Pierre Paquette

[Clothing and Textile Industry, February 8th, 2005]

Mr. Speaker, a number of textile plants have closed down recently. Industry representatives denounce the fact that garments manufactured from Canadian textiles cannot enter the U.S. freely, despite NAFTA.

Does the government plan to enter into negotiations with the U.S. authorities with a view to doing away with this practice, which is inconsistent with the spirit of NAFTA and limits access to the U.S. market by garments made of Canadian fabric?

[Supply, February 8th, 2005]

Mr. Speaker, I would first like to congratulate the member for his speech and for the clarity of his remarks. I would still like to ask a very specific question of him, though. Currently, the textile and clothing sectors are going through a difficult transition. Let us hope that they will emerge from it with the help of an adequate policy from the federal government.

Given the current situation, does he feel it is normal and understandable that clothes made of Canadian textiles outside Canada be taxed when they come back to Canada? I think it is completely illogical, and all the more so since the Americans have that kind of policy with the Caribbean, as you know. They export textiles which will be transformed into clothes and imported back on the American market duty free. We, in Canada, tax our textile manufacturers. Does he understand this aberration?

[Supply, February 8th, 2005]

Mr. Speaker, I address myself to the hon. member as former chairman of the Standing Committee on Finance. He was there when we wrote the report presented in April 2004. This report went much further than the measures announced by the Minister of Finance in mid-December.

Could he explain why we had to wait for six textile plants to close down before the Minister of Finance acted on the report presented by the committee in April 2004? I know we had an election, but from June 28 to mid-December, he had plenty of time to implement these three measures contained in the unanimous report from the Standing Committee on Finance.

[Supply, February 8th, 2005]

Mr. Speaker, I want to congratulate my colleague for his work on this matter. Long before his region was affected as it was in December, he was very active not only within the Bloc Québécois caucus, but also in the House to alert us to this issue. He tabled a petition with more than 2,500 signatures from people in the Huntingdon area calling on the federal government to intervene quickly. He did this several weeks before the Huntingdon tragedy.

I want him to say a few words about what the industry had to do to try to avoid the closures it unfortunately had to go through with because of the Liberal government's inaction.

[Supply, February 8th, 2005]

In the few seconds I have left, I would like to mention two things, very quickly.

First, the tariffs on imports have to be maintained. Under the WTO agreement, we have no obligation to reduce our tariffs on Chinese or Indian imports for example. They have to be maintained, because they are a very practical form of aid to our industries.

Second—and I did not have time to talk about it but I will have the opportunity to do so when I table a petition containing 13,500 signatures in connection with labelling clothing—we have to denounce the abuses and talk about the clothes that are made by children and prisoners and that are sold on the Canadian market. If consumers knew where this clothing came from, they would probably choose something made in Quebec or in Canada, or Quebec or Canadian textiles, because they know we try to give our workers the rights due them. Even if we do not always manage to do so, this is what we are aiming to do. We thus also consider the mandatory labelling of clothing something that will promote the Canadian and Quebec textile industry.

[Supply, February 8th, 2005]

Mr. Speaker, I would also like to thank the member for his question.

Huntingdon, it must be said, is just the tip of the iceberg. It stands out the most. We are talking about six companies closing in a small community. However, I would recall that there were closings in Trois-Rivières, Montmagny, Magog and Montreal. Just recently, a company closed in the Maskinongé area as well. We must be very aware of the fact that our industry has to be restructured. It cannot rest on its laurels, confident that we will protect it ad infinitum.

As we did in the past at the time of the North American Free Trade Agreement and also in previous decades, we need a program to help the industry restructure. This having been said, there will be some job losses of course, because companies are too outmoded technologically or because fewer workers than before will be needed as the result of technological innovation. A program to help older workers is one element. I emphasize this to the member, because we said: “With regard to these three elements.”

In the Bloc Québécois's proposals to the government, we also want a transfer of $200 million to the Government of Quebec—and this applies as well in the case of the other provinces—to provide occupational training programs. People will then be able to retrain or to work with the new technologies or in new occupations that will be created as this industry restructures.

So the member is quite right. This element seems essential to us. I recall that these assistance programs existed until 1997. We used them—I remember very well—in the case of the steel industry closures in the Sorel area and the mine closures in the asbestos region.

[Supply, February 8th, 2005]

Mr. Speaker, I would like to thank the member for Drummond for her excellent question. It is indeed a basic issue.

The Bloc Québécois has always been fairly critical of the plan for a free trade area of the Americas, especially in social and environmental terms. In terms of trade, though, there would be obvious advantages. A good trade agreement, with strong environmental and social guarantees, would be better than what we have now.

For example, if the Government of Canada allowed Canadian textiles to be processed in the West Indies, as are American textiles currently, this processed clothing still could not enter the US market because it would not be considered to have sufficient Canadian content to be covered by the North American Free Trade Agreement. That is a problem. But it does not mean that we should not take this step immediately for the Canadian market. However, it would not enable us to enter the US market.

However, as I said, the Prime Minister announced that he was going to meet Mr. Fox and Mr. Bush in March and April. Under the Free Trade Agreement, nothing would prevent Canadian textiles processed in the West Indies from being recognized as North American in origin, just like clothing made from US textiles processed in the West Indies. This approach requires political will as well as some vision in regard to the development of our manufacturing industry, especially clothing and textiles.

The Liberals seem to be crossing out an industrial sector because of their prejudices, they are unaware of the reality, they do not want to look at the context in which problems arise. In this case, they put forward measures like those announced in December. They are a first, inadequate step toward resolving the problem.

This situation also demonstrates the urgency of reviving the negotiations on the free trade area of the Americas. This means that the Government of Canada should drop its approach of protecting investment, which can be seen wall to wall in NAFTA and under which companies have more rights than do governments. We know that people do not want this in South America.

Those primarily responsible for the current impasse in the negotiations over a free trade area are, first of all, the Canadian government and secondly the American government.

[Supply, February 8th, 2005]

moved:

That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon, and that it ask the government to further elaborate with regard to the following elements: the use of safeguards provided for in trade agreements, the implementation of measures to encourage the use of Quebec--and Canadian--made textiles and the creation of a program to assist older workers.

Mr. Speaker, I am extremely pleased to move this motion, first because I feel that it is in line with the work of the Bloc Québécois in defending Quebec's interests. As you know, an important part of clothing and textile industries is in Quebec. Furthermore, in this case, we are defending the rights of workers to maintain employment in an industry that is currently threatened and which, through appropriate government policies, would be able to prosper as it has in the past.

In this sense, I will read the Bloc Québécois' motion again, so that people who are listening to us or who will be made aware of this extremely important debate on the future of textile and clothing industries truly understand what this is all about:

That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon, and that it ask the government to further elaborate with regard to the following elements: the use of safeguards provided for in trade agreements, the implementation of measures to encourage the use of Quebec--and Canadian--made textiles and the creation of a program to assist older workers.

As I was mentioning, the textile industry is extremely important in Quebec and in Canada. Indeed, it represents 48,000 manufacturing jobs and $6.6 billion in production every year, including over 50% in exports. In fact, we are talking about $3.58 billion in exports, of which a major part was going, until very recently, to the United States, and continues to do so, but at lower levels. So, as we can see, it is an extremely important manufacturing industry.

We are talking about 94,850 jobs in the clothing industry. I am quoting figures for 2001. This industry has annual sales of $6.72 billion, about the same as the textile industry. Exports represent 40%, or $2.73 billion.

As we can see, this is not a minor manufacturing industry; it is extremely important. As I said, 55% of all clothing produced in Canada is made in Quebec.

Unfortunately, these two industries are in the midst of a shake-up, and not their first one either. However, the federal government's attitude means that these industries are not receiving the assistance they need to survive the transition period made necessary because the rules of the game have changed.

Our impression, which my colleague for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup seems to share, is that the federal government has written off the clothing and textile industries for some time now, thinking that, as markets become more open, Canada might lose these two industries, but would win in other sectors and that, ultimately, everything would balance out.

Unfortunately, this is not the case. Real people are losing jobs in the clothing and textile industries; they are not just statistics. These people will find themselves unemployed, often women and immigrants, and will then have trouble finding a new job.

These job losses often affect communities too, which lose their municipal or regional mill. Just because markets are being opened up without consideration does not mean that other industries will necessarily set up in the regions affected by these mill closures.

There were recent closures in Maskinongé, for example, and 50 people lost their jobs. It is highly unlikely that the unchecked opening of markets will mean that these 50 jobs will be recreated on the basis of other industrial or economic activities.

The government is blind to the fact that the clothing and textile industries are extremely dynamic. According to Statistics Canada, the textile industry is the 12th largest in terms of research and development. This is not, however, the image being presented by the Liberal government, which would have us believe that this industry cannot adapt to change. This is not necessarily the case, if this industry receives the necessary assistance and already agreed upon R and D efforts are supported.

I remember very clearly that, after NAFTA and even the US-Canada free trade agreement, we were told the garment industry was doomed. That created great consternation in Montreal, but people rolled up their sleeves and began to produce high-end garments of better quality than the imports. As a result, during the first seven years of the 1990s, clothing exports increased by more than 400%. The industry was far from moribund.

The context changed, however. Both the clothing and textile industries were able to adapt to the free trade agreement between Canada and the United States, and to NAFTA. Not only the clothing and textile industries, but even the furniture industry as well, despite its being another doomed industrial sector according to the Liberal government.

Now things have changed, and not just because of the opening up of the markets. American protectionism is one thing. They have decided to have their garments manufactured in the West Indies. Their fabrics are shipped there to be manufactured in plants where the workers are paid very little. Then the garments are imported back into the U.S.

We do not have access to these agreements, which means that a considerable segment of Canadian and Quebec textiles have lost the natural market represented by the U.S. This is contrary to the spirit of NAFTA, which was meant to benefit the partners, and not only Canada, which includes Quebec of course, but Mexico as well. This situation has existed since 2000—it did not just crop up the other day—yet the federal government has done nothing. It has said nothing. It has accepted a rule change made unilaterally by the American authorities. As hon. members know, 1999 was the pivotal year for the clothing and textile industries. Since then, exports to the U.S. have slowly dwindled down in both of these sectors.

What is more, in 2003 the federal government decided—with our support—to open the borders to the 40 least developed countries duty-free. We agreed with that measure, but at the same time we also agreed to the condition that measures would be put in place to help our clothing and textile industries convert, and this never really happened. I will leave it up to my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup to go into that point in more detail. The programs the federal government put in place were inadequate. From 2003 on, an increase in imports from those countries, Bangladesh in particular, was already noticeable, and constituted a second blow to our industries.

I would again point out that the Bloc Québécois was in agreement with this initiative, as long as it was linked to some kind of assistance programs for the industries involved. Representatives from these industries have appeared before the Subcommittee on International Trade, Trade Disputes and Investment or the Standing Committee on Finance on several occasions asking for federal government support.

What has now changed is that the import quotas from all countries, and from China in particular, have disappeared since December 31. It is a third element which also has us worried, because we fear that this trend first noticed in the early 2000s is now growing, as evidenced by the closure of six plants in Huntingdon, and, more recently, of two textile mills in Gildan.

We have met earlier with workers from the textile and clothing industries. There was a woman amongst them who told us that she had just lost her job in a company that was very profitable and I believe what she says. However, the employer or the shareholders have decided to move outside the country to seek higher rates of return.

The whole context has changed and this is where the Liberal government should have thought about helping the industry. This is not what the government did at all. As I was saying earlier, the government has been dragging its feet, doing nothing until Huntingdon was faced with this crisis. Its reaction was based on a report tabled in April 2004 by the Standing Committee on Finance.

So a report was tabled in December 2004. I fully realize that there was a general election in June, but the measures were known. Why did the government wait for a crisis to happen, with the closure of six companies in Huntingdon in December, before implementing the measures recommended by the Standing Committee on Finance months earlier? Precious months were lost.

A number of the measures announced by the government—well, at least one—are going to take time to put in place. In any case, when assistance programs are announced, it takes time before results are seen.

If, immediately following the election, the government had acted on and implemented the measures advocated by the Standing Committee on Finance, the situation would probably be better today.

As you know, on December 14, 2004 the government hastily announced, at the eleventh hour, a series of three measures. What is interesting is that, the week before, I had asked a question in the House concerning the government's attitude toward the difficulties being experienced by the clothing and textile industries.

The Minister of Finance told me at the time that I was in too much of a hurry, that there was no emergency and that the government was working on a plan—we did not know what plan—in the routine manner, that is, not too quickly and without listening too closely to the needs of the public, the workers and the industry. Strangely, one week later the measures were more specific, but not very surprising, because they essentially repeated what had been proposed by the Standing Committee on Finance.

They proposed the elimination, effective January 1, 2005, of tariffs on imported fibre, yarn and textile inputs used by the apparel industry, while maintaining duties on products that could be proven to be also made in Canada. This is a measure with which we concur. In fact it can be found in black and white in the Bloc Québécois election platform of last May and June.

The problem lies in determining what is produced in Canada and what is not. The Canadian International Trade Tribunal has been asked to study the question. Knowing the Trade Tribunal and the meagre resources it has been allocated by the government, it will be several months before the situation can be clarified.

Meanwhile, manufacturers that import apparel will continue paying duties without knowing whether they are going to be reimbursed in the end. This is somewhat like the situation presently being faced by the softwood lumber producers with respect to the American authorities.

Obviously, this is not an environment that is favourable to investment. If I am obliged to pay customs duties and I am told that in a few months I will be informed whether or not I am eligible for the measure, then clearly, during that period I will not be investing in modernizing my machinery, in research and development, design, marketing and other things. So this is a measure that should have been announced last July.

The second measure is the addition of $50 million to the CANtex program over five years. Again I will let my colleague elaborate on this point. However, to give you an idea of how little this amount is, just this year, the last year of the program, the industry received $26 million to modernize.

The third measure is the five-year extension of the duty remission orders in effect.This too is a measure with which we concur. Obviously it helps out the importing manufacturers, but it does not help the textile and apparel manufacturers that do not import. It is an appropriate measure but it is not enough.

That is what the first part of our motion is about. It should be clear to this House, in light of the whole situation affecting both textiles and clothing, that these three measures announced last December at the eleventh hour do not constitute a complete or sufficient assistance plan for these industries.

So when we read:

That the House acknowledge the inadequacy of the assistance plan for the clothing and textile industries which was announced by the federal government following the closure of six plants in Huntingdon--

That is this first part.

In the second part of the motion, the government is consequently asked to elaborate on this assistance plan as quickly as possible.

The word “notamment” follows in the French version, to indicate that other measures are not excluded. Many have been suggested, including by the representative of the textile industry who wrote a letter to the Prime Minister some time ago. In that letter, the Canadian textile manufacturers association repeats several times the measures I have just been speaking about. One notes in that letter a certain sense of lyrical emphasis.

Each time he writes about some measure, he concludes his paragraph with the same remark, “This point has been raised repeatedly with ministers and officials, but it has not been addressed in this announcement”. Dealing with another measure, he concludes, “We have recommended such a program to your ministers and officials, and we are disappointed that it is not included in your announcement”. These are the words of Harvey Penner, who is the president of the textile association, in his letter to the Prime Minister after the announcement on December 14.

We are putting forward a series of measures. The first one would be to take advantage of the safeguards under the trade agreements.

As I mentioned, in 2003, Canada decided to unilaterally open its borders to the 40 least developed countries. We agreed with this initiative. But it should be noted that only one country in southeast Asia used almost 100% of its quotas, and that is China. Even Bangladesh, with its increasing exports to Canada, could not use 100% of its quotas when these were in force.

A concrete suggestion we are making is that, during a transition period, we invoke the WTO agreement, and more particularly the terms of China's accession to the WTO, to keep this quota for China and make sure our market is not flooded with clothing and textiles from China. This is extremely important, and international trade agreements allow this. It would not be contrary to the WTO agreements or any special agreement we have with China.

I think we should move quickly. We would have a more secure environment for our companies and workers so that they can modernize or restructure their business.

Secondly, we recommend the implementation of measures to encourage the use of Quebec- and Canada-made textiles. This could lead to the possibility, among others, that Canadian textiles processed outside of Canada be allowed to come back to Canada duty free, as is done in the United States. Ideally, the Prime Minister has stated that he would be meeting with his Mexican and American counterparts in March and April. Ideally, we would need to come to an agreement with the Americans, in the spirit of the North American Free Trade Agreement, so that Canadian textiles be considered as American textiles, for example, when they are processed in the Caribbean. Thus, they would have access to the American market. That being said, we would control at least the possibility to give our textile producers the right to export their products to countries that would transform them into clothes which we would import back duty free. That would allow us to keep a part of the textile market which we are now in the process of losing.

The third element mentioned in the motion has to do with the creation of a program to assist older workers. I do not need to speak at length of this measure. For years now, namely since the Liberal government abolished the program called POWA, we have been requesting it, industries have been requesting it, trade unions have been requesting it and associations of employers have been requesting it. In that sense, it seems to me that it would be utterly normal to ensure that older workers who lose their jobs due to the reorganization of their company or a plant closure have at their disposal a pathway that would take them to their retirement years in dignity.

As you can see, the motion is quite reasonable and it is the first response that the House ought to give to the problems the workers as well as the employers in the clothing and textile industry are currently facing. I would invite all the members here to vote in favour of this motion as a clear indication to these people that they have the support of all members from Quebec and the rest of Canada.

[International Aid, February 4th, 2005]

Mr. Speaker, in London yesterday, on the eve of a meeting of G-7 finance ministers, Nelson Mandela challenged the leaders of the rich countries to reduce the debt of the poor countries, to significantly step up international aid, and to make international trade more equitable.

Mr. Mandela emphasized the urgent need to act promptly. Hon. members will recall that the Prime Minister made drastic cuts to international aid when he was finance minister. Now he has a duty to heed the heart-felt plea of the former president of South Africa, who said in his speech “Massive poverty and obscene inequality are such terrible scourges of our times—that they have to rank alongside slavery and apartheid as social evils”.

The Prime Minister must show some leadership and remedy his past errors. It is high time the government put a realistic plan in place to enable it to reach at least the minimum objective of 0.7 of GDP by 2015.

When the budget is tabled a few weeks from now, it will give us a good indication of how serious the Prime Minister is. This may be an opportunity for him to put his money where his mouth is.

[Textile and Clothing Industry, February 3rd, 2005]

Mr. Speaker, whenever an industrial sector is concentrated in Quebec, the government drags its feet. The clothing and textile sectors are extremely important for Quebec and Canada. The government waited for the Huntingdon tragedy before it slipped in a few measures that did not satisfy anyone.

For months we have been suggesting ways the government could act, such as maintaining the quotas with respect to China, setting up an assistance program for older workers, or improving the industry assistance programs. What is the government waiting for to do something?