The House resumed from November 6 consideration of the motion that Bill C-24, An Act to implement the Free Trade Agreement between Canada and the Republic of Panama, the Agreement on the Environment between Canada and the Republic of Panama and the Agreement on Labour Cooperation between Canada and the Republic of Panama, be read the third time and passed.
Hon. Rob Merrifield (Yellowhead, CPC):
Mr. Speaker, it is a privilege for me to share my comments on a bill that should have been passed two and a half years ago. We are in the eleventh hour of debate on this bill, which is certainly not being rammed through. It should have been passed long ago.
We are a trading nation, as most members of the House and Canadians know. It is something to see the magnitude of trade that we do in Canada as we look at what has happened over our history. Eighty-five per cent of our trade has been with our southern neighbour, the United States.
Here I want to take the opportunity to congratulate President Obama for his win last evening and the people of Michigan for their decision to allow the new bridge to be built between Windsor and Detroit. The existing bridge is the largest trading bridge anywhere in the world. At times there is $2 billion a day in trade going across that bridge, so it is very important that a new bridge be built.
As I said, about 85% of our international trade has been with the United States, whereas last year it was about 73%. We are becoming less dependent on the United States and more dependent on other markets, such as the one we are debating under this piece of legislation, Panama's.
It is impressive to see the number of jobs created because of our international trade. One in every five Canadian jobs is generated through exports and 63% of our country's annual GDP is created because of international trade. Therefore, it is very important that we get this piece of legislation through. Panama is the hub of the Americas and a very important logistical platform for us to trade with in Central America.
This is a continuation of an agenda that our government has had since coming into office. We have signed nine different free trade agreements, including with countries such as Colombia, Jordan, Peru and Honduras; and with the European Free Trade Association, including Iceland, Liechtenstein, Norway and Switzerland. This is long overdue. We are very aggressively pursuing other countries with regard to free trade agreements, seen in the Canada-European Union free trade agreement, for example. We look forward to the final text perhaps being out before year end.
I was with the trade committee in Japan last week and was very encouraged by what we heard regarding a bilateral trade agreement with Japan, the world's third largest economy.
When we add all of these up and see exactly what we are doing, the possibilities of moving forward on our trade agenda are very encouraging.
Just to look at what we have done with NAFTA and the United States, since NAFTA was signed some 18 or so years ago, that agreement has created about 40 million jobs. The GDP of the three countries was a little over $7 trillion at the time of signing and is now over $17 trillion now. Between the three countries, we are now trading almost $1 trillion a year. It is very significant.
Canadians realize the importance of a trade agenda. What I cannot understand is where the opposition is at with regard to our trade agenda. Even today, opposition members say that they do not like and would get rid of the NAFTA agreement. They say they would never support it and never have supported it. It does not matter what kind of logic we use or what kind of math we put in front of them to show them the benefits of it, they disagree with it. This is something that I absolutely do not understand.
The opposition members have disagreed with all of the nine free trade agreements our government has signed, except maybe the one with Jordan, which they could not come to a decision on. They had to sit on their hands because they did not want to show that they were somewhat supportive of that agreement. When we look at the Canada-Panama free trade agreement, I would suggest that it is much more beneficial even than the agreement with Jordan. Yet the opposition filibusters and accuses the government of trying to ram it through.
There has been a lot of debate on the Canada-Panama free trade agreement, and it is amazing what is in that piece of legislation and what it will do for our agriculture sector. Agriculture is near and dear to my heart, as we farm about 3,000 acres of canola and wheat. It is important for us to understand the size of agriculture in Canada. The agrifood sector actually generates 8% of our GDP. It creates one in eight jobs in this country. That is 2.2 million jobs in Canada created because of agriculture. There is some $41 billion created because of trade in our agricultural products in international markets. Almost half of our total agricultural production in this country goes to international trade. Indeed, we are sixth largest exporter of agricultural products in the world.
It is very important that we make sure that we capture as many possible markets as we can for our agricultural products. Panama is the second largest market for agricultural products in Central America. This piece of legislation would allow agriculture not only to be enhanced but also for it to be done in a tariff-free way. How many tariffs are there? On the signing and implementation of this piece of legislation, 78% of Canadian agricultural exports to Panama would be tariff-free .
What are those products? The 20% tariff on frozen french fries, which help Prince Edward Island and Atlantic Canadians, would be eliminated. How about the pulse crops of the Prairies? There is a 15% tariff on those that would be eliminated immediately upon signing of this agreement. How about malt exporters, the barley growers of this country? The 10% tariff applying to them would be eliminated upon signing of this agreement.
By the way, the opposition disagrees with our getting rid of these tariffs and has fought this for two and a half years in the House. That is absolutely ridiculous when we see the benefits to these areas.
How about our beef sector, which has been plagued by the BSE crisis and all kinds of problems, including its exports to different countries around the world being shut down as a result? The producers have gone through a very difficult time. The tariff they face in the Panamanian region is 25% to 30%. That would be eliminated.
I was in Japan last week with the trade committee, where we were excited about the opening up of the export of our beef, from beef aged 21 months to beef aged 30 months now. However, Japan is another market that has been hurt because of the delays by the opposition with regard to this piece of legislation.
The tariff that really bothers me the most is the 60% to 70% tariff on our hog industry. It is amazing to see that kind of tariff placed on our hogs. That so important to us because our largest competitor in that market is the United States, which signed a free trade agreement with Panama on October 31. If we do not get our free trade agreement with Panama through the House, we will lose our competitive edge and never get it back. It is absolutely critical that we make sure that we stop playing around in the House and start doing what is right for Canadians. The opposition should get onboard.
There has been two and half years of filibustering in the House, two and a half years of wasted time and opportunity for us to be able to capitalize on the great infrastructure of the Panama Canal, as well as the opportunities for our agriculture sector and many others. The opposition says we are fast-tracking this by bringing in time allocation. I understand the NDP, because that is just their ideological bent and where they are at. They are what they are. However, two days ago we had the Liberals opposing our closure motion on this legislation. I find that really hard to understand.
Not only has the United States signed an agreement with Panama, but the European Union is also expected to sign an agreement, perhaps by the end of this year. Then we will lose a competitive edge with Europe as well.
It is absolutely amazing when we see what the opposition is doing with regard to this piece of legislation and the free trade agreements we have reached with nine different countries around the world and have been promoting. I just do not understand it.
I will quote the member for Dartmouth—Cole Harbour, who was the vice-chair of the trade committee at one time. He said that when it comes to trade agreements, they are “job-destroying”. I do not understand where he gets that math. How can he possibly get there?
There is only one thing that we heard with regard to trade in the NDP's platform and that was a $21 billion cap and trade carbon tax. That is what the opposition is promoting, instead of the positive trade we will experience when we pass this piece of legislation. I encourage the House to get on with this. The next two hours cannot go fast enough.
Ms. Annick Papillon (Québec, NDP):
Mr. Speaker, as a member of the Standing Committee on International Trade, I am very pleased to speak to Bill C-24, the Canada–Panama Economic Growth and Prosperity Act.
Bill C-24 follows up on a trade agreement that we signed with Panama on August 11, 2009. This free trade agreement poses some problems in a number of areas, including with regard to workers' rights and environmental protection standards. Today, however, I will focus on the issue of tax evasion and money laundering, which is very troubling.
When Todd Tucker of Public Citizen's Global Trade Watch testified before the Standing Committee on International Trade on November 17, 2010, he said:
|| Panama is one of the world's worst tax havens. It is home to an estimated 400,000 corporations, including offshore corporations and multinational subsidiaries. This is almost four times the number of corporations registered in Canada. So Panama is not just any developing country.
For decades, the Panamanian government has been deliberately pursuing a tax haven strategy. It offers foreign banks and firms a special offshore licence to conduct business there. Not only are these businesses not taxed, but they are subject to few regulations. According to the OECD, the Panamanian government does not have the legal capacity to verify key tax information about these businesses. Panama's shadowy financial practices also make it a very attractive place to launder money that comes from all over the world.
The Canada-Panama trade agreement could even exacerbate the problem posed by Panama's status as a tax haven. As the OECD pointed out, signing a trade agreement without first tackling Panama's shadowy financial practices may lead to greater tax evasion. There are no restrictions on capital entering or exiting Panama. Transactions are protected by banking secrecy, and financial activity is not monitored.
In March 2012, Canada and Panama entered into negotiations for a tax information exchange agreement. However, this agreement has not yet been concluded or signed. This is very troubling, considering the large amount of money laundering in Panama, including money from drug trafficking.
Furthermore, the issue of disclosing taxes has not been adequately addressed, even though the Panamanian government and the Conservative government claim that it has. Without a real political will, these agreements generally do nothing to eliminate legal tax evasion and do little to discourage individuals from illegally evading taxes. In general, tax information exchange agreements do not contain provisions on the automatic exchange of information. Individual requests must be made.
Members should listen carefully to what I am about to say, because it is the key part of my speech. The U.S. Congress refused to ratify a free trade agreement with Panama before it signed a tax information exchange agreement. According to tax evasion experts, the agreement with Panama enables it to sidestep the transparency provisions if they are contrary to Panamanian public policy.
As the opposition, we have made suggestions in the past to improve this agreement. During the clause-by-clause review, we proposed several amendments that would have made notable changes to the bill. These included the addition of crucial concepts of sustainable development and investment and, most importantly, we proposed a requirement for taxation transparency.
Before the clause-by-clause review of Bill C-24, the NDP moved a motion in the Standing Committee on International Trade to postpone the implementation of the Canada-Panama trade agreement until Panama agreed to sign an information exchange agreement. This motion was voted down by the Conservatives and the Liberals. That shows where those two dinosaur parties stand on proper, responsible tax policy.
Considering Panama's history and reputation in such matters, it is easy to see why such an agreement is necessary before we sign a trade deal. The U.S. Congress did not want to ratify the American free trade agreement with Panama until a tax information exchange agreement was signed. It is important to remember this because it is the crux of the matter. It is for this reason that the NDP has serious concerns, which I believe are shared by all Canadians.
Contrary to what the Conservatives would have Canadians believe, the NDP supports trade. We are in favour of developing Canadian exports by reducing trade barriers. We are in favour of developing an industry that exports value-added products. We are in favour of creating jobs in Canada by expanding access for Canadian products to foreign markets. We are in favour of increasing productivity by encouraging new investment. And, we are in favour of diversifying our exports.
The NDP has a trade strategy. We want to help Canadian businesses to be leaders in the global economy. We are going to improve the protection of human rights and the environment, and we will defend public resources and services that are essential to Canadians.
Finally, we are going to help lower Canada's trade deficit since, under the Conservative government, Canada has gone from having a trade surplus of $26 billion to having a trade deficit of $50 billion. Yes, I said “$50 billion”. It is shameful.
Since the Conservatives took office, the manufacturing trade deficit has increased sixfold to $90 billion. We are exporting $30 billion more in raw materials but $35 billion less in value-added products.
The Conservatives' track record shows that their trade approach is not working. That is understandable, because they are very bad managers. They are not going to become good managers by repeating the words “growth” and “economy”. Not at all. We know that, and so do Canadians.
The Conservatives are negotiating trade deals using an extreme, ideological strategy instead of making the interests of Canadians their priority. The Conservative government is completely dysfunctional and so is its trade strategy.
The NDP prefers a multilateral approach based on a sustainable trade model. In fact, bilateral trade deals are really just protectionist trade deals, since they give preferential treatment to a few partners and exclude the rest. This puts weaker countries in a position of inferiority vis-à-vis the larger partners. A sustainable multilateral trade model would avoid these issues while protecting human rights and the environment.
If the Conservative members have been listening to what I have tried to explain here, they will have understood that we do not oppose this agreement and that we want to give it a chance. All we are asking for is greater transparency. We do not want to be associated with tax evasion, and we especially do not want Canadian businesses to be associated with that, either.
I care about this country's businesses and their reputation. That is the difference between us and the Conservative government, which claims to be a good manager, to take care of Canadian interests and to be competent when it comes to the economy. This government is about to sign yet another free trade agreement—it is on quite a roll with these agreements—but it is not thinking carefully about its trade partners.
I am more than happy to do business, but not under just any conditions and to the detriment of Canadian businesses.
We in the NDP have ethics, and it would be nice if the government followed our lead.
What I wanted to say here today regarding the free trade agreement between Canada and Panama is simply that we support trade, but we believe that it must be carried out in a responsible and more serious manner for Canadians.
Hon. Ron Cannan (Kelowna—Lake Country, CPC):
Mr. Speaker, it is a privilege and an honour to rise in the House this afternoon to speak to this very important Canada-Panama free trade agreement.
I think it is the third time that I have visited Panama as part of the trade committee of which I have been a member for about six and half years. Back in May 2008, we travelled to Panama and had over 60 hours of extensive debate in a variety of committees and in the chamber. I am hoping that later this afternoon we will see logic prevail and this agreement continue through the House and become an act as soon as possible for businesses across Canada so they will have a rules-based and fair-trading system in a Canada-Panama relationship.
I will first take a moment to thank all the members of the House who paid tribute to our veterans. The speeches we heard were very emotional. When we look into the eyes of our veterans, we think of the men and women who are serving today and have served. I think of the veterans in my riding of Kelowna—Lake Country. It is an honour and a humbling experience to be their member of Parliament. It is because of their dedication and sacrifice that we have the best country in the world.
Our government believes in the importance of our veterans. We also want to expand our economy to make Canada an even better place.
We are focusing on a global commerce strategy because we understand the importance of trade. In fact, one in every five jobs is dependent on trade in Canada and it represents nearly 65% of our country's income. Indeed, the importance of international trade to an export-oriented economy like Canada has cannot be overestimated. There is no doubt that trade sustains the incomes and living standards of Canadians and ensures the long-term prosperity of our country. Furthermore, integration with regional and global trading networks is essential.
As a trading nation, Canadian exporters, producers and investors need access to international markets to stay competitive. It is pretty simple: When we trade, we become more competitive. Prices for goods and services go down. wages, salaries and our standard of living go up, and businesses are able to hire more workers. In addition, internationally-oriented firms are better positioned to withstand global downturns.
Our government understands, as most Canadians do, that trade is a kitchen table issue. The Minister of International Trade is with the Prime Minister in India right now working on expanding agreements. He understands the importance of trade to help families put food on the table and make ends meet.
We have heard from my hon. colleague for Yellowhead earlier today and yesterday from the member for London West, the hard-working member for the 10th largest city in Canada, as he likes to inform us, on the importance of how we need to work together to break down these trade barriers so that Canadian businesses can be competitive.
In my own riding of Kelowna—Lake Country, Campion Marine, the largest boat manufacturer in Canada, is continually requesting that we break down barriers so that the excise taxes that are in place in other countries can be eliminated and it can be competitive. That 5% sometimes can be the difference between success and hiring more people or, unfortunately, not being competitive in the marketplace.
As I mentioned, not only does trade support the quality of life for Canadians but it provides hope, jobs and opportunities for our children and grandchildren. It would be difficult for the average Canadian to imagine a world without international trade.
Our Conservative government clearly understands that our standard of living and Canadians' future prosperity will be generated by deepening and broadening our trading relationships. That is why deepening Canada's trading relationship is rapidly growing in markets around the world, such as Panama, which is an important part of this government's pro-trade plan for jobs, growth and long-term prosperity.
Canada's exporters, investors and service providers are calling for these opportunities. Business owners and entrepreneurs want access to global markets. We heard numerous witnesses testify at our trade committee saying that they need to be competitive. Unfortunately, the opposition continues to delay this.
We heard back on October 31, just last month, that the Panama-U.S. agreement had come into place. However, we are still at the gate. Our American colleagues in the south and their businesses are out making deals while we are spinning our wheels.
We cannot stop this. We need to continue to move forward. With the co-operation of the opposition and all members of this House, we can continue to expand, establish and grow our pro-trade plan.
Since 2006, Canada has concluded new trade agreements with nine countries. They include: Colombia; Jordan; Peru; the European trade association member states of Iceland, Liechtenstein, Norway and Switzerland; most recently, Honduras; and, of course, the discussion this afternoon is on Panama.
We are also negotiating with more than 50 countries, including major economies such as the European Union, India and Japan. Last week I was with some of the trade committee members in Japan where we are working on an economic partnership agreement, which is looking very promising, to expand relationships with Japan.
A deal with the European Union would represent the most significant Canadian trade initiative since the North American free trade agreement. Such a deal could potentially boost our bilateral trade with this important partner by 20%. It could also provide a $12 billion annual boost to Canada's economy, which is like a $1,000 increase in the average Canadian family's income or almost 80,000 new jobs.
Canada has also officially joined the trans-Pacific partnership, otherwise known as the TPP. The potential benefits of this initiative are enormous. The TPP market represents more than 658 million people and a combined GDP of over $20 trillion.
By improving access to foreign markets for Canadian businesses, we are supporting the Canadian recovery and creating new jobs for Canadian workers. It is part of our economic action plan. As the Minister of Finance alluded to during question period, the importance of helping small businesses grow with a tax credit is an initiative within budget 2012.
Within our free trade agreement with Panama, we have the government's efforts to strengthen the Canadian economy once again. These are multi-prong approaches to help grow our economy and create jobs. Pursuing bilateral and regional trade agreements is essential to bringing continued prosperity to Canadians.
I understand, and it is unfortunate, the opposition NDP continues to stand in the way of our efforts to open up new markets for our exporters. I would love to see the WTO and the multilateral agreements come to completion as well, but the reality is that they are stalled. In the meantime we continue to work with bilateral agreements and multilateral with the trans-Pacific partnership.
The NDP comes up with all these excuses and says it believes in free and fair trade. We do as well, but we are also doing the trade agreements rather than just talking about them. The fact is that the NDP's anti-trade record is clear. My hon. colleague and seatmate just asked the opposition party if it could please list off the number of trade agreements it has supported over the last 20 years. It was like a deer in the headlights. Unfortunately, there was no response. The NDP members like to talk about it over there, but we are doing it. Going all the way back to NAFTA, they have consistently opposed our efforts to create new opportunities for exporters and investors. On this side of the House, we are tired of hearing all the naysayers. We will continue to move forward in creating jobs.
The anti-trade NDP's special interest backers continue to fearmonger and misrepresent the facts about trade. They believe that the global economy is something Canadian workers should fear. Our government knows that our businesses, our entrepreneurs and our workers can compete with the very best in the world and win. With a rules-based, level playing field, Canadians will be number one.
However, to compete and win, Canadians need to be on a level playing field. With the entry into force of the United States-Panama free trade agreement just last month, Canadian firms are no longer competing on a level playing field. Their American competitors are now able to sell their products in Panama at a lower cost as the result of the duty-free access they enjoy under the US-Panama FTA. This is why the implementation of this trade agreement is an urgent priority for our government. Canadian companies are constantly proving that they are competitive enough to compete and succeed in the global marketplace, but the government has a responsibility to do all it can to help those companies succeed abroad.
Governments do not create jobs. We create the framework and the environment. We minimize regulations. We have to have incentives where necessary, but ultimately it is the private sector that will create the jobs. That is why our government will fight to ensure that businesses have what they need to be successful abroad and ensure that the Canada-Panama free trade agreement is ratified and enters into force as soon as possible.
In closing, we must prevent Canadian firms from losing market share in Panama and defend the competitiveness of our businesses in this fast-growing emerging market. In a short time, we will be voting on Bill C-24 in the House. This is why I ask for the support of all hon. members for the Canada-Panama free trade agreement and the parallel labour co-operation and environment agreements. It is the right thing to do for Canadians.
Ms. Lois Brown (Parliamentary Secretary to the Minister of International Cooperation, CPC):
Mr. Speaker, there are no words I like to hear more than “new markets”.
I am pleased to rise to speak to Bill C-24, the legislation implementing the Canada-Panama free trade agreement, as well as the related agreements on labour co-operation and the environment. Today I would like to focus on the commercial opportunities that exist in Panama. It is unfortunate that members opposite continue to suggest that this agreement should not be a priority for our government. It is no surprise to hear this from New Democrats. They, after all, have consistently opposed our government's efforts to open up new markets and create new opportunities for our exporters.
It is disappointing to hear others, like the member for Malpeque, whose own constituents stand to benefit from this agreement, in particular Prince Edward Island's potato exporters. The member for Malpeque has suggested that since our bilateral trade with Panama represents a fraction of our global trade, we should not concern ourselves with it. How wrong he is. That is why today I would like to spend a few minutes talking about some of the opportunities that exist in Panama and why it is in our nation's best interests to forge closer economic ties with this dynamic and fast-growing economy.
Panama has long been considered a logistics centre and international connection point in the Latin American region. Panama is often referred to as the gateway to Latin America and plays a critical role in connecting the Americas. Panama is a central point for goods travelling to Latin America, a nexus for international trade and a strategic hub for the region. According to Panamanian estimates, 5% of world trade passed through the Panama Canal in 2010, but that is not all. In addition to its importance as a hub for global shipping, Panama boasts a stable and robust economy with the second highest per capita income in Central America. In 2011, Panama's economy recorded real GDP growth of 10.6% and all indications show that this impressive growth rate will continue well into the future.
Like Canada, Panama welcomes international commerce and is committed to providing a stable and pro-business environment for trade and investment. In 2011, Panama received the fifth highest score in Latin America in the annual World Bank rankings of countries for ease of doing business. Panama is a perfect example of a dynamic, fast-growing economy with tremendous potential, just the type of economy our businesses need to engage with in order to succeed in the 21st century.
It should not be a surprise that Canadian businesses have already begun taking notice of this country's commercial potential. In 2011, our two-way merchandise trade totalled $235 million and this figure is rapidly growing. In fact, over the past five years bilateral merchandise trade between Canada and Panama has increased by 105%. Panama currently represents our second most important export destination in Central America. Number one is Costa Rica and we already have a free trade agreement there. It is clear that this thriving economy offers tremendous commercial opportunities for Canadian businesses, but what is even more impressive are the opportunities that lay ahead.
Panama continues to invest heavily in large strategic projects that will solidify its position as an important emerging market in the global economy. In addition to the widely reported $5.3 billion project to expand the Panama Canal, the Panamanian government is implementing a five-year infrastructure plan valued at $13.6 billion. Furthermore, under the strategic plan, the government of Panama has designated $2.8 billion for transportation infrastructure projects alone. Numerous infrastructure projects to build hospitals, social housing, bridges and airports are either already in progress or under consideration. Looking ahead, tendering processes for projects such as airport improvement and the construction of the fourth bridge over the Panama Canal are expected in the coming months.
Opportunities also exist in the energy sector, which is, as we all know, another area of expertise for Canadian companies. Panama's energy needs have increased significantly in recent years, with demand increasing 5% to 7% annually. The expansion of the Panama Canal and a large number of other private and public infrastructure projects have led to an aggressive road map for increasing the installed base of energy generation and transmission.
Canadian companies are acknowledged leaders in the development of these types of projects and clearly have the expertise to meet Panama's development plans. By implementing the Canada-Panama free trade agreement, our government will support Canadian companies looking to capitalize on these opportunities, by solidifying their ability to participate in large-scale infrastructure projects in Panama. The government procurement chapter in this agreement will guarantee that Canadian suppliers have non-discriminatory access to the broad range of government procurement opportunities in Panama and receive the same treatment as Panamanian firms when bidding for these opportunities.
Panama's vibrant market has been sparking interest in the business community across Canada. Canadian companies are eager to capitalize on these commercial opportunities. Our government is doing all it can to support Canadian companies. The opportunities are out there, and clearly Canadian firms have the expertise to succeed. It is our job to ensure they have access to these opportunities and are able to compete on a level playing field against foreign competitors.
With the United States-Panama free trade agreement entering into force on October 31 of this year, we must act quickly to implement the Canada-Panama free trade agreement so Canadian companies can compete on a level playing field and continue to be successful in Panama. Despite the continued opposition of the Liberals and the NDP, our government is creating new opportunities for Canadian exporters.
Mrs. Anne-Marie Day (Charlesbourg—Haute-Saint-Charles, NDP):
Mr. Speaker, I want to thank my colleagues who have spoken so far to Bill C-24, An Act to implement the Free Trade Agreement between Canada and the Republic of Panama, the Agreement on the Environment between Canada and the Republic of Panama and the Agreement on Labour Cooperation between Canada and the Republic of Panama. They have also done a fine job of explaining the NDP's position on this bill and why we oppose it.
I am pleased to speak to Bill C-24 on the Canada-Panama free trade agreement. This is not the first time we have talked about this bill and opposed it. It was introduced in the House in the 40th Parliament, where it reached second reading stage. The bill died on the order paper because of the election, as we all know.
I will try to explain why the NDP opposes this bill and the trade agreements proposed therein.
The free trade agreement is worrisome given the controversies surrounding Panama's track record on respecting workers' rights, human rights and the environment and because Panama is used as a tax haven for tax evasion.
In our opinion, this agreement promotes the exploitation of workers and human rights. When the committee studied Bill C-46, we heard convincing testimony about the fact that Panama had a bad track record when it comes to workers' rights and that the side agreements on labour co-operation were very weak.
Teresa Healy, senior researcher with the social and economic policy department of the Canadian Labour Congress, said:
|| The Canada-Panama agreement does not include specific protection for the right of association and the right to strike. Instead, it provides “effective“ recognition for the right to bargain collectively. As far as union rights are concerned, the agreement is, therefore, weaker than previous agreements.
|| On labour issues, the amendments are modest; there are no countervailing duties; there is no provision for abrogation or any other such remedy; and again, labour provisions are in a side agreement outside the main agreement.
|| I would like to say a few words about labour rights in Panama.
|| Panama has a population of about 3.4 million. It is currently enjoying relatively high rates of growth, but it is ranked second among countries in the region in terms of inequality: 40% of Panama's inhabitants are poor, 27% are extremely poor, and the rate of extreme poverty is particularly high among indigenous populations. In recent years, the country has undergone considerable liberalization and privatization, but they have not trickled down to financially benefit the population.
When we look at Panama's labour laws and the lack of protection for its working people, it amazes me that the Government of Canada is in such a hurry to sign an agreement with this country.
Teresa Healy of the Canadian Labour Congress testified before the committee about the labour co-operation agreement. She said that, although the agreement mentions the International Labour Organization's core labour standards, it is still too weak. What is more, in recent years, the Panamanian government has been increasingly harsh on labour unions and workers. We are convinced that this trade agreement does not respect the integrity of human rights.
The Government of Canada issued an official warning that can be found on the site for tourists and investors. It reads:
|| OFFICIAL WARNING: Foreign Affairs and International Trade Canada advises against all travel beyond the town of Yaviza in Darién Province. The danger zone begins at the end of the Pan American Highway (past Yaviza, about 230 km southeast of Panama City) and ends at the Colombian border. This area includes parts of Darién National Park and privately owned nature reserves and tourist resorts. Due to the presence of Colombian guerrilla groups and drug traffickers, levels of violent crime in this zone are extremely high, with numerous reports of kidnapping, armed robberies, deaths and disappearances.
I would also like to add that Darién National Park is a nature reserve in the Darién region of Panama that has been a UNESCO world heritage site since 1981.
Darién National Park is the largest of Panama's national parks. It is connected to Los Katíos National Park in Colombia.
I would like to quote the hon. member for Newton—North Delta. When the bill reached second reading stage, she said:
|| It seems that we have not learned too many lessons from our experiences with NAFTA. As a result of NAFTA, we have seen hundreds of thousands of jobs disappear over the border and into other countries.
During the clause-by-clause review, the NDP member for Vancouver Kingsway proposed several amendments that would have made progressive changes to the bill. The changes would have integrated into the bill the protection of workers' rights, including the right to collective bargaining. Other amendments would have required the Minister of International Trade to consult workers and unions, as well as human rights experts and organizations, in order to conduct analyses of the impact of the trade agreement. That motion was rejected by the Conservatives and the Liberals.
As for respecting the environment, the agreement on the environment is an exact replica of environmental agreements we have signed before, such as the Convention on International Trade in Endangered Species, the Montreal Protocol on Substances that Deplete the Ozone Layer, the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, the Rotterdam Convention on Trade in Hazardous Goods, and the Stockholm Convention on Persistent Organic Pollutants.
Canada and Panama have agreed to not weaken their environmental regulations in order to attract investment, and interested parties must ask the government to investigate suspected violations of environmental regulations. However, it is important to note that there are no financial penalties for non-compliance.
Panama is also a tax haven. In March 2012, Canada and Panama began negotiations on a tax information exchange agreement. However, this agreement has not yet been signed. A lot of money laundering goes on in Panama, particularly with money from drug trafficking. The lack of tax transparency in Panama led the Organisation for Economic Co-operation and Development, the OECD, to label this country as a tax haven. It is often necessary to know the name of the suspected tax evader in order to obtain tax information from the other country. Governments cannot easily access this information.
Before the clause-by-clause review of Bill C-24, the member for Vancouver Kingsway moved a motion in committee to postpone the implementation of the Canada-Panama trade agreement until Panama agreed to sign a tax information exchange agreement. Once again, this motion was voted down by the Conservatives and the Liberals.
We want fair trade. In my riding, Charlesbourg—Haute-Saint-Charles, many people buy fair trade coffee. Do my colleagues have any idea what fair trade coffee is?
Panama is the smallest coffee producer in Central America. In the 2000s, the country experienced a coffee crisis. Producers banded together, and Panama's coffee was chosen as the best in the world for the first time in 2004. Fair trade coffee is the result of demand from consumers who all decided to make choices that would ensure that the producers receive fair payment for their product.
With this free trade agreement, we are worried that small producers will not end up processing or marketing their products. There is a very big risk of a third party taking over these steps, thus depriving the producer of the added value when selling the product. It is no easy task to protect one's business in a sector dominated by a handful of large-scale producers, and this is not a fair market.
Mr. Scott Armstrong (Cumberland—Colchester—Musquodoboit Valley, CPC):
Mr. Speaker, I rise in the House today to talk about the Canada-Panama free trade agreement and the many benefits this agreement would bring for agriculture and agrifood producers and exporters.
First, I would like to emphasize that our Conservative government clearly understands that our standard of living and Canadians' future prosperity will be generated by a deepening and broadening of our trading relationships.
That is why our government is committed to securing and deepening access to traditional markets such as the United States, while broadening and expanding access to dynamic and fast growing economies around the world. Pursuing new trade opportunities is a win-win for Canada and its trading partners.
Canadians benefit from jobs, prosperity and consumer benefits that come from increased trade. In turn, our international partners, many of which represent developing economies, benefit from an ever-expanding middle class and improved standard of living that is lifting more of the world's population out of poverty.
We are also creating new opportunities for our exporters, opportunities that are bringing jobs, growth and long-term prosperity to hard-working Canadians across the country.
As Canada's agriculture and agri-food sector becomes more modern, more innovative and more competitive, the sector is becoming a more significant part of Canada's economy. In fact, in 2012 the agriculture and agri-food industry accounted for one of every eight jobs in Canada. This translated into employment for over two million Canadians. It also accounted for 8% of Canada's gross domestic product.
In 2011 Canada ranked as the fifth largest exporter of agriculture and agri-food products on the planet, thanks to exports totalling $41 billion. That is why our government works tirelessly to improve access to international markets for agricultural exporters.
Whereas over its 13 years in government the Liberals completed only three trade deals, in less than six years our government has concluded free trade agreements with nine countries. They are Colombia, Jordan, Panama, Peru, Iceland, Liechtenstein, Norway and Switzerland and Honduras. Sadly, the ideologically driven NDP has consistently opposed these agreements.
The Canada-Panama free trade agreement we are debating today is another example of the actions our government is taking to support Canadians as they compete and win in the global economy.
Our government will ensure that Canadian agriculture and agri-food producers and exporters remain competitive with exporters to Panama. I want to emphasize why this is so important.
As members of the House are aware, Panama has also concluded free trade agreements with the United States and the European Union. Panama's free trade agreement with the European Union could enter into force as early as the end of this year. However, the United States-Panama free trade agreement entered into force just last week.
The United States is Canada's biggest competitor in Panama and many Canadian exports are in direct competition with those of the United States.
Canadian products are now at a competitive disadvantage as they continue to face duties while exports from the United States enjoy duty-free access. Over 87% of U.S. exports of consumer and industrial goods to Panama are entering that country duty-free. Our government will not let Canadians compete on an unlevel playing field. It is time the House finally passes this agreement.
Our agreement with Panama is a comprehensive agreement that covers market access for goods, including agriculture and agri-food products. In 2011 Canada exported nearly $25 million worth of agriculture and agri-food products to Panama.
Upon implementation of this agreement, high quality Canadian products such as beef, pork, malt, frozen potatoes, pulses, maple syrup and canola will benefit immediately from duty-free access to Panama. This will be welcome news for agriculture and agri-food exporters.
Let me cite one example. Canada's exporters of frozen french fries will benefit from the immediate elimination of Panama's tariffs of 20% on this product. In 2011 Canada exported almost $12 million worth of frozen french fries to Panama. This is a $1 million increase over 2010 exports.
It is curious that the member for Malpeque has suggested that in the past our government has exaggerated the benefits of the agreement. I would remind him that his home province of P.E.I. exported over $1 million of potatoes to Panama just last year.
Our pulse exporters will also benefit from this agreement. Tariffs of up to 15% will be eliminated with the implementation of this agreement.
Canadian malt exporters would benefit from the immediate elimination of Panamanian tariffs of up to 10%. Our pork sector would also benefit. Tariffs on pork products, such as fresh and chilled pork cuts and sausages, would also see immediate tariff elimination. Everyone knows the difficulty our pork producers have had in recent years. This is an industry that desperately needs this help.
In 2009, Panama re-opened its market to Canadian beef and in 2010 Panama lifted the last of its BSE-related limits on imports from Canada, including a ban on live cattle. This was good news for our beef exporters, and this agreement would bring them even further benefits. Under this agreement, Canada's beef exporters would see the immediate elimination of Panamanian tariffs ranging from 25% to 30% on all of Canada's beef cuts within a 200 ton tariff rate quota. Panama's tariffs on other agricultural exports, such as refined canola oil and refined sugar from Canada, would be eliminated over a period of five to fifteen years. This particular agreement would have ongoing and increasing benefits for agriculture and agrisector producers.
Those are just some of the benefits that our producers and exporters would see from this agreement. It is obvious that, for all of those reasons, the Canada–Panama agreement would be a win for Canadian agriproducers. It would create more Canadian jobs by enhancing our ability to export more goods and services to this dynamic and fast-growing market, including our agricultural goods.
I ask all members to join me in supporting this agreement.
Mr. Brad Butt (Mississauga—Streetsville, CPC):
Mr. Speaker, I am pleased to rise in the House today to speak to the benefits for Canadian investors and service providers from the Canada-Panama free trade agreement.
First, I would like to emphasize how disappointing it was to hear some of the comments yesterday from the members opposite. We have before us in this House the opportunity to bring a level playing field to our Canadian exporters. Today, as a result of the U.S.-Panama free trade agreement, they are at a disadvantage.
Our government is committed to giving our exporters the tools they need to compete on fair terms. I am surprised by the member for Malpeque, for example, who claims to support this agreement but called our bringing this legislation to a quick vote “absurd”. I am sure the exporters in his home province of Prince Edward Island, who are facing Panamanian tariffs while their American competitors have duty-free access, would have a thing or two to say about that.
I am not surprised by the rhetoric coming from the NDP members. They have been consistently anti-trade since the days of NAFTA. Now they are committed to voting against yet another free trade deal. Obviously, a leopard does not change its spots.
I would like to speak to the benefits of this free trade agreement for Canadian investors. Foreign investment is an integral component of today's modern economy. With one in ten Canadian jobs generated by foreign investment, our government understands that attracting new investment is critical to the long-term prosperity of our economy. Investment not only produces jobs but it increases the transfer of know-how and of efficiencies and economies of scale to host the economy. It contributes to our nation's competitive advantage, it enhances productivity and it promotes innovations.
The results speak for themselves. Investments with our partners, inward and outward, are essential to the long-term prosperity of our economy. They not only strengthen Canada's global competitiveness at home but also paves the way for new opportunities for Canadian companies overseas.
This is why it is important to build on our investment relationship with countries like Panama. In fact, Panama is already an established and growing destination for Canadian direct investment abroad, particularly in areas such as construction, mining, banking and financial services. There are enormous commercial opportunities for Canadian investors in Panama.
We are already seeing some of these major projects unfold. Canadian companies are demonstrating tremendous interest in Panama, partly as a result of the major government projects currently under way there. These projects include the building or improvement of ports, roads, hospitals, social housing projects, bridges and airports, which are part of the $13.6 billion Panamanian government strategic investment plan. Under this plan, there are a large number of infrastructure projects that will create new opportunities for Canadian businesses.
The current and future opportunities in Panama for Canadian investors illustrate just how important it is to enhance our investment relationship with countries like Panama. Once this agreement is implemented, Canadian investors in Panama will enjoy greater stability, transparency and protection for their investments.
The free trade agreement with Panama would provide investors from both countries with the benefits that come with enhanced investment obligations. These reciprocal commitments would serve to promote bilateral investment flow, which is crucial in linking Canada to global value chains.
The agreement provides a range of obligations to protect investment abroad through legally binding rights and obligations. The investment obligations of this agreement incorporate several key principles, and they include treatment that is non-discriminatory, protection against expropriation without compensation and the free transfer of funds. Through this agreement, investors would also have access to a transparent, impartial and binding dispute settlement mechanism. While this agreement would ensure that investors and their investments are protected, it would not prevent either Canada or Panama from regulating in the public interest with respect to health, safety and the environment.
Let us now turn our focus to Canadian service providers. Our services sector is a critical component of the engine of our economy. In total, it is responsible for more than 70% of our total GDP and more than three in four jobs in Canada. That is why I am very pleased to see that our free trade agreement with Panama includes important provisions covering services that would open new doors for Canadian service providers. Indeed, this free trade agreement contains strong provisions governing cross-border trade and services that would provide new market access by Canadian service providers to Panama's dynamic and rapidly growing market.
The agreement provides market access beyond Panama's obligations under the World Trade Organization's General Agreement on Trade in Services, particularly in areas of Canadian expertise and export interest, including mining and energy-related services, professional services, environmental services and information technology. Indeed, the free trade agreement we are debating here today contains substantive provisions governing cross-border trade and services, as well as providing a level market access similar to that afforded under the North American Free Trade Agreement. The Canada-Panama free trade agreement will provide a transparent, predictable and rules-based trading system to Canadian service providers, while ensuring they are treated equitably with Panamanian companies.
It is clear that Canadian service providers stand to benefit considerably from the implementation of the Canada-Panama free trade agreement. In 2009, Canadian commercial services exports to Panama amounted to $48 million. This agreement provides a great opportunity to take our current bilateral trade in services to a new level in the years ahead.
Closer economic integration with Panama promises to deliver further gains for Canadian exporters, investors and service providers. Canadians value the real and tangible benefits that this agreement will produce, and that is why Canadian businesses have been strongly advocating in favour of this agreement.
However, to take advantage of these opportunities, this House must pass the Canada-Panama free trade agreement tonight. With the United States-Panama free trade agreement now in force, the timely implementation of this free trade agreement is much more critical. That is why I urge all hon. members to support the implementation of the Canada-Panama free trade agreement.