May 21, 1951 (21st Parliament, 4th Session)


Wilbert Ross Thatcher

Co-operative Commonwealth Federation (C.C.F.)

Mr. Thatcher:

I thank the minister for his correction. I am very pleased to have it. He

Trade Agreements
is correct and I was wrong, but the fact still remains that as to standard machinery what I said is correct. I say that despite the concessions which we have obtained from the United States at these three conferences the American tariff level is still considerably higher than the Canadian. The effect of Torquay, Geneva and Annecy is that it will facilitate the entry of more United States goods into Canada without bringing the United States tariff to a point where Canadian manufacturers can compete in the United States market. I think Canadians are going to be disappointed that something has not been said about armaments. I understood that Canada was going to manufacture arms for the United States. Now it appears that all we are going to make now is parts. I do not know if there is a tariff on munitions that we export to the United States. I assume there is. Perhaps this is one item on which we should have received a concession in these critical times. .
I say again that the Canadian government vas bested at Torquay by our United States friends, if you judge by the dollar value of the concessions obtained. I think at this time it is proper that we should consider the state of our trade with the United States. I would not deny for a moment the tremendous strides which the government has made in building up our exports to the United States. The fact that they have been able to build up our exports in that market, the most competitive in the world, is no mean achievement, and I do not wish to detract from it. Nevertheless when we recall that in 1950 two-thirds of our exports went to the United States we can see the dangers inherent in the situation. This afternoon the leader of the opposition (Mr. Drew) said we were something like the man who put all his eggs in one basket. That is what we have done so far as our trade is concerned today. As has been pointed out already, the United States market has never been known as the most stable market in the world. Actually the opposite is true. It is subject to economic recessions, and going by past history, tariff policy can change overnight. I wonder what would happen to Canada if suddenly General MacArthur or Mr. Taft should become president of the United States. I think then we might have to worry immediately about higher American tariffs. Therefore I say one of our objectives in tariff and trade policy should be to diversify our trade to a greater extent in future.
The minister or some of his friends may ask how we can do that. Well, there are many possibilities. I have in my hand a

clipping from the Financial Post of April 14, which states that France offers to exchange steel for our newsprint. They want our newsprint, most of which is going to the United States. We are pretty short of steel. There may be objections to such a procedure; perhaps the price of French steel is too high, or there may be other reasons why that is not feasible, but on the surface this would seem to be one way by which we might diversify our trade.
Our second chief trade problem today is the British market. A great deal has been said already about the deteriorating position of that market. In 1949 United Kingdom sales to Canada were only 43 per cent of her purchases from this country. In 1950 they were 85 per cent. Before the war Britain used to take nearly half our exports. Last year she took only one-third, and I think it is safe to say that all hon. members are alarmed at the way our exports to Britain have deteriorated. Prior to the war the British bought a great deal from us. Since the war they have not been able to buy as much simply because they lacked the Canadian dollars with which to make those purchases. British statesmen and opposition leaders in this house have warned the Canadian government repeatedly as to what would happen if we did not permit them to earn more Canadian dollars. To give only one illustration, I remember a Canadian Press dispatch back in 1949, which said:
Cripps issues warning Canada to lose exports unless it "buys British."
Britain will buy less food from Canada unless Canada buys more from Britain, Sir Stafford Cripps, chancellor of the exchequer, said Thursday.
. . . he said the crux of the post-war Anglo-Canadian trading problems is expansion of British exports to Canada.
At that time, two years ago, Sir Stafford Cripps put the trade problem as far as England was concerned right up to this parliament. If Canada wanted to hold the British market he told us we had to buy from them. However in the intervening years, our government has been most apathetic in trying to increase British imports. As a matter of fact this government has taken several steps which have had the opposite effect. For instance, several years ago our government encouraged the British to send textiles to Canada. They said that in order to encourage that trade they would remove the tariff. The British textile industry went to work and produced at competitive prices, and began to earn a great many Canadian dollars. As soon as they began to do that our government decided to put the tariff back on again. Much the same thing happened in the

automobile industry. Ever since the end of the war one cabinet minister after another, one government spokesman after another, has been urging British industry to become competitive, to get their prices down; yet when the British automobile industry did begin to compete, when they did produce a car that could be sold in the Canadian market, right away our government put on a dumping duty.
I cannot reconcile actions like those with a desire to increase British imports, and increase trade within the commonwealth. I think it is fitting also to mention what happened as far as our wheat agreement was concerned. The British government made an agreement in writing with the Canadian government to buy wheat at a fixed price. They fulfilled the terms of their agreement, and did so in writing; yet numerous members of this house accused the British of reneging, of failing to live up to a moral obligation, I do not suppose the British liked such statements very much. I think we in this house should remember that our chief market for farm products in the past has been Britain, as it probably will be in the future. When we do things like that and make statements like those in this house, I suggest that we are jeopardizing that market. Insulting your customers is not a good way to build up trade. I do not think you could do it in any other kind of business.
Mr. Speaker, it is clear now that another world-wide, multilateral trade conference like Torquay is most unlikely. If that is the case, any additional concessions we get must come from direct negotiations. Therefore I agree with other hon. members who have suggested that we should commence further trade negotiations with Britain. Probably we should do the same thing with the United States, and possibly with France and: other countries. Our first objective in these negotiations should be to get back our old, traditional markets, and our second objective, the diversification of our trade. If we can do these things, our trade in future will remain in a healthy position.

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