Pierre Paquette

[Softwood Lumber, October 4th, 2001]

Mr. Chairman, I do not believe we have been able to discuss the softwood industry much in recent weeks. It is understandable that all hon. members were reeling from the shock of the events of September 11.

I believe it is worthwhile holding an emergency debate, as suggested by the Canadian Alliance, on the softwood lumber industry, since this week there have been three days of meetings held in Washington between American officials and Canadian federal and provincial officials.

What is also interesting to note is that the consensus that gradually developed this past winter and spring to demand for compliance to the free trade agreement immediately seems to have held up over the intervening weeks and months.

That consensus was not built up overnight. Discussions are still being held within the industry in Quebec and at the Canadian Manufacturers Association. The choice offered to us was either to follow the legal approach to the end, something that had never been attempted, or to enter into negotiations with the Americans, and in that context to repeat what happened in 1986 and 1996.

The wise choice that the Quebec industry made, as did the other industries and the governments across Canada apparently, was to use the legal approach all the way. There are very good reasons for this. First, in the United States—this has already been mentioned, but we do not insist enough on this in Canada and in Quebec—we have allies among American consumers and builders. We have a broad range of allies.

I had the opportunity, along with the hon. member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques and the hon. member for Rimouski--Neigette-et-la Mitis to travel to Washington as part of a non-partisan delegation of parliamentarians. I was surprised to see that the U.S. black people's chamber of commerce supports the Canadian position, as do a number of other consumers associations.

We do have allies, even among U.S. parliamentarians. The Minister for International Trade mentioned it. This summer, about 100 parliamentarians from both the Senate and the Congress wrote President Bush to ask him to maintain free trade in the lumber sector, because it was in the best interests of consumers in the various states that they represent.

It is also important to recall that we are now engaged in a negotiation process on a free trade area of the Americas. There is something contradictory in the Americans asking for protectionist measures in the lumber industry when all the nations of the Americas are talking about greater trade liberalization. In this regard, I think that President Bush does have—as the Canadian Alliance member pointed out—a responsibility.

We certainly realize that, following the September 11 events, this may not be at the top of his priorities. However, at some point in time, if he is the free trader he claims to be, he will have to take steps to put a stop to the procedures and harassment by the American lumber industry, particularly since we are now trying to further develop harmonious relations between all the countries. In my opinion, a prerequisite to such relations is to settle trade wars that have no real basis.

Another element, which strikes me as important and enters into the arguments relating to pursuing the legal battle, is the existence of the World Trade Organization. The rules it is in the process of developing—a process not yet complete—did not exist at the time of the last problems, which occurred around 1995-96. Now, with the WTO in place, and involved in this matter, U.S. legislation is now being challenged by the Canadian government, and rightly so, moreover.

From the political point of view, the situation is completely different from what it was in 1996. On the economic level—as the minister has said—the stumpage fees in Quebec have increased substantially in recent years. I also want to point out that a study commissioned by the government of Quebec on stumpage fees in private woodlots reached a very interesting conclusion.

As we know, Quebec has a price setting mechanism. I believe it is along the same lines as the one applied in the other provinces--Ontario, Alberta and British Columbia in particular--which take into consideration the stumpage fees for private woodlots to set the ones for crown lands.

We are often told that since 90% of forests are under public administration in Quebec, the private sector could not be taken into account because it was too heavily influenced by the strong presence of public forest management.

What is interesting is that the study in question reaches the same conclusion, from which I shall read an excerpt, because it seems to me to offer additional proof that there is no subsidy involved in setting softwood lumber prices in Quebec:

Empirical data indicate that there is a single price for wood originating in Quebec, New Brunswick or northeastern U.S., once adjustments are made for the quality and for shipping costs.

What we see is that the price of wood in Quebec is the same as throughout eastern North America. The paradox is that the Atlantic provinces, including New Brunswick, were excluded from the American process, more so because their forests are managed privately rather than publicly. But we can see that price setting comes down to the same thing.

This study clearly shows that prices based on stumpage fees accurately reflect market prices. This is further proof that there are no subsidies.

We are right in economic terms. Our environment, in political terms, is favourable. And yet we face a whole series of legal proceedings and harassment from part of the industry in the United States.

The Minister for International Trade and the federal government will have to take steps to help the industry and those working in it. They will have to ensure the consensus remains, because, obviously, with the latest layoffs in British Columbia, among others, the pressure is tremendous, as we can understand.

The Minister for International Trade and the federal government will have to use their imagination in coming to the aid of the industry to help it get through these turbulent times and through the legal process and come out a winner.

I think the minister mentioned the possibility of the EDC's providing guarantee for the exporters, which corresponds to the interim countervailing duties of 19.3%.

Since the minister spoke of it around the end of August, I think it was August 24, we have heard nothing more. I think this avenue should be explored, and it seems to me it could help the industry get through the period better.

There is also the whole issue of employment insurance. I know that my colleague, the member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques, will elaborate on that. We also have a situation, with the economic downturn, that would allow the federal government to implement measures, particularly with regard to employment insurance, that would help industry as a whole, including the lumber industry, which is suffering the consequences of countervailing duties, and it will only get worse.

Last, and this is very important, the federal government and the Minister for International Trade must play a leadership role. They have done that. I humbly submit that the Bloc Quebecois has supported the government in its initiatives and has even guided it in some instances to ensure that it was headed in the right direction. This must continue.

In this context, it seems important that, following the meetings between the provinces, there be a summit where the provinces, the industry and the federal government get together to assess the situation before the end of October.

I hope we will get through this dispute and that our interests, which are totally legitimate, will be defended in a context where we cannot let the might makes right principle prevail, because that would be contrary to all the work that has been accomplished by Canadians and Quebecers over the last 60 years.

[Softwood Lumber, October 4th, 2001]

Mr. Chairman, I have just one simple question. I have received information to the effect that during the discussions over the last three days, there was talk of temporary measures before a return to full free trade.

I would like a very clear answer. Is the government in the process of negotiating temporary measures to reach a settlement with the United States, which would have the effect of restricting access to the American market, as was the case in 1996?

[Foreign Trade, October 4th, 2001]

Mr. Speaker, in this context, would the minister agree to call a meeting of his NAFTA partners, the United States and Mexico, to discuss an agreement to establish a security perimeter which would strike a fair balance between trade and security imperatives, our humanitarian commitments and respect for civil liberties?

[Foreign Trade, October 4th, 2001]

Mr. Speaker, the foreign trade of Quebec and of Canada has been greatly affected by the September 11 attacks, which have resulted in security taking priority over the flow of goods at the Canada-U.S. border. According to the Manufacturiers exportateurs du Québec, exports by Quebec companies to the United States have dropped 15% since the attacks. On an annual basis, this represents a shortfall of $8 billion.

Would it not be wise for the Minister of Foreign Affairs to give serious thought to creating a North American security perimeter with his NAFTA partners in order to ensure the uninterrupted flow of goods and people, with due regard for security imperatives?

[Canada-Costa Rica Free Trade Agreement Implementation Act, October 1st, 2001]

Mr. Speaker, I thank the hon. member for Châteauguay for his question. There can never be too many opportunities to explain the shift that be triggered by some aspects of NAFTA's chapter 11.

We all agree in this House that foreign investments are entitled to some form of protection. However, there must not be an imbalance, as was the case with chapter 11, between the rights of businesses and the ability of the states to create the collective tools that the public wants them to have.

Under NAFTA, this was not fully duplicated in the Costa Rica--Canada investment protection and incentive agreement, two things present a problem. The first one, which is found in the agreement with Costa Rica, is that a private company can go directly to a court created under the agreement to take legal action against a government because of measures that it deems harmful to its profitability. This is the first problem and, in my opinion, a fundamental one.

The second problem with chapter 11 of NAFTA is the definition of expropriation, which is much too broad, as exemplified by the legal proceedings undertaken by UPS against the Canada Post Corporation, where UPS claims that Canada Post is guilty of unfair competition because it uses its infrastructures to provide courier services. We will get back to this later on.

I will wrap up my remarks by commenting on the matter of disputes. For a private company to sue a government directly, as part of an agreement which creates a tribunal, is most unusual. Apart from NAFTA, to my knowledge there is, no other agreement with such provisions.

In the case of the World Trade Organization, we have a perfect example involving Bombardier and Embraer in Brazil. Bombardier feels that it is suffering because of policies that allow the Brazilian government to subsidize Embraer's exports, especially those to the United States. Under no WTO agreement is Bombardier going to sue the Brazilian government directly. The company is represented by the Canadian government, which has filed a complaint with the World Trade Organization. The Brazilian government, on behalf of Embraer, is responding to this complaint. Governments speak for private companies. These are the sorts of mechanisms that we should have in NAFTA and in any free trade agreements we sign.

The impact of this chapter was underestimated. In an article that appeared in Le Devoir last May, Mr. Parizeau, who was in fact a supporter of the agreement, and no one would question his support for the North American Free Trade Agreement, admitted that he had underestimated the impact of chapter 11.

In conclusion, I know to his credit this summer, ministers for international trade from the three countries, Canada, the United States and Mexico, presented documents clarifying interpretation of this chapter. I examined these documents. In my opinion, they do not go far enough and the problem still remains.

The debate on the free trade agreement between Canada and Costa Rica is an opportunity to further consider this issue and to come up with solutions which serve the interests of Canadians and of Quebecers.

[Canada-Costa Rica Free Trade Agreement Implementation Act, October 1st, 2001]

Mr. Speaker, I thank my colleague, the hon. member for Kamouraska--Rivière-du-Loup--Témiscouata--Les Basques for his question. I feel it is totally appropriate, even central, to this debate.

On the one hand, we are told that this agreement is not, in the end, all that serious because it repeats the terms of the agreement with Chile, more or less, which is inspired by NAFTA. It gets passed just like that, while they are fully aware that this is just one more agreement that is not seen as satisfactory by increasing numbers of people in the Americas, or in any of the democratic world.

In Quebec and in Canada, more and more people no longer accept the way governments negotiate these trade agreements with impact on all aspects of our lives, economic—and on that we are all in agreement, I think—social, cultural , or environmental.

Either we act as if there were no problem, and pass this implementing legislation because we have nothing against Costa Rica, which is true—in fact our feelings toward it are far from negative—or we take advantage of this opportunity, as my colleague has said, to hold an indepth debate, not just on this agreement but on the entire process leading up to free trade agreements, be they the one with Costa Rica or future agreements with Guatemala, Honduras, El Salvador or within the framework of the free trade area of the Americas.

For me, there is an extremely important principle at stake, one that has moreover been referred to by the French Prime Minister, Lionel Jospin. Mr. Parizeau has used it as well, often, but I believe it merits some thought. Within the framework of trade agreements, whether continental or international, countries may delegate part of their sovereignty in order to ensure proper administration, to ensure that an agreement is properly implemented and respected.

But in no case must the sovereignty of states, democratic states in particular, be handed over to private interests.

As far as Chapter XI of NAFTA is concerned, that is what is happening; the same goes for the agreement between the Government of Canada and the Government of Costa Rica for the promotion and protection of investments.

I believe we have an opportunity here to regroup, to ensure not only that this agreement is beneficial and gets signed, but also that the coming agreements with the four other Central American countries and with all the other countries of the Americas, meet our wishes that they serve the interests of the general population, not monied interests.

[Canada-Costa Rica Free Trade Agreement Implementation Act, October 1st, 2001]

Mr. Speaker, it is with great pleasure that I rise to take part in this debate on Bill-32, an act to implement the free trade agreement between the Government of Canada and the Government of the Republic of Costa Rica.

Today's debate will be an opportunity to continue the debate first begun this spring and last winter concerning the kind of free trade agreement we want to have, bearing in mind that we are engaged in negotiations for a free trade area of the Americas scheduled to end in 2005. This agreement must be viewed in the light of this negotiation process.

Obviously, we cannot disagree in principle with a free trade agreement with Costa Rica. In this case, opening up markets gives all the countries, Canada, Quebec and Costa Rica, an opportunity to improve trade and increase wealth. Since Costa Rica is a developing country, a southern country, and has a right to the development of trade with a rich nation such as Canada, it can only benefit. We think that it is in the interest of all trade partners for the ground rules from a trade point of view to be known and respected.

The interesting thing about the case of Costa Rica is that this very small country managed to use the rules of the World Trade Organization to make the American giant see reason when it did not want to let Costa Rican textiles in. Costa Rica filed a complaint. A WTO panel ruled in its favour. The United States agreed to open its market to Costa Rican textiles, not because it was Costa Rica that was asking but because it was the WTO.

Trading nations throughout the world therefore have an interest in principle in seeing that the rules are as clear as possible. It is because we agree in principle that we are going to vote in favour of Bill C-32 at second reading.

That having been said, our final position is far from certain, because we have very serious reservations, particularly with respect to the issue of investment and the anticipated effects of this agreement on the refined sugar industry in Quebec and in Canada. The preceding speaker mentioned this, and I will be coming back to the topic of the very significant risks of this free trade agreement with Costa Rica for such sectors as the Lantic Sugar refinery in Montreal, which was mentioned by the member for Hochelaga--Maisonneuve last week.

If no changes are made to those two aspects of the agreement we will, as I said, be forced to reassess our position at third reading.

Of course, we will be told that it is going to be very difficult to backtrack on an agreement the Canadian government has already signed with Costa Rica. That is the government's fault, because if the process had been more transparent, if parliamentarians have been involved, if civil society had been consulted as the Minister for International Trade had made a commitment to do, we would not be in this situation. We are, therefore, refusing to be held prisoner by a done deal and we are not going to hand over a blank cheque to the Minister of International Trade, or to the Liberal government, because this precedent with Costa Rica, as in the other cases, will enable this government to continue negotiation process with regard to the free trade area of the Americas with the same lack of transparency, not involving parliamentarians and not consulting civil society.

It is time the government understood that democracy and transparency are now essential conditions for the successful signing of any free trade agreement, whether with Costa Rica or the with regard to the free trade area of the Americas. Enough is enough. The Liberal government is responsible for getting us into this situation, and now it is being forced to face up to its responsibilities and to get back to our Costa Rican partners on two aspects, namely investment protection and the predictable effects of the agreement on the refined sugar industry.

I thought that message had been understood at the Quebec City summit. With the experience of the failed multilateral agreement on investment at Seattle and the difficulties at the Quebec City summit, I thought that it had become clear for democratic governments, particularly the Government of Canada, which brags about being a model in this respect, that the era of negotiations behind closed doors was over.

Costa Rica is not a good example because we never heard about it and there were no consultations, even though, as I said earlier, the Minister for International Trade told us back in January that he would consult industry officials and civil society. But he did not do it.

I also remind the House that in the winter and spring the Bloc Quebecois moved two motions to democratize the negotiation process on the free trade area of the Americas, but both of these motions were rejected by the Liberal majority.

In one instance, we unanimously adopted a proposal to implement a continuous process to consult parliamentarians and civil society, but nothing was done by this government; nothing was done by the Minister for International Trade.

During the debate on the free trade agreement with Costa Rica, the government will have to finally open its eyes.

This bill should also be put in the context of not only the negotiations on the free trade area of the Americas, but also in the context of the negotiations at the World Trade Organization.

If we miss this opportunity to have a substantive debate on the transparency and democratization of the negotiation process, chances are that, following some agreement at the World Trade Organization, the Liberal government will once again put us before a fait accompli.

The same goes for the ongoing negotiations with four Central American countries, namely Guatemala, Nicaragua, Honduras and El Salvador, in that we have absolutely no idea of what is going on with these negotiations. It is the same thing with the free trade area of the Americas.

As far as we are concerned, it is imperative that, in this agreement, we take into account the two themes or issues that I mentioned earlier.

The first one is the investment issue. The Minister for International Trade is playing with words. In the background papers that were distributed to us, we are told that there is no new commitment on investments and services, which is true.

However, this may suggest to some opponents that there is nothing in this agreement that resembles chapter XI of NAFTA on the protection of investments, which is false. There are no new commitments on investments, because these commitments were made in 1998, when the investment protection incentive agreement was signed.

This agreement, which the Costa Rica—Canada free trade agreement refers to specifically, contains provisions similar to those found in chapter 11 of NAFTA. These provisions, according to a number of people, present considerable potential problems. This was evidenced recently by the proceedings UPS launched against Canada Post and the Government of Canada.

So, the free trade agreement with Costa Rica refers to this agreement for the promotion and protection of investments, and I will read article XII of March 18, 1998, which provides that:

Any dispute between one Contracting Party and an investor of the other Contracting Party, relating to a claim by the investor that a measure taken or not taken by the former Contracting Party is in breach of this Agreement, and that the investor has incurred loss or damage by reason of, or arising out of, that breach, shall...be settled amicably between them.

The following article provides:

If a dispute has not been settled amicably within a period of six months from the date on which it was initiated, it may be submitted by the investor to arbitration in accordance with paragraph (4).

Arbitration between a private party and a government is the prerogative of chapter 11, a chapter that was promised us. However, the Minister for International Trade had said that he did not want it in the final agreement of the free trade agreement of the Americas.

I note that the following appears on the federal government's website:

Canada is not advocating the replication of NAFTA investor-state rules in the FTAA and has not supported the proposals made so far by other FTAA countries to include such a type of dispute settlement mechanism.

As we can see, there is a blatant contradiction, since, once again, we see in the free trade agreement with Costa Rica provisions referring to another agreement—it is true—but they are the ones from chapter 11, which the government says it does not want to include in the final free trade area of the Americas agreement.

We might have expected that the federal government, the Minister for International Trade, would go back to the 1998 agreement to strike out the provisions and have disputes between countries, which are provided for in all the agreements, including that of the WTO, even those involving private business, settled by governments, by countries and not by private interests.

It is therefore essential to review this if the agreement is to be acceptable. Even though, as I mentioned, we support free trade in theory, we must ensure that it benefits the people of the Americas, in this case, the people of Costa Rica, Canada, and Quebec, rather than private corporations that would take precedence over the right of sovereign states to make decisions based on the interests of their citizens.

We have been told, and I think this is scandalous, that this agreement poses no threat, since there is very little, if any, Costa Rican investment in Canada. That is not the point. The point is whether we, as Canadians and Quebecers, believe that trade agreements must take into consideration the development of all populations, rather than defending the interests of our own capitalists. I believe, as a matter of principle, that this parliament must ensure that this situation is rectified.

In the case of sugar, which is the second aspect, and I believe that my colleague from Hochelaga--Maisonneuve outlined the difficulty, we gave Costa Rica better access to the Canadian market than what we would receive under this agreement, with respect to the Costa Rican sugar market. Obviously, we will be told that Costa Rica does not produce refined sugar, only a small amount of raw sugar. They export very little to Canada.

But that is not the point. Once again, we are setting a precedent, whereby in negotiations with the other four countries of Central America, including Guatemala, which is a very large producer--combined, these four countries export one and a half times the total industry production in Canada and Quebec--we will open up our markets to this raw sugar, and possibly refined sugar, since it will cost relatively little for Guatemalans to develop a sugar refining industry. We will be opening up our markets without them reciprocating.

Let us not kid ourselves. The market for refined sugar from Canada or Quebec will not be Guatemala, Honduras, El Salvador or Costa Rica, but the United States. The problem is that the Americans have a protectionist attitude and policy when it comes to refined sugar. As long as they refuse to open their markets, any opening in Canada's market for refined sugar from other countries will be a concession without an equivalent advantage.

We think it very important that this part of the agreement be dropped, not because we are protectionists like the Americans, but because we really believe in free trade. And because we do, we want this part of the free trade agreement between Canada and Costa Rica to be dropped and the Canadian government to propose multilateral liberalization of the refined sugar market, including, of course, the American market, as part of free trade area of the Americas negotiations.

In this context, our industry will have an opportunity to develop, to be competitive, and to hang on to existing jobs, as well as create more. As the House is probably aware, our sugar industry, especially the Lantic Sugar refinery in Montreal, has worked hard to become an international player. In this industry, we operate according to the rules of free trade, because the raw sugar refined in Canada is bought at market prices and not subsidized in any way.

If we truly believe in free trade, if we truly believe that free trade should serve the public and not just the private sector, it seems to me that we have a golden opportunity during the coming weeks to do something about it, to use free trade with Costa Rica as proof in the free trade negotiations that Canada wants to play a leadership role. The opportunity is there.

I think that government members were somewhat deluded about the real impact of the issues surrounding this free trade agreement. We are not at all sure that we are going to support this bill at third reading. Work will be done in committee. My colleagues and I will have an opportunity to present a number of amendments to correct the situation, in the hope that parliamentarians will match actions to words and that the free trade agreement with Costa Rica will truly serve Canadians, Quebecers and Costa Ricans.

[The Taliban, September 24th, 2001]

Mr. Speaker, the ruling Taliban in Afghanistan took over the offices of the United Nations in Kandahar, in the southern part of the country, and seized all of the UN's communications equipment in Kabul, on Friday. While some of the UN's activities have been maintained, most of them have been disrupted or stopped.

According to a UN spokesperson, the Taliban also took over the offices of certain non-governmental organizations in Kandahar and uttered death threats to the employees found on site.

Such acts of aggression must be considered as attacks against the entire international community. These attacks heighten the climate of uncertainty and tension that exists in the region.

We condemn the Taliban action, as this hateful behaviour toward NGOs will diminish the services to local populations that are already so poor.

[Customs Act, September 24th, 2001]

Mr. Speaker, I believe we agree on the objectives of this bill in this connection.

Indeed, all shippers, all truckers, all manufacturers, cannot be treated in the same way. Clearly, a number of them, because of their past performance, their reputation, their credibility I would say, represent less of a risk than others who are less well known, because they have been in the business a shorter time or have had fewer contacts with Canada.

In my opinion, we cannot therefore be opposed in principle to this idea of having a concentration of resources toward companies or individuals which are considered to be a higher risk than others.

Now the question is whether we are going to differentiate between a high risk company, a medium risk company and a low risk one. While I agree in principle, I must say that I do not know the answer for the moment, since we do not have the regulations.

It seems to me that if the minister's approach is a serious one, he must introduce the mechanisms by which the department will indeed determine this and the method it will use to ensure that companies or individuals deemed to be low risk are indeed that—even if there will always be a minimum of checks to be carried out at the border itself—and will be differentiated from those of medium and high risk as far as security is concerned—and I share the hon. member's concerns—but also as a matter of equity.

A company that benefits from this special border-crossing right will have a competitive advantage over another company. This can become a very easy way to encourage undesirable illegal traffic. The very principle of a bill that is aimed at risk management at source, that is with the shipper, the manufacturer or the passenger, is an interesting one. That said, as long as we do not have the regulations, the principle remains one on which we cannot form an opinion.

That is why I have already said that, without the regulations, we will not be in a position to vote in favour of Bill S-23 at third reading.

[Customs Act, September 24th, 2001]

Mr. Speaker, I thank the member for his question. I have not had an opportunity to examine the Alliance's amendments in detail.

It is clear to us that we must work collectively to find a balance between the security of Canadians and Quebecers crossing the border and the necessary fluidity of commercial transactions.

In a context of free trade with the United States and Mexico, if it were to take several hours or days to clear goods at the border, we would lose the advantages these agreements were designed to produce.

From this perspective, there is no easy solution. It is also clear that this cannot simply be left up to the Canada Customs and Revenue Agency. There is a whole series of other conditions. The leader of the Bloc Quebecois spoke about them during the special debate on the events of September 11. Canada in particular must assume its responsibilities with respect to world peace and the development of underdeveloped, or developing, nations, and ensure that the laws are actually respected.

With regard to the use of technologies, the bill proposes that the necessary resources be made available to ensure that these laws are respected. I think that the comments we have heard from those representing groups such as the Canadian Manufacturers' Association, or exporters, indicate that, as we speak, we do not have the resources necessary to enforce this law, even with all its shortcomings.

A law using additional new technologies and information will require resources. In this regard, we are waiting for the government to make a firm commitment during this debate.