Mr. Speaker, it is an honour for me to speak to Bill C-24, the softwood lumber agreement, which I respectfully ask all members of the House to join me in supporting.
The softwood lumber agreement is good for our industry, good for the lumber communities and good for Canada. I remind all hon. members that we have two national governments that support this deal. All of our major softwood lumber producing provinces support the deal, including those of the members who introduced an amendment and subamendment today. We also have 90% of the industry supporting the agreement and the deal in the legislation. One has to ask why the hon. members are not listening to their provinces and why they are not listening to the industry.
This deal eliminates the punitive U.S. duties. It ends costly litigation, takes our lumber producers out of the courts, provides stability for industry and returns more than $5 billion Canadian. It is a practical and flexible agreement that ends the dispute on terms that are highly favourable to Canada.
Let us remember that this disagreement has been going on for 24 years, this last legal agreement five years alone.
I am proud to be part of a government that has provided a solution that will put our two nations back on track for making North America more competitive for the future. I also want to give my appreciation to our Prime Minister and to our Minister of International Trade for their exceptional work on securing this deal on behalf of our softwood lumber industry.
Today I would like to outline some of the key features of the agreement. Let us begin with the return of the duties.
Clearly, one of the agreement's most important features is the return of $5 billion Canadian. This is a significant infusion of capital for the industry and will directly benefit the workers and communities across Canada that rely on softwood lumber for their livelihood. Without question, this dispute has been extremely difficult for Canada's lumber industry. That is why it is imperative that companies receive this money as quickly as possible so that they can continue to invest in their operations and their people, and to increase their productivity and their competitiveness.
An innovative deposit refund mechanism has been developed that will ensure that Canadian companies receive their share of duty deposits within four to eight weeks after the agreement comes into force. It is designed to help Canadian companies begin reinvesting in their enterprises and bring a measure of stability to an industry that has been hit hard for over 20 years of repeated trade action.
I also want to comment that we have seen the U.S. lumber trade coalition tell us that if this deal did not proceed, if we did not have this agreement, that it can guarantee Canada that there will be continued litigation regardless of the outcome of any lawsuits.
A second key feature is the revocation of the U.S. duty orders and the end to related litigation.
Let us talk about the flexible export measures. The deal also provides a strong measure of flexibility for our provinces. For the next seven to nine years no border measures will be imposed when lumber prices are above $355 per thousand board feet. When prices drop below this threshold, the agreement allows provinces to choose the option that best suits their particular economic situation.
Option A involves an export charge that increases in steps from 5% when the price of lumber is $336 to $355 per thousand board feet to 10% when the price is $316 to $335, and then 15% as the price of lumber falls below $315 per thousand board feet. Option B combines at the same price levels lower export charges of 2.5%, 3% and 5% with quotas.
I should point out that funds collected under either option will now stay in Canada. The Government of Canada will distribute to the provinces revenues from the export charge minus the administrative and perhaps legal costs that are associated with the agreement.
This is a significant improvement over the current environment. Currently the duties imposed by the U.S. are reassessed annually. In other words, the industry never knows from one year to the next what duty rate may apply. Under this agreement the industry will know and can take full advantage of a stable predictable business environment.
The agreement also contains a provision allowing provinces to seek an exit from border measures based on a process to be developed by Canada and the U.S. in consultation with the provinces.
I urge the members who sit on the trade committee with me to work with us in committee, rather than try to hijack it this session. Let us work together toward a better future for our softwood lumber industry. Let us work on this agreement.
It provides for reduced export charges when other lumber producing countries significantly increase their exports to the U.S. at Canada's expense.
Importantly, this agreement has a dispute settlement process for issues related to the implementation of the agreement. The process will be neutral, transparent and efficient.
Often we hear opposition members talk about chapter 19. What they are neglecting or actually choosing to ignore is the testimony that we heard in committee that clearly told us that never was softwood lumber to be included in NAFTA. In fact, there was a memorandum of understanding that was pulled out of the agreement so that it would not be there. We have been trying to apply this dispute to NAFTA when no one agreed that it should be there in the beginning.
This new dispute mechanism will no longer be U.S. trial law. It will be international trade law. There are many who suggest that signing on for this new dispute mechanism is reason alone for signing on to the agreement.
The agreement of course will provide a stable business environment. But perhaps the feature of this agreement that has garnered the most attention and continues to be the subject of myth and misinformation from those who do not understand it is the termination clause. Let me be clear. This agreement will last for seven to nine years, providing a stable market environment for our softwood lumber industry. During this time, the U.S. will be prohibited from initiating further trade action.
I should also point out that the U.S. has agreed to a 12 month standstill on trade action in the event that it may decide to terminate the agreement. This provides yet another measure of stability, one which I might add was added at the industry's request following an August 9 meeting with CEOs.
While the termination clause in this agreement is a standard feature of international trade agreements, I can tell the House that termination by either country is highly unlikely. This is a hard-won agreement and both sides have a clear interest in maintaining the rights and privileges under it.
Within Bill C-24 these features are key elements of the agreement. Bill C-24 will bring these elements into play and implement Canada's commitments under the agreement. In particular, the bill provides authority to impose an export charge in a manner consistent with the agreement. It also seeks to amend the Export and Import Permits Act to bring the export measures component of the agreement into action.
Today I ask all parliamentarians to join me in supporting this bill, putting an end to this long-standing dispute and building a brighter future for Canada's softwood lumber industry, for the workers, families and communities that rely on it.
I want to comment a little further on the proposed amendments. I find it very interesting that the member for Beauséjour tabled such an amendment, considering that the industry in his own province is unequivocally supporting this deal. The industry had written asking him to support this deal. In fact, it does not quite understand why he would not want to support the deal. I have the names of companies, such as the Maritime Lumber Bureau, J.D. Irving Limited, M.L. Wilkins & Son Ltd., Pro Lumber Incorporated, North American Forest Products Ltd., and the list goes on and on.
I am not quite sure where the member is coming from because this deal would provide market access by providing the stability and certainty that the industry has told us it clearly must have. This is exactly what the focus of the Prime Minister and the Minister of International Trade has been all along, to find a stable and predictable market for our industry.
The U.S. is not interested in escaping its obligations on this deal. It has no interest in backing out whatsoever. I remind everyone that it is only the Canadian government or the United States government that can terminate the deal.
We also know, as I alluded to earlier, that the softwood lumber industry was not included in NAFTA and that is why any attempts to try to govern it under NAFTA rules have not worked. The new dispute settlement will work. Canadian workers have always had the support of this government. It is the workers who will finally gain their job security who will benefit most from this deal. Over $5 billion will be returned to the industry ensuring that it can prosper and secure its workers jobs in the future.
In conclusion, I ask all members to can the rhetoric and to support this deal. Let us move forward for a stronger North American softwood lumber industry that will benefit all of Canada.