Madam Speaker, I am pleased to speak to Bill C-24, an act to implement the free trade agreement between Canada and the Republic of Panama, the agreement on the environment between Canada and the Republic of Panama and the agreement on labour co-operation between Canada and the Republic of Panama. As members of the House are aware, the Liberal Party supports this bill. The Liberal Party supports free trade and free trade agreements, and has provided leadership in that regard over many decades.
This has been an interesting bill on which to prepare my thoughts. Yes, this is a free trade agreement and we support that. In addition, Panama is the largest market for Canada in Central America, and that is significant.
It should also be noted that the Panama Canal, which is essential to international trade, is undergoing expansion to the tune of $5.3 billion. This work will create significant opportunities for Canadian companies working in construction, environmental engineering and major project consulting services, among other things.
There are some opportunities here. I want to keep in perspective in this debate that in 2009 Canada's exports to Panama totalled about $90 million. That $90 million is important to those companies that sell goods and services to Panama. I do not want to minimize that, because $90 million is $90 million. That amount could grow 30%, 50% or 100%, in which case it would be $180 million.
We support the Canada-Panama free trade agreement. It is a small positive step forward. However, I want to frame that by looking at the purpose of the free trade agreement and whether it is a good choice for Canada's resources compared with other things the government, the civil service and parliamentarians could be doing to accomplish those same objectives. My conclusion is no it is not. It is a distraction. This is yet another free trade agreement with a minor trading partner. We have seen the Conservative government ratchet up numbers with other minor trading partners to say there is another free trade agreement. It appears to be optics over substance.
I would contend that what the government needs to accomplish as its goal is a vital thriving economy that provides jobs and benefits for Canadians. That objective is not being met by the Conservative government. It is spending its time signing many small, minor free trade agreements. Where is the strategic thinking? There has been no strategic thinking. It is all optics.
The objective should be to have a strong thriving economy that creates jobs and benefits for Canadians. However, the facts clearly show that the Conservative government has a history of mismanaging our economy. For example, the government greatly increased government spending while reducing government revenues which threw the country into a deficit situation even before the onset of the recession. The government did not recognize when the recession was upon us. In fact, the government said that Canada was not in a recession and would not be in a recession. There has been a record of mismanagement by the government. One of the unhappy effects of that mismanagement is that today, Canada still has 525,000 fewer net full-time jobs than it had before the recession.
Members opposite have been throwing around job growth numbers, but they have been measuring that from the trough of the recession, which is not a metric that represents the kind of progress Canada wants to make. From before the recession to today, we want to see a country that is building jobs, building its economy and having the kind of fundamentals that allow Canadians to have jobs and feed their families.
There are 525,000 fewer full-time jobs thanks to the government's policies at a time when our population has increased by more than one million. Not surprisingly, the unemployment rate is much higher than it was when the Conservative government first took office. In fact, the unemployment rate is 7.6%, which is two percentage points higher. We are seeing somewhat of a jobless recovery. How is the free trade agreement with Panama going to help that?
Canada had $90 million in exports to Panama. What was the total exports of Canadian goods and services from Canadian businesses in and around 2009-10? It was $339 billion worth of exports, so $90 million versus some $339 billion. The exports to Panama turn out to be something like 3/100th of a percent of our total exports, which is $3 on every $10,000 that Canadians export.
Should we not be signing free trade agreements? No, that is not my point. My point is whether we are focusing on the key success factors for our economy and the job creation that is the goal of this? I see spending some three years negotiating a free trade agreement with Panama as being destructive to some of the much more significant things the government could and should be doing to accomplish that goal.
Unfortunately, we are going backwards with many of the government's policies. I will mention one other one which is the impact of the government on small and medium size businesses, which has not been positive. Industry Canada's analysis shows that in its last 20-year analysis of job creation it was not only the small and medium size businesses that created the jobs. On a net level, they created all of the net new jobs in Canada. In fact, large 5% of the jobs created by large businesses were lost on a net basis in that 20-year period up to 2003 which, as far as I know, was the last analysis of a 20-year period that Industry Canada has done.
What does that tell us? If we want jobs in Canada, we need to work with the small and medium size businesses. What has the Conservative government done? Unfortunately, it has done the opposite. The tax rates for large businesses have gone down from 22.5% to 15%, the ones that are net job losers. What has been the corresponding reduction in tax rates for small and medium size businesses? Actually there has been no reduction. There has been an increase in their costs through an increase in the EI payroll tax rate. Although the Liberals, the business community and the economists across Canada argued that taxing employment was the wrong thing to do at a time of economic challenge, in a recession, the Conservative government went ahead and did just that and added $1.2 billion in EI payroll tax increases.
We have a situation where we have a jobless recovery and we have the job engines, the small and medium size businesses, being ignored by the government. Industries that are big job creators, like tourism, have been mismanaged, unfortunately, by the Conservative government.
Tourism is an incredibly vital and important industry for the small and medium size businesses but we are falling behind. Even though Canada is recognized as the number one tourist destination, we have fallen from being seventh in the international competition for overnight visitors to fifteenth. We are losing market share dramatically. During the Conservative government's six years, we have seen a lot of that market share decline.
Why is that declining? The tourist industry representatives have some answers to that, and it is the policies of the Conservative government for the most part. Yes, there are some factors that have been outside the government's control but the government did control its decision to slap a visa on Canada's fastest growing tourist market, Mexico, with no consultation, upsetting an important trade partner and reducing the number of Mexican tourists substantially, by some 35%, through that act.
The government has been told time and again that its fees and taxes at airports make air travel uncompetitive and drives tourists to airports in the United States. It is very costly to businesses along the border in Canada. As far as I know, nothing has been done to address those cash grabs through the airports. In fact, we are seeing another addition to the cash grab at the Vancouver International Airport with an additional $5 being added to the airport improvement fee that all travellers will be paying.
In the skills and trades training, we know there is a serious mismatch between the kinds of skills and trades training happening in Canada for the jobs of today and in the future. Some of the key analysts on this issue are telling us that within about five years Canada will likely have 1.5 million jobs without people who are suitable to fill them and 1.5 million people without jobs. Where is the overall strategy to address that?
Unfortunately, the government is ideologically against having a hand in providing leadership on issues like this. It is leaving it to the provinces to solve. The government says that each of the 13 provinces and territories can battle it out themselves. The present federal government does not want to provide leadership or some kind of a framework to address a national problem that impacts national productivity and undermines Canada's prosperity, our economy and the jobs that a thriving economy can produce.
Given those challenges that the government is facing and has created, its answer is a free trade agreement with a country to which we sell $3 out of every $10,000 of our export goods and services? I would argue that if that same time and energy had been put into managing more effectively the relationship that Canada has with our most important trading partner, the United States, there would be a far greater return on effort.
We need to look at what is happening with our relationship with the United States in terms of trade. Our trade with the U.S. exceeds $1.4 billion every day. That compares with $210 million on both sides of the ledger between Canada and Panama in a year.
One would think that we would be focusing on the United States and our trade relationship, really being present where decisions are made in the United States, ensuring that our case is understood, using the department's resources that instead are doing free trade agreements with countries like Colombia, Jordan and Panama, and focusing on where it can really count. When organizations want to achieve a result, they focus on the key factors that will drive that result.
We have a government that wants to notch up some more numbers by saying that it has more free trade agreements than other governments have had. It is as if that will deliver the result that Canadians need, which is a thriving economy and jobs.
Eighty per cent of Canada's economy depends on access to foreign markets, and our largest partner, of course, is the United States; that is 75% of Canada's merchandise exports go to the United States. Panama is not even on the list if one looks at the top countries of importance for Canada's exports.
How are we doing with our U.S. exports? Canada's share of United States' imports have fallen in a great number of sectors. In furniture, we used to have a 25% share and it is down to 9.1%. In electrical equipment, we used to have a 10% share of U.S. imports and we now have just over half of that, 5.4%. In textiles, we used to have a 6.8% share that the U.S. imported and now it is down to 2.2%. Printing has fallen from 30.3% down to 17%. Fabricated metal used to be at 18% and has now dropped down to 10%. Rubber and plastics used to be at 31%, and are now down to 19.9%.
What has been happening? We have been losing market share with our biggest trading partner that accounts for 75% of Canadian export sales.
The government has had its talented people running around and organizing a free trade deal with Panama. What was the rush? Why did it not spend that time working on recovering some of our market share in the other core markets and the other core products and services?
The Prime Minister insulted the United States president and its people who wanted to take the time they needed to properly study a potential thousand kilometre pipeline on American soil that would run through some environmentally sensitive areas. Did we say that we would respect the right of Americans to study the costs, benefits and risks and make a decision? No. The Prime Minister postured and basically insulted our largest trading partner by saying that if it did not take our crude oil without any questions, we would sell it somewhere else. That was very diplomatic. That will really help. Canadians need the United States to be a co-operative trading partner. However, the government is essentially amateur hour when it comes to trade, and that has been shown from day one.
The Prime Minister has been blindsided by U.S. protectionist policies. The Conservatives were surprised by the initial buy America provisions in the 2008 stimulus package. They negotiated a solution to that, which lasted all of a year, and then buy America was back, which surprised the Canadian government's administration again.
The Prime Minister and his minister were taken off guard by the surprise announcement of a maritime commission. The commission will do research and could potentially impose fees and tariffs on U.S. goods coming through Canada at our ports. Canadians will have to pay a new border tax. These costs undermine our trade with America but we are busy doing a free trade agreement with Panama.
The complete and utter amateurishness of the Prime Minister with respect to the government's relationship with China has put Canada back about four years in terms of getting its assured destination status. This was important for tourism and we lost about four years of that tourism boost.
As a result of the kind of insults that the Prime Minister has delivered in public to the Chinese leadership, our trade with China has been languishing. Other countries are taking advantage of the great growth and the economic well-being of China while Canada has been stagnant. Canada has a four to one trade deficit with China. For every $4 that we spend buying goods from China, we only receive $1 from selling our goods to that country. Have we had a strategy focused on that key success factor for Canada's trade? No, we have not. We are busy negotiating free trade agreements with Panama and posturing about our natural resources.