House of Commons Hansard #157 of the 41st Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was benefit.
Charlie Angus NDP Timmins—James Bay, ON
Mr. Speaker, I rise on a point of order. Talking about who contributes in campaigns has no relevance. It seems to me that the Conservatives either know what they are talking about or they do not. They clearly do not, so they should stick to the facts.
Opposition Motion—NexenBusiness of SupplyGovernment Orders
The Deputy Speaker
That is not a point of order.
The minister of state.
Maxime Bernier Conservative Beauce, QC
Mr. Speaker, I would like to emphasize that we take all investments into consideration. Legislation is in place and has been for some time. It has proven itself and has helped Canada grow. We will comply with the legislation that Parliament has passed.
Kevin Lamoureux Liberal Winnipeg North, MB
Mr. Speaker, I would like to think the member would be concerned when the Canadian Intelligence Services Agency, CSIS, has flagged foreign takeovers as the potential for security risks. Canadians have expressed valid concerns regarding the lack of clarity and the need for more rules. This is just one more thing that is added onto it.
Does the member believe that when CSIS argues there is a need to be concerned about security related issues, particularly on this agreement, Canadians should be concerned, or is CSIS wrong in the manner in which it has put it forward?
Maxime Bernier Conservative Beauce, QC
Mr. Speaker, I would remind my hon. colleague that the minister will base his decision on the Investment Canada Act. This legislation also allows the government to study an investment when there is reason to believe that it could compromise national security. This follows an amendment we made in 2009 to ensure that questions of national security would be considered and to update our legislation, taking into account what was being done in other developed countries.
The legislation before us today is therefore modern and up to date, and it will help the minister make the right decision in the interest of the Canadian economy. It will ensure net benefits for the Canadian economy, while also taking national security into account, since that is part of the legislation.
Geoff Regan Liberal Halifax West, NS
Mr. Speaker, I am very pleased to rise here in the House to take part in today's debate on foreign investment, specifically, the proposed transaction between CNOOC and Nexen.
The Liberal Party understands the need for foreign investment. It is important for the creation of economic growth and for the creation of jobs.
We also note that studies have shown that foreign investment tends to increase innovation in a country. It is valuable and important for Canada. If there is a lot of foreign direct investment out of Canada, that is important to our economy. It creates wealth and jobs at home because there are returns from that. Head offices are based here that are important employers and they create good jobs in Canada.
Our position is not like the position of the NDP over the years. That party has long been opposed to free trade and foreign investment. It has opposed foreign investments over and over again. These days all of a sudden those members are trying to present some sort of a new face, a different picture, that they are not going to look quite so economically irresponsible, but rather make it look as though they are being a little more open to these things. Although they are trying to bury the past, Canadians are not buying it so far, but we will have to wait and see.
The Liberal Party has been asking for weeks for answers from the government about this deal. It is clear the government does not know what it is doing in this case, or else maybe it is afraid to tell Canadians what it is doing, what its plans are, how it is going to manage this, or perhaps both.
As a result of the government's economic incompetence, Canadians really are not confident that they can be assured of being protected by the Conservative government.
Let us remember that the Conservatives inherited the best fiscal situation of any new government coming into office, with a $13 billion surplus in 2006 and they turned that into a deficit before the recession began in 2008. By April and May 2008, the country was already in deficit again. The government entered that year with a deficit of over $5 billion and it had not even begun spending on stimulus at that point.
The Conservatives claim they have had a good record economically. I think most Canadians recognize that is not the case. Therefore, it is hard for them to have the kind of confidence they are looking for that the government will deal with a matter like this properly. For this and other reasons, as well as their failure to be open about this, there is a growing level of cynicism over this deal. The actions of the Conservatives are a major contributing factor to that cynicism and to the concerns Canadians have about this.
The report from CSIS talks about foreign companies, state-owned companies. It does not specify this instance, but it talks about how these kind of deals could create security concerns. That has obviously created a lot of concern for Canadians as well.
The public has expressed reservations about this deal because the government has failed to be open, despite repeated promises. A moment ago my hon. colleague talked about some changes the Conservatives made in 2009 in relation to a bit of tinkering around security questions. In 2010, a year after that, the Prime Minister said that we needed a clearer, more transparent process, yet we have seen nothing since then.
The government sat on this question knowing full well that proposals like this would come forward. We have been hearing lots of talk in the oil sands, in the west and elsewhere, of foreign interests and takeovers. For the government to say that it was not ready, that it did not know it was coming and that it did not even prepare for this, makes no sense.
I am delighted to be splitting my time with my hon. colleague from Malpeque. I look forward to hearing him on this topic in a few minutes.
We even see growing dissent on the government backbenches. There is clear division on that side. Even the backbench members are concerned about where the government is headed. Maybe they too find it awfully difficult to see where the government is headed on this because it has not been transparent. Apparently there is a dispute about this even in cabinet. The member for Calgary West seems to be the poster boy for opponents to the deal, but he certainly is not the only one to question what the government is doing on foreign investment.
It is something Canadians have been wondering about for years, ever since the fiscally incompetent crowd over there took power in 2006, because during that period we witnessed a hollowing out of the natural resources sector in this country. Lots of former leaders in that sector are now gone and owned elsewhere. Think about aluminum; think about steel; think about metal. Big companies in these sectors, important Canadian companies, have all been gobbled up by foreign owners. The companies, since then, have failed to live up to their commitments, and the government has not held them to those commitments. The government lacked the fortitude to enforce the commitments that were in those deals.
How can Canadians have any confidence in what the government will do with the next deal, that it will enforce any conditions that may apply to the CNOOC Nexen deal? Of course it probably should not surprise us that the government lacked the fortitude to enforce even the basic promises made in some of those deals when we know about the government's own record for keeping promises. Seniors remember the broken promise from the government and the Prime Minister on income trusts. Voters remember the fixed date election law, and that promise was broken. All Canadians these days are paying more and more because of the broken gas tax promise. The Prime Minister said whenever gas prices rise above 85¢ we will get rid of the tax, which would alleviate the challenge for Canadians paying for that. That is another broken promise.
We have a Prime Minister who has made a habit of failing to live up to his promises or to keep a promise, so how is he likely to ask others to do so? It does not seem very likely. In fact, part of the problem we are dealing with today is a direct result of the Prime Minister failing to keep his promise to review and update the Investment Canada Act and to provide a clearer process. There are a number of ways of doing it. One option is by making amendments to the net benefit test. Another is to ask if there is some other process we should use entirely. Do we use one that still leaves it to the discretion of the government in the end, or do we find something else that removes that discretion? That is what we ought to be discussing.
One of the reasons we are supporting the motion today is that we believe it is important to have a public discussion about this. It is important to have members of Parliament at committee discussing these issues. As my good friend from Wascana recently pointed out, the six-step test for net benefit in section 20 of the Investment Canada Act remains a very foggy test. It is not all that clear. In any given case, net benefit is what the Prime Minister decides, despite all the things listed in section 20. It changes from deal to deal. As we saw with the potash deal a couple of years ago, we know decisions are based on political expediency. It was clear the government wanted to go ahead with that deal, but it finally backed down.
We do not have a clearly defined set of regulations. Is that the way to go? Do we need a different process that takes it out of the hands of the cabinet? Or do we want to leave some flexibility in government on these decisions? That is the kind of thing that a committee of Parliament ought to be studying. I had a motion passed last spring after waiting quite a while, adopted by the industry committee to look at this, but we are still not at it and we have a situation in this Parliament where committees go in camera so the government can avoid dealing with things it does not want to deal with.
This is a case where the Prime Minister said in 2010 he wanted to deal with this, he wanted this study. The Minister of Industry said a year and a half ago that the committee ought to be looking at this. Well, who has a majority on the committee? Has the government really allowed the industry committee to study this question, if it has not happened? It has the majority. It controls the agenda and yet the committee has not studied this issue. We know who is in control of that.
The unfortunate truth is that, because of the Prime Minister's failure to keep a promise again, there will be a lot more potential takeovers that will be decided on this very sketchy basis, and that is economic mismanagement to add to the Conservatives' fiscal mismanagement. The sad truth is that the government has not done its homework on this deal even though it had plenty of time to prepare for this kind of situation, the same way it failed to do its homework on the northern gateway pipeline proposal as we heard from former Conservative minister Jim Prentice this very week. He talked about how they totally failed to consult aboriginal communities, how they have not lived up to their responsibilities.
Don Davies NDP Vancouver Kingsway, BC
Mr. Speaker, listening to the Liberals accuse the Conservatives of breaking promises is like listening to Mike Tyson give sensitivity training to the member for Calgary West.
The gratuitous shots taken at the New Democratic Party for consistently standing up for good trade agreements in this country for 25 years are really something.
The Liberal Party stands today in this House and says that it supports trade, but it opposed the free trade agreement. The Liberals also said that they would abrogate NAFTA. They tend to forget that, but today they would have Canadians trust them to keep their word. We all know that, from a national child care program, to a national housing program, to abrogating NAFTA, the Liberal Party did not keep a single promise it made.
My questions is: What is the position of the Liberal Party? Will the members of the Liberal Party oppose the Nexen takeover, yes or no? What is their position on the recent FIPA signed by China and Canada? Do they oppose that, or will they prevaricate and tell Canadians both answers depending on what room they are in?
Geoff Regan Liberal Halifax West, NS
Mr. Speaker, I thank my hon. colleague for his question, and I have to admit that we did have a laugh at his joke. It was clever wording, and taking shots at the member for Calgary West is fairly easy these days, although I think there is some basis for doing that. However, the NDP is not averse to taking gratuitous shots at our party or any party. We have seen that many times in the past.
What we have not seen the NDP members do a whole lot is stand up for real job creation in Canada or for investment in Canada, which is the kind of activity that creates jobs. They make a lot of noise about being for small business and job creation, but we do not see them actually support measures that make those things happen.
Maybe the NDP does not understand or recognize that investment is important or that it is primarily the private sector that creates the jobs and wealth in our economy, which allows our government to provide the services that are so important for this country.
Kevin Lamoureux Liberal Winnipeg North, MB
Mr. Speaker, I appreciate the comments from my colleague. Just to add to that, whether it is free trade or investment, there is a general lack of support that comes from the New Democratic Party toward those two policy initiatives.
Having said that, I have a question regarding the issue of providing more clarity and rules. Could the member provide more comment on that issue?
Geoff Regan Liberal Halifax West, NS
Mr. Speaker, on this point I am going to surprise my NDP colleagues by agreeing with them and the motion they have brought forward today.
I think it is important that we hold public hearings on this topic. It is important that we hear from expert witnesses who have considered these kinds of questions and can give us their thoughts on the best practices around the world. Let us look at those. Let us look at possible ways to strengthen the act and make foreign investment work for Canadians. That is the key here.
We ought to make sure that there is a process in place, that conditions can be put and enforced against these companies, that there are the proper enforcement mechanisms to ensure those conditions are enforced, so that this kind of investment gives Canada the kind of benefit we want to see in terms of job creation, development of our economy, and innovation. We have seen that there is a lot of past history showing there are benefits from foreign direct investment in this country.
Another topic for perhaps another time is the kind of investment we have elsewhere. How do we encourage that? To what degree do we want to encourage national champions that are not just targets for takeover but are in fact doing the kind of investment elsewhere that helps to create those head offices and jobs in our country?
Charlie Angus NDP Timmins—James Bay, ON
Mr. Speaker, I listened with interest, but I think we are missing the big elephant in the room. CSIS is talking about foreign espionage and the threat to the energy sector posed by state-owned enterprises.
In The Globe and Mail, an editorial on September 25 said “Foreign espionage is...not a 'net benefit to Canada'”.
I would ask my colleague what he thinks of a government that ignores clear signs from our intelligence agency about the threat to Canadian development and our resources by a foreign takeover from China.
Geoff Regan Liberal Halifax West, NS
Mr. Speaker, this is a real concern. We ought to be concerned, but we also ought to examine it. We should try to understand and maybe have people from CSIS come before the industry committee to talk about this and examine in which cases they feel there are threats, in which cases they do not and what is the nature of the threats. Some of them are obvious, if we are talking about a nuclear or electrical plant. As far as the development of an oil sands project, it is a little less clear what the security risk is, but let us discuss and examine those issues.
Wayne Easter Liberal Malpeque, PE
Mr. Speaker, I am pleased to speak on this motion, which just like yesterday's motion on employment insurance, is quite reasonable. I certainly believe MPs from all sides of the House should be able to stand up in their place and support it. It is not going against government policy. It is, in fact, doing reasonable things for Canadians and doing the proper study.
We all know that the government has failed, as has been mentioned by many speakers, in its commitment to lay out the rules on foreign investment in Canada, which it committed to do following the attempted takeover of Saskatchewan potash some two years ago. There is no question that the Conservative government has completely botched up the Nexen situation by completely failing to outline the concept of net benefit within the Investment Canada Act. This particular proposal goes far beyond just an ordinary investment because, in this case, we are talking about Canadian resources. Because of that failure and the lack of leadership on the part of the government, ministries within the government now are trying to make rules on the fly, it seems to me. That is unacceptable.
As the motion states in (c), the government “must respect its 2010 promise to clarify in legislation the concept of 'net benefit' within the Investment Canada Act”. That is certainly not too much to ask and we all know the government has completely failed in that obligation. Yes, we know government members will rant on in their remarks about the net benefit test that is already there, but we all know that when we go through the six points, they are basically meaningless and vague, and they give government a wide-open door for what it may or may not want to do and, specifically on the Nexen-CNOOC proposal, they really are not the kind of criteria that are necessary.
This is not a straightforward commercial venture in which a company is buying a business that produces widgets. This is much beyond a commercial venture. This is about buying a company that may not have the capital flow that is required to expand into the future. Yes, that company is looking for capital investment, but it is a company that has control over and access to Canadian resources that we should be looking to enhance in terms of Canada's value-added industry, Canadian jobs and resourcing our own energy sector. This is really about control of our resources.
Premier Redford and a number of premiers have talked about a national energy strategy, and I certainly agree we need one. We need a national energy strategy in this country. I come from the east coast. However how do we utilize Canadian resources of all types? In this case, how do we utilize energy, which CNOOC might eventually control, to add value for Canadians, to be an energy resource for Canadians, to be a benefit to this country and to use our resources to fuel our own industrial plants where we would create Canadian jobs and production beyond our energy sector? In other words, how would we fit this proposal into a Canada-wide energy strategy?
The points I just made really relate to (a) and (b) of the motion. The motion states that we need to involve all Canadians, a public process and proper public consultations, so we can see what is at stake in the overall proposal. What do Canadians really want? How will my constituents in a riding in eastern Canada, far away from where this deal is taking place, impact it?
I will now turn to the heart of the issue as it relates to this specific takeover proposal. The $15.1 billion effort by China's state owned oil company, CNOOC, of Canadian Nexen has to be placed in the proper context, one that goes beyond the shareholders of Nexen itself.
I will quote from testimony at a United States-China review commission on January 26, 2012. It reads:
Beijing’s instinctive impulse for national control over key resources and energy in the face of chronically growing dependence on imported oil is what has driven its push for control over overseas oil and natural gas resources embodied in its “Go Out” strategy adopted after 2000. The go out strategy reflects the growing politicization of energy security in China but is symptomatic of the reaction to growing energy security anxieties across the region in Asia among the big oil importers.
The submission to the commission continued with the following:
First, Beijing has sponsored and supported the overseas acquisition of oil and gas resources by China’s three main national oil companies (NOC) with state bank funding, loans, and expanding state diplomacy in the key oil and gas exporting regions. The NOCs often pay significant premiums to other market bidders to acquire these assets.
I know that CNOOC has made clear that it is operating on a strictly commercial basis. That may be so, we do not know, but all the more reasons for proper consultations and investigation. However, it is a fact, as stated to that “before the commission”, it is paying high premiums on share prices in order to buy Nexen.
If the board of directors of Nexen, who certainly need capital, are getting this premium, then they do have an obligation to their shareholders to say that it is an opportunity and that it is for shareholders.
However, our job and the government's job is to decide on the criteria and on whether it would be a benefit to Canada. This motion goes right to that point.
As I said at the beginning of my speech, this motion is not all encompassing. It is a reasonable motion. The government backbenchers need not be afraid that the Prime Minister will come down on them if they vote for this motion. This is doing the reasonable thing for Canadians and holding proper consultations in order to have the right criteria on this kind of proposal. As I said, this is not an ordinary business acquisition. This is about our energy sector. It could affect how we implement a national energy strategy, if we ever do. As it could affect jobs in our industrial plant in Canada, we need to do it correctly.
The Conservative government has failed to make clear in any respect to any constituency what constitutes Canada's interest in this $15.1 billion purchase of Nexen by China's state owned enterprise, CNOOC, as demonstrated by the story in The Globe and Mail of September 25 headlined, “Protect Canadian ownership of oil sands firms, executives urge”.
When we have public declarations from leading oil executives in Canada with respect to concerns regarding increased foreign, in this case Chinese, investment, there is a reason for greater concern, and that goes to the point of the motion.
We Liberals, as my colleague from Halifax West said, are very much in favour of trade and of investment but at the end of the day they need to be in Canadians' interest. In this case, we are not talking just about a commercial venture. We are talking about an impact by a state owned company on our resources.
Peggy Nash NDP Parkdale—High Park, ON
Mr. Speaker, I thank the member for his comments on this important motion from our side.
I think we would all agree that investment is important to Canada. We are a massive country with a relatively small population. We not only have abundant natural resources but it has always been a massive project to transform those resources, to process them and to create a vibrant manufacturing and technology sector in this country, sadly, one that, under the current government, we have seen erode significantly.
If the member believes in public consultation and believes that perhaps not every foreign takeover is in the best interests of Canadians, why did his party, when it was government, approve over 10,000 foreign takeovers and never rejected one in the history of the Investment Canada Act?
Wayne Easter Liberal Malpeque, PE
Mr. Speaker, many of the cases that she talked about in terms of former Liberal governments, when we were balancing the books in this country and creating public investment in the country, were very much commercial types.
In this case, as in the Saskatchewan potash case, which we strongly opposed, we are seeing companies come in and basically trying to take over the natural resources of the country, dominant control. In this particular case, we are taking about a state owned enterprise, which could have serious implications on policy development in the future. It is not just a commercial business venture.
John McCallum Liberal Markham—Unionville, ON
Mr. Speaker, I have a question for my colleague regarding the commitment given by the Prime Minister in, I believe, 2010, almost two years ago, that he would give clarity to the Investment Canada Act and to the definition of the term “net benefit” for Canada.
That is a long time ago, and this is a really important issue. With all of his discussions with the Chinese and other governments, the Prime Minister must have seen something like this coming.
Could my colleague explain the irresponsibility of the Prime Minister in leaving this to the last minute when he has had almost two years to get the job done?
Wayne Easter Liberal Malpeque, PE
Mr. Speaker, it is clearly a lack of leadership on the government's part.
We all know that the six points under the Investment Canada Act are very vague and really do not lay out the serious criteria needed for this kind of a proposal.
I know my colleague strongly supports investment in trade. We need the criteria laid out to ensure any capital investment coming into this country, commercial ventures and trade issues going forward are for the benefit of Canadians.
In this particular case, we do not want to see a proposal that at the end of day could even compromise our ability as politicians, both federally and provincially, to implement a national energy strategy that is to the benefit of all Canadians. We need those options open.
The bottom line is that the Prime Minister failed in his leadership, failed to lay out the criteria necessary as he said he would do and failed to live up to his word. When we see him operating across the world these days, it looks like Canada is not open for business, it is just up for sale. That is not what we want to see.
Don Davies NDP Vancouver Kingsway, BC
Mr. Speaker, I am delighted to be sharing my time with the member for Longueuil—Pierre-Boucher.
I think all Canadians understand the importance of investment in Canada and conversely the investment by Canadian firms in the rest of the world. I also think that Canadians understand the need to develop economic policy in this country that is capable of reflecting a multi-factored and nuanced approach. I think Canadians understand and desire economic policy in Canada that accomplishes a number of goals at the same time, where we create strong value-added industries and good, solid industrial sectors in this country that create good paying jobs on which people can raise their families. I think Canadians want the development of the Canadian economy by Canadians for Canadians and in Canadians' interests.
As well, I think Canadians understand that Canada operates in the global world and that we understand and do seek to have responsible and effective investment by other countries and other companies that operate across the world in Canada. I think everybody agrees with that.
Within that general framework, we have the situation of China. I think all Canadians are starting to recognize the critical importance of that country as a leading major ascending economy in the world. Right now, China has emerged as the second leading economy around the globe. China is of particular importance to western Canada, in particular to my home province of British Columbia where Asia-Pacific trade and economic relations are increasingly important every day.
We know that China has massive foreign reserves. It is sitting on a lot of cash that it seeks to put to productive use around the world. Canada wants to engage and be part of this growth but Canadians do not want the growth to be completely without any kind of rules or regulations and to be pursued blindly without consideration for how that economic integration with China can be most effective in developing the Canadian economy.
Canadians also have a very sharp appreciation for the importance of Canada's non-renewable resource sector. We know that we are blessed with many resources that are non-renewable, from minerals to oil and gas. We know that is an important part of our economy. Canadians know that this resource is a strategic one. It is a critical domestic asset. We live in a country that is cold and we require natural gas and other substances to heat our homes, so we know that oil is a very valuable commodity.
The proposed takeover of a major Canadian oil sector, in this case Nexen, by the foreign company CNOOC, a state owned Chinese company, is of major importance to Canadians. It not only raises questions of foreign ownership of Canadian strategic assets but it also raises the larger question of what Canadian policy should be toward foreign takeovers of Canadian companies generally.
Therefore, the New Democrats are very pleased to have put before Parliament today a motion that reads as follows:
That, in the opinion of the House, the government: (a) should not make a decision on the proposed takeover of Nexen by CNOOC without conducting thorough public consultations; (b) should immediately undertake transparent and accessible public hearings into the issue of foreign ownership in the Canadian energy sector with particular reference to the impact of state-owned enterprises; and (c) must respect its 2010 promise to clarify in legislation the concept of “net benefit” within the Investment Canada Act.
When we read those words, I would respectfully venture to say, they are impossible to disagree with. How could anyone in Canadian Parliament, from any party, oppose a review of the takeover of major Canadian strategic oil company assets by a foreign state-owned company without having involvement and input from the public and the stakeholders of our country?
Who could possibly be opposed to clarifying, not only for the Canadian public but for investors around the world, the concept of “net benefit” when that phrase is contained within the body of our legislation? Who could oppose having clearly defined criteria so that investors know what the ground rules are when we are considering a foreign takeover of a Canadian asset? It will be interesting to see whether the Conservatives oppose that.
As a little background, in July 2012, CNOOC, which is a majority Chinese state-owned enterprise, made a $15.1 billion takeover bid for Nexen, which is Canada's twelfth largest oil company. This is the largest proposed foreign takeover by a state-owned enterprise in Canada's history. It is the first in a likely wave of similar major acquisitions.
Nexen has 300,000 acres of oil sands assets, including an upgrader at Long Lake, as well as interests in a further 300,000 acres in shale gas assets. That is an estimated 37 trillion cubic feet of gas in northeast British Columbia.
The Chinese government owns almost 65% of CNOOC and it names the chair, vice-chair and other key directorship positions, giving the Chinese state significant influence over major decision making. This deal would give state-owned CNOOC full control of a Canadian company with significant oil sands reserves, as well as offshore oil assets in the U.S., Gulf Coast and North Sea.
In an attempt to win approval CNOOC has made some promises. It has promised to make Calgary the headquarters for CNOOC Ltd.'s North and Central American operations. It has promised to retain Nexen's current management and employees, to increase capital spending on Nexen's assets, to list CNOOC shares on the TSX and to maintain Nexen contributions to community and social commitments. Those are laudable promises.
Here is what CNOOC has not promised. It has not promised to maintain or increase value-added processing jobs in Canada, to improve environmental performance or to place Canadian interests ahead of those of its state owners.
Given the serious concerns that this deal raises, New Democrats are calling on the government not to oppose the deal at this point but to conduct open public hearings before making a decision on the deal. Both the business sector and Canadian workers in communities need certainty when it comes to foreign takeovers, but the current review process lacks transparency and accountability.
The current Investment Canada Act mandates that important transactions, currently over $300 million, be reviewed. The Conservatives want to raise that threshold to $1 billion, meaning many more transactions and takeovers of Canadian companies would occur without any government review whatsoever. However, these transactions must be reviewed by the Minister of Industry to determine whether they present a net benefit to Canada.
Again, the concept of “net benefit” is not clearly defined in the act. In 2010 in the wake of the rejection of the BHP Billiton bid for Potash Corp., the then-industry minister promised to clarify the meaning of “net benefit”, but has yet to do so, notwithstanding the fact that the government has had two years to do it.
In 2010, the Conservative government unanimously supported an NDP motion calling for a more transparent investment review process, including mandatory public hearings with affected communities and public disclosure of all conditions attached to approval of a takeover, along with enforceable penalties for non-compliance. The Conservatives have failed to live up to that promise as well.
I also want to comment a bit about domestic investment. The current Minister of Trade has said that it is important to attract foreign investment to Canada. Right now we have $500 billion of domestic Canadian investment sitting on the sidelines.
I suggest that the government do two things: work on policies devoted to getting that Canadian domestic investment capital to work in the Canadian economy, and start keeping the promises it made in 2010 to the Canadian people to actually bring public, full, transparent review to these important economic decisions that affect all Canadians and the future of the Canadian economy.
Kevin Lamoureux Liberal Winnipeg North, MB
Mr. Speaker, I was present when the member was questioning one of my Liberal colleagues regarding the Liberal Party's position and whether it supports the takeover. He even seemed to imply that it would be irresponsible if it did not have a position.
My question is similar to that of the New Democratic Party member. Is he in a position to say very clearly whether the NDP supports the deal? Would the New Democrats join the Liberal Party in acknowledging that this whole issue should be given due diligence before any sort of decision is made?
Don Davies NDP Vancouver Kingsway, BC
Mr. Speaker, New Democrats believe that the magnitude of this deal and the potential impacts of increasing foreign investment by state-owned enterprises in the energy sector necessitates that the government consult with Canadians rather than grant approval through a secretive and unaccountable review.
The New Democratic Party, the official opposition, has put this motion and chosen to devote one of our opposition days to this very question. We are inviting stakeholders, not just the Canadian public but the Canadian business sector generally, the oil and gas sector, academics, experts and businesses and industries that are operating in the trade concerned and people who have experience and expertise in Asia to come forward and give us their views before we make an informed decision.
We did not have any criteria for the net benefit test. We are calling on the government to publish those criteria so Canadians and the parties in the House can make an informed decision before approving such an important deal.
Marc-André Morin NDP Laurentides—Labelle, QC
Mr. Speaker, what worries me is how dim-witted the members opposite appear.
Earlier I heard a minister say that, in the name of freedom, the government cannot intervene to prevent Nexen shareholders from selling their shares. We are told that the government cannot intervene, but on the other hand, the Conservatives are willing to hand responsibility over to the Chinese communist government.
There is something wrong with this picture. This kind of stubbornness will not get us anywhere.
Don Davies NDP Vancouver Kingsway, BC
Mr. Speaker, it is a true and fair comment to say that we are getting mixed messages and a complete lack of clarity from members of the government. I do not think the Conservatives know what position to take. Half of them want to allow untrammelled free market principles to prevail and to let any company in the world have access to whatever assets it wants in Canada. Others on the government side have serious concerns about state ownership. The government needs to work out those mixed messages.
However, in the past two years state-owned Chinese companies such as PetroChina, Sinopec and CNOOC have invested more than $10 billion in the Canadian oil and gas sector. That now accounts for control of more than 7% of oil sands reserves. Serious questions of Canadian control of strategic assets are engendered by this issue.
There is the environment as well. We cannot talk about oil and gas without responsibly raising the concept of wise and prudent environmental stewardship. This is another concern of CNOOC because its record in terms of protecting the environment is, to put it charitably, somewhat questionable. These are other very important issues that need to be studied before the government approves this deal.
That is what Canadians send us here to do. Canadians send representatives to Parliament to have full evidence before us and to study issues very thoroughly before we make decisions that would affect our economy in major ways. I encourage and urge all members of the House from all parties to agree with this very reasonable motion that simply calls on an evidence-based, open and transparent public discourse before we make this important decision.
The people of Canada, and the people of Alberta in particular, own the reserves of oil and gas in this country. We need to ensure they have their say.
Pierre Nantel NDP Longueuil—Pierre-Boucher, QC
Mr. Speaker, this is an important day: we finally get a chance to speak about a subject that our dear friends opposite have been trying to deal with in secret. This is the largest foreign takeover by a state-owned company ever proposed in the history of Canada. It is probably the first in a series of similar major takeovers, which is even more worrisome.
I am not an expert on energy issues. I am the member of Parliament for Longueuil—Pierre-Boucher, and people in my riding are worried about this issue, just as Canadians in other places are. When I see a poll reporting that 68% of people who usually support the Conservative Party do not approve of this agreement and that 72% of New Democrats and 73% of Liberals also reject it, I think it would take a real ostrich to hide its head that deeply in the sand and pretend that everything is fine. Do the Conservatives think that we will let them approve this and not do anything? That is a joke. It would be totally irresponsible, and I wonder what leads the government to take such an attitude. Is it its habitual short-sightedness? Is it the prospect of a quick profit? Is it doing the bidding of its friends in big business? Is it all of the above? I think it may be.
The oil sands are one subject we must study thoroughly. They are a precious source of wealth for Albertans and such a crucial dimension of today’s economy should be considered seriously and certainly not just glanced at by a little club in the back room.
Most people in my riding are distressed that we are so dependent on that source of energy. We are not the only ones expressing our disapproval; everyone on the planet feels the same way. We must develop alternative energy, but we must take good care of this resource we already have and we must use it to its full potential. We must create jobs for Canadians.
I am really quite shocked at the poll results. For example, the Abacus survey asked people if they agreed that Chinese companies should be allowed to purchase Canadian natural resource companies. That is ridiculous. Some 73% of respondents said they were uncomfortable with this idea, but the government wants to slide it past us, like a box of chocolates slipped under the door.
Clearly, Canadians want to talk about it. That is the function of this House, in fact. Parliament is the place where we talk. Today’s motion reads as follows:
That, in the opinion of the House, the government: (a) should not make a decision on the proposed takeover of Nexen by CNOOC without conducting thorough public consultations; (b) should immediately undertake transparent and accessible public hearings into the issue of foreign ownership in the Canadian energy sector with particular reference to the impact of state-owned enterprises; and (c) must respect its 2010 promise to clarify in legislation the concept of "net benefit" within the Investment Canada Act.
My neighbours opposite like to make decisions behind closed doors, but whether they like it or not, we have to talk about this. What right do the Conservatives have to give the impression that they received a mandate to make things happen and then say they do not have the time to talk about it? This type of attitude is shameful in our democracy. I wonder if, as usual, they are going to work alone and say that they have people who know what they are doing and that we, the social democrats, offer nothing more than pie in the sky. It is not true. This image they are promoting of us is pure fabrication.
The fact that they negotiate all manner of agreements in secret is bad enough, but it is even worse when we are talking about things as important as our natural resources.
The Conservatives committed us to procuring fighter jets that will take us decades to pay for. That is a very big problem. They did not take this purchase seriously. They made a bad choice, and it is the taxpayer who is going to have to foot the bill. However, in this case we are talking about our resources. This is strategic. It is a big deal.
If the government bothered to look at the situation of Canadians and Quebeckers in Montérégie, Longueuil and my own neighbourhood, it would be ashamed of how out of touch with reality it is. It does not see that 300,000 people have become unemployed since the crash. It does not see that people are outraged because they feel this makes no sense and they wonder what business this government has making decisions about everything without consultation. That is the issue. It is clear that the Conservatives are not being transparent about this, and that is what we cannot abide. We need to stop saying that they do not see what is going on.
We are saying that the Conservatives do not see the situation, but they do. It is not that they do not see it. It is not a mistake. It is that they do not want to see it. This government is running recklessly forward like a Cyclops who sees nothing but the target that its oil company advisors have programmed into its mind.
Opening the door to this type of takeover is the first step in handing over the future of the development of this Albertan natural resource to foreigners. While a consensus cannot even be reached on the transportation of this resource and decisions on increasing processing jobs are still under debate—and I would like to remind hon. members that we are in a Parliament—this government is making decisions in favour of very specific individuals and interests. The polls are very clear: everyone is concerned about this transaction.
Some foreigners will be at the negotiating table for this transaction. The Chinese government will do its utmost to convince Albertans that everything is fine and will tell Canadians that Albertans can continue to send their raw resources with no value added to benefit other countries.
After the proposed takeover of PotashCorp was rejected in 2010, despite repeated calls from the business sector and civil society, the industry minister at the time—my colleagues know who I am talking about—and the Conservatives did not keep their promise to reform this legislation.
Is there a club of business people somewhere—it needs to be mentioned because many of the Prime Minister's former advisors are in on this major deal—who said that we needed to step on the gas so that they could make big money while there was still time?
In 2010, the Conservative government unanimously supported an NDP motion requiring mandatory public hearings involving the communities affected by a transaction under review and the public disclosure of any conditions attached to the approval of a takeover. The motion also called for the law to set out sanctions for non-compliance with the conditions of a transaction. Did the Conservatives keep that promise? Clearly, they did not.
By taking over Nexen, CNOOC would become a member of COSIA. Other businesses have expressed concerns about this. Even CSIS issued a warning:
When foreign companies with ties to foreign intelligence agencies or hostile governments seek to acquire control over strategic sectors of the Canadian economy, it can represent a threat to Canadian security interests. The foreign entities might well exploit that control in an effort to facilitate illegal transfers of technology or to engage in other espionage and other foreign interference activities.
Everyone knows how far China's ambitions extend. In 2009, I visited Shanghai and Beijing. Demand for energy has since multiplied. A billion Chinese want access to a more comfortable standard of living, and we understand why. China is at the heart of all international development, as is India. All Canadians want to sell them products. We want to sell products, but not our country or our soul. We want to sell them products.
In Longueuil—Pierre-Boucher, people are aware that we must create wealth in order to share it. And although big projects like the oil sands or Plan Nord represent real business opportunities for a large number of suppliers, the resource itself belongs to the public.
Naturally, trucking firms and bus companies are pleased that we are developing these resources, because they transport them. Airlines are booming: they transport workers. They are pleased. These suppliers are connected to the major job sites. They create employment and pay taxes, but the resource belongs to the provinces.
Canadian engineers would love to work on plans to process these resources in Canada. However, if the Chinese government is literally on the board of directors, will it be more difficult to advance our interests?
The FIPA is an agreement that will allow CNOOC to circumvent the courts by using an arbitration process to claim damages and interest from the government for so-called current or future losses. And this will happen behind closed doors. That is also a huge problem.
As I am being signalled that I have only one minute left, I will conclude by saying that the New Democratic Party is in favour of trade agreements and investments that promote Canada's interests. We want jobs here, in Canada, for all Canadians, in all sectors.
Have Canadian interests been sacrificed to secure this agreement? That is the big question. Observers have noted that the advantages of this agreement, the FIPA, are skewed in favour of China, not Canada.
The Canada-China FIPA favoured by the Conservative government is in fact a big step backwards compared to similar agreements signed by Canada. Unlike the other agreements, this one does not require the arbitration of disputes to be carried out in a transparent manner that is open to the public and the media.
It is important to talk about this, and I am pleased that we are discussing this issue today.
Kevin Lamoureux Liberal Winnipeg North, MB
Mr. Speaker, could the member provide some additional comments in regard to how CSIS has been brought into the debate now, primarily because of its concerns regarding security of national interests? Does the member agree that this in itself is reason as to why it is so very important that the whole process in this takeover by foreign investment needs to be reviewed in a very public and transparent way because it is in Canada's best interests to ensure that this takes place?
Pierre Nantel NDP Longueuil—Pierre-Boucher, QC
Mr. Speaker, I thank my hon. colleague for the question.
Indeed, it does not take a rocket scientist to understand that national security is at stake here. We cannot imagine doing business with these companies or entities without questioning their underlying interests. It is important to remember how large the Chinese population is and the scope of its ambition. It is legitimate, but this is basically like handing over the keys or the combination to the safe and telling them to help themselves.