Mr. Ron MacDonald (Parliamentary Secretary to Minister for International Trade, Lib.)
Mr. Speaker, it is a pleasure to debate a very important piece of legislation for all Canadians. The legislation would solidify the good trading relationship Canada has had with Chile.
Bill C-81 is enabling legislation for the Canada-Chile Free Trade Agreement. It is an important milestone for us because it broadens the access to Canadian products and services under a free trade regime into Latin American and South American countries.
As most people in the House and in the country are aware, Canada has a very proud and strong tradition of being very competitive in international markets.
I come from Atlantic Canada which has a history of trade. Many times I have said in the past that up until 1867 when we were merely a British colony places like Nova Scotia did a great deal of trade. The reason Nova Scotia did so well in the 1800s is that the culture of the people in Atlantic Canada was to look abroad.
The port of Halifax, the finest natural port in the world, used to be chock full of ships plying their trade. I am told one could almost walk from the shores of Dartmouth to the shores of Halifax on a good summer day. Ships from all over the world were coming into the port of Halifax in the 1850s and 1860s to trade with the world. They would not just trade with central or upper Canada. They would trade with the New England states. They traded a great deal with Latin America, with the Caribbean, with Europe and with the rest of the world.
In 1867 with the formation of Canada and the various regimes and nation states that were being put in place protectionism became the name of the game. For well over 120 years we saw countries like Canada looking more and more inward and putting up barriers to trade to protect their industries and markets.
In the last decade there has been an explosion in trade deregulation. If we look around the globe we see the emergence of different trade groups like the European Union and the Mercosur block in South America. In North America we initially had the free trade deal with the United States which was then extended to Mexico and was known as the NAFTA.
Great debates took place in Canada on whether or not this nation was up to the challenge of competing globally and of removing the tariff and non-tariff barriers to its own markets, on whether or not we had the wherewithal as an entrepreneurial class of Canadians to still be competitive, to have growth in our industries and jobs, and to create wealth.
Maybe the verdict is out but I think the verdict in on free trade. After two recessions, one in the early eighties and the other in the early nineties, Canadian industries are among the must competitive in the entire world.
In my job as Parliamentary Secretary to the Minister of International Trade I deal with some of the most successful competitive companies with the best practices in the world. They are Canadian companies in almost every sector: mining, natural resources, telecommunications and infrastructure. They are renowned around the world for the way in which they do their business, the quality of the product and the timeliness of delivery of their service.
In the last few years we have seen the Canadian industrial infrastructure take advantage of the reduction in tariffs and the introduction of free trade in the NAFTA. We continue to penetrate the toughest market in the world, the American market.
The statistics are important. At the risk of sounding boastful I would like to repeat them. Canada, this great country of ours with 30 million people, does $1 billion a day in two-way trade with the United States of America. We ship $550 million in goods and services south of the border and we get $450 million back. For every working day of every month in Canada, Canada does over $1 billion in two-way trade. This is a small country with 30 million people and we do over $1 billion every working day.
If anybody out there questions whether or not Canadian industries are up to the challenge of free trade and can compete in international markets and keep their own markets the answer is yes.
Canada leads G-7 countries in terms of the percentage of GDP coming from trade. It is approaching 39 per cent. It boggles the mind that Canadian industry has been as competitive as it has been. Most of the nearly 700,000 jobs created since the government came to power have been created in industries that have expanded their export performance. They have gone out. They have competed. They have penetrated markets. They have created jobs and wealth for Canadians.
What does it mean in terms of jobs created in international trade? How do they relate? They relate in a very real manner. For every $1 billion in exports from Canadian industry there are 11,000 jobs maintained or created in the Canadian economy. These are not the traditional McJobs at $5 per hour. These jobs are in the high tech sector. These are jobs for scientists, researchers and professionals. These jobs create real wealth and prosperity across the country.
Places like Atlantic Canada where I come from have benefited a great deal. It has taken us a little longer to twist our minds around to the fact that we once again can be competitive and that we are no longer bridled and collared by just the domestic marketplace and the regulatory regimes that go with it.
Increasingly we see ships from around the world once again making the port of Halifax and the port of Saint John, New Brunswick, part of their international ports of call. We see the jobs that come with that. We see more and more people from around the world looking at places like Atlantic Canada because of its strategic location, because of its natural resources and because of its history of entrepreneurship and trade. Increasingly we are seeing these individuals looking at places like Atlantic Canada and the ports in the province of Quebec and in British Columbia as places where they want to invest dollars.
The recent history of free trade has been extremely successful. About a year ago we decided we would not wait for the United States which had decided not to give fast track authority to its president to pursue trade liberalization or free trade negotiations with Chile. We as a government made a strategic decision to follow an independent forum and an independent trade policy. It was in our best interest, because we knew how competitive our industry was, to extend our free trade negotiations to our friends to the south. We found a willing partner in the great nation of Chile. Chile said: "We also want to become a partner in free trade with Canada. We believe there is a tremendous amount we can do together". The negotiations began in January 1996. In less than one year, on November 18, 1996 the Prime Minister of Canada and the President of Chile initialled the free trade deal between Canada and Chile.
It is a very important deal. It showed the world that Canada was not just going to talk about free trade. It showed Canada was going to pursue opportunities wherever they existed so Canadian companies could have access to foreign markets. It showed that we were not afraid to allow foreign companies access to the Canadian marketplace because we were absolutely convinced of the competitiveness of our industry and our entrepreneurs.
What has this deal done for us? Some people would ask why we would go with Chile, that we do not really have a lot of trade with
that country. We do have a lot of trade. We have about $700 million a year in trade. More important is the recognition that we invest about $7 billion in Chile. Canada is the second largest investor in Chile. It is important for us. It gives us a window on that market in South America.
This is a good deal for Canada. It is a deal that has good support around the House of Commons. It immediately reduces the import duty for about 75 per cent of the goods that Canada exports to Chile. For the rest of the goods, by and large with one or two exceptions, over the next five years a zero tariff will be applied.
The deal also allows us to do a couple of other things which I will cover quickly. It gives us a very good dispute settlement mechanism which is similar to the deal we have with the United States. On trade remedies, where I will draw the line, we have agreed in this deal that there is no room in a free trade association for anti-dumping laws to be applied. This is a great victory for Canada. This deal is a great victory for the people of Chile.
I look forward to support from all members of the House to have this speedily passed at second reading and referred to a committee so that on June 2 this free trade deal will come in force for the benefit of all people of Canada and Chile.
Topic: Government Orders
Subtopic: Canada-Chile Free Trade Agreement Implementation Act