleague, I congratulate the member for Joliette, for initiating this debate today.

I am also scandalized, a bit like the member for Burnaby—Douglas earlier, that an issue as important as this is being raised today, two weeks before the end of the agreement, two weeks before free trade resumes and by the opposition.

Such an important matter as this should have been given special attention by the House, debated and treated with something besides arrogance on the part of the government when we ask questions about it. It should have been responded to in a way that at least gives impression the issue is being addressed, if forestry workers are not given full satisfaction.

When we asked questions on lumber in the House, we had the impression the issue was a bit embarrassing or that it did not concern us.

This morning, thanks to my colleague from Joliette, we are having an indepth debate and we can show just how important this matter is. It is important for Quebec and for the rest of Canada. As we have just said, what does it mean for Quebec? It means 30,000 jobs, including 10,000 in the forest. This matter is doubly important for my riding of Champlain.

This year we will be celebrating the 350th anniversary of the city and the region of Cap-de-la-Madeleine. We are at the start. The forest is part of our culture, part of our past and will be part of our future if properly handled. My riding includes the city of La Tuque, in the north. Each time there is talk of American dissatisfaction over lumber, I can say the workers around La Tuque are not particularly happy with the situation. They do not like it a whole lot.

Last week I travelled around that region. They begged me to press the minister to do his best to defend this cause. He should stop saying in the House that he has everything under control if he is to come back after a meeting with the Americans and say that he is a bit discouraged by the whole issue.

The Mauricie region depends on the wood industry, on softwood lumber. Our industries have managed to adapt. Our industries are financially viable. As my colleague said earlier, perhaps the Americans are afraid because we adapted a bit quicker than they did. However we must now have the opportunity to compete freely. We can be replaced.

Sources say that the wood industry in general, especially the softwood lumber industry which is the object of today's debate, involves some 250 communities in the province of Quebec. Most of the 27 communities in my riding are concerned by the softwood lumber issue. I hope the minister will understand. Even if we do not obtain unanimous consent from the House, I hope we will give the minister a clear enough mandate for him to stand up and avoid weakening his position. To this end there is nothing else to do but to come back to free trade as of April 1.

I will read again the motion of the member for Joliette:

That this House support the government will [—]

I wish to underline the word will, because I was wondering if the will was there. I have faith in the Prime Minister who seemed to be saying yesterday that the will was there.

The motion goes on:

—the government—in its efforts to restore free trade agreement rules for lumber and inform the United States that it rejects any obstacle to that free trade process.

The motion before us is extremely important. In the riding of Champlain and in the Mauricie region, history is closely related to the forest. I remember the fight that I personally led in the late seventies, as a member of the national assembly, regarding the closure of pulp and paper mills. At the time, Trois-Rivières was considered the world capital of pulp and paper. We held our ground and we modernized the plants, thanks to René Lévesque, who believed in the importance of unconditional government support.

Mr. Lévesque used to say that the broadest possible consensus was needed to protect such an important industry. When we ask the minister about this issue, I would appreciate it if we could get answers other than those that we were given yesterday, and I am not only referring to this specific issue.

Yesterday, when we put questions to one minister, another would reply. Then, when we would ask a question to the second minister, the first one would provide the answer. We were treated as if we had no right to speak in the House, as if democracy did not exist. Today's motion seeks to strengthen the minister's resolve.

We had a great poet, Félix Leclerc, who was born in La Tuque and spent his childhood there. Another great performer, Sol, our national hobo, did a show to pay tribute to Félix Leclerc, after he had passed away. Sol ended his show by saying “This great and extraordinary poet of ours finally made us realize one thing: to become a giant, one has to stand up”.

I am asking the minister to stand up and to protect our lumber industry with all his energy. This morning, we are giving him our support, so that the people in La Tuque, Saint-Tite, the Mauricie and all of Quebec will know that everything will be done to protect their jobs in the lumber industry, and that the Americans will realize that, as of April 1, it is free trade and nothing else.

[Philip Mayfield, Canadian Alliance, Cariboo—Chilcotin, BC]

Mr. Speaker, I would like to compliment my Bloc Quebecois colleague for his speech. It reminds me again that so many of the difficulties that Quebec experiences with the federal government are the same difficulties that we in British Columbia experience.

He spoke of 27 communities in his constituency, a majority of which depend upon the wood industry. I am not competing with him in any sense, but in my constituency which is more than 120,000 square kilometres in size with 36 communities, there is not one of us who does not depend upon the forest industry. This is an extremely important issue for us.

In our minds it is an issue of fair competition. We believe that we have taken up the challenge of competing fairly and now we are being castigated because we have outdone our competitors in the United States. We have the most efficient mills in the world not because they came cheaply or easily, but because of the kind of wood we have in the forests and because of the kind of difficulties with which we have to compete. This includes the kind of equipment that we have and the kind of personnel we have to recruit, train and employ. We are able to compete very well.

To say we are not competing fairly is more than wrong. It is a falsehood being promoted by people who would rather make profits by making false accusations than competing fairly. We have mountains called Pike's Peak. To bring in the lumber, truckers go up one mountain they call Heaven because it is so far away and so difficult to get to. Those are the kind of difficulties we have overcome.

We have come through a period of softwood quotas where some of the major companies have made it through fairly well but not easily. There is no room for expansion for those who would like to grow. We have had a very difficult time. Now we are coming to a period where we are talking about countervailing duties and anti-dumping penalties that will make it even more difficult for those who are already losing money. This is the difficulty we face. We need fair competition and free trade so that we can compete fairly.

In the presence of the foreign trade minister who is in the House today, what recommendations would my colleague make so our foreign trade people can take to Washington a consistent, clear and urgent message that free trade with Canada depends not only upon wood, but upon the whole spectrum of free trade?

[Marcel Gagnon, Bloc, Champlain, QC]

Mr. Speaker, I thank the hon. member for his question. When he talks about the competitiveness of the workers of his province, and the same goes for Quebec workers, he is right to say that some industries are able to face competition. In this sense, this is why free trade is beneficial for us.

As I said in my speech, one must have the energy, the willingness and the strength to succeed. To my knowledge this strength is also to be found in parliament.

Ministers who have such issues to contend with should submit them to us for discussion, to obtain the support of parliament and make use of its strength, so that they can meet with the Americans and tell them that we are almost unanimously in favour of free trade. There must be free trade because this has been negotiated. It has to happen now. No barrier is acceptable.

[Pierre Pettigrew, Liberal, Minister for International Trade]

Mr. Speaker, I will be sharing my time with the member for Vancouver Quadra whose contributions to this very difficult file have helped the government a lot. I thank him for his work on this file.

I am pleased to rise in the House today and to respond to the opposition day motion brought forward by the hon. member for Joliette. Since the beginning of the 37th parliament the member and his party have often brought up the issue of softwood lumber in the House of Commons.

I have already given an overview of Canada's position on lumber during oral question period in the House and from time to time to the media, but I am very glad to know that today all parliamentarians will have the opportunity to discuss one of the most important business issues for Canada, one that touches hundreds of communities across the country.

Canadian softwood lumber products are the largest group of products exported from Canada to the United States. In fact one out of every sixteen Canadians works in our forestry industry and is dependent, for his or her income, on the production and export of our forest products.

Across Canada, from British Columbia to Newfoundland, at least half of the economic well-being of over 330 communities is dependent on the forest products industry.

Canada's role in the production and export of lumber is unique. It represents 20% of lumber exports worldwide and 34% of lumber exports to the growing U.S. market. Our plants not only employ 64,000 Canadians. They also provide housing to millions of people on this continent and around the world.

In fact last year we exported $10 billion worth of lumber to the United States, which is no small feat.

The agreement has had its good sides for our industry, but after five years we have come to realize that it also had its weaknesses. The industry in Canada and the U.S. have now agreed not to renew the 1996 agreement.

It is time to move away from managed trade in this industry and to turn toward what should already have been in place for a long time: free trade in softwood lumber.

This is what Canadians want and deserve. Regrettably it is also what the United States softwood lumber industry fears the most. We have recently seen American legislators propose resolution after resolution calling for further restrictions on Canadian exports to the United States. I take this opportunity today, therefore, to put the issue into perspective by addressing what is really behind the U.S. industry's attack on our exports and the nature of the challenge we face.

The U.S. industry and some supporters in congress have long been mesmerized by their own rhetoric. U.S. claims of subsidization are in fact no more true today than they have ever been. Today I would like to focus on what are actually the five essential facts of Canadian softwood lumber trade with the United States. These hard facts, which we all need to keep clearly in sight, will form the foundation of the Canadian position on softwood lumber.

First, the U.S. industry's position on softwood lumber is not based on any legitimate claim of unfair practices by Canada. It is based on protectionism, pure and simple.

Second, Canada has a right under our trade agreements including a right of access to the United States softwood lumber market which the United States must recognize.

Third, Canadian forestry programs do not constitute subsidies to the Canadian industry.

Fourth, Canada is a leader in sustainable forest management practices.

Fifth, the role of the Government of Canada is to safeguard the Canadian interest in the face of U.S. protectionism and to work toward free trade in this vital sector.

Let me take each of these five points in turn. First, it is good old protectionism that has always driven the United States industry position on softwood lumber. We have heard U.S. claims that there will be a wall of wood coming from the north when the softwood lumber agreement expires.

Traditionally Canadian lumber shipments to the United States arrive in April as demand for wood increases due to spring housing starts. This is normal and is not a wall of wood from the north. In reality what we could face is a wave of protectionism from the south washing over us on April 2. This has been going on for nearly a century. United States softwood lumber producers have always wanted to restrict Canadian exports. They have always wanted protectionism from Canadian competition.

However there are now interests in the United States that have taken a position against another round of protectionist measures in this sector. American homebuilders and other consumers of softwood lumber are also calling for free trade, pointing to the adverse effects in the United States of reducing access to Canadian wood and the price.

U.S. homebuilders claim that protectionism costs United States consumers $1,000 for every home built in that country. This is a steep price to pay to protect the United States lumber industry. The fact is the United States needs and relies on our lumber. It is not self-sufficient. Second, et me talk about our rights.

A second essential point has to do with the protectionist threats currently being uttered by the U.S., which go directly against our trade agreements, those of NAFTA and the World Trade Organization.

The government has already taken steps. We have initiated two major dispute settlement proceedings at the WTO against the U.S., proceedings that directly affect lumber. What counts is that we are not prepared to allow the U.S. to concoct its own version of the rules established internationally or to choose which of their trade obligations they are prepared to honour.

The most central point in the softwood lumber issue is as follows. Throughout all our discussions about lumber, the U.S. has always alleged that the Canadian industry is subsidized. Nothing could be further from the truth. The Canadian industry is not subsidized by cutting rights or by any of our policies.

This is why despite several tries the Americans have never managed to get their subsidy allegations to stick. In fact, their subsidy allegations have never been proven. If they build another countervail case, we will defend ourselves against such allegations as we have in the past.

Fourth, let me address the question of forest management practises and the environment. Once again the facts speak for themselves. Canada, with 94% of forest land under public ownership, controls harvest levels so that forests are not depleted. Canada grows twice as much wood as is harvested annually. Less than one-half of 1% of Canada's commercial forests are harvested each year, well below sustainable harvest levels. Canada, with more commercial forest land, cuts less than half of what is harvested in the United States each year.

The simple truth is that Canadian harvests are limited by annual allowable cuts that are based on the sustainable growth rate of the forest. As recently as January, a joint survey conducted by the University of British Columbia and Yale University ranked Canada as one of the top three nations in environmental sustainability.

Fifth, the Government of Canada's role is to safeguard Canadian interest. During the past year I have consulted with Canadian industry from all regions of our country to hear its views on how to proceed next. I have asked Canadians at large through open dialogue their thoughts and ideas. I have brought our stakeholders together to listen to what they had to say about our trade with the United States.

Recently I met with representatives of all provincial and territorial governments in Ottawa to discuss their specific concerns and to determine together how we should proceed. In an effort to bring all views forward and to continue our dialogue with our neighbour to the south, I met with United States trade representative Bob Zoellick in Washington a little more than three weeks ago. At that time I presented Canada's case to the United States and proposed as a way to avoid our recent history of trade dispute on softwood lumber that both countries appoint envoys to provide governments with non-binding recommendations on solutions to this dispute.

We will continue to work with all the stakeholders in Canada and to ensure that the interests of all of Canada's regions from British Columbia through Quebec to the Atlantic provinces will be taken into account.

Furthermore, even though we are working toward finding solutions, we will also affirm our rights under our trade agreements. We are entitled to free trade. We want free trade.

In conclusion, I support a vigorous Canadian lumber sector, as do all members on both sides of the House. This is why I will support the motion by the member for Joliette. I encourage all members on both sides to do the same. We must send a clear signal to the US that our House of Commons is united in its support for the Canadian lumber sector and let it be known that we will defend our rights under the international agreements.

[Ghislain Lebel, Bloc, Chambly, QC]

Mr. Speaker, I have a question for the minister.

I would like him to explain how it can be that in the United States when there is a dispute, when an appeal is won, and I presume the decision must be executed as in a regular court, it does not work that way for the Americans. Even if they lose, they try a kind of blackmail on us and we end up forced to negotiate what is coming to us as a result of the decision by the trade tribunal. I am not laying any blame whatsoever on anyone.

I would just like him to explain how, even if we win out, they will not comply unconditionally but come after us with other agreements on milk, eggs, yoghurt, margarine or mayonnaise. Do the Americans only use free trade when it suits them? That is what I would like explained.