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


Donald Methuen Fleming

Progressive Conservative

Mr. Fleming:

That belongs to history now. I think most of the free nations of the world tried to do their best, with due regard for their own interests, to give some play to the principles of multilateral trade. But, apart from Geneva and some very limited success at Annecy, and even more limited success at Torquay, it seems that many of those high hopes that were held five years ago have passed now into the limbo of disappointments.
We will not forget, either, in measuring the benefits we have enjoyed as a great trading nation, the fact that we owe much to the enlightenment which has distinguished not only trading policies in the United States, but also those policies that have sought, even at considerable cost to the American public, to assist other nations on the path to recovery. Whoever in this world, living twelve years ago, could have foreseen that the policies of the United States which, up until that time, from the Canadian point of view presented a great handicap and barrier to the freeing of the channels of international trade, would have been supplanted by policies which have been marked by generosity rarely equalled in history? And Canada has been the beneficiary of those American policies of trade, and those economic policies which have been designed to assist Europe back onto its feet. The European recovery plan gave great benefits to Canada.
I think the house will welcome, in general, the proposal to send these agreements and the accompanying documents to the standing committee on banking and commerce for more detailed examination. That, I think, is a highly proper course with respect to a measure of this kind, particularly as it seems to me some attempt will have to be made with respect to many of these items to measure the advantages against the possible disadvantages involved for Canada. We shall have to work within obvious limitations, and the

Trade Agreements
judgment that we shall apply in the committee or in the house must necessarily be tentative, until the agreements have been in operation and there has been an opportunity to see them at work.
However, I think we may well pause to consider the rather limited terms of the reference to the committee, and shortly I should like to say a word concerning the terms of the resolution and to compare it with the course the government invited the house to follow with respect to the Geneva agreements in the session of 1947-48.
May I first offer some comments with reference to the background against which we ought fairly to measure either the benefits or the disappointments of the Torquay agreements. I am not going to weary the house with statistics. As a matter of fact very few statistics need to be emphasized now beyond those that have already been recorded in the course of the debate this afternoon. But let me deal with our fundamental problem, and it is a problem. Whatever joy we may take out of the fact that our markets in the United States have been expanding as a result of the stockpiling policies of that country, the fact nevertheless remains that our trade problem increasingly becomes one of seeing our eggs to an ever-growing degree being placed in one basket.
Let us look at the figures for only the last two years. I will not trouble the house to go back beyond that. In 1949 our total export trade amounted to $2,993 million. Of that sum we exported to the United States $1,503,459,000, or 50 per cent in round figures. To the United Kingdom we exported $705 million in round figures, or 23-5 per cent. To the other commonwealth countries we exported $310 million or 10 per cent of our total exports. That means that in 1949 we exported half our produce to the United States and one-third to all commonwealth countries.
What is the picture in 1950? Our total export trade expanded to $3,118 million, the largest figure in our history. The United States purchased $2,021 million out of that total, or 65 per cent of the aggregate. The United States, even with a much larger total of exports, moved up from 50 per cent the year before to 65 per cent of that considerably larger total. United Kingdom purchases dropped from $705 million in 1949 to $470 million in 1950, and that figure represented only 15 per cent of our total exports. That is a fact that must arrest the attention of the house and give concern to the Canadian public.
Our exports to the United Kingdom dropped from $705 million in 1949 to $470 million

in 1950, and in that year they represented only 15 per cent of our total exports. In 1950 the commonwealth countries purchased $185 million of our exports, a very substantial drop from the $310 million the year before, and at that figure of $185 million they were only 6 per cent of our total exports. Therefore, as applied to the larger total of exports in the year 1950 compared with 1949, we see that the United States has moved up from 50 to 65 per cent, and all commonwealth countries, Great Britain included, have dropped from 33 -5 per cent to merely 21 per cent. Only one-fifth of our exports went to all commonwealth countries combined last year.
One has scanned the figures for the first two reported months of this year 1951 in the hope that the trend would have been arrested, but we see that for the first two months of the calendar year 1951 our exports to the United Kingdom have dropped-I will give round figures-from $79 million to $73,600,000, and total exports to all commonwealth countries are about what they were in 1950. In those two months our exports to the United States have increased from $260 million to $339 million. Now, sir, let us be fair. We are glad to see the increase in our exports to the United States, but let us remember that they are due to what may be temporary policies. These high exports to the United States are due to their policies of stockpiling, but even if it is only temporary we are glad to see the trading gap between Canada and the United States, which has traditionally existed, being closed under pressure of world events.
But no Canadian can view with any degree of equanimity this situation when our exports to the United Kingdom have shown this very alarming decrease accompanied by an equally alarming decrease in our exports to all other commonwealth countries. When I say all commonwealth countries I am referring not merely to the aggregate; I am referring to all commonwealth countries because it is one of the alarming features of our trading statistics of 1950 that the decrease in our exports to commonwealth countries applied right along the line. All commonwealth countries were purchasing less from us than in the previous year.
In the face of that situation what is the course that we urge upon the government? We urge, as we have consistently urged, that the government should take every step open to it to arrest this alarming decline in our exports to the commonwealth countries, and in particular to the United Kingdom, that great traditional market, a great market particularly for the primary produce of Canada. This danger of which I have spoken, of putting all our trading eggs in one basket,

is a danger that confronts the primary producer in this country more than it does any other person in our Canadian economic system. Therefore as one who regards the primary producer of this country as still the bedrock of the soundness of the Canadian economy, I make no apology for attaching the highest importance to this decline in our exports to the United Kingdom and to all commonwealth countries.
It is a fact that stares every one of us in the face, and I submit that the house cannot be content to sit back and watch the government apparently viewing this alarming decline with apathy. In case hon. members think that is a little strong, may I come back to this point, that we have urged upon them the calling of a conference of these very nations who are purchasing less from us, as I have indicated. Why should we not sit down together and see if we cannot do something to eliminate the very real difficulties that stand in the way of restoring the kind of trade they were doing with us previously? It is not simply a case of trying to expand our trade. It is a case now, so far as Canada is concerned, of seeking to win back markets that we have been steadily losing in the past fifteen months at an alarming rate. It is not good enough simply to sit back and watch that going on under our very eyes. It is far too dangerous a trend for any Canadian to sit back and watch without grave concern.
There are difficulties on the other side of this picture. The difficulties are not simply on the part of Canada, or any unwillingness on the part of Canada to trade. We will frankly realize, if we approach the problem realistically, that there are in the policies being followed by the United Kingdom government difficulties in the way of increasing trade between Canada and the United Kingdom. The bulk purchasing policies of the United Kingdom government have not in the long run assisted Canada's export trade to expand, no matter what some of the ministers opposite may say about temporary benefits. As a country we have not had much benefit from some of the bulk purchasing policies followed by the socialist government of the United Kingdom which has been directing many of its bulk purchases to countries which are competitors of ours.
The difficulties in the field of exchange are very great; unquestionably the negotiators who represented Canada were confronted with the problem very frequently. But, sir, when difficulties arise do we simply sit down and say it is no use, and throw up our hands? I say this situation is too serious to justify an attitude of that kind. Not once, but on
Trade Agreements
many occasions we have urged the government to call a conference or to recommend the calling of a conference by other nations within the commonwealth, in order that sitting together we might seek to grapple with this problem and see if we cannot at least reduce some of these very real and admitted difficulties in the way of the expansion of trade with one another. The house will not have forgotten that on February 28, 1950, a motion was introduced in this house on behalf of the official opposition by the hon. fnember for Lake Centre (Mr. Diefenbaker) which will be found at page 308 of Hansard for that date. This was on a motion to go into supply; and after moving that all words after the word "that" be stricken out the official opposition sought to substitute this motion:
this house is of the opinion that the government should take immediate steps to convene at the earliest possible date a conference of the nations of the British commonwealth and the countries of the empire to devise policies to restore our lost markets, and thereby to provide jobs for our Canadian people.
If one turns to pages 337 and 338 of the same volume the unhappy fact will be noted that the government whipped up its big majority to defeat that motion by a vote of 148 to 55. What was the result? A situation which was then commencing to assume serious proportions was permitted to assume more and more imposing proportions until now the export trade of this country to Great Britain has dropped from $705 million in 1949 to $470 million in 1950, and to commonwealth countries from $310 million to $185 million. I do not say that whole drop could have been avoided by the calling of a conference. We have to be frank and admit the difficulties which brought about this situation, helped along by policies the British government felt compelled to adopt. But there is no possible extenuation for the failure of the government to do what ought to have been done to meet these conditions by seeking to call a conference at which everything possible would have been done by men of good will from our sister nations within the commonwealth to at least reduce those difficulties. So time has gone on and the situation has steadily become worse.

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