Mr. Speaker, I am pleased to take part in the debate on Motion M-414, which proposes measures to address the challenges facing Canada's forestry sector.
I would like to preface my comments by saying that I do not wish to downplay the challenges facing the forestry sector. Members on both sides of the House and from all regions of the country understand that these are serious, major challenges, but in many cases, they are a lot like the challenges affecting other sectors of the economy.
Forestry companies and related industries are not the only ones having problems. The slowdown in the American economy resulting from the sub-prime mortgage crisis south of the border is now having a negative impact on a number of sectors here that export goods and services to the American market.
Also, the loonie's recent rise to dizzying heights compared to the American dollar is having an impact on many sectors of the economy where costs are calculated in Canadian dollars and revenue in U.S. dollars.
Competition is also a factor in other sectors too. Many sectors are beginning to deal with increased competition from low-cost producers, as well as conventional producers seeking to increase their market share.
The combination of a strong Canadian dollar, a weak American economy and increasing foreign competition is having a tremendous impact on the bottom line for many Canadian companies, particularly in the manufacturing sector.
The forestry and manufacturing sectors both need access to appropriate basic economic tools so that our companies can turn their attention and their efforts to facing these challenges. Clearly, Canadian manufacturers are determined to remain competitive within a global economy. International competition is a catalyst for innovation.
Competitiveness opens up new opportunities, and the reality of today's world market has made it easier than ever to coordinate activities along the supply chain. Cheap telecommunications and fast, easy transportation have made global networks a reality, and international trade, product research, innovation and development, financing and other services are being set up where it makes the most business sense.
When economic fundamentals are solid, businesses have a better chance of making their mark and succeeding. Canada's economic fundamentals are solid.
While other economies are facing uncertainty, Canada is the only G-7 country with budget surpluses and a falling debt burden. Our unemployment rate is the lowest it has been in 33 years. In 2007, employment in Canada rose by approximately 360,000 jobs, all of them good, high-paying jobs.
This government wants to make sure that Canadians are benefiting from our economic success, and this certainly includes the manufacturing and forestry sectors.
We want them to make investments that will help them compete in the long term. We want them to benefit from a well-informed workforce. And so, the government has announced a plan to build a strong economy by creating the conditions that will allow Canadians and Canadian businesses to prosper.
Advantage Canada has established a strategic, long-term economic plan to improve Canada's economic prosperity, both today and in the future—prosperity that will benefit manufacturers. The plan creates five key advantages that will help our country to remain internationally competitive while ensuring that we live in a stronger, safer and better Canada.
The tax advantage will establish the lowest tax rate on new business investment in the G-7. The fiscal advantage will eliminate Canada's total government net debt in less than a generation. The entrepreneurial advantage will reduce unnecessary regulation and red tape. The knowledge advantage will create the best educated, most skilled and most flexible workforce in the world.
And the infrastructure advantage will help move people, goods and services across our country and our borders.
We then followed up on these concrete measures. We introduced a substantial tax break for manufacturers on the capital cost allowance for eligible machinery and equipment, which means a $1.3 billion boost to the manufacturing industry. Our manufacturers can now invest to increase productivity, so that they can remain competitive, regardless of the value of the Canadian dollar.
In the 2008 budget, we extended the provisions of the accelerated capital cost allowance program from two years to five. This will mean $1 billion in assistance for manufacturers, and is just one of many measures introduced since our government was elected in 2006. These measures include eliminating the capital tax and the corporate surtax and reducing corporate and small business tax rates. Overall, these measures represent $9 billion in tax relief for manufacturers and producers in Canada.
We are eliminating administrative formalities and reducing red tape. We are supporting marketing and R and D. We are making the largest infrastructure investment in the past 50 years. Like other sectors, the forestry industry will certainly benefit from these measures. And the forestry industry has benefited from one of the first measures the government took after being elected just two years ago: the successful negotiation of the softwood lumber agreement between Canada and the United States.
We must not underestimate the importance of this achievement. For Canada, resolving this dispute was the best way to improve basic economic conditions in the forestry industry. This action by our government put an end to years of expensive litigation that produced no tangible results and only prolonged the uncertainty for the market and for Canadian producers.
This measure gave stable access to the United States, the largest economy in the world, our closest neighbour and our largest market and trading partner. It also put $5 billion back into the hands of Canadian softwood lumber producers. That was a huge injection of capital for producers who, in many cases, likely doubted they would ever see that money again.
Earlier, I mentioned the low unemployment rates and how employment in Canada had grown by 360,000 jobs in the past year alone. On our side of the House, we understand that this overall growth is not divided equally among all communities across the country. We know that some manufacturing jobs are threatened and that this is an important issue in the forestry industry as well. We know that we cannot be complacent, especially if we want to be competitive in the global economy.
Like much of the manufacturing industry, the forestry industry must restructure and adapt to the new economic realities that are affecting many single-industry communities. Consequently, on January 10, 2008, the Prime Minister announced a $1 billion national community development trust to help vulnerable communities that are dependent on a single employer or industry.
We expect the provinces and territories to use this funding for a wide range of initiatives ranging from job training and development to community transition plans and infrastructure initiatives to promote local economic diversification.
It is not the government's policy to choose winners—nor should any government have such a policy. Our role is simple. Our role is to lay the economic foundations necessary to ensure that the economy can function properly. This can be difficult to achieve, however. If we are successful, businesses will be in a better position to develop and prosper.
This government wanted to provide businesses and manufacturers with the conditions that would allow them to compete with the rest of the world and this is working. Manufacturers are adapting and innovating. They are confident and the government will be here to back them up. We will continue to work with them by creating a climate in which businesses can succeed and there will be jobs for Canadians.