Debates of Oct. 27th, 2014

Canada-Korea Economic Growth and Prosperity Act

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Speaker, my colleague mentioned in her speech that we on this side tried to introduce some amendments at committee. I am not sure if I heard correctly, but I think she used the word “sabotage”, which did not quite make sense to me.

One of the amendments we tried to introduce was to repeal the investor state dispute settlement from this agreement. I wonder if the member is aware that under NAFTA, there have been over 30 investor state claims against Canada at all levels of government, targeting public policy measures from bans on fracking to court rulings on drug patents, and that Canada has already paid out over $160 million to investors, either as a payout or for legal fees in trying to defend various legislation.

I am wondering if she thinks it is right for our tax dollars to go toward paying corporations when they dispute various laws that are put into place for our benefit.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, as the member well knows, the investor state dispute settlement has been a core element of Canada's policy, and it has been so for more than a generation. This agreement, like all other major trade agreements since NAFTA, includes these protections.

This is a two-way street. As a result of these provisions, Canadian businesses are provided with protection from arbitrary and discriminatory actions from the host government.

As I said, this is a two-way street. The investor state dispute settlement has been there for a generation, and it is a critical element that we believe should absolutely be there.

[Lois Brown, Conservative, Parliamentary Secretary to the Minister of International Development]

Mr. Speaker, one of the great things about our free trade agreements is that we have the opportunity to influence the way that people do things in other countries.

In particular, we have agreements on labour issues. I have worked in this area with my husband, on issues related to occupational hazards and physical problems that people have from workplace injuries. Therefore, I know that we have the opportunity to have influence.

I wonder if the Parliamentary Secretary to the Minister of Labour could comment on some of the things we are discussing in these free trade agreements so that we can find some compatibility between our two countries and have influence on the way they do things.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, again, this particular agreement stands out from the pack in that regard. I think everyone in this House is very concerned about occupational health and safety issues, which also includes compensation in the case of injuries and illness. We see the results in Canada when we have proper legislation and regulations in place, and we are having a significant impact. There is nothing more horrific than losing a husband, wife, son, or daughter to a workplace injury.

Again, I am very pleased to see strong robust measures in this particular agreement and Canada's ability within free trade agreements to have those discussions.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, like my colleague, I am offended at the use of the word “sabotage”. As a party, we proposed amendments to a controversial provision and debated them in the Standing Committee on International Trade.

One could say that this is a cornerstone of international trade, but that is not recognized internationally. If the member refuses to withdraw the word “sabotage”, I would like to know whether she considers the new president of the European Commission, not to mention Germany and Austria—which are trading partners and also question the validity and usefulness of the investor state dispute settlement programs—to be saboteurs for raising these questions with respect to the agreement with the European Union?

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, I know that the NDP struggles to support any free trade agreement, and I think that is the first thing that is important. However, we are talking about dispute resolutions for international arbitration, which does not restrict any level of government from legitimately legislating in the public interest.

I think it is important to understand what these things do and do not do.

Canadian and foreign investors alike are subject to all of Canada's laws and regulations pertaining to environment, labour, health care, and safety standards.

The NDP knows very well that we have an agreement that has been agreed upon between two countries. However, to make such a massive change in an agreement would mean going back to the bargaining table and renegotiating, and, to me, that is sabotage.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Speaker, it is a pleasure to rise today to speak to the Canada-Korea free trade agreement. When I think what this free trade agreement would mean to our riding of Huron—Bruce, it is very significant. There is no doubt about it. In Huron and in Bruce counties, agriculture, light manufacturing and tourism are really the key pillars. Energy as well is another huge contributor to our local economy.

When we think of agriculture, we produce everything that Korea wants and everything it needs. That is why it was so significant when the Prime Minister made his announcement in September that we were going to be able to move forward on the deal.

The Korean economy is the 15th largest in the world. It is the fourth largest in Asia. It has 50 million people who know and understand the quality products that are made right here in our country. Agricultural exports, just in Ontario alone at this juncture, are $68 million. Definitely, in no time at all we would see that grow and grow and quite likely double, triple and quadruple.

There are products grown right in the riding of Huron—Bruce that have tariffs on them today. Let us just pick off the easy ones. Pork and beef are pretty obvious ones. There are identity-preserved soybeans, white beans, adzuki beans, navy beans, kidney beans, and the list goes on and on. All together, the average tariff rate is 52.5%. Put in context in terms of what the Canadian dollar looked like two years ago, a year ago and what it is today, currency has very little impact. It does have some, but when we factor in some of the tariff rates on some of these products, it makes it terribly uncompetitive when dealing against the United States and the European Union. This is a great deal for producers from one coast to the other, but certainly in Huron—Bruce.

The market for pork in Korea is $1.1 billion annually. The market for beef in Korea is $1.3 billion annually. In the last number of years our market share has continued to decrease. We have a very small share of the market relative to the U.S. and the European Union. By putting this deal together, ratifying it and getting it moving, we would have the ability to change the momentum and start growing into that market, taking away some of the market share from both the EU and the American deal.

From 2010 to 2013, our pork market share went from 14% to a little under 9%, at 8.9%. That represented a $22 million decrease. In the same period of time, the U.S. and the EU market share increased 10% to over three-quarters of the market. The duties on pork, averaged out, on fresh, chilled and frozen, is 25%. Those would decrease over the next 13 years. As of January 1, that would allow our producers to trend with both the U.S. and EU. It is very important.

In Huron—Bruce and in Perth county, which is right beside Huron and into Wellington, there are a huge number of pork producers. They have experienced many difficult times. They are starting to recover and this year will be one of the better years they have had in a decade. A deal such as this helps to increase that momentum and helps to allow the economy to grow and expand in a riding such as mine.

Beef has seen the same trajectory as pork in the last number of years, going from $9.6 million to $6.7 million. Their duties are actually higher than pork. They are 40% to 72%. They would decrease over the next 15 years, which is important as well.

Beef producers in Huron, in Bruce, and in our neighbouring counties in both Wellington and Perth, have struggled, certainly with the price of land and other issues that contribute to the profitability of the beef market. They have had their struggles, but again, like pork, the last couple of years in the red meat sector they have had better years. The price of their fat cattle is if not at, then near all-time highs.

Deals such as this allow the red meat sector to continue to grow. If we look at the hundreds and thousands of acres of corn grown in Huron, Bruce, Perth, Middlesex and Wellington counties, the corn input has certainly provided a huge input into the beef and pork. It is vitally important and helps the agriculture economy grow.

Another one that people may not think about but where it certainly does have an impact is in the spirits industry. Spirits Canada President Jan Westcott has probably been quoted by many people in the House. There are smaller distilleries. There are certainly the large ones that Jan represents, but there are the smaller ones as well. Barry Stein and Barry Bernstein of Still Waters Distillery, one that I have toured in Concord, Ontario, have a 100% rye whiskey. The tariffs on that product are 20% if they want to sell it in the Korean market. That will be eliminated. The tariff will be at zero.

The beautiful thing about that is that small distilleries such as theirs, or even the large ones, can continue to work with Canadian rye growers. Whether it is in Alberta or southwestern Ontario, companies such as Still Waters Distillery, when they have those tariffs eliminated, can become competitive in a market such as Korea.

Since 2008, when the ratification of both the EU and the American deal came into place, the Canadian market share for spirits was cut in half. This is a chance for them to once again gain momentum. Like I said, when those distilleries can work with growers, it helps to diversify their economy. It helps to diversify their crop rotation. That is very exciting for farmers, as well.

Especially in Huron County and now getting into Bruce County as well, the specialization around identity-preserved beans is really becoming a science. It is really becoming perfected. Companies like Thompsons, P and H, Huron Commodities, and Snobelen, out of Lucknow, have really worked with growers to perfect this identity-preserved bean.

Koreans want this bean more than they want American beans. They know it is a higher quality. It is our climate and our soil. The premiums that farmers get, just the premium for growing it, forget the price, can be over $2 and in some cases as high as $3.50 a bushel. Some fields are 50 bushels to the acre, times 100 acres, that is a lot of premium. That is a lot of dollars in the pockets of farmers. That is a positive thing.

The tariff on those IP beans is almost 500%. Let us think of the impact when that tariff is reduced to zero. It is going to allow companies such as Huron Commodities to compete and succeed in this market. These are big deals.

Some of the beneficiaries of these deals are farmers, obviously. There will be higher prices for everything they grow and everything they sell. Farm machinery dealerships will benefit as farmers will have more dollars in their pockets to reinvest in their equipment and operations. Processors, such as Huron Commodities, will have a chance to grow, expand and develop, as well as all the companies that supply them.

Farmers will also have the profits to reinvest in R and D. Just one example is GPS systems in the tractors that work with planters and combines. These are all things that five or six years ago growers in my area did not have the ability to use, the technology or the profit.

In addition to that, here is something that over the last five years I did not think we would see. Pork producers are actually starting to build new barns again. This is good for cement companies, people who own gravel pits, builders, steel and so on. They are starting to have a rebirth of building pork barns, so that is important. Nuhn Industries in Sebringville in the member for Perth—Wellington's riding has grown and doubled in size. Trucking companies, rail lines, ports and harbours will all benefit from this deal. It is very exciting.

I would be happy to take any questions.

[Gord Brown, Conservative, Leeds—Grenville, ON]

Mr. Speaker, the member for Huron—Bruce has been very active on this. It is something that definitely benefits his riding, much the way that these benefits will come to my riding of Leeds—Grenville, which has very large agricultural industries.

The member said that he had more to talk about in terms of the benefits to his riding. I would like him to expand upon that.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Speaker, I would also like to congratulate the member on his charity hockey game last week where he raised over $100,000 for charity. I would also like to point out that it is the first time in 25 years that I have scored two goals in a game, so that was certainly a milestone for me.

The benefits to producers in Huron and Bruce counties are very significant. If we look at what it allows just with perfecting and growing those soybeans, they are able to produce over $3 a bushel for premiums. This is what allows farmers to fix or build new drying sheds. This allows them to buy a new tractor or at least have the confidence to buy one. It allows them to work with the University of Guelph, Ridgetown Campus and the seed companies to look at other generations, new iterations of the seed for higher yield and better protection against pests, to look at how they are able to dry and mature their crop. We had a partnership with Guelph Hensall co-op on a white bean project a number of years ago.

These are the kinds of investments we see when there is profit in a market. Trade deals like this keep profit in the market.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I thank my colleague from Huron—Bruce.

Of course, this is a new agreement designed to foster good trade relations with South Korea.

Given that this is very important and that there were some problems, particularly in terms of non-tariff barriers, would the member support a decision by the House or the Standing Committee on International Trade to create a regular mission to monitor progress on the implementation of the free trade agreement between Canada and South Korea to ensure that the implementation is proceeding properly?

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Speaker, we are talking about tariffs. I am glad the member brought this up. It does not deal directly with his question, but sanitary and phytosanitary measures are some of the impediments that have caused trade problems in the past, where we have had an agreement, yet the other country can use some sort of condition to either slow, stop or never allow. Pork International has done a great job. That is something we have set up to educate processors or consumers over there. We have veterinarians over in these countries that work with government officials so they better understand how if there is a problem in this country, we can contain it so it does not get to their country.

Those phytosanitary measures are very important. I know the Minister of Agriculture and Agri-Food has travelled around the world making sure that our departments are doing this so that officials around the world are educated and know that Canada has the absolute world-leading, world-class sanitary and phytosanitary measures.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Mr. Speaker, I have had the opportunity to go to the member's riding. It is a beautiful riding. In fact, I caught myself thinking would it not be nice if this might one day become a Liberal riding. I have to admit that went through my head.

However, I want to commend him on his homework. This is a man who obviously has looked at how the agricultural economy of his riding will benefit from this. I congratulate him for being very much aware and he provided many examples of different products that stand a good chance of making it into South Korea, so that is a great thing. He is obviously doing his homework.

Has he had a chance to look at the trans-Pacific partnership and does he see good opportunities coming forward with respect to that potential future trade agreement?

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Speaker, I have also been to his riding, and I can understand why he would be optimistic about the prospects in Huron—Bruce. Unfortunately, he may not know that they only got 9% on election day in 2011. They certainly have a lot of work to do there, but we never know what can happen.

In any event, the important thing with the TPP is that we continue to negotiate. We are working on behalf of Canadians. We are working on behalf of Canadian industry to grow our markets without the barriers of tariffs. That is the most important thing.

We have to be in negotiations with a big agreement like the TPP. I hope we continue to move forward. However, if we can do deals like the Canada-Korea agreement while we are working on the TPP, let us do it.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I am pleased to rise in the House to speak to Bill C-41, which will implement the free trade agreement between Canada and the Republic of Korea. I am very pleased because, honestly, our position makes me smile and laugh. As deputy international trade critic, I am pleased to confirm what our senior international trade critic said, and that is that we are going to support this bill to implement the trade agreement at third reading.

This makes me smile because, unlike what our opponents, the government members, like to say, we are not a party that is against international trade. We are not anti-trade, quite the contrary. If members want to ask me questions about that, they should also speak to the member with whom I have been communicating over the past two, three or four years on economic issues. They will see that as an economist, I am in favour of the principles of trade agreements and that the value of each trade agreement that we sign or negotiate must be assessed based on the content and details of that agreement.

Furthermore, I think that we cannot repeat often enough the basis on which the NDP, the official opposition, assesses these trade agreements. We have three criteria. The first pertains to the notions of democracy, respect for human rights, and respect for environmental rights and working conditions. When we signed NAFTA, or even the initial agreement between Canada and the United States, there was an entire section regarding environmental issues and respecting environmental rights and working conditions. However, only side agreements were signed, and they were not as restrictive. We then saw that very few complaints were lodged about NAFTA. Complaints were made regarding working and environmental conditions, but they did not end in a court decision. The process clearly has no teeth.

What we on this side of the House want is for the negotiation of trade agreements to be used as leverage with the country we are negotiating with in order to raise that country's environmental and democratic standards, as well as its standards related to human rights and working conditions.

We think this first condition is essential, which is why we repeatedly said that we opposed the agreement with Honduras, because the agreement did nothing to raise these standards.

The second condition is the economic and strategic value of the agreement in question. There is no denying that South Korea is a significant trade partner. South Korea is Canada's seventh-largest trade partner and its third-largest in Asia. The standard of living, or more specifically, the per capita income in Korea, if we evaluate it based on purchasing power, is about 75% of that of Canada, and that is rather significant. From a strategic standpoint, therefore, no one can deny the importance of South Korea.

More specifically in terms of agri-food, and because the region I am honoured to represent relies on agri-food for 12% of its economy, it is important to point out that South Korea is our fifth-largest partner in this area. In terms of current global exports, South Korea is as important as Germany or France as a trading partner. Exports are currently worth over $3 billion.

In fact, this brings several questions to mind. As I said at second reading, an internal memo from the Department of Foreign Affairs and International Trade raised the problem that the government was squandering too many resources on issues that had less strategic value and that the resources were not available to negotiate and eventually conclude as agreement as important as the one with South Korea.

I think the government needs to seriously address this issue at some point, because putting these resources into an agreement with Honduras when our trade with that country is worth a little over $40 million and neglecting the negotiations for an agreement with a trade partner worth over $3 billion in exports is highly problematic in terms of the government's ability to effectively negotiate trade agreements. Thus, there can be no question about the economic and strategic value of the agreement.

This brings us to the third criterion we used to analyze the agreement: the actual terms. Obviously, the Standing Committee on International Trade did its job. I know that a number of members of the House also assessed the consequences of the agreement for our ridings and the economies of our regions. As with any trade agreement, certain sectors will benefit in the short and medium terms, while others will face economic challenges once this agreement is implemented.

I am going to talk about the advantages and disadvantages. As far as advantages are concerned, the beef industry will benefit rather quickly from the phasing out of the 40% tariffs imposed on that sector. Some members of the House have already mentioned that. The United States also opted to have this tariff phased out when it signed the agreement in 2012.

Our share of the beef market in South Korea has decreased tremendously because of our diminished competitiveness compared to the United States. Tariffs on the U.S. are currently 32% and are decreasing by 2.7% a year, while tariffs on our products are 40%. This is a real red flag. These market shares we are losing for our beef sector have to be recovered quickly.

In 2002, our beef exports to South Korea totalled $50 million. After the South Korean embargo was lifted in 2012 and the South Korean market was finally reopened, beef exports totalled $10 million. The following year, in 2013, these exports dropped to $7.5 million. The difference in tariffs has had a huge impact, and that is why we must use the agreement with South Korea to minimize and eventually compensate for and eliminate the competitive difference between Canadian and American exports.

The European Union and the United States signed agreements with South Korea in 2012 while our own negotiations lagged, mainly for lack of resources. This resulted in a 70% drop in our share of the agri-food market. However, it is an important sector of our trade with South Korea. It was quite irresponsible not to put enough resources into concluding an agreement with South Korea more quickly. It took 10 years to negotiate.

I was talking about the elimination of 40% tariffs on the beef industry. Tariffs of 18% on beef offal will eventually be eliminated. For pork, these tariffs can reach 25%, depending on the product. These tariffs will gradually decrease to allow our farmers to open up a market. This decrease will be welcomed in the pork industry in particular, since there is currently uncertainty in that sector as a result of our trade with Russia, which was a big consumer and importer of Canadian pork.

A number of areas stand to win, as pointed out by most of the people who came to the Standing Committee on International Trade. The aerospace sector the forestry sector, which is an important industry to my region and riding, stand to gain a lot. Furthermore, tariffs for various forestry products, which vary from 8% to 13%, will eventually be eliminated. Tariffs for other sectors, such as mining, transportation, fish and seafood, which could go as high as 50%, will also gradually be eliminated. Some sectors stand to benefit a lot. Furthermore, nearly 87% of all the tariff lines that imposed tariffs on our exports to South Korea will eventually be eliminated.

One of the reasons why we are supporting this agreement is that it is 100% reciprocal. Once again—and earlier I heard a speech that mentioned this—we need to consider South Korea's tariffs on Canadian products. They were much higher than Canada's tariffs on South Korean products. This will give our exporters access to a market that did not use to be as open to Canadians as the Canadian market was to South Koreans.

Obviously, if at some point we are unhappy with something in the agreement, if there are disputes about the effects of the agreement, there is always a way to renegotiate or revoke it. This, however, would take six months. Everything can be renegotiated.

We also raised concerns about the investor state dispute settlement mechanism, and I will come back to that. It is very important to have that six-month time period. It cannot be so long that it ties the hands of future governments—that is a fundamental principle of democracy—as is the case, for example, with the Canada-China foreign investment protection agreement, which is binding for 31 years.

In all of the trade agreements that we have signed in the past, that fundamental principle allowed us to renegotiate or open up the agreement to include or withdraw certain clauses, obviously with our partner's consent, over a six-month period or with six months' notice.

This new investor state dispute settlement mechanism contains more progressive transparency measures than previous incarnations. These measures are welcome. When it comes to the lack of transparency in the process, this is one element that really worries those who want to ensure that the recourse measures to ensure compliance with trade agreements are democratic and open.

The disadvantages have been talked about in committee and by the media. There are a number of risks related to the challenges facing the automobile and steel industries. A representative of Unifor, the main union representing auto workers, expressed his concerns about these agreements. This might come as a surprise, but the Canadian Council of Chief Executives had the same concerns. I should point out that we import around $3 billion worth of South Korean cars but export just $15 million worth of Canadian or Canadian-American cars.

This is a major concern for the union and the automobile industry. We had a 6.1% tariff on South Korean cars, but there was an 8% tariff on cars we exported to South Korea. The tariff was higher. That is not the only reason for the big difference, and people have pointed that out, but we still have to pay close attention to the auto sector and the impact of this agreement on it. As I said, the Canadian Council of Chief Executives has recognized this particular challenge. In committee, it suggested that we should develop a special strategy for the auto sector vis-à-vis the Korean market for automakers. Here is what it said:

...that Canadian auto and auto parts manufacturers are positioned for success. Such a strategy could examine exports, two-way foreign direct investment, and non-tariff barriers as well as cooperation with other major auto and auto parts exporting nations that have free trade agreements with Korea, to ensure an open market for foreign products.

This specific problem for the auto industry was raised by the Canadian Council of Chief Executives, among others, and must be taken seriously. In fact, this was included in one of the amendments that we tried to propose. We proposed it at the Standing Committee on International Trade and it was rejected by the government members on the committee. We proposed five amendments and they were all rejected.

There is a lot of talk about the investor state dispute settlement mechanism, but that is not the only thing we proposed. The government could have accepted entirely reasonable aspects, such as sending a Canadian mission to South Korea to oversee the implementation of the agreement and report on the progress of that implementation. In fact, I asked the member for Huron—Bruce about that. This mission should report regularly, every year, until it is no longer necessary to do so.

The government members rejected this idea. Again, to reassure those who might be concerned about this, we proposed an amendment whereby no environmental law could be repealed or amended in order to increase investment. These are laws for the common good. These are the environmental protections the public called for and we recommended, not to put up an obstruction or a non-tariff barrier, but truly for the common good. The government refused.

The measures we proposed sought to respond to the concerns we on this side of the House are hearing. The last amendment we proposed responded precisely to the request by Unifor and the Canadian Council of Chief Executives; it was aimed at developing a strategy to help the auto industry and the steel industry meet the challenges that the implementation of this trade agreement will present.

In closing, I would like to speak to this issue of the investor state dispute settlement mechanism. I heard the parliamentary secretary say that this was the cornerstone of every trade agreement that has been and will be negotiated by Canada.

There is no international consensus. Many countries are asking questions about the validity, usefulness and relevance of this mechanism. The first time it was proposed in the context of trade negotiations was for NAFTA, in response to concerns that Canadian and American investors had regarding the strength and soundness of the Mexican legal system, in particular. That is where the idea of an external mechanism came from. No one said that this had to be done behind closed doors, but that is what happened. No one was supposed to say that the Canadian or American legal system had not been used. However, this agreement goes beyond Canadian and American legal powers. The fact remains that it was originally in response to the perceived lack of soundness of one of our trade partners, namely, Mexico in this case.

This issue can also come up in the negotiation of trade agreements that we, as a party, if we formed the government, might negotiate less aggressively than this government is doing. I am thinking of countries like Honduras and Panama and other countries we do business with that not only have serious problems when it comes to human rights, environmental rights and working conditions, but also have legal systems of dubious soundness and impartiality.

Is that the case with South Korea? I do not think so. Is that the case with the European Union? I do not think so. Should we automatically include an investor state dispute resolution mechanism in situations where our trading partners have respected, impartial systems that can serve as tribunals in the event of any investor complaints regarding what is perceived as an impediment to investments or profitability, which would ultimately be a non-tariff barrier?

This mechanism remains controversial and will continue to be debated. I categorically reject the government's contention that this is the cornerstone of the agreement. On the contrary, in the months and years to come, we will see more and more countries raising concerns and asking questions about the relevance of automatically having such mechanisms in every agreement. As I mentioned, the new president of the European Commission and countries such as Austria and Germany are beginning to publicly air their concerns.

Nevertheless, we support Bill C-41 at third reading stage. We support the principle of the agreement with South Korea, which may not be the agreement we would have negotiated but, for the time being, satisfies the three criteria we use to assess the relevance and desirability of a trade agreement. We will gladly vote for this bill.

[Hoang Mai, NDP, Brossard—La Prairie, QC]

Mr. Speaker, I would like to thank my colleague for his speech and for his work on this file.

I had the opportunity to work with him on the Standing Committee on Finance. I know that his arguments and proposals are well thought out because of his training as an economist.

In his speech, he talked about the criteria the NDP uses before taking a position on this kind of free trade agreement. Contrary to what the Conservatives and the Liberals like to say, we are not opposed to everything. We have a specific vision and we do not give our support lightly.

Could my colleague talk about these criteria?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, this relevant question cannot be repeated enough to counter the misinformation that many government members want to spread about us.

The first criterion pertains to the level of democracy and respect for human rights, environmental rights and working conditions. These provisions are essential.

I found it interesting that a parliamentary secretary indicated that this criterion was part of the free trade negotiations with South Korea. However, why was it not included in the negotiations with Honduras, where human rights are clearly not respected? The situation in that country is far more urgent than that in South Korea, which is an excellent global citizen.

The first criterion should be essential when considering a free trade agreement, and it should even be a principle under which we include provisions that would allow the partner country to raise its standards in order to meet the conditions established by the future agreement. Right now, we are not using that tool even though we should be able to do so.

As for the two other conditions, it goes without saying that we should prioritize negotiating an agreement if the country is a strategically and economically important partner to Canada. At the end of the day, if these first two criteria are met, we look at the effect the agreement will have on the Canadian economy. Then we can decide whether we support this trade agreement.

[Sadia Groguhé, NDP, Saint-Lambert, QC]

Mr. Speaker, I congratulate my colleague on his speech.

He clearly pointed out in practical terms that New Democrats support Canada's trade development and prosperity. It goes without saying that it is crucial to diversify our economy with multiple players.

That said, I would like to hear more from my colleague about the weakening of our environmental standards, which he talked about in his speech. We proposed an amendment that the government unfortunately rejected.

What does he think that means?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, these amendments would help reassure Canadians who are concerned about compliance with the investor state dispute settlement process.

With respect to NAFTA, some American investors filed lawsuits against Canada as a result of environmental regulations or legislation. Canada lost some of the lawsuits, but more importantly, ended up withdrawing the regulations or legislation to avoid the whole process.

As a result, the Canadian government and the provincial, territorial and municipal governments hesitate to enact legislation or make regulations for the common good, since they are afraid that they will be the target of a lawsuit because of the investor state dispute settlement process.

One of the two proposed amendments to reassure the Canadian public had to do with environmental regulations or legislation, but the Conservative government is clearly not interested in trying to alleviate the public's legitimate and serious concerns.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Mr. Speaker, I would like to thank my brilliant colleague for his speech.

I would like to draw on his extensive knowledge and ask him if he could talk a bit about the threat that currency manipulation represents for exporters.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, it is not only a threat to exporters. Currency manipulation can have a tremendous impact on the global economy. In the late 1990s and early 2000s, there were large waves of currency market speculation, which seriously affected many economies, particularly in Southeast Asia. Those repercussions were also global.

In the late 1980s and early 1990s, there was a massive devaluation of the Mexican peso, in part because of currency market manipulation. It had a serious impact on Mexico itself as well as the United States, which was Mexico's largest partner.

We need to be very careful. Canada needs to be vigilant as a country but also as a partner with many other major economies. I am thinking about the G20. We need to try to minimize the impact that speculation could have on the currency market and prevent this type of economic upheaval, which greatly affects the general public, but only benefits the speculators, who generally do not have the same concerns as the general public.

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, I would like my colleague to clarify something that bothers me a bit.

We know that our neighbours, the United States, managed to get benefits and protections for their industries that we, in Canada and with our government, are not managing to get. I wonder why the United States is able to protect its industries, while here we either do not want or cannot do so. What is the reason?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, that is a very good question. It goes to the heart of one of the concerns I raised in my speech, namely the minimal resources the government allocated to such an important agreement. It doled out all kinds of resources to negotiate strategic agreements that are much less crucial than this one. At the end of the day, since the government eventually had to act swiftly to conclude this agreement that the United States and the European Union had concluded two years earlier, the government probably had to make a few concessions to sign the agreement quickly.

The question is important because it also allows me to respond to an argument I heard an hon. member and parliamentary secretary use, specifically that an investor state dispute settlement mechanism is the cornerstone of any trade agreement. Currently, the United States and the European Union are on the verge of entering into negotiations for which such a mechanism would not be included. We insist on having such an agreement, despite the fact that it could derail the trade agreement with the European Union. Germany and Austria do not support this agreement. The United States is entering into negotiations with this issue off the table and not negotiated.

The government will eventually have to get serious and carefully reflect on the criteria and the approach currently being used for negotiating trade agreements.

[Dan Albas, Conservative, Parliamentary Secretary to the President of the Treasury Board]

Mr. Speaker, it is with great pleasure that I talk about the landmark Canada-South Korea free trade agreement.

I will be sharing my time with the Parliamentary Secretary to the Minister of Natural Resources.

The fact that even the NDP can see the benefits and support this deal is a testament to its importance to Canada and to my home province of British Columbia.

I would also like to take a brief moment to recognize the great work of the member for Abbotsford, who is to be commended for his ongoing efforts in this important area.

As a member of Parliament from British Columbia, I find the Canada-Korea free trade deal an easy one to support. That is because South Korea is an important market for British Columbia. In fact, 50% of all Canadian exports to South Korea are from British Columbia. South Korea is British Columbia's fourth-largest trading partner, with exports worth an annual average of $2.2 billion from 2011 to 2013.

Today I would like to take a few moments to explain why this particular deal is good for my riding of Okanagan—Coquihalla.

One of the many things that I love about Okanagan—Coquihalla is the vast diversity of this beautiful part of British Columbia. We are well known as an incredible wine region and as a popular tourist destination, but we are also so much more. Mining, forestry, ranching, farming, manufacturing, IT and technology services, retail, education, and even retirement are all industries that support jobs in my region.

I suspect it will not surprise any member of the House that many of these industries have customers that extend outside Canada. In fact, a growing number of these industries now have an increasing number of customers outside North America. That is very exciting. However, it is also a reality of today's global business environment.

Let us not forget also that mining, forestry, farming, manufacturing, IT and technology, and many other industries are not unique just to Okanagan—Coquihalla; many members of this place will also be familiar with these activities in their own ridings.

Let us also not forget that across the border is the United States. These activities not only exist there, but also compete against our Canadian interests. Let us not forget that the United States of America has enjoyed the opportunities of free trade access to the South Korean market since 2012. That provides a competitive edge for U.S. employers against whom our Canadian employers must then compete, because U.S. employers are not subject to the punitive tariffs and duties that increase the cost of Canadian-produced exports entering Korea.

I would like to take a moment to provide some local examples of how this trade deal would affect Okanagan—Coquihalla. Farming, as an example, remains a vibrant and important activity in Okanagan—Coquihalla. In particular, soft fruits such as apples, peaches, pears, grapes, and apricots are all things for which our region is well renowned.

One thing every farmer has in common is a tractor. In a discussion with one of our region's largest tractor dealers, it so happens that I discovered this dealer sells a tractor that is built in South Korea. As Canada has no free trade agreement with South Korea, that means two things for that dealer: he pays more to land a shipment of these tractors into Canada than do his competitors in the United States, and this in turn means that the farmers he sells to have to pay more for that very same tractor than their competitors do in Washington State. It also means that both are at a competitive disadvantage compared to the farmers just across the border in Washington State. This Canada-South Korea trade deal would help level the playing field to address that inequity.

I should also point out the benefits to British Columbia in other sectors, such as forestry and value-added wood products. Some of those products hail from the riding of the member of Parliament for British Columbia Southern Interior.

Despite the pine beetle devastation of B.C. forests, our forest export lumber and value-added wood producers are still very important to our British Columbia economy. In 2012, this sector employed over 56,000 people. British Columbia exports of forestry and value-added wood products to South Korea averaged close to $330 million annually between 2011 and 2013. We can just imagine what will happen when 58% of tariffs on forestry and value-added wood products become duty free upon this agreement's implementation.

I am particularly excited about this point, because in the community of Okanagan Falls is Structurlam Products, which produces an extremely innovative, environmentally value-added wood product that utilizes cross-laminate construction. This is an innovative and emerging value-added wood technology with an exciting future in Okanagan—Coquihalla.

However, I would be remiss if I did not mention mining. In my region, we have mining in Logan Lake and Merritt. Princeton, in the riding of the member of Parliament for British Columbia Southern Interior, has a mine as well that is adding to the local economy and helping people put food on the table. We also have an extensive mine service industry and equipment services in communities like Penticton and Okanagan Falls. These employers, as part of the B.C. mining industry, collectively employ 33,000 British Columbians and pay some of the highest wages, and these go to our local economies.

Let us not overlook the hard work of these 33,000 British Columbians in the mineral exploration and mining industry, which represents 5.8% of B.C.'s total gross domestic product. We can imagine what will happen when tariffs on 99% of the minerals Canada sells to South Korea are eliminated once this agreement comes into force.

Let us also not forget that trade is a two-way street. The Canada–Korea free trade agreement's investment chapter also means that Canadian investors in the metal and mineral sector would have non-discriminatory access to the South Korea mining sector. That is, of course, why this agreement is strongly endorsed by the Mining Association of Canada.

I, of course, have to mention another sector that would greatly benefit from a Canada–South Korea free trade deal, and that is Canada's outstanding wine production. This summer, during my listening tour, people at one winery mentioned that the domestic demand for icewine is on the decline. This deal would eliminate a 15% tariff on icewine in the large and lucrative market of South Korea, which would greatly benefit Okanagan icewine producers. People at another winery recently shared with me the outstanding success they had in achieving and signing a $1 million export deal. For a small family winery, these deals are huge. That is why opening more markets and eliminating trade barriers is critically important to them.

I must take a moment here and again lament, for the wine producers in Quebec, Nova Scotia, and British Columbia, that it will soon be easier to sell wine directly to Korea than to Ontario. On that note, I want to thank the member for Port Moody—Westwood—Port Coquitlam for his work in promoting interprovincial trade.

I did not mention that there are a number of tariffs that would help many industries in British Columbia: cherries, blueberries, and agri-foods. This agreement would help provide jobs. It would help provide markets that would help keep farmers farming, help keep people working, and help put food on the table. This agreement means that all British Columbian Canadians could finally compete on a level playing field with other countries that have implemented free trade agreements with South Korea, including our friends and competitors, the United States and the European Union.

We have learned that when Canadians get out and compete internationally, we can succeed, because we have great products and we have great people. There is so much potential this country has. I am happy to support this bill moving forward. I would ask other members to consider supporting this and other vehicles as well.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Speaker, the member mentioned mining, and I would like to reiterate what he said. We have some real success stories in the area that we serve. Certainly the mine in Princeton, the copper mine, is a success story. I have had a chance to visit it. It is a good corporate citizen. It would benefit, as would others, from the agreement. There are obviously good things in this agreement, and we are supporting it.

I still cannot fathom this whole investor state mechanism that we and I keep referring to because of things that have happened in the past or are happening now. I would like my colleague to give us his thoughts on the following. This is a quotation from the CCPA Monitor:

Lone Pine Resources, a Canadian firm registered in Delaware, is suing Canada for $250 million under NAFTA because Quebec's fracking moratorium is apparently an illegal barrier to its investment opportunities. Again, the decision will be made by paid arbitrators, not the courts.

This is the kind of model that will be part of this agreement.

I have asked my constituents and others whether they think a company should be able to sue the federal government because a province or a municipality or the federal government wants to enact laws in the interest of its citizens. They said no, it does not make any sense.

I would like to get my hon. colleague's comments on that aspect of this agreement.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Mr. Speaker, I always find it ironic when the NDP or, in this case, this particular member praises a local industry. Yes, absolutely, this copper mine has helped Princeton, and actually the whole Okanagan-Similkameen has seen economic activity. However, on the same aspect, the member has written in the Penticton Herald that free trade will destroy Canada.

He cannot have both. He cannot say that this mine, with its products that go all across the world, is a good corporate citizen but then not support it in these kinds of things.

As to the investor state provisions, there has to be a way to ensure that when Canadian companies are working abroad, or vice versa, the companies are not singled out and treated arbitrarily in an unfair way that would basically amount to expropriation without compensation.

Every government has a right to regulate, and that would not change under this particular provision. What it would ensure is that our business investors would not be singled out and treated unfairly in Korea or in any other country where we have these agreements.