Debates of May 1st, 2001

Supply

[Pat O'Brien, Liberal, Parliamentary Secretary to Minister for International Trade]

Mr. Speaker, I thank my colleague for his kind remarks to me and to the minister. As he knows I certainly will share those comments with the minister. I think a lot of good and important work was done in achieving a democracy clause at Quebec City. I am pleased to see he is very supportive of that.

The member talks about, and rightly so, the Liberal Party changing its view after the 1988 election won by his party. We certainly did change our view as a party. The facts speak for themselves in terms of the enormous benefits of free trade. There is no denying it, other than it seems the NDP is determined to deny those facts. The reality is the facts speak for themselves on just how positive it has been for Canada.

As a student and teacher of history I want to help the member out a little on the respective positions of our two parties. He will recall that Sir John A. Macdonald was the champion of protectionism. At that time the continentalist party was traditionally the Liberal Party. It was only in the latter part of the 20th century with the Mulroney government that the Conservatives started to move more toward a free trade party.

With all due respect to my colleague, a reading of Canadian history will show the traditional economic position of our two parties. The Liberal Party has been far more the continentalist party traditionally while his party, starting with our first prime minister, was a party of national policy built on protectionism. High tariffs was one of the fundamental tenets of that protectionist national policy. That sets the record straight for the many viewers out there.

I will ask my colleague a question on investment. We very much intend to table our position on investment, but it simply is not ready for that now. Does the member not agree that it is important we consult widely with Canadians?

I spoke about this point recently with the chamber of commerce in my riding of London—Fanshawe. Those business people and other Canadians very much want to be consulted on what our policy would be. Those consultations are under way now. Does the member not think it is important to finish that consultation extensively rather than rush into the House and into a premature release of our position on investment?

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

Mr. Speaker, the hon. member suggested in his opening remarks that I might recall Sir John A. Macdonald was a protectionist. Maybe he was there, but I was not at the time so I do not recall his position on that and I do not recall the debate.

The question was whether I think the government should consult. I do think it should consult, but the key word is I think it should listen as well as consult. It should ensure that the views of all Canadians are brought together and included in the chapter 11 clause. Then I think the government has to be very firm and vigilant to ensure that the clause is changed.

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, I have a question for my friend in the Progressive Conservative Party. Several times he made reference in his address to the House that chapter 11 of NAFTA is wanting in a number of respects and needs tinkering or altering in some form.

Could he share with us what ways he sees that chapter 11, while maintaining it, could be improved to avoid the abuses that have occurred under it?

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

Mr. Speaker, the whole point is that chapter 11 is wanting. When something new is done or a new position or new policy is developed, often there will be unforeseen interpretations. That is what happened in this case.

Chapter 11 has to be more than just tinkered with. It needs substantial changes to protect the Canadian government against actions from business with respect to health concerns and environmental issues. Although I still believe we need an investor clause included in our rules based trade agreements, there should be a rules based clause for investors in the same way there are other clauses.

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, I am glad to be participating today and I will be sharing my time with my colleague from Windsor—St. Clair.

I will begin by reading the opposition motion:

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.

I was very proud of the federal New Democratic Party for being in Quebec City at the peoples summit, particularly our opposition to chapter 11 of NAFTA and our concern that chapter 11 would essentially find its way into the free trade area of the Americas. Our underlying concern is the loss of democratic leverage in favour of a purely commercial agenda.

We allege the free trade agreement, NAFTA, and now the FTAA have been written by and for multinational corporations and not for people. The FTAA has been referred to by doubters as NAFTA on steroids. A Saskatchewan farmer some 80 years old refers to the FTAA as standing for fleeced and trampled all over again.

We heard most recently from the Conservative member who preceded me about our concerns with Metalclad v Mexico. It had tried to ban a toxic waste dump site but under chapter 11 Metalclad won. The parliamentary secretary challenges us to talk about democracy and point to any other trade agreement that is more democratic. With the investor state provision decisions are made behind closed doors by a tribunal. No arguments come outside those doors. I cannot think of anything less democratic than chapter 11 of the North American Free Trade Agreement.

There are other examples. The member for Cumberland—Colchester talked about UPS suing Canada Post because Canada Post owns 96% of Purolator. United Parcel Service is arguing that is an unfair trade advantage and is seeking many hundreds of millions of dollars in retribution from Canada Post. We have many concerns with chapter 11 of NAFTA being extended into the free trade area of the Americas.

Chapter 11 allows investors rights to challenge environmental laws and regulations, as in the Metalclad case, before international tribunals and to sue governments for compensation for profits lost due to government action to protect the environment.

Another example which springs to mind is Ethyl Corporation and the MMT decision that affected Canada. We paid out more than $10 million in damages to Ethyl. Never mind pristine water or a green environment, in our view this is mostly about greenbacks, especially American greenbacks.

It was examples like Metalclad, UPS and Ethyl that have caused us concern with chapter 11. As was stated earlier, we got a commitment from the Minister for International Trade that there would be no chapter 11 in the free trade area of the Americas. That was before Quebec City. The Prime Minister had lunch with Vicente Fox and George W. Bush and now says that chapter 11 is not so bad, and away we go. We appear to be not only stuck with it in terms of NAFTA, but I believe we will find at the end of the day that it is embedded in the free trade area of the Americas.

As Dalton Camp noted in a recent column in The Hill Times , chapter 11 was never designed for people. It was designed for corporate folk who own the media, some politicians and a few economists. Tens of thousands of protesters who were in Quebec City certainly know that chapter 11 was not designed for them.

Our critics and the Minister for International Trade say that anybody who is opposed to it is living in the last century. As I indicated earlier, one of the most underreported stories from the behind closed doors heads of state meeting in Quebec City was when an audio feed was inadvertently left on for part of what was supposed to have been a closed session. There were several leaders from smaller, poorer countries who spoke in that closed session and challenged the idea that unbridled capitalism was the best way to nurture democracy.

Just listen to the words of Alfonso Portillo, the president of Guatemala, who said in that closed meeting: The small economies are not the same as the big economies. Just to become the equals of big brothers, we will need to be treated accordingly.

The democracy clause was a big deal, probably the big deal, of the summit leaders. It was certainly flaunted by the Prime Minister. Hugo Chavez, president of Venezuela, said behind those closed doors that if democracy did not provide land, if it was concentrated in the hands of 2% of the population, they could not speak of democracy.

How can it be democratic when ordinary people in the streets are out there protesting, the vast majority of them very peacefully, but the corporations are buying their way inside the summit gates to curry favour with heads of state by paying a mere $500,000 or so?

Some of those elected leaders were saying what people outside were saying, that is, more than half of the population of the Americas, of which there are 800 million, live in poverty, and it is our contention that the free trade agreements have tended to widen, not narrow, the inequalities.

In fact, I just saw some documentation this morning. The essence of it was that over five years after NAFTA in Mexico the average wage has fallen some 20 cents or 30 cents an hour. Believe me, having lived in Mexico, I know what the hourly wages are in that country.

We do have a great deal of concern with regard to chapter 11. The New Democratic Party wants fair trade. We in the NDP say that there is a world of difference between fair trade and free trade. We want rules that reflect the common concerns for the welfare of all and the sustainability of our environment. It is our belief that when more people become more hungry or more impoverished, we are indeed all impoverished.

I also want to absolve the people who were arrested in Quebec City. There is the idea that those arrested were all the bad actors. We acknowledge, as I said earlier, that there were a few, but certainly not all who were arrested. Many innocent people were picked up, arrested and detained. I encourage people to look at the comments of Daniel Turp, a former esteemed member of the House in the last parliament, who was there watching over human and civil rights. He was quoted by the public press.

Let me just attempt to close by identifying with a statement by Paul Wellstone, the senator from Minnesota, that is, we are not against global trade but we are against greedy corporations that dominate that global trade. That is the essence of our concern with chapter 11 of NAFTA.

[Pat O'Brien, Liberal, Parliamentary Secretary to Minister for International Trade]

Mr. Speaker, first of all I would like to address the member's comments about the police. I had the privilege of being in Quebec City and of meeting some of the delegations from the other countries as well as talking to some of the peaceful protesters, which I agree made up the vast majority of people. However, my view of it is that the police showed tremendous restraint in the face of incredible provocation and violence by a small but determined minority. That seems to be the view of most objective observers of that particular weekend.

I would like to ask the member two specific questions about investment. We know that teachers' pension funds, labour pension funds and nurses' funds are some of the very largest funds in Canada. In fact, in my former life I was a teacher in Ontario, and the Ontario teachers' pension fund is one of the very largest in North America. As well, 50% of Canadians own mutual funds as a portion of their retirement savings.

Would the member share with us his view and the view of his party? Should we or should we not have rules to protect Canadian investments abroad? Would the NDP as a party be willing to rescind the rules that protect the savings of those Canadians such as those I just mentioned whose lifetime savings are tied up in these funds?

[Dick Proctor, NDP, Palliser, SK]

Yes, Mr. Speaker, we should have rules, but I would echo the comments made by the member for Cumberland—Colchester who indicated that some of the decisions or challenges made to the way we have chosen to do business in Canada were not foreseen at the time chapter 11 was put into place and they need to be changed dramatically.

The point of the member's question goes to the heart of the debate. Is maximizing profits what it is all about? Is it all about maximizing the return on the pension funds for the teachers or the profits of Metalclad Corporation or UPS? Is that the kind of world we want to build? The New Democratic Party thinks not.

[Pat O'Brien, Liberal, London—Fanshawe, ON]

Mr. Speaker, I guess we are making a little progress. We found out that the NDP does believe in rules for investment. Of course the member, in answering the question, went on to Metalclad and so on. That was not the point of my question at all.

I was speaking not about maximizing profits but about protecting the life savings of people through a proper series of investment rules that are very important here in Canada and abroad.

The hon. member asked earlier how we can call the summit democratic. Very simply, we had 34 democratically elected leaders who were there of their own volition to participate in it. We had a parallel summit of citizens funded in large part by the federal government. There were extensive consultations and hearings at the standing committee and by the minister. There were a number of opportunities for Canadians to be involved.

My question for the hon. member is simply this. How can he and his party ignore comments like those of UN secretary general Kofi Annan who has said that the best thing we can do, including the NDP, for the very people we all seek to help, the less fortunate peoples, is to globalize and liberalize trade. How can NDP members ignore the comments of such an outstanding world leader?

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, on the democratic front, one of the most untransparent things that has happened in parliament was the breathtaking news that the Minister for International Trade said he had great results and would make all of the position papers available. Then there was a pause and he said that of course he would not be able to do that before the Quebec summit because the translation was not complete, but he would be doing it eventually. Such hypocrisy.

In terms of trade, we continue to say that we believe in fair trade. To listen to the member for London—Fanshawe, one would think that there had been no trade prior to the North American Free Trade Agreement or the free trade agreement. Somehow we have been developing trade throughout the world for many hundreds of years. Some rules have been better than other rules, but the notion that suddenly we live in a global economy and we have trade is a very thin reed on which to base an argument.

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, I want to start my comments today by welcoming this opportunity. It is a continuation of the speech I was giving yesterday on the water bill and the exposure that these types of trade agreements have meant to Canada.

The first comment I want to make is with regard to the report published in the last year and a half on the negotiations that went on around the MAI. The report I want to make specific reference to, because it seems to be very appropriate given the motion before the House today, was prepared by Madam Catherine Lalumière, who is a European member of parliament.

In her report she goes through some analysis of what happened leading up to the dismantling of the negotiations on the MAI. She credits a number of the non-governmental organizations that raised opposition to it. Of course as we all know that ultimately culminated in France withdrawing from those negotiations and the negotiations collapsing.

She has prepared a report out of that and has made a number of recommendations that I believe are very appropriate and timely for the discussion today. One of those is a blanket recommendation that says there should be no investor state claims. She analyzed what happened with NAFTA, looked at the cases that have been repeatedly mentioned today and said no to investor state claims.

The report goes on to say there should be no general treatment clause given to foreign companies so that they have an integral and constant protection. There is to be none of that. It says to impose limits on expropriation claims—so those are some of the rules the parliamentary secretary seems to be referring to—in order to prevent their use against all regulation or public legislation that reduces the economic value of economic foreign investment. The report says that effectively that is what NAFTA did. The report recommends just the opposite.

There are many more than the four recommendations I will mention, but one final one is a recommendation for continued governmental rights to establish performance requirements. By that they mean public benefits from foreign investment.

Because of my own ethnic heritage I want to talk about the European Union model and its impact on the state of Ireland. Again, that model is fundamentally and philosophically different from the free trade agreement, from NAFTA and from the FTAA, should we ever, God forbid, get to that.

I was in Ireland in the mid-nineties just as the effect of the capital transferred from the European Union was beginning to allow the economy in that country to develop. I watched as it progressed over the last half dozen years to where it has become a much more vibrant economy. However, that is an entirely different model. It allowed that country to move forward. It allowed it to in effect move from somewhere back in the twenties or thirties as far as the development of their economy was concerned into this millennium in a very short period of time. If we had applied the NAFTA rules there, none of that would have happened in Ireland, nor would it have happened in Portugal, which has had a very similar experience.

As my colleague has already mentioned, there was perhaps from the perspective of the government the unfortunate experience of someone leaving a button turned on. The international trade minister was quoted, as we have heard in some of the comments from our colleagues in the Alliance, as to how the trade agreements are the miracle solution to poverty. The trade minister was quoted as saying “It is not the market or trade per se that can eliminate inequality”.

Even the international trade minister recognizes that these treaties and agreements are not the be-all and the end-all. Again as my friend has already indicated, all we have to do is look at the Mexican experience. He was struggling at one point for the dollar figure. Let me quote it because I do have it available. Remember that NAFTA came into effect in 1993. Between 1994 and 1999 wages dropped in Mexico. The average hourly wage dropped from $2.10 an hour to $1.90 an hour. That was the experience Mexico had.

There are a number of other indicators, the maquiladoras probably being the best example, of the type of consequences of those agreements where there are no protections for labour standards, human rights or the environment, all of which are protected and guaranteed in the European Union model.

I will spend a moment on the Auto Pact. I have long time personal experience with that particular trade agreement which was done away with as a result of one of those rulings by those faceless bureaucrats who make these decisions.

If we look at that as a model, we are constantly being accused as a party and as a movement of opposing trade. Nothing is further from the truth. That agreement had the support of our party since its inception. What did it do? It allowed cities such as Windsor, London, Oshawa and a number of others to develop very vibrant economies and well-paying jobs for the labourers who worked in those plants. We did not have that as a result of the FTA or NAFTA. That was all there before.

We also constantly hear the government talk about the $1.2 billion a day of trade that goes on. A great deal of that preceded the FTA and NAFTA and was related to managed trade in the form of the Auto Pact.

I will move to some comments that have come out in the last couple of days and which cause us great concern around the issue of the use of chapter 11.

Specifically, in the Edmonton Journal this morning Mr. Bill Turner, a businessman and interestingly the natural resource advisor to the governor of New Mexico, said:

Canadians will some day consider water a prized commodity rather than a natural, protected resource. And all it will take, all it will take is court action to loosen Canada's grip on its envied supply.

If we read between the lines, he is talking about a chapter 11 application.

We will see that come unless we do something as a government and as a society to stop that. However that is what we will be faced with unless we do away with the chapter 11 type of protection for multinational corporations in the private sector.

It is very clear that the motion before the House is not a motion that opposes the liberalization of trade. It is about a policy that will require this government and future governments to protect Canadians' rights to have an economy that is not based just on profit for multinational corporations, but a society that will allow people to develop their environmental concerns, their labour standards and their human rights in a safe and protected manner.

[Stephen Owen, Liberal, Vancouver Quadra, BC]

Mr. Speaker, I would be interested in knowing the hon. member's views on articles 14 and 15 of the North American agreement on environmental co-operation which provides the ability for organizations of civil society and NGOs to challenge the states in the North American Free Trade Agreement for failing to effectively enforce their environmental standards.

Is the hon. member aware of that opportunity and does he agree that in that situation it is appropriate for non-state actors to challenge states and foreign countries?

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, I am aware of the provisions in the side agreements for both the environment and labour standards. Let me make comments on both.

With regard to the environmental standards, it is obvious, given the full eight years that NAFTA has been in place now, that they are grossly ineffective, particularly because there are no resources of a meaningful nature for an NGO or a private citizen to take that on. It is just not possible. It is not a practical way of dealing with it.

It is obvious, from the results on the labour standards side, especially the Mexican experience, that even when large unions have attempted to use those side deals nothing has happened. In that case their government would not enforce the number of rulings that came down. They have been few and far between because they do not have the resources to effectively push the rights forward.

[Pat O'Brien, Liberal, Parliamentary Secretary to Minister for International Trade]

Mr. Speaker, first, I listened carefully to my colleague's comments. He noted that much of the trade that exists between Canada and the United States, and our number is $1.3 billion two-way trade a day across the border, existed before the FTA.

I remind my colleague that over the past 10 years export sales in goods and services, as a percentage of our GDP, has gone from 25% to 45%. That is a tremendous growth. There is no other way to put it than much of that is attributable to the FTA and to NAFTA. Some 90% of the 2.1 million jobs created in this country since we came to power in 1993 were directly related to our exports in goods and services.

The hon. member raised the subject of Ireland, which is pretty close to my heart, its subsidies and the good work they have done. I saw them firsthand and there is no question that is true. Canada has been a player in that, contributing significant money through the international fund of Ireland.

However does the member not understand that we cannot fairly compare and draw an analogy between the FTAA, which is in its infancy and really has not even been struck yet as we are only talking about it, and the EU which has been 40 years in its evolutionary stage.

Canada has a fund for development in the Americas that has been recently created by the Minister for International Cooperation. Is the member not aware of that fund? Is the member not aware of the concerns raised by President Fox and other leaders, and the steps that were taken in Quebec to create a fund for development in the Americas, exactly the same kind of ideas that he spoke about vis-à-vis Ireland? They have to have time to mature.

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, I am aware of absolutely everything that the member for London—Fanshawe raised.

Let us talk about that fund for a minute. Ireland was provided with approximately $8 billion from the European Union for a population that I believe at that point was about 2.5 million people.

There is a proposal I believe to top up the fund, which my colleague from the government side talked about, to $25 billion for what would be 500 million people?

[Pat O'Brien, Liberal, London—Fanshawe, ON]

It is just starting.

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, that is the point. It is just starting. Why is that? Why did we follow this model? Why did we not follow the European model? That is what this government needs to answer.

[Stephen Owen, Liberal, Vancouver Quadra, BC]

Mr. Speaker, I will be splitting my time.

I will address the issue of the value of foreign investment for Canada.

First, we know that there is almost $300 billion of foreign investment directly into Canada each year. This is immensely important.

When companies from other countries invest in our country, they bring ideas as well as support jobs. One in ten jobs in Canada is supported by that nearly $300 billion investment per year. They also bring ideas and technology to our country. Also, in an increasingly cyclical way, they support 50% of our exports by investing in this country. Investment into Canada is immensely important for jobs, the GNP and bringing in ideas and technology.

Investment outside of Canada by Canadians is even larger. It is more than $300 billion a year. This provides great opportunities for us to deal with other countries but it must be protected. Canadian companies and individuals investing abroad deserve protection. However investors in Canada also need the protection of rules.

Trade and investment inside and outside of Canada is immensely important to our country. We also have important domestic responsibilities. Those are to protect very strategic parts of our public services and our governance models. Our health care, education, social services and water absolutely need to be protected.

Canada has not put out its negotiating position yet in terms of the investment provisions in the FTAA because they are being developed. There is a great deal of consultation going on and more will continue. Those will be made public when they have been properly consulted on and prepared. The government has consistently said that it will protect and will not sign any agreement that does not protect those important strategic policy issues in Canada.

However our interests are not just domestic. Our interests and our social responsibilities are global. The democracy clause in the FTAA framework is a major first step toward this. We must ensure that other global issues of social importance, whether they be environmental, human rights, the rule of law or the promotion of democracy, are protected and linked in some effective way to our trade agreements. The advance that we have made in the FTAA discussions in Quebec City demonstrates that well.

The hon. member mentioned that he was aware of the North American agreement both on environmental co-operation and labour co-operation. He felt that they had not been perhaps as effective in allowing NGOs to challenge governments. However he did not answer the question whether those could be improved, just as chapter 11 rules, interpretation and processes need to be and will be in future agreements.

If those could be improved should NGOs be able to effectively challenge governments? I challenge hon. members to consider carefully the reality of new governance in a modern society where the market and civil society have a powerful and important role to play with governments. If NGOs should be able to challenge governments and other non-state actors, why not corporations as long as those rules are fair, transparent and they meet other social responsibilities?

I will talk about this concept of new governance a little further. NGOs will come up to the governance table as they are invited to do more and more effectively. We saw that opportunity in the FTAA lead-up consultations across the country and the people's summit and the civil society committee taking part in the negotiations of the free trade of the Americas. However, if civil society is going to step up to the governance table, it has to demonstrate its democratic nature and its representative nature, just as corporations must prove their social responsibility.

One of the most powerful forces to exact social responsibility from corporations trading abroad is the democracy of the market. If a company such as Levi thinks it is going to get 10 year old kids in India or Bangladesh to stitch its jeans, then the North American, European and increasingly other markets are simply not going to buy its product. We had a striking example of market democracy in my province of British Columbia where not only were civil society and the market involved in looking at land use planning and forestry practices on the mid coast, but they were making decisions without government.

We have powerful forces that need to be brought to bear. We not only need linkages between free and fair trade but also social responsibilities, environmental, democratic, rule of law and labour practices.

Finally, chapter 11 of NAFTA needs to be clarified. There are problems which have been properly pointed out. However that does not mean corporations should not have the opportunity, under a proper set of rules and processes, to challenge governments in courts as they do domestically.

Foreign investment helps developing countries. Globally, however, there is not sufficient public money or public interest to provide the investment necessary for countries to pull themselves out of poverty. Direct or indirect foreign investment through private companies is an effective way of supplementing the public money available for that purpose.

[Denis Paradis, Liberal, Parliamentary Secretary to Minister of Foreign Affairs]

Mr. Speaker, first allow me to talk a bit about NAFTA.

Whereas the success of NAFTA is usually linked to the opening up of markets to goods and services, its capacity to attract foreign investment in the regions could end up being the most powerful and durable impact of the agreement. As the Prime Minister said, NAFTA works quite well.

I will quote some figures. The total direct foreign investment in NAFTA countries was $1.97 billion in 1999, more than double the figure of 1995.

American investments in Canada has doubled since 1993 and reached $186 billion in 2000, whereas Mexican investments in Canada reached $132 billion in 2000.

Canadian investments in NAFTA countries have also been quite sizeable. In 1999, direct foreign investments of Canada in the United States and Mexico were $134.3 billion and $2.8 billion respectively.

I will now say a few words about the World Trade Organization. The WTO is not the multilateral agreement on investment, commonly called the MAI. These are two different things. The WTO has more than 130 member states, most of which are developing countries. The multilateral agreement on investment was meant for an elite group of developed countries, the OECD countries. Each member of the WTO has its own approach to investment, and, for the time being, there is no consensus to proceed with an agreement on investment.

Proposals on investment brought forward during the period leading to the ministerial meeting in Seattle were quite different from those in the MAI. Nobody has suggested we should include dispute settlement mechanisms for investor-state conflicts. We can expect that any new WTO agreement on investment will include developing countries.

During the ministerial meeting in Seattle, many countries, the United States included, wanted our international trade minister, who is doing an excellent job, to chair the implementation task force of the Seattle meeting. He has accepted, and he has shown that Canada is perceived as a country that helps build bridges between developed and developing countries.

The task force was supposed to highlight the enormous challenge of including these countries in the round and determining the means to implement the agreement. The idea of a new round at the WTO is not dead. A ministerial meeting will take place in Doha, Qatar, in November this year.

Whatever its position on investment, the government is determined to protect the rights of Canada to make regulations in strategic sectors such as health, education, culture, and the environment. That is what Canadians have always wanted, and that is what their government will stand for.

I would like to add a few words on the free trade area of the Americas and the FTAA mechanisms.

In the free trade area of the Americas, every country will have to submit a proposal to the nine negotiating groups, one of which will deal with investment.

To date, Canada has not yet submitted its proposal to the group dealing with investment. We prefer to pursue our negotiations and wait for the other countries to submit their proposals. We expect to submit our position after we have held all our consultations with the provinces and with the stakeholders.

However, the Canadian proposal will look at the rules applicable to investment in the light of its experience with trade negotiations and with the implementation of its rules concerning investment with other countries such as, obviously, NAFTA member countries, as well as Latin American and Caribbean countries. We will rely on our past experiences.

The main objective of Canada is to ensure a clear delineation of the obligations with respect to investment that will serve Canadian interests.

Countries of the Americas need and want capital as well as the opportunities associated with investment, of course. It is in their interest to guarantee that investment flows in a predictable manner in the whole area.

Mexican President Vicente Fox recently stated in Montreal that Mexico benefited from increased investment, which creates jobs, improves health care and raises standards of living. He also recognized that the middle class has made major progress since NAFTA. More than 10 million people are now said to be part of the middle class.

As for the FTAA, Canada is not advocating a reproduction of the rules applying to investors and states under NAFTA, and we did not support any proposal made up until now by other member states of the FTAA to include a dispute settlement mechanism.

In the FTAA, Canada is taking into account the work already started with its NAFTA partners on the issue of investment in this agreement, including the clarification of the provisions concerning investors and states, as the case may be.

I would now like to say a few words on the General Agreement on Trade in Services.

Coming back briefly to what I was saying on NAFTA, I would like to say that this agreement is extremely profitable for Canada.

My riding of Brome—Missisquoi, which is located along the Vermont border, is an extraordinary one in the sense that it has a large, qualified workforce. It is a riding, of course, that wants to attract American investors on our side, so that we can re-export goods to the United States and elsewhere.

In this respect, NAFTA gives us that flexibility. In Brome—Missisquoi, I am in the process of building a Team Brome—Missisquoi, so that we can export more goods to the United States and that investments can be made on both sides of the border.

I now want to come back to the General Agreement on Trade in Services. The 1994 Marrakesh agreements provided for new discussions on agriculture and services at the World Trade Organization. The agreement on services is better known as the General Agreement on Trade in Services, the GATS.

Services are not only important to the Canadian economy, they are the cornerstone of employment in many areas and regions, whether for a plant with 500 employees or a business starting up with only three employees.

We have made our position known to the WTO: Canada's objective in the GATS negotiations is to reach the best agreement possible, to improve Canadian service suppliers' access to foreign markets and to provide Canadian consumers with a larger choice of services at a lower cost.

This agreement deals mainly with the issues of market access and non discriminatory treatment of service suppliers. However, the agreement also deals with major issues concerning service suppliers' right to a commercial presence, that is, where to invest to establish a presence in other countries.

However, the GATS lets us choose. All members are free to make commitments on this commercial presence or to choose not to do so. Let us be very clear. This agreement is not an agreement on investment under chapter 11 of NAFTA.

The GATS does not include any safeguards for investors, such as the right to compensation in case of expropriation, or any provision concerning a dispute settlement between an investor and a state.

If the hon. member would withdraw her motion, I would move to replace the motion we are debating now by the following motion:

That this House calls upon the government to respect the words of the Minister for International Trade, who stated in the House on April 30, 2001 “Our view is that we want to clarify certain aspects of chapter 11 within the present mechanism of NAFTA”.

Words intended to ensure a more open and transparent dispute settlement process, and to safeguard the interests of all Canadians in this and all future trade agreements signed by Canada.

Thus, I am proposing that the previous motion be withdrawn and replaced with the one I just read.

[The Deputy Speaker]

Does the hon. parliamentary secretary have unanimous consent to move his motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, first, I was the one who yelled “no” to oppose withdrawal of the NDP motion. I was pleased to do so.

There is a simple reason for that: we cannot trust the government on free trade negotiations, especially since this government, which prides itself on being democratic, even refused to provide us with the texts. We, who have been elected by the people, cannot even have a look at the content of the agreement which will be negotiated.

I was in Quebec City during the people's summit. I attended several meetings. I met workers from several countries who told us bluntly that the free trade agreement and all the resulting changes have definitely not improved their living conditions. We were told this by people who came to give evidence, people who have to live with these changes.

Can the parliamentary secretary assert that the opposite is happening in Canada? Free trade was supposed to improve the standard of living in Mexico and other countries. The reverse is happening. Canada's standard of living is dropping.

For instance, there is a shortage of beds in hospitals. There are not enough physicians. Health care is being privatized. Experts and everyone else are saying that this is because of free trade. And then we are told that this is the best thing that ever happened.

Can the parliamentary secretary tell us about what the free trade agreement provides in terms of worker protection? In terms of unionization for their protection we need laws to protect workers in all these countries. Where is the balance between the two, apart from the fact that big corporations, which as far as I am concerned represent the liberals, will be the winners with free trade, not Canadians, not workers of the Americas?

[Denis Paradis, Liberal, Brome—Missisquoi, QC]

Mr. Speaker, my colleague from Acadie—Bathurst most certainly wants to speak about job creation. So, let us talk about job creation, but in a positive way.

With the free trade area of the Americas, we have a powerful neighbour, namely the United States, with whom we are used to trade. It is the country just south of ours. Since the FTAA also includes every South American country, we would have a market of 800 million people. If we take away the 300 million people living in the U.S., we have 500 million more people with whom everyone in Canada can do business in a free trade context.

The benefits are clearly there. In Canada's justice system, common law exists alongside the civil code. Latin American countries usually have civil law. Common law applies in Canada and the U.S. We also have a culture similar to that of Latin American nations.

We should stop looking at the negative side and view in a positive light all the jobs that can be created and the improvement to the quality of life that can be made throughout the Americas. That is what the free trade area of the Americas is all about.

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

Mr. Speaker, the hon. member talked about civil rights. Coincidentally I was just reading a copy of a letter sent to the Prime Minister expressing concern about why the disturbances occurred.

We saw what happened in British Columbia some time ago with the pepper spray incident. We saw what happened in Quebec City. Forgetting about trade and what the police did, because they did what they needed to do, the question is: Why did it happen? Why must our leaders fence themselves away from the people? What is wrong? Where is the leadership that the Prime Minister has not shown?

[Denis Paradis, Liberal, Brome—Missisquoi, QC]

Mr. Speaker, first, I want to congratulate the Prime Minister for the tremendous work he has done and for a wonderful summit that brought everyone closer together.

The member mentioned the protests. Yes, there was a huge protest with 25,000 to 30,000 people walking peacefully from one end of Quebec City to the other in order to peacefully get their point across. We are open to such peaceful suggestions.

But we draw the line at violence. Everyone agrees with that. Canadians do not tolerate violence.