Mr. Speaker, it is my pleasure to have this opportunity to talk about the benefits for Canadian investors. My speech today will be about the investment aspects of the Canada-Panama free trade agreement.
Foreign investment is a crucial component of today's modern economy. Foreign investment not only brings with it jobs, but increases the transfer of know-how, efficiencies and economies of scale to a host of economic opportunities. These markers of success, in addition to the people ties fostered, help strengthen Canada's global competitiveness at home and pave the way for new opportunities for Canadian companies overseas. These opportunities help Canadian companies remain globally competitive by ensuring their integration into the world economy.
At the end of 2011, Canadian direct investment abroad reached an all-time high of $684 billion. The value of the stock of foreign direct investment within Canada is also impressive. By the end of 2011, Canada had attracted more than $607 billion in foreign direct investment.
I will pause for a moment to remind my colleagues and to emphasize that the actual numbers from the end of 2011 show there is more investment from Canadian companies abroad than direct investment we get from foreign companies. This is important. We often hear in the House, on the street and in our ridings, that Canada is hollowing out, that Canadian companies are being sold and we are losing our control. In actual fact, that is not the case. Canadian companies are more aggressive and progressive in investing in foreign lands than the money that comes into our country.
As the past few years have demonstrated, the Canadian economy has proven to be a safe harbour as the global economy faces severe challenges. Canada is home to 27 of the Financial Times “Global 500” companies. More top global companies have headquarters in Canada than in Germany, India, Brazil, Russia or Italy.
Canada has also outpaced its G7 partners with its economic growth, the fastest it has been in the last 10 years, as a result of having lower corporate taxes, prudent fiscal management and financial regulation, a business climate that rewards innovation and entrepreneurship and an open economy that welcomes foreign direct investment.
Canada must remain diligent to ensure that our economic credentials remain strong at home and that Canadian businesses continue to have access to an increasing number of investment opportunities abroad. This is why it is important for us to leverage our investment relationships that we have around the world and with countries like Panama.
While data is unavailable for the end of 2011, the stock of Canadian direct investment in Panama was estimated by Statistics Canada to have reached $121 million at the end of 2010. Canadian investment in Panama, primarily found in the financial services and the mining sector, also has strong potential for growth.
There are many Canadian investment success stories around the world and Panama is no different. Scotia Bank has been in Panama since 1973 and has expanded to become the country's fifth largest commercial bank. SNC-Lavalin moved its Central American regional office to Panama in 2006. Inmet Mining Corporation continues to develop its copper mine in Panama, which is now over 13,000 hectares.
Opportunities for Canadian investors in Panama are also poised to grow in the future. We have heard about the tremendous opportunities that exist in Panama with respect to large numbers of infrastructure projects.
In addition to the ongoing $5.3 billion U.S. Panama Canal expansion project, the government of Panama has numerous projects either under construction or already in progress. These projects include the building or improvement of ports, roads, hospitals, social housing projects, bridges and airports, which are part of the U.S. $13.6 billion Panamanian government strategic investment plan for 2010 to 2014.
Under this plan, a large number of infrastructure projects would create new opportunities for Canadian businesses. A country like Canada, with so much expertise to take advantage of these significant opportunities in Panama, must act now. The current and future opportunities for Canadian investors show how important it is to enhance our investment relationship with countries like Panama.
This agreement would do just that by building upon a Canada-Panama Foreign Investment Promotion and Protection Agreement signed in 1998. By enhancing the investment provisions under this agreement, a free trade agreement with Panama would provide investors from both countries with the benefits that come with enhanced investment obligations. These provisions, which would promote the two-way flow of investments between Panama and Canada, would provide a range of obligations that would benefit investors from both countries.
They are designed to protect investment abroad, through legally binding rights and obligations. The investment obligations of this agreement incorporate several key principles. They include: treatment that is non-discriminatory and meets a minimum standard; protection against expropriation without compensation, meaning we cannot take land or property without compensation; and the free transfer of funds without penalty.
In short, Canadian investors would be treated in a non-discriminatory manner. This dynamic would help foster an investment relationship between our two countries and pave the way for an increased flow of investment for the years ahead.
Through this agreement, investors would also have access to transparent, impartial and binding dispute settlement systems.
While this agreement would ensure that investors and their investments are protected, it would not prevent either Canada or Panama from regulating in their public interest, with respect to health, to safety and to the environment.
The investment provisions also include an article on corporate social responsibility. This provision recognizes that Canada expects and encourages Canadian companies operating abroad to observe internationally recognized standards of responsible business conduct. This provision would also help level the playing field for Canadian investors when they invest abroad by encouraging CSR principles among all investors.
Overall, this agreement would send a positive signal to our partners around the world about the openness of Canada to foreign investment. This agreement would enhance investment opportunities abroad for all Canadians.
Foreign investment links Canadian companies to global value chains and to new economic opportunities. This enhances our competitiveness and increases the flow of goods and services between Canada and our trading partners.
To date, Canadian companies have shown a significant interest in investing in the Panamanian economy. However, as time passes, opportunities for Canadian investors are at risk. That is why it is critical that Canadian companies have the ability to strike while the iron is hot. I encourage members not to delay the approval of this agreement.
Our government has been very clear that trade and investment are vital to the economic growth and long-term prosperity of Canadians. That is why our government continues to move forward with an ambitious free trade agreement agenda that focuses on creating partnerships with key nations around the world. To take advantage of commercial opportunities around the world, we must do everything we can to open doors for Canadian businesses.
That is why I ask all hon. members to show their support for the Canada-Panama free trade agreement.