This week, I changed much of the tech behind this site. If you see anything that looks like a bug, please let me know!

House of Commons Hansard #52 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was chapter.

Topics

Questions On The Order PaperRoutine Proceedings

10:15 a.m.

Etobicoke North Ontario

Liberal

Roy Cullen LiberalParliamentary Secretary to Minister of Finance

It would be a breach of the confidentiality provisions of the Income Tax Act to reveal information about an individual taxpayer.

However, the Department of Finance has developed a model to calculate the value of the tax incentives available to all new oil sands projects in Canada. The model results are described in a working paper that will be released soon. A draft version of the report estimated that on average a new oil sands project in Canada will receive federal income tax incentives worth 4.6% of the total capital investment of the project.

Questions On The Order PaperRoutine Proceedings

10:15 a.m.

Liberal

Derek Lee Liberal Scarborough—Rouge River, ON

I ask, Madam Speaker, that the remaining questions be allowed to stand.

Questions On The Order PaperRoutine Proceedings

10:15 a.m.

The Acting Speaker (Ms. Bakopanos)

Is that agreed?

Questions On The Order PaperRoutine Proceedings

10:15 a.m.

Some hon. members

Agreed.

SupplyGovernment Orders

May 1st, 2001 / 10:15 a.m.

NDP

Alexa McDonough NDP Halifax, NS

moved:

That this House calls upon the government to respect the spirit of the evidence given by the Minister of International Trade before the Foreign Affairs Committee, who stated “I can assure you that we are not seeking an investor-state provision in the WTO or anywhere else”, by refusing to sign any trade agreement, such as the FTAA or the GATS, that includes a NAFTA Chapter 11-style investor-state clause.

Madam Speaker, let me indicate at the outset that I will be sharing my time with the member for Burnaby—Douglas.

Two images come to the mind of Canadians on the subject of Quebec City: the wall, this reinforced concrete fence all around the old capital to prevent people from getting in and another wall, a wall of tear gas, or 5,000 tear gas grenades thrown everywhere, blinding everyone, demonstrators and residents.

Who could imagine more potent symbols for the squalid secrecy that surrounded international trade talks than that ugly wall and that haze of gas?

While the Liberal government trumpets its success at advancing the corporate driven globalization agenda, millions of Canadian now get the picture: fortress walls and noxious gases for ordinary citizens, privileged access and security passes for the corporate elite, rights and rewards for the rich, rhetoric for the rest of us. For the Liberals apparently that is what democracy looks like.

Quebec was the high water mark for irony and for hypocrisy. The official line was that the FTAA was about spreading democracy, but the chain link fences, the tear gas, the water cannons, the plastic bullets and mass arrests that prevented citizens from getting anywhere near the summit made the case more effectively than anything else could that democracy is threatened by the corporate model of globalization.

Behind the wall around old Quebec the threat to democracy became more ominous as information leaked out that the NAFTA drafters had every intention of extending the most anti-democratic provision of NAFTA, chapter 11's investor state clause, to the rest of the Americas.

Last year Canadians dared to hope that their objections to corporate globalization were getting through to the government. The Minister for International Trade once called NAFTA “primarily an exercise in the economic disarmament of federal governments”.

At the international affairs committee in April, just a year ago, the minister declared his opposition to any form of investor state mechanism, such as the one enshrined in NAFTA being included in any future trade agreements. He assured parliament that his officials were working with Washington to have NAFTA chapter 11 reconsidered. “Take the good news and run with it”, he told the foreign affairs and international trade committee.

In December the trade minister reiterated his concerns. He stated starkly that he would not sign any deal that contained the offensive clauses, period.

Following the Quebec summit the Prime Minister was calling chapter 11 of NAFTA a good clause. “It is one that works reasonably well”, said the Prime Minister. His trade minister has been faithfully parroting the line ever since.

To concerned people throughout America, however, chapter 11 is not a good thing. It is the Trojan horse of so-called free trade in the style of big business. Chapter 11 is the clause that ends the debate over whether globalization threatens the sovereignty of countries.

Under NAFTA, chapter 11 established a new system which enables foreign investors to bring injury claims against democratically elected governments. It allows multinational corporations to usurp the sovereign powers of government and the democratic rights of citizens and communities. Foreign capital investing in Canada, Mexico and the U.S. may demand compensation if profit making potential of their ventures is injured by government decisions.

Foreign based companies are given rights greater than domestic businesses operating in their home country. Canada's baptism of fire began with the Ethyl Corporation's challenge to Canada's right to control the use of MMT in this country.

MMT is a gasoline additive, a neurotoxin which interferes with automobile exhaust systems banned in several U.S. states, but under NAFTA's investor state provisions Ethyl took the Canadian government to court and sued for lost profits. To avoid an arbitration panel the Canadian government settled out of court, withdrew its legislation and paid $19.6 million in damages to Ethyl. To satisfy Ethyl's commercial interests, Canadian parents today have less control over the quality of air their children breathe.

To date at least 15 chapter 11 suits have been launched. No one really knows for sure. Apparently it is not really the public's business. There is no requirement to inform the public, even though public laws are under attack and taxpayer money will pay the fines.

Unlike other trade agreements, chapter 11 gives global corporations freedom to litigate on their own without having to ask national governments to act on their behalf. With status to challenge other governments as legal equals, this clause allows NAFTA to end run governments and even constitutions.

Chapter 11 of NAFTA has become the defining issue for FTAA negotiations. In Mexico a U.S. waste disposal company, Metalclad, was awarded $16.7 million in damages when a state government took steps to protect its water supply. Metalclad's victory established that NAFTA's dispute mechanism reaches to subnational governments, including municipalities.

Then there is Sun Belt Water of California. Who knows what is next? Who would have guessed that UPS would launch a lawsuit to challenge the operation of Canada Post? Who would have believed that the Canadian government would have left us so vulnerable or that, even in the face of this challenge to Canada's right to deliver its own mail and the right to keep public services in the public domain, the Canadian government would decide chapter 11 is a good clause that is working reasonably well?

As chapter 11 damage awards accumulate, more and more Canadians are starting to press more serious questions about exactly what is at stake under the new world order. Who voted to destroy national sovereignty? Who gave corporations the right to decide public values?

Why elect governments that hand their powers over to big business?

In conclusion, I implore the government once again to find the courage to oppose chapter 11 and refuse to sign any international agreement that contains this pernicious provision. The very foundations of our democracy are at stake.

SupplyGovernment Orders

10:25 a.m.

NDP

Pat Martin NDP Winnipeg Centre, MB

Madam Speaker, I am very proud today that the leader of our party has chosen this topic to use for our opposition day. At least this party is standing up for the rights of Canadians as we seek to defend our interests in the face of these global trade agreements.

She made reference to some of the brokers that are negotiating these deals and their attitude about the preservation of public services. Would she comment on the opinions of one such key figure, the former head of the WTO, when he said that there was a surplus of democracy in the world today that was interfering with the free movement of investment and capital?

Would she comment on what kind of a mindset could lead someone to say that kind of thing in an era where we value democracy above all else? In an era where our parents went to war to fight for democracy there are actually people out there negotiating deals on our behalf who believe there is a surplus of democracy.

SupplyGovernment Orders

10:25 a.m.

NDP

Alexa McDonough NDP Halifax, NS

Madam Speaker, I think all Canadians and in fact many people around the world know that democracy was the galvanizing force behind some 50,000 to 60,000 Canadians and others throughout the Americas gathering in Quebec City.

We heard a lot of talk from the government in the run up to the FTAA negotiations at Quebec City about how this was to strengthen democracy, but before the Quebec City summit took place people had begun to familiarize themselves with what exactly the FTAA was, with how it fit into the new world order as visualized by the World Trade Organization, and with the fact that governments were willing to weaken democracy.

My colleague has raised a question about an astounding ominous quote from a former WTO official who said there was a surplus of democracy in the world and that democracy was interfering with the free flow of capital and investment.

When we ask Canadians what they care about, when we ask free people around the world what they care about, what they care about more than anything else is governments that can act in the public interest, governments that will respond to their needs and concerns about health care, basic public services, education and a safe, clean environment. The health of their children is the future of the planet.

Some 50,000 to 60,000 peaceful demonstrators in Quebec marched with the slogan “This is what democracy looks like”. People were speaking to and through their governments to insist that they retain the right to act in the public interest and not forfeit the right to do that to multinational corporations.

SupplyGovernment Orders

10:25 a.m.

Liberal

Pat O'Brien Liberal London—Fanshawe, ON

Madam Speaker, I heard the estimate of the number of people in attendance. It seems to grow every time I hear the number quoted by the NDP. The leader of the NDP said that there was nothing for peaceful demonstrators. I should like to ask her a couple of questions.

Is she unaware of government funding to help the parallel summit take place? Is she totally and completely unaware of the extensive consultations that took place for several months by the government or of the hearings that took place by the standing committee before the election and after?

She talks about ordinary citizens having tear gas. Are they the ordinary citizens who were throwing chunks of cement and cans, which I stepped over, at the police? Are they the same ordinary citizens that she is speaking about? Does she fail to acknowledge that there was a minority of irresponsible violent people there and the police showed tremendous restraint?

Quite frankly we have had a lot of rhetoric from the leader. I should just ask her another question, very pointedly. I challenge her to tell me one trade negotiation that Canada has ever been involved in that has been more open and transparent than this one.

Her trade critic and repeated witnesses have failed to ever answer that question. Maybe the leader could tell us just one trade negotiation that has been as transparent, let alone more transparent, than this one.

SupplyGovernment Orders

10:30 a.m.

NDP

Alexa McDonough NDP Halifax, NS

Madam Speaker, the member opposite asked a lot of questions. I doubt I will be given the opportunity to answer them all. However let me say this right up front.

Yes, I am absolutely aware. I will quote directly what the member when he said that there was a minority of violent protesters in Quebec City. Indeed there was. We have been absolutely unequivocal in saying that violence was not acceptable.

Let me ask the member this. Does he think it is responsible to keep painting a picture of some 50,000 to 60,000 peaceful protesters as being somehow in favour of the violence of that tiny minority?

It is grotesquely irresponsible for the government to keep characterizing democracy seeking Canadians in such a vile way.

Second, I am absolutely aware of the people—

SupplyGovernment Orders

10:30 a.m.

The Acting Speaker (Ms. Bakopanos)

I am sorry but the hon. member's time is up. I did allow some flexibility over the time limit. The hon. members have ample time during questions and comments to put the questions to the other hon. members. I would like some order please in the House.

SupplyGovernment Orders

10:30 a.m.

NDP

Svend Robinson NDP Burnaby—Douglas, BC

Madam Speaker, it is an honour to participate in this debate and to follow the leader of my party on this very fundamental question about democracy itself, about corporate power and the power of people in the country and in the Americas.

I will respond briefly, because unfortunately the time is limited, to the comments made by the Parliamentary Secretary to the Minister for International Trade when he trumpeted the great transparency and democracy surrounding the FTAA process.

Surely the hon. member recognizes that this is completely ludicrous. Instead what the government has clearly demonstrated is total contempt for democracy in this process. I can give many examples of that. The fact is that today on May 1 we still, as parliamentarians and as peoples of the Americas, are not entitled to view the text that is being negotiated.

The minister said we would see the text and that it was tough to translate. Frankly there is something absurd about a debate taking place on a document that still has not been made public. The government has refused to make public its own negotiating position on some very fundamental issues such as investment, intellectual property, services and dispute settlement.

Even worse we see a continual erosion of the minister's original position with respect to the most undemocratic provision of the existing NAFTA agreement, and that is the investor state provision in chapter 11. This is the thrust of our motion today because it illustrates so clearly and transparently how profoundly undemocratic the process is, as well as how undemocratic the substance is of the FTAA.

It was a little over a year ago, in response to my colleague from Winnipeg—Transcona in the Standing Committee on Foreign Affairs and International Trade, that the Minister for International Trade was clear and unequivocal. He said “I can assure you that we are not seeking an investor state provision in the WTO or anywhere else in other agreements”. My colleague pursued. He asked “Not at the FTAA?” The minister responded “No, no, no. Not on FTAA either”.

That was in April of last year. Seen since then we have seen backtracking, reversal and betrayal of the government's fundamental commitment that it would not allow this destructive and undemocratic provision to be a part of any broader trade deal throughout the hemisphere.

Just a little over a month ago, in response to my question in the same committee, the minister said:

—we would of course not sign another agreement that would have the kind of clauses that we are seeking to clarify right now...we will not go to the sort of thing that we are seeking to clarify in chapter 11...

Yet, in the wake of the summit of the Americas, the Prime Minister said to forget all that and that chapter 11 was working reasonably well. The minister himself said after the summit of the Americas that things were fine, that there was no problem and that everything was working just fine.

What is the position of the Government of Canada? According to the minister's spokesperson, its position on chapter 11, investment provisions, is set out in the government's website. If we go to the government's website, here is what it says:

To date, Canada has made no submissions to the Negotiating Group on Services. Any submission made by Canada will be made available on the website.

When we asked the minister's spokesperson what was Canada's position on this fundamental issue of investor state, the minister's chief assistant said “We have not made our position known yet because we do not have one”.

The government may shamefully not have a position on investor state on chapter 11, but more and more the people of this hemisphere do because they have witnessed already the destructive impact of chapter 11 on the environment and on the fundamental rights of workers.

It is no coincidence that today is May Day, a day when we pay tribute to and honour the contribution of working men and women throughout the hemisphere and throughout the world. It is just a couple of days after the Day of Mourning for workers who were killed and injured on the job. More and more we have witnessed under NAFTA, under this regulation of growing corporate power, deregulation and privatization, an erosion in the rights of workers.

I attended, along with my colleagues, the people's summit. One of the most powerful and moving forums was the forum of women. It talked about the impact of the existing trade deals on women. I will never forget hearing a speech by a Mexican woman who worked in the maquiladoras. She spoke of the dramatically increased level of violence directed against women and yes, also violence at the workplace. That is what is being entrenched in this new FTAA.

We still do not know if there was a leak on the proposed investment provisions in the FTAA with respect to chapter 11. However we already know all too clearly what this means for us under NAFTA. On a number of occasions my leader has referred to a study which was just published by Professor Howard Mann, a respected director of the International Institute for Sustainable Development, who documented clearly and eloquently the problems with chapter 11 of NAFTA.

The study points out that the current interpretations of NAFTA's chapter 11 can have a significant and determinative negative impact on government decision making in relation to public interest. In fact they already have. The list goes on too long. A small community in Mexico, Guadalcázar, was told that it had no right to protect its citizens from the impact of a toxic waste dump. The company, which wanted to exercise its corporate rights under NAFTA, was awarded some $20 million because the citizens of that community said no.

More and more we see that local governments in Canada are recognizing the potential impact of chapter 11. Cities like Vancouver, Halifax and others adopted unanimously a motion condemning the investor state provisions and called on the Government of Canada not to sign any trade deal that would prevent them from making these decisions. As New Democrats, we stand in solidarity with those citizens and with citizens throughout the hemisphere.

We saw the MMT case as well in which the Canadian government was forced to abjectly apologize to Ethyl Corporation for having made a decision to ban this destructive gasoline additive. Even the Liberal member of parliament for Lac-Saint-Louis said in the wake of that decision “I can't believe that a foreign corporation can almost dictate its terms and we as a sovereign nation are completely powerless to do anything about it”.

It is astounding that the onus is on us as a country to prove MMT is not harmful. We saw it with Metalclad and Ethyl Corporation MMT decisions. We are certainly witnessing it now with the challenge by UPS to the Canada Post Corporation. This is a shocking challenge to the power of government to ensure that the public sector can operate in an effective way on behalf of the citizens in that country.

I am very pleased to note that the Council of Canadians and the Canadian Union of Postal Workers have launched a constitutional challenge to these sweeping and unprecedented powers given to secret tribunals to take away the right of government to make decisions in the best interests of its citizens.

I know that my time is limited and I hope I will have an opportunity in the question and comment period to talk a little bit about some of our positive alternatives to these proposals because the Hemispheric Social Alliance and the people's summit of the Americas came out with a strong, positive and eloquent statement of alternatives.

The fundamental issue before the House is the issue of democracy as opposed to corporate power. I appeal to all members of the House to support the motion because it simply reaffirms the principles the government indicated it was committed to, which was that the investor state provision had no place in this agreement.

In closing, I move:

That the motion be amended by inserting after the words “Committee” the words on “April 5, 2000”.

SupplyGovernment Orders

10:40 a.m.

The Acting Speaker (Ms. Bakopanos)

The amendment is in order.

SupplyGovernment Orders

10:40 a.m.

Edmonton Southeast Alberta

Liberal

David Kilgour LiberalSecretary of State (Latin America and Africa)

Madam Speaker, the member who just spoke and I are both from the class of '79. There are only three of us left in the House, so we have to treat each other well.

Virtually all the nations of the Caribbean have asked for a free trade agreement with Canada, and we are negotiating one with them. All the nations of Central America have asked for a free trade agreement with Canada, and we are negotiating one with them. We signed one last week with Costa Rica.

One or two per cent of our trade is with countries outside of the United States and Mexico. Why is the New Democratic Party so excited about possibly having a free trade agreement of the Americas with these other countries, which are all virtually asking for this trade agreement?

Why does the New Democratic Party not talk about the plan of action which deals with all of the issues which I thought were important to it such as: transparency and good governance; electoral processes; fight against corruption; strengthening human rights; human rights of children and adolescents; freedom of opinion and expression; rule of law; the drug problem; preventing violence; communications; and education?

Why does it only want to talk about chapter 11? Could it be that the NDP knows that the people of Canada and the 800 million people who live in this hemisphere are also concerned about all these other things? Could it be that it does not want to talk about the fact that the World Bank and the Inter-American Development Bank are agreeing to finance this plan of action?

Could it be that members of the NDP have picked out one thing, chapter 11, that they think Canadians might support them on and have ignored all the other good things about the summit, which was probably the most important event ever to take place on Canadian soil?

SupplyGovernment Orders

10:45 a.m.

NDP

Svend Robinson NDP Burnaby—Douglas, BC

Madam Speaker, it could be but it clearly is not. The reality is that one of the reasons we are focusing on the investor state provision, which gives sweeping powers to corporations at the expense of elected governments and citizens, is the fact that there is no protection whatsoever.

The hon. member talked about a declaration that referred to human rights, sustainability and the environment. He referred in glowing terms to the provisions of the summit and a final agreement on workers' rights. If the government and the member are serious about the importance of respect for fundamental human rights, workers' rights, as set out in ILO conventions, and the environment, why is it that there are no tough, enforceable provisions on those particular sections in the trade deal that the government is pushing? Why only corporate rights? Why is that the Holy Grail?

If the government were serious about these things, it would recognize those provisions, as the peoples' summit recognized them in its closing statement.

We are not opposed to globalization that puts the environment and human needs front and centre. However, the corporate driven globalization which is exemplified and has as its heart the investor state provision, is what we reject. That is why we are focusing on it.

I will close by quoting from one of the largest industrial groups in the world. Percy Barnevick, the president of the ABB Industrial Group, said:

I would define globalization as the freedom for my group of companies to invest where it wants when it wants, to produce what it wants, to buy and sell where it wants, and support the fewest restrictions possible coming from labour laws and social conventions.

That is the corporate and Liberal model of globalization. That is the heart of an investor state and that is why the New Democrats say no to that model.

SupplyGovernment Orders

10:45 a.m.

NDP

Peter Stoffer NDP Sackville—Musquodoboit Valley—Eastern Shore, NS

Madam Speaker, the toxic Texan of the United States is talking about opening up energy expropriation at the expense of the environment. A great alternative was put forth by many people at the summit. Could the member for Burnaby—Douglas elaborate on the alternatives that were offered at the summit?

SupplyGovernment Orders

10:45 a.m.

NDP

Svend Robinson NDP Burnaby—Douglas, BC

Madam Speaker, there was a declaration at the peoples' summit that talked about another possibility. It set out a clear alternative that would focus on an assurance that human rights, the rights of the environment and the rights of indigenous peoples would be put front and centre, ahead of corporate rights. I would be pleased to share it with members of the House.

Business Of The HouseGovernment Orders

10:45 a.m.

Scarborough—Rouge River Ontario

Liberal

Derek Lee LiberalParliamentary Secretary to Leader of the Government in the House of Commons

Madam Speaker, I rise on a point of order. There have been consultations with respect to an order passed earlier today. I believe you would find unanimous consent for the following amendment. I move:

That the order with regard to Bill C-16, made earlier this day, be amended to read as follows:

That the motion to refer Bill C-16 to the Standing Committee on Justice and Human Rights be amended to refer the bill to the Standing Committee on Finance.

Business Of The HouseGovernment Orders

10:45 a.m.

The Acting Speaker (Ms. Bakopanos)

The House has heard the terms of the amendment. Is there unanimous consent?

Business Of The HouseGovernment Orders

10:45 a.m.

Some hon. members

Agreed.

(Amendment agreed to)

The House resumed consideration of the motion and of the amendment.

SupplyGovernment Orders

10:45 a.m.

London—Fanshawe Ontario

Liberal

Pat O'Brien LiberalParliamentary Secretary to Minister for International Trade

Madam Speaker, I am pleased to rise in the House today to debate the motion. I note that NDP members have taken some latitude in their comments. I would like to take the same latitude, address some of their comments and then debate more directly the motion that is before us today.

I challenge the leader of the NDP to give me one example of a more open and transparent trade negotiation than the one Canada has been involved in. She ducked the question.

The very same question was put to the trade critic for the NDP by the Minister for International Trade not long ago in committee. The member for Burnaby—Douglas also ducked the question. Members of the NDP are very good at ducking questions that they do not have answers for when they relate to trade or anything else.

The trade critic for the NDP who spoke before me made the point that we have not yet made our position known on investment because we do not have a position. The reality is that the Liberal Party and the government believe in consulting with Canadians on important issues before we announce our position. Unlike the NDP we are not tied to a rigid straitjacket of left wing ideology, which is the reason we see so few of them in the House of Commons following the last election.

I welcome during questions and comments somebody in the NDP telling us when there has been a more open and transparent trade negotiation. I rather doubt anyone could. The trade critic and the leader could not do it. I would like their whole caucus to reflect on it. Maybe those members could come up with something other than utter silence.

I would now like to speak about a subject which is often overlooked in the debate that refers directly to the motion. It is the vital role investment plays in the Canadian economy. There is no doubt that foreign direct investment in Canada and Canadian direct investment abroad have joined international trade in goods and services to become our principal engines of growth and job creation.

Foreign direct investment helps ensure that Canadian firms have the capital they need to succeed and grow in the highly competitive global economy. We know that investment creates jobs, spurs innovation and provides Canadians with access to the capital and expertise that make our country stronger. Canadian direct investment abroad is equally important. It helps Canadian firms establish a presence in key foreign markets, to share Canadian expertise and values, and to export goods and services to key markets.

I should like to share some recent statistics that help to paint a clear picture of the situation. In 2000 the stock of foreign direct investment in Canada reached a record $291 billion. At the same time Canadian direct investment abroad increased to an all time high of $301 billion in 2000 and exceeded foreign direct investment in Canada for the fifth year in a row.

Traditionally Canada has been viewed as a net recipient of foreign direct investment. Many people do not realize that Canada is a strong and vital net exporter of foreign direct investment.

Foreign investment in Canada has over the years been an important source for jobs, especially high skilled and high value added jobs. Foreign investment in Canada has brought with it advantages in research and development, technology and talented people, which have all made real and lasting contributions to our economic and social well-being.

An economic forecast prepared by Industry Canada and the Department of Foreign Affairs and International Trade estimates that each $1 billion increase in new inward investment to Canada could generated up to 45,000 jobs and $4.5 billion in GDP over a five year period. The study also postulates that one job in ten and approximately 50% of Canada's total exports are derived from foreign direct investment.

It should be noted further that a large proportion of profits from new investments is reinvested in Canada, contributing to a higher growth rate and a rise in Canadian living standards.

Canada has an affluent domestic market, a highly skilled and well educated labour force, efficient transportation systems and a telecommunications infrastructure which is the envy of the world. The Canadian private sector is competitive and knowledge intensive, whether in telecommunications, biotechnology or computer software. In encryption capabilities, medical devices, pharmaceuticals and ocean technologies Canadian firms lead the way.

Our excellent health care and education systems are cornerstones to our high quality of life. Canada remains an attractive location for foreign investment.

These Canadian advantages have not been gained by compromising our overriding economic and social values. Foreign investors in Canada are subject to the same laws and regulations as our Canadian investors, including those aimed at protecting the environment and those ensuring the highest labour, health, building and safety standards. We should not forget that creating prosperity and wealth in Canada is a necessary first step.

We have progressive social policies to utilize that wealth to create a healthy and educated society. This is an element that the NDP leaves out. It wants to redistribute wealth but does not want to focus on wealth creation as a precondition. Hence the ideological straitjacket that I mentioned at the start of my remarks which is shared by few Canadians.

Investment is not a one way street. One of the most significant features of Canada's recent economic history has been the rapid growth of Canadian investment abroad. The value of this investment has increased by fivefold between 1985 and 2000 from $57.2 billion to $301 billion. In 2000 and for the fifth consecutive year direct investment abroad by Canadians overtook foreign investment in Canada. That is an outstanding performance.

Direct investment abroad by Canadian industry is part of its strategic effort to increase market share and stay competitive in foreign markets. Firms are increasingly using outward investment to strengthen their operations, penetrate new markets and acquire new technologies, resources and skills. Evidence suggests that this type of investment does not precipitate an export of jobs but rather results in increased sales and production from home facilities.

A recent study by the OECD found that on average every $1 of investment is followed by $2 of exports. It all adds up to jobs and opportunities for Canadians. The growth of Canadian foreign direct investment abroad has led to an increase in exports. This has directly affected Canada's economic health.

These investments create opportunities for Canadians by giving Canadian firms new markets to extend their businesses through exports and through local sales. Canadian direct investment abroad often secures new customers and creates sales in new markets. In addition, it provides much needed capital infusion in growing economies.

When Canadians invest abroad we also bring our values together with the products we export. Additional research has shown that the growth of productivity and profits of Canadian firms involved in global markets has been superior to the performance of domestically oriented firms. We have also seen that income from Canada's outward foreign direct investments increase during recent years helping to improve our standard of living.

The motion is not founded on fact. The Minister for International Trade has been repeatedly very clear in the House of Commons, in committee and in the media that the Government of Canada does not seek to scrap or reopen chapter 11 of NAFTA but seeks to clarify it.

It seeks to have adjudicating bodies more accurately respect the intentions of the NAFTA partners when they signed this clause. Points of clarification are very important. The minister has made that clear. However he has repeatedly said that there is no need or interest in scrapping or reopening such a clause because there has to be balance and sensible protection for investment in Canada and for Canadian investment abroad.

The motion is devious in that it seeks to contrast the NDP's interpretation of what the minister said with what the Prime Minister said. That will not hold water or bear scrutiny.

The reality is that chapter 11 of NAFTA is working reasonably well when put in the context of the enormous volume of trade that we do with our NAFTA partners, especially the United States with whom we have a two way trade daily of $1.3 billion.

In that context the clause is working relatively well. However we would like to see further clarification and tightening up of the clause in how it has been interpreted by adjudicating panels.

It is interesting to listen to the rhetoric of NDP members. They love to use the word rhetoric but do not like it applied to themselves. I eagerly await an answer to the question they have continually ducked about a more transparent trade negotiation.

It was fascinating to sit in the House a few short weeks ago and watch NDP members grind their teeth as the labour prime minister of the United Kingdom, Tony Blair, said very bluntly that no matter how well intentioned critics of freer trade may be they cannot be allowed to stand in the way of logic. He said the best thing we could do for our own nations and for poorer nations was to globalize and liberalize trade.

NDP members dismiss Tony Blair as a labour leader who is out of touch.

SupplyGovernment Orders

11 a.m.

An hon. member

A neo-Liberal.

SupplyGovernment Orders

11 a.m.

Liberal

Pat O'Brien Liberal London—Fanshawe, ON

Yes, a neo-Liberal labour leader who is out of touch. I wonder which labour party is out of touch. It might just be the NDP, and that might be reflected in the size of its caucus and the incredible soul searching it is very rightly going through.

The NDP dismissed Tony Blair very blithely. However we can refer to statements like those of UN Secretary-General Kofi Annan who said the best thing we could do for less developed and poorer nations was to globalize and liberalize trade. He even quantified that. He said liberalized trade would result in a direct infusion of capital to poorer nations of somewhere between $100 billion to $150 billion. That is much more than the combined foreign aid or overseas development assistance given by all the nations of the world.

When I raised the issue with a labour leader in my city of London, Ontario, I got a pathetic response. I was told Kofi Annan was a handpicked puppet of the Americans. What ideological garbage coming from the NDP and its spokespeople across the country. They are so ideologically tied down to their own little interpretation of reality that they dismiss one of the best prime ministers the U.K. has had in recent times and an outstanding leader of the United Nations because they do not agree with NDP ideology.

The leader of the NDP spoke about public opinion. I do not know what public opinion poll she has been reading but I do know one thing. The reality, and I mean reality and not the NDP version of it, is that a cross section of public opinion polls shows that Canadians overwhelmingly endorse the pursuit of globalized trade.

Between two-thirds and 70% of Canadians have repeatedly expressed support for it. One labour council poll came up with different numbers. We were not surprised at that. However a cross section of the polls shows that Canadians overwhelmingly support the globalization of trade. They understand its value and know that it has created 2.1 million new jobs in Canada since 1993. Close to 90% of those jobs are directly related to our exports of goods and services.

I do not know where these interpretations of public opinion come from, but they certainly do not reflect the public opinion I read and hear about all the time in my city of London, Ontario, and in my riding of London—Fanshawe.

Canadian investors benefit from a rules based system at the World Trade Organization, regional arrangements such as the NAFTA, and bilateral agreements such as the Canada-Israel and Canada-Chile free trade agreements to which my colleague, the secretary of state, referred earlier.

Investment rules provide for transparent, predictable and fair rules for Canadian investors, large and small. The NAFTA investment rules play an important role in protecting and facilitating foreign investment activities of Canadian firms in the United States and Mexico. Trade and investment rules give a relatively small economy like ours more leverage against the political pressure sometimes exerted by larger economies.

If there is a trading nation in the world that needs these rules it is Canada. Only the NDP fails to understand that. Its members do not understand that Canadian jobs are dependent on freer trade. They champion themselves as spokespeople for the labour movement, but they are now questioning that and rightly so. The labour movement does not reciprocate when it goes to the polls, and with very good reason. It knows who is in touch with reality and who is not.

Investment rules also attract foreign investment into Canada because they strengthen Canada's reputation as a secure base for establishing global enterprises.

We come to the matter of disputes. There have always been disputes between governments and companies and there always will be. NAFTA did not create such disputes. Chapter 11 did not create such disputes. Companies have always been unhappy with governments for various things and have taken a variety of actions.

Disputes stand out for the simple reason that they are rare, although some are admittedly dramatic. In the context of our full trading relationship we have not had many trade disputes, and Canada has done very well in some of them.

Disputes affect a small portion of the billions of dollars in investment that Canada attracts, with over $93 billion last year alone. Disputes affect a very small portion of the billions that Canadian firms invest abroad, with some $62 billion in 2000. Moreover we have means to address such disputes.

It boggles my mind that people suggest we do not need to protect either investment in Canada or Canadian investment overseas. It is incredible. I do not know if the motion is serious. It is not accurately worded. It does not reflect the repeated statements of the Minister for International Trade that we must clarify, not scrap or reopen, chapter 11 of NAFTA. He has said that repeatedly and it has been published in Hansard on many occasions. In answering questions in the House in the minister's absence I have made the same point because it is consistent with what he has said.

In conclusion, foreign direct investment in Canada and Canadian investment abroad are both vital to Canada's growth and prosperity. Investment brings knowledge, technology and new opportunities for Canadians. It enriches the range of possibilities to which Canadians can aspire while helping build the knowledge economy and prepare Canada to compete confidently on the global stage.

For these reasons the government believes policies which protect Canadian investment abroad and promote Canada as a location of choice for investment are critical to our economic and social well-being. We will therefore not support measures that limit the government's ability to protect Canadian investments abroad. We will not support measures that blatantly threaten jobs, jobs which are badly needed and which have been created in significant numbers since 1993 because of our success in trade.

Earlier today I had the honour to table the latest story on overseas trade for Canada in the year 2000. It was a tremendous success story and it was an honour to table it. Most Canadians and all political parties in the House seem to understand that, with the sole exception of the NDP. That is its problem.

SupplyGovernment Orders

11:05 a.m.

NDP

Dick Proctor NDP Palliser, SK

Madam Speaker, I listened with interest to the remarks of the parliamentary secretary. Implicit in his remarks was the assumption that we are a small political party representing a few people on the outside of the fence looking in.

However one of the most unreported stories of Quebec City last week was that the mikes were left on inside the room when the 34 heads of state thought they were in closed session.

It is not nearly as much beer and skittles as the member for London—Fanshawe would have us believe. Speakers such as the presidents of Paraguay, Guatemala, and Venezuela all spoke about concerns they have as small, poor countries in Latin America and the Caribbean that are trying to compete with the giant to the south of us and to the north of them.

A great deal has been said today, both by the member who just spoke and the hon. member from Edmonton, on the matter of democracy. Venezuelan president Hugo Chavez, in the closed door meeting where the microphone was inadvertently left on, said that if people were denied land and power was concentrated in the hands of two per cent of the population, one could not speak of democracy. Would the member for London—Fanshawe care to comment?

SupplyGovernment Orders

11:10 a.m.

Liberal

Pat O'Brien Liberal London—Fanshawe, ON

Madam Speaker, the reality is that the leaders of the Americas overwhelmingly support the FTAA, as my colleague the secretary of state noted earlier. Why? It is because they understand the truth of the comments of Kofi Annan. They understand that globalized and liberalized trade is the best thing that could happen for their countries, their economies and their people.