Mr. Speaker, it is an honour to rise today to speak to Bill C-24, the Canada-Peru free trade agreement.
As members know, our Conservative government's global commerce strategy includes a re-energized agenda of trade liberalization with our partners around the world. It will be this strategy that will help to lead Canada out of this recession that is affecting every country in the world today.
As a trading nation, Canadian companies, Canadian producers and Canadian investors need access to international markets to stay competitive. We have entered an age of fierce global competition, as emerging economies continue climbing the value chain and establishing themselves in an ever-widening range of sectors.
In this time of economic uncertainty, with a slowdown in the U.S. economy, our top commercial partner, and ongoing turbulence in international financial markets, Canadian exporters and investors will continue to be affected.
We have done a good job of riding out the storm, thanks largely to Canada's strengths, like low unemployment, the strongest fiscal situation in the G7, a sound borrowing system and our endowment of natural resources that continue to be in demand the world over.
However, it is extremely clear that we must remain vigilant. Our Conservative government must continue to fight protectionist measures around the world and continue taking steps to ensure Canadian companies remain competitive, maintain their markets and have access to new opportunities.
The Prime Minister and the Minister of International Trade understand the challenge. The Prime Minister has committed to playing an active role in the Americas and to building strategic relationships with key partners in our neighbourhood.
Peru is a leader in Latin America, a lynchpin in the political and economic stability of the region. It has been an economic engine with a GDP growth rate of 9.8% in 2008, the top of Latin American countries and higher than that experienced by China or India.
Peru also has a solid outward orientation. A leader in trade liberalization, Peru is currently pursuing trade negotiations with a number of countries.
As it stands, Canadian exporters are at an immediate risk of losing markets in Peru due to the entry into force of a trade promotion agreement with the United States on February 1 of this year.
Peru has also recently completed trade negotiations with China and EFTA and is negotiating with the EU, South Korea, Mexico and Thailand.
As members can see, Peru has a very robust international trade agenda. It is an economic engine in the Americas. It is beneficial to Peru and beneficial to Canada that we see this free trade agreement go forward.
Our firms and Canadian workers deserve trade agreements that address this situation and allow them to compete in international markets on a level playing field. We need partners like Peru, especially as we move forward on engaging with like-minded countries throughout the Americas.
Canadians will benefit. Peru is already an established and growing market for our businesses. In 2008, two-way merchandise trade between our countries totalled $2.8 billion.
With this new agreement, our nations are taking a critical step to intensify our commercial relationship in the years ahead and to create new opportunities for citizens in both countries to prosper.
Upon its implementation, Peru will eliminate tariffs on nearly all current Canadian exports, including wheat, pulses and mining equipment.
It should be noted that some opposition parties have been holding up a number of these free trade agreements. At the same time, they propose that they continue to support Canadian business and Canadian opportunity, especially Canadian exports because we are an exporting nation.
In wheat and barley alone, in two free trade agreements between Colombia and Peru, roughly $250 million of Canadian trade is at risk because these agreements have not passed through the House yet.
Perhaps the members who are intent on holding up these agreements and at the same time are saying that they support Canadian industry, should take a look at this one industry alone where a quarter of a billion dollars are at risk because of opposition shenanigans, quite frankly, in holding them up.
Upon its implementation, Peru will eliminate tariffs on nearly all Canadian exports, including wheat, pulses and mining equipment. Again, that is worth repeating. A variety of paper products, machinery and equipment will also enjoy the same benefit.
The Canada-Peru free trade agreement also provides a great opportunity to take our current trade in services to a new level in the years ahead. In 2006, the most recent year where statistics are available, Canada exported $33 million worth of commercial services to Peru. This new agreement provides a wonderful opportunity to grow this number in the years ahead and continue boosting the level of cross-border trade enjoyed by our two countries.
Canadian investors, too, have a significant presence in the Peruvian market. Even before this agreement, our countries made a firm commitment to enhancing two-way investments through a joint foreign investment promotion and protection agreement, or FIPPA, which entered into force in 2007. Canada is one of Peru's largest overall foreign investors, with an estimated $2.35 billion worth of investment stock in Peru in 2008, led by the mining and the financial sectors.
This FTA builds on the existing FIPPA and gains new ground for Canadian investors. Specifically, it includes strong obligations that will, first, ensure the free transfer of capital related to investments, protect against unlawful expropriation and provide for non-discriminatory treatment of Canadian investors. In short, we have levelled the playing field.
It also provides for an effective, binding and impartial dispute settlement mechanism. In other words, the agreement provides the security, stability and predictability that investors need. Our government procurement agreement guarantees Canadian suppliers the right to bid on a broad range of goods, services and construction contracts carried out by Peru's federal government entities.
It is no wonder that Canadian businesses in a number of sectors have been strong advocates of this agreement. Their support has been crucial throughout the negotiating process that began in June 2007. The result is something we can all be proud of. With this new agreement, our nations are taking a critical step to intensify our commercial relationships in the years ahead and to create new opportunities for citizens in both countries to prosper.
We have negotiated a high quality and comprehensive free trade agreement, covering everything from market access to goods to cross-border trade and services, to investment and government procurement. Canadian exporter service providers and investors will benefit, and the agreement will create new opportunities for Canadian businesses and producers in the Peruvian market.
However, an effective should do more than eliminate tariffs. It should also tackle the non-tariff barriers that keep a trade relationship from reaching its full potential. With this agreement, that is just what we have done, by including new measures to ensure greater transparency, including better predictability of incoming regulations, and the right by industry to be consulted at an early stage in the development of regulations, promoting the use of international standards and creating a mechanism to promptly address problems.
We are taking action on a number of fronts to unlock the trade potential inherent in the Canada-Peru relationship but this agreement is significant for other reasons as well. This agreement is also accompanied by important side agreements that demonstrate our joint commitment to corporate social responsibility, the rights of workers and preserving the natural environment.
Many Canadian companies and the Canadian government are at the forefront of efforts to ensure accountability and transparency through renewed commitments to principles of good corporate citizenship, both domestically and internationally.
The Canadian government encourages and expects Canadian companies operating abroad to respect all applicable laws and international standards and to conduct their activities in a socially and environmentally responsible manner, recognizing that responsible business conduct reinforces the positive effect that trade and investment can have on labour rights, the environment and competitiveness.
This complements the Conservative government's recently announced corporate social responsibility strategy that will increase the competitiveness of the Canadian extractive sector operating abroad by enhancing its ability to manage social and environmental risk. Our nations recognize that prosperity must not come at the expense of the environment and workers' rights.
This agreement paves the way for significant dialogue in other areas of mutual interest, including poverty reduction and trade related co-operation. We share a belief with Peru that open markets and international trade are the best hope for fostering development of our common security in the hemisphere. In fact, this approach builds on our successful experience with free trade partners, such as the United States, Mexico, Chile and Costa Rica.
We recognize that prosperity cannot take hold without security or in the absence of freedom and the rule of law brought about through the pursuit of democratic governance. A good, healthy democracy cannot function without a sound underpinning of personal security and the chance to improve living standards through increased trade and investment. That is why our Conservative government is committed to working closely with partners like Peru to influence positive change throughout the region and promote the principles of sound governance, security and prosperity.
Taken together, these agreements mark a new chapter in the Canada-Peru relationship, one that will forge an even stronger bond between our nations in the years ahead. They also mark yet another milestone in Canada's trade policy. In this day of fierce global competition and overall economic uncertainty, I am proud to say that we are taking the measures necessary to continue creating a resilient and competitive Canadian economy in the years ahead.
We need to move expeditiously to help our businesses grow. As I noted, the United States already has preferred access to Peru's markets for their exports and government procurement. Canadian companies deserve to compete on a level playing field. I ask for the support of all hon. members of this place as we continue these efforts and create new opportunities for all Canadians to thrive and prosper in the global economy.
In closing, I would say that since coming to government, in 2006, we have pursued a very ambitious free trade agreement, especially in the Americas. There is a tremendous amount of Canadian direct investment abroad in the Americas. Quite frankly, this is our neighbourhood. This is the continent that Canada is part of: North America and South America. It only makes sense that we have closer ties.
Unfortunately, that was not seen as a priority by the previous government, so we have a lot of ground to make up. We have a huge opportunity. There are a number of countries throughout Central America, the Caribbean and South America that are looking to enhance ties with Canada and improve the situation they find their own countries in.
These are growing economies with some challenges, and we recognize that. For us to turn our backs on these critical relationships at this time would not be good foreign policy, it would not be good trade policy and it would indicate that we do not have a clear understanding of what is going on in Central America and South America.
The opportunity is huge and the benefits are great. The benefits are great, not just for Canada but for our partners in Central America, South America and the Caribbean. Again, I would implore all my colleagues in the House to support this agreement. It is a good agreement, one that will help carry Canada into the future and ensure and protect Canadian and Peruvian jobs and opportunities.