Mr. Speaker, I truly do appreciate the opportunity to participate in this debate tonight along with many of my colleagues in the House. As so many of them have indicated tonight, I have also been following the situation in Ukraine very closely over the past number of months. I can say that our government is deeply disappointed with the Ukrainian government's decision to suspend signing of the association agreement and the deep and comprehensive free trade area with the European Union. Like hundreds of thousands of Ukrainian citizens, we believe the decision to not sign the association agreement represents a lost opportunity. We stand with all Ukrainians who are fighting for their beliefs in a democratic European Ukraine, and we believe that Ukraine's best hope for democracy and economic prosperity lies in closer alignment with European and North American norms and institutions.
More disturbing is the shady way in which the new laws were passed by the Ukrainian parliament on January 16. If they stand, these new laws will place serious limitations on the human rights and civil liberties of Ukrainians.
In particular, we are very concerned about a new measure that would define Ukrainian non-governmental or civil society organizations as “foreign agents” if they receive money or property from foreign countries and participate in any so-called political activities. The new law would require such foreign agents to register with the government and to provide monthly reports on their activities and income. They would also be subject to different tax treatments on these foreign funds. These changes could be a serious hindrance to the economic prosperity of the Ukrainian people and would have a serious impact on Canada's development assistance work in the Ukraine.
As a way of providing some context for this debate, I would like to take a few moments to tell members about Canada's work to help Ukraine achieve economic prosperity. As members know, the historic ties between our two nations extend back through generations of Ukrainian migration to Canada. For more than 120 years, Ukrainian-born Canadians have contributed to the social, economic and political fabric of Canada. Today, Ukrainians make up almost four per cent of the total Canadian population. I know my riding of Elmwood—Transcona is very reflective of this.
Economically, Canada and Ukraine enjoy positive commercial relationships, with two-way trade that totalled $313.5 million in 2012. Over the years, we have developed a close bilateral relationship, a solid economic partnership, and strong people-to-people ties. In 1991, Canada was the first western nation to recognize Ukraine's independence. Since then, much of our development assistance in Ukraine has focused on increasing economic opportunities for Ukrainians in a strengthened democracy.
Over the years, Canadian development assistance investments in private-sector development and governance in Ukraine have contributed to the country's transition from a centrally planned system toward a free-market democratic model. However, Ukraine was an integral part of the former Soviet Union, and as such its economic transition has been much slower and more difficult. To build resilience and achieve broad-based prosperity, Ukraine must diversify and grow its real economy, especially through developing its small and medium-enterprise sector, which is far smaller than in other European countries. Stimulating the growth of small and medium enterprises will also help to expand and strengthen the middle class. We know from experience that a healthy, civically engaged middle class and small-business sector will help to nurture a well-functioning democracy. Given its rich natural resources, reasonable labour costs and large and well-educated population, Ukraine has excellent economic potential. However, it will face challenges in becoming competitive. If concluded, planned free trade agreements with Europe and Canada will help to provide a road map to greater competitiveness within a predictable rules-based framework.
To increase rates of economic growth in Ukraine, Canada is focusing on three areas of intervention.
The first area is to strengthen the investment climate in a sustainable way by building economic foundations. In practical terms, this means improving the capacity of all levels of government, including local governments, to deliver on the basic needs of citizens and create a supportive framework for local business growth and trade and investment. That means providing security and a level playing field for small and medium enterprises, from fair and transparent regulations, to independent and predictable application of the rule of law.
The second area of focus is growing businesses, especially those that are micro, small, and medium-sized firms, including those in the agricultural sector. Our goal is to help make these businesses more sustainable and competitive. We would do this by helping entrepreneurs access the things we take for granted in Canada, such as business networks, value chains, productivity-enhancing technology, insurance and business financing.
The third area of focus, and one I believe in strongly for a number of reasons, is investing in people, especially women and youth. Our objective is to build a skilled, trained workforce of women and men who can seize opportunities in a rapidly expanding labour market that is fuelled by the needs of local and international employers.
Careful investment of development assistance in these areas will lead to increased employment opportunities and enhanced business productivity and profitability in Ukraine, resulting in rising household incomes and reduced poverty over the long term.
This is also in Canada's interest. As Ukraine's economy continues to grow, so will the economic ties between our two countries. Canada's development program has contributed significantly to advancing Ukraine's sustainable economic growth. Agriculture is a key growth sector for the Ukraine.
Canadian support has helped to increase the competitiveness of smallholder fruit, vegetable, and dairy farmers who have invested in improved technology and are working together to market higher-value, higher-quality products demanded by the marketplace.
With help from Canada and specialized technical assistance from Israel, smallholder horticulture farmers in southern Ukraine have sold more than 12,000 tons of produce, for over $12 million. Most importantly, they have increased their household income by over 30% since the start of this project.
Agricultural insurance is an essential component of a modern agricultural economy. It allows farmers to invest with confidence and for banks to lend to farmers with confidence. With support from Canada, Ukraine has implemented a new agricultural insurance system based on international best practices. At the start of 2013, seven Ukrainian insurance companies were selling the 14 products developed by this project, resulting in more than 1,000 insurance contracts covering a total of 1.929 million hectares of crop. The crop area that is covered expands every day.
Canada is also helping to create partnerships between Canadian and Ukrainian cities to help them modernize their approach to local economic development planning. The Federation of Canadian Municipalities has worked with municipal partners in 12 cities to develop and implement municipal strategic development plans. These plans have helped to operationalize 15 demonstration projects, in tourism development, city branding and marketing, and business centre creation.
As part of the implementation of the cities' strategic plans, an additional 45 local economic development projects were launched. Cities were able to attract $80 million in investments from private and donor sectors, thanks to a training program for city officials on how to promote cities' competitive advantages.
We are working to improve the planning and delivery of services that support economic growth at the municipal level. We have also helped government institutions at the regional level to formulate and implement reform-oriented policies that are in the public interest and adhere to international best practices. We are assisting with the development of a national demand-driven vocational skills training systems across the country.
Each of these initiatives will help to increase broad-based economic growth in Ukraine. We are doing these things because we believe in Ukraine and its people.
As I mentioned earlier, we are very concerned that our partners not be deemed foreign agents. That would subject them to an additional taxation and reporting burden, limiting their ability to achieve meaningful results for the Ukrainian people. It may even force some of them to close their shops.
We have strong historic ties with Ukraine. We have forged strong alliances out of a shared understanding of Ukraine's unique challenges, as well as a common desire to see the country overcome them.
We look forward to continuing with that work and to helping Ukraine and Ukrainians achieve the freedom and prosperity they not only yearn for but that they deserve. We remain hopeful that the current crisis will come to a peaceful settlement and that Ukraine will begin to get its economy back on track.
In summary, Canada is deeply concerned about the deterioration of democracy and rule of law in Ukraine. Canada remains committed to helping Ukraine by working to improve economic opportunities for Ukrainians in a strengthened democracy.
Canadian assistance is also focused on facilitative judicial and civil service reforms. Canada's support for small and medium enterprise growth is helping to develop a middle class in the Ukraine, which is essential for ensuring a sustainable democratic transition. We are monitoring the situation very closely and will continue to deliver assistance as appropriate. Canada will continue to stand by Ukrainians who are expressing their concern with the recent direction their government has undertaken.