House of Commons Hansard #52 of the 38th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was industries.
John Williams Conservative Edmonton—St. Albert, AB
Mr. Speaker, I have the honour to present the sixth report of the Standing Committee on Public Accounts concerning the public accounts of Canada 2004 referred to committee Thursday, October 21, 2004.
Questions on the Order PaperRoutine Proceedings
Beauséjour New Brunswick
Liberal
Dominic LeBlanc LiberalParliamentary Secretary to the Leader of the Government in the House of Commons
Mr. Speaker, I would ask that all questions be allowed to stand.
Dominic LeBlanc Liberal Beauséjour, NB
Mr. Speaker, if you were to seek unanimous consent I think you would receive it. The member for Algoma—Manitoulin—Kapuskasing would like to revert to presenting reports from committees.
Questions on the Order PaperRoutine Proceedings
The Deputy Speaker
Is there unanimous consent of the House to revert back to presenting reports from committee?
Brent St. Denis Liberal Algoma—Manitoulin—Kapuskasing, ON
Mr. Speaker, I have the honour to present, in both official languages, the second report of the Standing Committee on Industry, Natural Resources, Science and Technology, in relation to the certificate of nomination of Pierre Coulombe, President of the National Research Council of Canada.
Pierre Paquette Bloc Joliette, QC
moved:
That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon, and that it ask the government to further elaborate with regard to the following elements: the use of safeguards provided for in trade agreements, the implementation of measures to encourage the use of Quebec--and Canadian--made textiles and the creation of a program to assist older workers.
Mr. Speaker, I am extremely pleased to move this motion, first because I feel that it is in line with the work of the Bloc Québécois in defending Quebec's interests. As you know, an important part of clothing and textile industries is in Quebec. Furthermore, in this case, we are defending the rights of workers to maintain employment in an industry that is currently threatened and which, through appropriate government policies, would be able to prosper as it has in the past.
In this sense, I will read the Bloc Québécois' motion again, so that people who are listening to us or who will be made aware of this extremely important debate on the future of textile and clothing industries truly understand what this is all about:
That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon, and that it ask the government to further elaborate with regard to the following elements: the use of safeguards provided for in trade agreements, the implementation of measures to encourage the use of Quebec--and Canadian--made textiles and the creation of a program to assist older workers.
As I was mentioning, the textile industry is extremely important in Quebec and in Canada. Indeed, it represents 48,000 manufacturing jobs and $6.6 billion in production every year, including over 50% in exports. In fact, we are talking about $3.58 billion in exports, of which a major part was going, until very recently, to the United States, and continues to do so, but at lower levels. So, as we can see, it is an extremely important manufacturing industry.
We are talking about 94,850 jobs in the clothing industry. I am quoting figures for 2001. This industry has annual sales of $6.72 billion, about the same as the textile industry. Exports represent 40%, or $2.73 billion.
As we can see, this is not a minor manufacturing industry; it is extremely important. As I said, 55% of all clothing produced in Canada is made in Quebec.
Unfortunately, these two industries are in the midst of a shake-up, and not their first one either. However, the federal government's attitude means that these industries are not receiving the assistance they need to survive the transition period made necessary because the rules of the game have changed.
Our impression, which my colleague for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup seems to share, is that the federal government has written off the clothing and textile industries for some time now, thinking that, as markets become more open, Canada might lose these two industries, but would win in other sectors and that, ultimately, everything would balance out.
Unfortunately, this is not the case. Real people are losing jobs in the clothing and textile industries; they are not just statistics. These people will find themselves unemployed, often women and immigrants, and will then have trouble finding a new job.
These job losses often affect communities too, which lose their municipal or regional mill. Just because markets are being opened up without consideration does not mean that other industries will necessarily set up in the regions affected by these mill closures.
There were recent closures in Maskinongé, for example, and 50 people lost their jobs. It is highly unlikely that the unchecked opening of markets will mean that these 50 jobs will be recreated on the basis of other industrial or economic activities.
The government is blind to the fact that the clothing and textile industries are extremely dynamic. According to Statistics Canada, the textile industry is the 12th largest in terms of research and development. This is not, however, the image being presented by the Liberal government, which would have us believe that this industry cannot adapt to change. This is not necessarily the case, if this industry receives the necessary assistance and already agreed upon R and D efforts are supported.
I remember very clearly that, after NAFTA and even the US-Canada free trade agreement, we were told the garment industry was doomed. That created great consternation in Montreal, but people rolled up their sleeves and began to produce high-end garments of better quality than the imports. As a result, during the first seven years of the 1990s, clothing exports increased by more than 400%. The industry was far from moribund.
The context changed, however. Both the clothing and textile industries were able to adapt to the free trade agreement between Canada and the United States, and to NAFTA. Not only the clothing and textile industries, but even the furniture industry as well, despite its being another doomed industrial sector according to the Liberal government.
Now things have changed, and not just because of the opening up of the markets. American protectionism is one thing. They have decided to have their garments manufactured in the West Indies. Their fabrics are shipped there to be manufactured in plants where the workers are paid very little. Then the garments are imported back into the U.S.
We do not have access to these agreements, which means that a considerable segment of Canadian and Quebec textiles have lost the natural market represented by the U.S. This is contrary to the spirit of NAFTA, which was meant to benefit the partners, and not only Canada, which includes Quebec of course, but Mexico as well. This situation has existed since 2000—it did not just crop up the other day—yet the federal government has done nothing. It has said nothing. It has accepted a rule change made unilaterally by the American authorities. As hon. members know, 1999 was the pivotal year for the clothing and textile industries. Since then, exports to the U.S. have slowly dwindled down in both of these sectors.
What is more, in 2003 the federal government decided—with our support—to open the borders to the 40 least developed countries duty-free. We agreed with that measure, but at the same time we also agreed to the condition that measures would be put in place to help our clothing and textile industries convert, and this never really happened. I will leave it up to my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup to go into that point in more detail. The programs the federal government put in place were inadequate. From 2003 on, an increase in imports from those countries, Bangladesh in particular, was already noticeable, and constituted a second blow to our industries.
I would again point out that the Bloc Québécois was in agreement with this initiative, as long as it was linked to some kind of assistance programs for the industries involved. Representatives from these industries have appeared before the Subcommittee on International Trade, Trade Disputes and Investment or the Standing Committee on Finance on several occasions asking for federal government support.
What has now changed is that the import quotas from all countries, and from China in particular, have disappeared since December 31. It is a third element which also has us worried, because we fear that this trend first noticed in the early 2000s is now growing, as evidenced by the closure of six plants in Huntingdon, and, more recently, of two textile mills in Gildan.
We have met earlier with workers from the textile and clothing industries. There was a woman amongst them who told us that she had just lost her job in a company that was very profitable and I believe what she says. However, the employer or the shareholders have decided to move outside the country to seek higher rates of return.
The whole context has changed and this is where the Liberal government should have thought about helping the industry. This is not what the government did at all. As I was saying earlier, the government has been dragging its feet, doing nothing until Huntingdon was faced with this crisis. Its reaction was based on a report tabled in April 2004 by the Standing Committee on Finance.
So a report was tabled in December 2004. I fully realize that there was a general election in June, but the measures were known. Why did the government wait for a crisis to happen, with the closure of six companies in Huntingdon in December, before implementing the measures recommended by the Standing Committee on Finance months earlier? Precious months were lost.
A number of the measures announced by the government—well, at least one—are going to take time to put in place. In any case, when assistance programs are announced, it takes time before results are seen.
If, immediately following the election, the government had acted on and implemented the measures advocated by the Standing Committee on Finance, the situation would probably be better today.
As you know, on December 14, 2004 the government hastily announced, at the eleventh hour, a series of three measures. What is interesting is that, the week before, I had asked a question in the House concerning the government's attitude toward the difficulties being experienced by the clothing and textile industries.
The Minister of Finance told me at the time that I was in too much of a hurry, that there was no emergency and that the government was working on a plan—we did not know what plan—in the routine manner, that is, not too quickly and without listening too closely to the needs of the public, the workers and the industry. Strangely, one week later the measures were more specific, but not very surprising, because they essentially repeated what had been proposed by the Standing Committee on Finance.
They proposed the elimination, effective January 1, 2005, of tariffs on imported fibre, yarn and textile inputs used by the apparel industry, while maintaining duties on products that could be proven to be also made in Canada. This is a measure with which we concur. In fact it can be found in black and white in the Bloc Québécois election platform of last May and June.
The problem lies in determining what is produced in Canada and what is not. The Canadian International Trade Tribunal has been asked to study the question. Knowing the Trade Tribunal and the meagre resources it has been allocated by the government, it will be several months before the situation can be clarified.
Meanwhile, manufacturers that import apparel will continue paying duties without knowing whether they are going to be reimbursed in the end. This is somewhat like the situation presently being faced by the softwood lumber producers with respect to the American authorities.
Obviously, this is not an environment that is favourable to investment. If I am obliged to pay customs duties and I am told that in a few months I will be informed whether or not I am eligible for the measure, then clearly, during that period I will not be investing in modernizing my machinery, in research and development, design, marketing and other things. So this is a measure that should have been announced last July.
The second measure is the addition of $50 million to the CANtex program over five years. Again I will let my colleague elaborate on this point. However, to give you an idea of how little this amount is, just this year, the last year of the program, the industry received $26 million to modernize.
The third measure is the five-year extension of the duty remission orders in effect.This too is a measure with which we concur. Obviously it helps out the importing manufacturers, but it does not help the textile and apparel manufacturers that do not import. It is an appropriate measure but it is not enough.
That is what the first part of our motion is about. It should be clear to this House, in light of the whole situation affecting both textiles and clothing, that these three measures announced last December at the eleventh hour do not constitute a complete or sufficient assistance plan for these industries.
So when we read:
That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon--
That is this first part.
In the second part of the motion, the government is consequently asked to elaborate on this assistance plan as quickly as possible.
The word “notamment” follows in the French version, to indicate that other measures are not excluded. Many have been suggested, including by the representative of the textile industry who wrote a letter to the Prime Minister some time ago. In that letter, the Canadian textile manufacturers association repeats several times the measures I have just been speaking about. One notes in that letter a certain sense of lyrical emphasis.
Each time he writes about some measure, he concludes his paragraph with the same remark, “This point has been raised repeatedly with ministers and officials, but it has not been addressed in this announcement”. Dealing with another measure, he concludes, “We have recommended such a program to your ministers and officials, and we are disappointed that it is not included in your announcement”. These are the words of Harvey Penner, who is the president of the textile association, in his letter to the Prime Minister after the announcement on December 14.
We are putting forward a series of measures. The first one would be to take advantage of the safeguards under the trade agreements.
As I mentioned, in 2003, Canada decided to unilaterally open its borders to the 40 least developed countries. We agreed with this initiative. But it should be noted that only one country in southeast Asia used almost 100% of its quotas, and that is China. Even Bangladesh, with its increasing exports to Canada, could not use 100% of its quotas when these were in force.
A concrete suggestion we are making is that, during a transition period, we invoke the WTO agreement, and more particularly the terms of China's accession to the WTO, to keep this quota for China and make sure our market is not flooded with clothing and textiles from China. This is extremely important, and international trade agreements allow this. It would not be contrary to the WTO agreements or any special agreement we have with China.
I think we should move quickly. We would have a more secure environment for our companies and workers so that they can modernize or restructure their business.
Secondly, we recommend the implementation of measures to encourage the use of Quebec- and Canada-made textiles. This could lead to the possibility, among others, that Canadian textiles processed outside of Canada be allowed to come back to Canada duty free, as is done in the United States. Ideally, the Prime Minister has stated that he would be meeting with his Mexican and American counterparts in March and April. Ideally, we would need to come to an agreement with the Americans, in the spirit of the North American Free Trade Agreement, so that Canadian textiles be considered as American textiles, for example, when they are processed in the Caribbean. Thus, they would have access to the American market. That being said, we would control at least the possibility to give our textile producers the right to export their products to countries that would transform them into clothes which we would import back duty free. That would allow us to keep a part of the textile market which we are now in the process of losing.
The third element mentioned in the motion has to do with the creation of a program to assist older workers. I do not need to speak at length of this measure. For years now, namely since the Liberal government abolished the program called POWA, we have been requesting it, industries have been requesting it, trade unions have been requesting it and associations of employers have been requesting it. In that sense, it seems to me that it would be utterly normal to ensure that older workers who lose their jobs due to the reorganization of their company or a plant closure have at their disposal a pathway that would take them to their retirement years in dignity.
As you can see, the motion is quite reasonable and it is the first response that the House ought to give to the problems the workers as well as the employers in the clothing and textile industry are currently facing. I would invite all the members here to vote in favour of this motion as a clear indication to these people that they have the support of all members from Quebec and the rest of Canada.
Karen Redman Liberal Kitchener Centre, ON
Mr. Speaker, discussions have taken place between all parties and I believe you would find consent that the 24th report of the Standing Committee on Procedure and House Affairs concerning the membership of certain committees be deemed tabled and concurred in.
Committees of the HouseRoutine Proceedings
The Deputy Speaker
Does the hon. member have the unanimous consent of the House to move that motion?
Committees of the HouseRoutine Proceedings
The Deputy Speaker
The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?
The House resumed consideration of the motion.
Pauline Picard Bloc Drummond, QC
Mr. Speaker, I thank the hon. member for Joliette for his most interesting presentation.
As we know, Canada has been dragging its feet regarding this issue. The government had 10 years to deal with the situation. We knew that, on January 1, 2005, custom duties and tariffs on all textile and clothing imports would be lifted.
When the government learned, through the headlines in the media, that our textile companies were closing, instead of coming up with an assistance plan to support them, it showed up in a panic with a series of measures which, in our opinion, are inadequate. The government will not correct this injustice by merely throwing money at the problem, in an attempt to bolster its image. Some specific measures must be taken.
Today, the media are reporting that, according to the Canadian Textiles Institute, this injustice could have been corrected by reaching an agreement on a free trade area of the Americas, to allow the free flow of goods.
I wonder if my colleague could explain to us how such an agreement could be implemented to correct the injustice done to our textile companies, in addition to the injustice suffered by the workers who are losing their jobs. These people have often worked their whole life in that industry and now they are finding themselves out of work.
Pierre Paquette Bloc Joliette, QC
Mr. Speaker, I would like to thank the member for Drummond for her excellent question. It is indeed a basic issue.
The Bloc Québécois has always been fairly critical of the plan for a free trade area of the Americas, especially in social and environmental terms. In terms of trade, though, there would be obvious advantages. A good trade agreement, with strong environmental and social guarantees, would be better than what we have now.
For example, if the Government of Canada allowed Canadian textiles to be processed in the West Indies, as are American textiles currently, this processed clothing still could not enter the US market because it would not be considered to have sufficient Canadian content to be covered by the North American Free Trade Agreement. That is a problem. But it does not mean that we should not take this step immediately for the Canadian market. However, it would not enable us to enter the US market.
However, as I said, the Prime Minister announced that he was going to meet Mr. Fox and Mr. Bush in March and April. Under the Free Trade Agreement, nothing would prevent Canadian textiles processed in the West Indies from being recognized as North American in origin, just like clothing made from US textiles processed in the West Indies. This approach requires political will as well as some vision in regard to the development of our manufacturing industry, especially clothing and textiles.
The Liberals seem to be crossing out an industrial sector because of their prejudices, they are unaware of the reality, they do not want to look at the context in which problems arise. In this case, they put forward measures like those announced in December. They are a first, inadequate step toward resolving the problem.
This situation also demonstrates the urgency of reviving the negotiations on the free trade area of the Americas. This means that the Government of Canada should drop its approach of protecting investment, which can be seen wall to wall in NAFTA and under which companies have more rights than do governments. We know that people do not want this in South America.
Those primarily responsible for the current impasse in the negotiations over a free trade area are, first of all, the Canadian government and secondly the American government.
David Tilson Conservative Dufferin—Caledon, ON
Mr. Speaker, I congratulate the member for Joliette for raising the issue in the House today.
It is not a new issue. It is an issue that has been around for a good number of years. The community of Huntingdon where Huntingdon Mills is located is obviously suffering a great deal by these job losses. I understand the population of Huntingdon is about 2,600 people and the loss of jobs is about half. All of us represent communities that have manufacturing industries and the magnitude of job losses is rather spectacular.
The question that I have for the member for Joliette deals with the final part of the motion that deals with a program to assist older workers. This type of job loss can be very devastating to a community. When half or all of the income is gone, depending on whether it is a single parent family, this has an effect on not only children and seniors but it can have a spin-off effect on jobs related to the industry.
For that type of magnitude I am surprised that the Bloc is zeroing in just on that one area, which is the assistance for older workers.
Companies have closed in my community and it has had an effect on everyone in the community: the retraining of people, finding jobs for people, assisting people economically to get them through that tough time.
My question for the member from the Bloc is why is he zeroing in on that one issue?
Pierre Paquette Bloc Joliette, QC
Mr. Speaker, I would also like to thank the member for his question.
Huntingdon, it must be said, is just the tip of the iceberg. It stands out the most. We are talking about six companies closing in a small community. However, I would recall that there were closings in Trois-Rivières, Montmagny, Magog and Montreal. Just recently, a company closed in the Maskinongé area as well. We must be very aware of the fact that our industry has to be restructured. It cannot rest on its laurels, confident that we will protect it ad infinitum.
As we did in the past at the time of the North American Free Trade Agreement and also in previous decades, we need a program to help the industry restructure. This having been said, there will be some job losses of course, because companies are too outmoded technologically or because fewer workers than before will be needed as the result of technological innovation. A program to help older workers is one element. I emphasize this to the member, because we said: “With regard to these three elements.”
In the Bloc Québécois's proposals to the government, we also want a transfer of $200 million to the Government of Quebec—and this applies as well in the case of the other provinces—to provide occupational training programs. People will then be able to retrain or to work with the new technologies or in new occupations that will be created as this industry restructures.
So the member is quite right. This element seems essential to us. I recall that these assistance programs existed until 1997. We used them—I remember very well—in the case of the steel industry closures in the Sorel area and the mine closures in the asbestos region.
Marcel Gagnon Bloc Saint-Maurice—Champlain, QC
Mr. Speaker, I do not know how much time remains for questions and comments.
Marcel Gagnon Bloc Saint-Maurice—Champlain, QC
Since there are only about 40 seconds left, I will skip my turn and let the next member speak because my question would be longer than that.
We are talking about something that affects all of Quebec, but since my riding is deeply affected, I would have liked a longer discussion in this regard. I will continue with my other colleague.
Pierre Paquette Bloc Joliette, QC
In the few seconds I have left, I would like to mention two things, very quickly.
First, the tariffs on imports have to be maintained. Under the WTO agreement, we have no obligation to reduce our tariffs on Chinese or Indian imports for example. They have to be maintained, because they are a very practical form of aid to our industries.
Second—and I did not have time to talk about it but I will have the opportunity to do so when I table a petition containing 13,500 signatures in connection with labelling clothing—we have to denounce the abuses and talk about the clothes that are made by children and prisoners and that are sold on the Canadian market. If consumers knew where this clothing came from, they would probably choose something made in Quebec or in Canada, or Quebec or Canadian textiles, because they know we try to give our workers the rights due them. Even if we do not always manage to do so, this is what we are aiming to do. We thus also consider the mandatory labelling of clothing something that will promote the Canadian and Quebec textile industry.
Robert Thibault LiberalParliamentary Secretary to the Minister of Health
Mr. Speaker, it is a pleasure to speak to the motion.
I welcome the opportunity to speak on this motion today, and commend my colleagues for raising such a vital subject, one in which this government has continually seen as a priority. I regret, however, that this government cannot support this motion as written. The reason can be found in the very first line: that this House “acknowledge the inadequacy of the assistance plan for the clothing and textile industries.“
Far from an “inadequate“ plan, the December 14 announcement of new measures to make our textile and apparel industries more internationally competitive delivered. It offered tariff relief benefiting both the textile and apparel industries. It provided additional assistance funding for Canadian textile firms. And it responded to calls to extend the current duty remission orders benefiting textile and apparel manufacturers.
Those allegedly inadequate measures could be worth $600 million over the next five years. They will help Canadian companies improve their productivity and invest in new products and new markets, and they will provide them with the tools they need to compete in a changing global trade market.
This announcement also directly responds to the recommendations made by the House of Commons Standing Committee on Finance last fall. Specifically, the committee recommended extending the current duty remission orders and immediately ending tariffs on inputs not produced domestically. I could hardly call such a comprehensive package, one that explicitly responds to the concerns of the Commons finance committee, inadequate.
How specifically do these measures help these industries? Let us briefly summarize the measures announced by the government less than two months ago.
The first element of the recently announced textile and apparel package is tariff relief. The Government of Canada has eliminated tariffs on fibre and yarn imports and on imports of textile inputs used by the apparel industry, effective January 1, 2005. This single measure is worth approximately $90 million to the textile and apparel industries, every year.
The member from Joliette should remember that all apparel and textile companies can benefit from the elimination of tariffs on inputs they import. These benefits are unconditional, and apply across the country.
However, and this is a very important point, tariffs will remain on products where Canadian production can be demonstrated. The Minister of Finance has already asked the Canadian International Trade Tribunal to consult with the textile industry over the next three months to identify such products.
The textile industry now has an opportunity to provide evidence of actual production. Their input will be given great consideration in making final decisions on precisely which articles will benefit from tariff elimination. Importers will be required to pay duties while this consultation takes place and until final decisions are made regarding which imports can benefit from tariff relief. Once a final decision has been made, importers will be able to request a refund on the duties paid on these products since January 1 of this year.
Some may ask if apparel companies would be required to pay tariffs if the textile industry starts producing something that is currently not manufactured. It is a longstanding practice not to restore tariffs once they have been removed, to ensure that the tariff system is transparent and predictable.
Transparency and predictability benefit the Canadian economy by providing importing companies with the stability they need to make long-run investment decisions. Furthermore, domestic producers of goods not subject to duties know when they are entering a market that they will have to compete in a duty-free environment.
The second component of our December 14, 2004 announcement is assistance to the textile industry. The Government of Canada will provide a further $50 million in funding to the textile production efficiency component, or CANtex, over the next five years to encourage Canadian textile companies to adapt, to shift to higher value added products, focus on niche markets and improve productivity. All firms in the textile industry that make textiles for apparel use will be eligible to apply for further assistance under the enhanced CANtex initiative. I say further because this is not the first time this government has recognized the competitive challenges faced by the industry and acted.
In February 2004, for example, we provided $26.7 million to CANtex, and before that provided $33 million to the Canadian Apparel and Textile Industries Program—funding, which has been used in over 300 projects that increase productivity, lower costs, improve efficiency and identify new markets.
Mr. Speaker, the member for Joliette should recognize that this Industry Canada funding has made a difference. It is not funding designed to compensate firms having difficulty competing. It is there so that they can find their own solutions, by improving their production process, identifying emerging opportunities and purchasing the equipment that will beat their competition to market. It is designed, Mr. Speaker, to ensure our companies can take on the world and win.
The final measure deals with duty remissions. The December announcement included extensions to duty remission orders introduced seven years ago as a temporary measure to help textile and apparel firms adjust to earlier competitive pressures caused by increasing global trade. These gave companies in six textile and apparel subsectors the right to a remission of duties paid on certain imports.
Benefits have averaged $30 million annually over the past three years, with 90% of the benefits going to apparel manufacturers and the tailored collar shirts and women's wear subsectors.
These orders were set to expire on December 31, and I clearly recall many members of this House standing up and demanding that this government extend these orders and give these individual firms time to adjust.
The government heard from many firms in the apparel industry as well, which stressed the importance of the remission orders to their viability and called on the government to not let these orders abruptly expire at the end of last year.
That is exactly what we did, but we also introduced a phase-out period for these temporary measures. Firms benefiting from these orders have until the end of 2009 to adjust and to make the changes necessary to adapt to a changing trade environment.
Remission order benefits will decline to 75% of original levels in 2007, to 50% in 2008 and to 28% in 2009. They will expire completely on December 31, 2009.
In short, Mr. Speaker, in recent years, this government has repeatedly made the commitments necessary to help these companies face the competitive pressures they are dealing with. We lived up to that commitment once again on December 14, 2004.
And we will never back down on that commitment, no matter how many ill-advised motions are introduced by the opposition on “inadequate assistance” plans that are directly benefiting the workers on these companies across Canada.
There is something else missing from the member's motion today, and that is reality, the reality of a global economy that has more open markets and more trade between nations than ever before. We hide from this reality at our peril.
Clearly, Canada's textile and apparel industries face an increasingly competitive marketplace. Competition from low-wage developing countries increased this year when all countries, not just Canada, removed their quotas on textiles and apparel. This was the result of World Trade Organization negotiations 10 years ago, negotiations designed to open new trading opportunities for all countries, including Canada and, I remind members, Canadian manufacturers abroad.
As the hon. Minister of Industry said on the day these measures were announced, “There is nowhere to hide in the world of trade and textiles. The whole world is going through it right now”.
Fortunately, Canada has historically been a trading nation. Our industries recognize this even if some of their members of Parliament may not. As the Canadian Textiles Institute has concluded, the Canadian textile manufacturing industry in recent decades has transformed itself through substantial and sustained capital investment. They take such steps, Mr. Speaker, because they recognize the realities of today's global trading environment, not the trading rules of the past that the member for Joliette may pine for.
The Government of Canada understands today's realities too.
The December 2004 assistance announcement considered the risk of trade retaliation by other countries; in short, such a risk of countervailing duty measures would be low. This is a vital consideration if Canada's aim is to introduce measures to improve the competitiveness of these industries. Otherwise, the introduction of subsidy assistance measures encouraging the use of Canadian made products over imported ones, which this motion appears to be asking for, would likely be challenged by our trading partners in the World Trade Organization.
The WTO Subsidies Agreement explicitly prohibits subsidies that are contingent on import substitution. It is one more reason this motion cannot be passed as written.
The motion before us today calls for the use of safeguards provided for in trade agreements. These safeguards already exist.
Canada's trade legislation, like that of other trading nations, provides for various measures to protect domestic producers from any injury caused by import competition. The Special Import Measures Act, the Canadian International Trade Tribunal Act, the Customs Tariff and the Export and Import Permits Act together are what make this protection possible.
As well, under the World Trade Organization accession protocol, China agreed to a special textile and apparel safeguard. Under this provision, WTO members can protect their domestic textile and apparel industries from market disruption when imports from China threaten to impede the orderly development of trade in these products.
Here is how it works. If increased imports cause or threaten market disruption, domestic producers may request that the Minister of International Trade introduce the special textile and apparel safeguard. If consultations do not result in voluntary restraint, then quotas may be imposed. This special safeguard provision is in effect until the end of 2008.
My colleagues will speak further as to the numerous examples of this government's commitment to the textile and apparel industries. They will describe this country's efforts to work toward an integrated North American market for Canadian apparel and textile products and to consider any and all proposals made jointly by these two industries for new market development.
They will outline how this government continues to act to protect against illegal transshipment of imported apparel and textile products, and to respond to industry complaints regarding import injuries. They will summarize how the employment insurance program has continued to meet the needs of workers adjusting to changes in these industries. And they will elaborate on the many, many measures introduced in recent years to provide assistance whenever required to ensure these companies have the resources to compete.
These companies will have challenges, as we have seen recently, but then, they have also had to confront challenges. After all, the Canadian textile industry is one of Canada's oldest manufacturing industries, yet history shows it has evolved and modernized to the point where today it employs 50,000 Canadians across the country.
When markets for Canadian textile products change over time, these entrepreneurs adapted so that today the subsector producing textiles for apparel use comprises approximately 25% to 30% of the Canadian textile industry. Today they produce a wide array of textiles, including carpeting, industrial and specialty products, which would have been unimaginable a century ago.
Likewise, the apparel industry employs nearly 100,000 Canadians, and is centred in Canada's big cities, such as Montreal, Toronto, Winnipeg and Vancouver. The jobs it provides are often the jobs generations of new Canadians have turned towards, and today approximately 40% of apparel workers are first-generation immigrants.
I should also note that the textile tariffs paid by Canadian apparel firms, ranging from 5% to 14%, are much higher than the tariffs on inputs used by other Canadian manufacturing sectors. That is one of the reasons we introduced substantial tariff relief before Christmas.
Yes, they have faced hardship, and will continue to do so, but history says that they will make the changes necessary to continue to prosper. These are companies that can compete. They are modern and efficient. They invest in their production and are a major user of high technology. They provide quality jobs for thousands of Canadians.
They will ultimately succeed if government can provide them with the assistance that can help them compete in a world where other markets remain open to their products as well. They are more than capable of doing this, and recent years have illustrated how progressive federal economic policies can help them do that.
With government support and encouragement over the course of the last decade, Canada's textile and apparel industries have demonstrated the innovation and the investment required not only to simply survive, but to thrive in the 21st century global economy.
As a member of this government, I am proud of the steps taken to help them succeed. They are far from “inadequate”. And for those reasons I cannot support this motion.
Deepak Obhrai Conservative Calgary East, AB
Mr. Speaker, I note with much interest that it is the parliamentary secretary for health who is speaking on trade issues. That is quite an interesting response from the Liberals on this very important subject.
What brings this to our attention, and the Bloc motion recognizes this, is what is happening in the domestic industry. It seems to me that the Liberal government is rushing all the time to sign these trade deals, deals that seem to be desired by the government to put its signature on trade deals without doing a deeper analysis of how they will impact the domestic market.
There is no denying the fact that as a trading nation we need to sign trade deals to protect ourselves. There is no question that with 31 million people our prosperity lies in international trade and that will have an impact on domestic markets.
However, if we look at the crises that are now taking place in the beef industry with BSE, in the softwood industry, and now in the textile industry with the closure of six plants in Quebec, we all knew that this would happen. We all knew a long time ago in the WTO negotiations that we were moving in this direction. I was at the WTO meetings in Seattle and Doha.
What I fail to understand is why the government takes stopgap measures. It makes these announcements about stopgap measures to help our local Canadians who are impacted by these trade deals. Even now, the record of this government in assisting domestic Canadians in relation to these trade agreements is not something to be proud of. Someone asked the parliamentary secretary, what is the point? Why do you want to rush into signing trade agreements when you do not really do a thorough analysis of what is happening in the domestic industry?