Mr. Speaker, I appreciate the opportunity to speak in that it is my first opportunity to congratulate you on your appointment as Deputy Speaker.
I am pleased to respond to the opposition motion today on the growing protectionism in the United States, proposed by the hon. member for Kings—Hants, my good friend who shares with me a role on the House of Commons international trade committee.
This is a worthy motion that, I think, expresses the concerns of many Canadians and it is a concern that many of us share. The hon. members of the New Democratic Party, on the other hand, want to know why the government will not put in place a buy Canadian act in response to the proposed buy American provisions in the U.S. stimulus package. The short answer is that kind of knee-jerk response would be profoundly counterproductive.
Canada prospers as one of the greatest trade and market economies in the world. If we have one of the highest standards in the world, and I believe we have, it is precisely because we have such fierce and successful proponents of market liberalization, the very opposite of protectionism.
Last year our Conservative government signed free trade agreements with the European Free Trade Association, our first in nearly a decade, and agreements with Peru and Colombia. We are in talks with Panama, Jordan, India and the European Union to do more of the same.
In his keynote address at the November 2008 APEC CEO summit in Lima, Peru, the Prime Minister talked about the damaging role played by protectionism in creating the Great Depression. He said that the Great Depression “was not caused by a stock market crash”. The crash, he went on to say, “was only the beginning”. He said that the real nail in the coffin, what transformed a nascent recession into a full-fledged, decade-long depression, were a handful of actions taken by governments, the most egregious of which was the erecting of “protectionist barriers in a short-sighted attempt to preserve jobs”.
Speaking to an audience of presidents and prime ministers from APEC countries, our Prime Minister said, “These are mistakes the Government of Canada will not make”.
This government's insistence on not building walls and not closing doors is not just about keeping a promise the Prime Minister made at an APEC leaders summit. It is about standing up for what Canadians believe in, even when the principle, that ideal, is put to its ultimate test.
Refusing to retaliate with a destructive NDP proposal is not just about our blind adherence to free market ideology. When it comes to Canada's support of free trade and open economies and markets, our view is based on the success of our North American economic partnership.
We took a close look at a trusting relationship with the United States and transformed it into the most successful commercial partnership in the world. We later parlayed that successful formula into the North American Free Trade Agreement, and the success of NAFTA has exceeded all expectations. In the last 15 years, trade with North America has tripled to nearly $1 trillion and nearly 40 million jobs have been created.
Let us not forget that, notwithstanding our current difficulties, the prosperity generated around the world in the last half century has been unprecedented in history. It has been precisely the dismantling of protectionist barriers and the easing of trade restrictions that has ushered in this extraordinary era.
Tempting as it may be in these times of economic instability to barricade the border and prevent commerce, such a move would be profoundly misguided. It is now the time for opening, not erecting walls.
The $825 billion economic stimulus package currently being debated in the United States Senate is a historic effort by the United States government to stimulate the U.S. economy by earmarking money for roads, bridges, waterways and other badly needed projects. The version of the American recovery and reinvestment act passed by the House of Representatives contains provisions that expand on buy American and buy American requirements which would restrict foreign, including Canadian, access to these important projects.
It is important to note, however, that although the American house has passed a version of the bill, the senate has only begun its consideration of its version of the bill and associated amendments, and this work will be in progress for several more days.
I was encouraged last night to see an amendment proposed in Washington that would cause the new legislation to be “consistent with the United States obligations under international agreements”.
Once the Senate has passed its version of the bill, the two bills will proceed to a conference process where the language will be discussed and modified until a single bill is agreed upon. This consolidated bill in the United States Congress will then be voted on by both chambers and, when passed, the consensus version of the bill proceeds to the president for his signature.
The stimulus package is, as yet, only in the middle stages of this process and we expect that the legislation will undergo additional revision before it is passed into law.
This government is concerned about the possible effects such protectionist measures could have on Canadian industries. That is why we are working with our friends and allies both in the United States and in other countries to ensure we continue to enjoy prosperous trading relationships. Canadian ministers and officials at all levels are engaged with their U.S. counterparts on this matter.
Ministers of our government, as well as Canada's ambassador to the United States, have expressed Canada's concerns to the new administration, the legislatures on Capitol Hill and other U.S. stakeholders. They have emphasized the need for a coordinated approach to stimulate the North American and global economies and, in particular, the importance of avoiding protectionist measures that could exacerbate the global economic crisis.
We know our U.S. partners want the same outcome for their citizens as we do, as do all countries with whom we trade. Canada is fortunate at this critical time to be represented by Ambassador Michael Wilson in Washington. Mr. Wilson is highly regarded in Washington, respected, experienced and connected. It was a privilege to be with the then finance minister Wilson when the free trade agreement was established between Canada and the United States. I know that Ambassador Wilson is fully seasoned in these matters and the fine points of this trade agreement and he is knowledgeable in diplomacy.
We are encouraged by his efforts and the efforts of our ministers in this dialogue and the results they seem to be producing. President Obama has publicly expressed his desire to avoid passing legislation that would result in a trade war. As I mentioned, just last night the U.S. Senate approved an amendment requiring that the bill respect the United States' international trade commitments.
new We agree with President Obama's conclusion that protectionist measures risk triggering a trade war that is in no country's interest.
The Minister of International Trade stated in Parliament that the U.S. and Canada, as G20 and NAFTA partners, have committed themselves to keeping their borders open to trade, including for projects covered under the economic stimulus. We are in a collective effort to restore and stabilize our economies. This government is continuing to remind our U.S. friends that our collective objective of combatting the global economic crisis must prevail over the pressures of protectionism.
Canada is not alone in its unease about these provisions and is joining others in raising concerns about retrenching behind market access barriers. In the United States, major stakeholders, including leading U.S. associations and U.S. industry leaders, have also expressed serious reservations about the inclusion of expanded buy American provisions and will continue to argue for open markets.
We are fortunate to have the United States as our closest friend and ally. The arrival of a new administration signals a fresh chapter in Canada-U.S. relations and we are beginning that chapter with vigorous, constructive exchanges with our U.S. partners to combat this downturn together.
With the Unites States administration just sworn into office, we are renewing our long-standing relationship with the United States. In doing so, Canada and the United States have the great advantage of building on a strong, historic partnership. One need only look to our long cooperation in the World Trade Organization to illustrate this point.
Canada and the United States were two of the original signatories to the General Agreement on Tariffs and Trade, GATT, the predecessor to the World Trade Organization.
More than 60 years ago, in 1947, Canada and the United States supported and signed on to this fledgling body, which ultimately went on to lay the foundations to the rules which, to this day, govern much of the international trade and commerce in the world. In 1994, in response to a Canadian-led initiative, the GATT became the Word Trade Organization, the WTO.
At the heart of the World Trade Organization are various WTO agreements, negotiated and signed by 153 of the world's trading nations. These documents provide the legal groundwork for international commerce. They are essentially contracts binding governments to keep their trade policies within agreed limits.
Although negotiated and signed by governments, the goal is to help producers of goods and services, exporters and importers, to conduct their business while allowing governments to meet social and environmental objectives.
Canada and the United States are committed to the multilateral trading system, and are engaged in the WTO's current Doha development agenda, the Doha round, as it is more commonly known.
A well-functioning, rules-based trading system is in the interest of all trading nations, including Canada. Rules are essential to help us in our goal of securing access to foreign markets for our exporters and our service providers.
We also keep our own market open in order to have access to imports, thereby allowing our producers and consumers a greater variety of goods and services to choose from.
The recent financial crisis, which began in one part of the world, has spread worldwide to truly become an economic crisis, some observers even compare it to the Great Depression of the 1930s. An unfortunate byproduct of these times of economic stress is that countries may fall prey to the temptation of protectionist tendencies. During this time of global uncertainty, it is of the utmost importance that we resist the protectionist pressures that may accompany economic uncertainty.
Canada stands firm in the belief that the road toward greater economic growth and security is through maintaining open markets. That is why at the G20 meeting in Washington last November, Canada demonstrated tremendous leadership.
We pushed for progress on four initiatives to address the causes of the global financial crisis. Canada pushed for initiatives that were ultimately endorsed by the G20 leaders. We pressed for action to address the causes of the crisis, commitments to strengthen domestic financial regimes, an agreement to conduct transparent international assessments of national financial systems, and Canada pressed for a commitment to resist protectionism and maintain open markets. That was our Prime Minister in Washington at the G20 meetings last November.
We succeeded in our efforts at the G20 meeting. Let me quote from the G20 leaders statement:
We underscore the critical importance of rejecting protectionism and not turning inward in times of financial uncertainty. In this regard, within the next 12 months, we will refrain from raising new barriers to investment or to trade in goods and services, imposing new export restrictions, or implementing World Trade Organization (WTO) inconsistent measures to stimulate exports.
We have worked closely and effectively with the United States over many years in the G20, WTO, NAFTA and elsewhere. If we value our friendship with the United States, and we certainly do, then we must do what only friends can do, and that is to stick by our principles and urge our friends to stick by theirs.
President Obama has signalled his administration's desire to re-engage heartily with the rest of the world. Provisions in the current version of the American recovery and reinvestment act, making its way through the senate, may threaten to undermine that goal.
Some members have suggested that the government adopt a “if you can't beat them, join them” approach, but that is not what friends do. We must keep up the pressure, and we will, to encourage the United States to take the right road because it is actually the only road that will lead us toward economic recovery.
