FAIT Committee Meeting

STANDING COMMITTEE ON FOREIGN AFFAIRS AND INTERNATIONAL TRADE

COMITÉ PERMANENT DES AFFAIRES ÉTRANGÈRES ET DU COMMERCE INTERNATIONAL

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, May 2, 2001

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[English]

The Vice-Chair (Ms. Colleen Beaumier (Brampton West—Mississauga, Lib.)): I call the meeting of the foreign affairs and international trade committee to order.

Today we're meeting on the main estimates, and we are very privileged to have the minister with us. With the minister there is Robert Wright, Deputy Minister for International Trade; Kathryn McCallion, ADM, Corporate Services, Passport and Consular Affairs; John Gero, Assistant Deputy Minister, International Business and Chief Trade Commissioner; and Claude Carrière, Director General, Trade Policy Bureau I, chief negotiator for the free trade area of the Americas. They're here again, I might add. We had them yesterday.

Welcome, minister. We have been looking forward to this visit, and I am sure that we have a lot of very interesting questions for you. If you would like to begin, please do so.

Hon. Pierre Pettigrew (Minister of International Trade): Thank you very much, Madam Chair. I am very pleased to be here today accompanied by the people you have identified. I am here for the easy questions, and they are here for the tough ones.

[Translation]

I'd like to tell you that I'm very pleased to be here once again, obviously. We've had quite a few meetings over the past few months, and I'm always pleased to meet with the Committee on Foreign Affairs and International Trade.

I would like to emphasize how much I value the good work of the committee. I feel that, in recent years, this committee has played a crucial role not only in consulting with Canadians on important issues but also in analyzing and making recommendations to the government on very important policy matters.

Your reports on the World Trade Organization and on the Free Trade Area of the Americas have been very valuable and, in all honesty, have assisted the government in forming its positions. I thank you for your hard work and your contribution to the process.

Today I would like to give an overview of the work done by my department to develop Canada's trade around the world. I would also like to touch on the Summit of the Americas, which was held recently in Quebec City, and look to the year ahead, outlining our priorities.

[English]

First, however, I would like to give the committee some sense of how well Canada is doing in this important area.

The second annual State of Trade Report, which we released yesterday, describes a year—and indeed a decade—of outstanding Canadian trade success, and I want to bring your attention to a few landmarks of the year 2000.

Our economy hit the $3-trillion mark. We recorded the highest rate of growth in 12 years, and we registered the ninth consecutive year of record growth. We enjoyed the longest period of uninterrupted growth in over 30 years. We experienced our best employment record in nearly 25 years, and Canada saw its net foreign indebtedness expressed as a percentage of GDP drop to its lowest level, namely 23.5%, in 50 years.

Our exports now represent over 45% of our GDP. That's almost half, and trade not only drove this phenomenal economic growth, it also helped provide the means for the government to begin our multi-year program of reinvesting in education, innovation, our universal health-care service, and our young people.

Part of the mandate of the Department of Foreign Affairs and International Trade is to promote Canadian goods and services abroad and to promote Canada as a place to invest and to transfer new technologies. Trade promotion can come in many forms. It can be conducted in a high-profile fashion through Team Canada missions or through missions led by the trade minister, and it can range to the lower-profile but every bit as important work of the hundreds of trade commissioners we have posted around the world. The trade commissioner service has 530 trade staff in more than 130 embassies and consulates around the world. They are there to help Canadians take advantage of the business opportunities available in foreign markets.

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In the year 2000 the department conducted a survey of almost 2,000 clients of the trade commissioner service, mainly small and medium-sized enterprises, to measure the level of satisfaction and to ensure that their services were meeting the needs of business firms and our partners. The vast majority of these clients, 78%, said they were somewhat or fully satisfied with the services of the trade commissioner service, and almost half of them thought the service exceeded their expectations.

[Translation]

The government of Canada also offers many more services to exporters through Export Development Corporation and the Canadian Commercial Corporation. Both of these Crown corporations have helped Canadian companies, particularly SMEs, succeed in international markets.

However, while our trade record is cause for celebration, we must be mindful of the challenges that lie ahead. The slowing US economy will doubtless continue to have an impact on our exports in the current year. So will the ongoing softwood trade dispute, which we are working hard to resolve.

At the same time, as a result of the concerns of developing countries and differences between the European Union and the United States, it now seems uncertain whether we will make significant progress soon toward freer global trade although I sense a more positive atmosphere recently. Certainly, the results of the Quebec Summit showed quite clearly that leaders in this hemisphere are up to the challenge of opening markets further.

[English]

Before I continue, let me tell you about an historic achievement Canada secured at the free trade area of the Americas trade ministerial meeting in Buenos Aires last month. At Canada's urging, trade ministers from across the hemisphere unanimously supported releasing the draft negotiating text to the public. As you remember, Madam Chairwoman, in my previous appearances before this committee I outlined the reasons I felt the public release of this text was important. The world has evolved, and more and more ordinary Canadians are interested in contributing to the discussion on trade. Releasing the text will only serve to increase the already high confidence Canadians have in the trade-negotiating process.

What we accomplished in Buenos Aires has never been done before in any trade negotiation process anywhere in the world. It will be a testament to our maturity if we take advantage of this opportunity to constructively contribute to the public discussion on the free trade area of the Americas.

The FTAA is charting new territory and we all as Canadians can be proud of the leading role our country has taken on this front. It's important to recall that our country first started its campaign to increase transparency shortly before the November 1999 meeting of the FTAA ministers in Toronto. That was more than 18 months ago.

At the time, Canada was pushing for the renewal of the civil society committee of the FTAA, and the outlook was bleak, to say the least. Through persuasion, however, we were able to gather 22 ministers and have them engage in a direct dialogue with the civil society committee, and the result was a renewed commitment to maintaining the civil society committee.

Since that time the government of Canada has always felt that we could make even greater strides. We are confident of the benefits that trade yields for both our economy and our society, and we have nothing to hide. Thus began our crusade for increased transparency. With our success in Buenos Aires we will now take our campaign to the WTO.

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[Translation]

Overall, of course, the Summit of the Americas was a resounding success in terms of fostering democratic rights, liberalizing trade, bridging the digital divide and realizing human potential. In signing the Declaration of Quebec City, the 34 leaders clearly committed themselves to democracy by making it the essential condition for participation in the Summit process.

In order to ensure equitable distribution of the benefits and prosperity resulting from economic growth, the leaders decided to pursue discussions on the economic integration of the Americas and to continue negotiations towards creating a Free Trade Area of the Americas, the largest free trade area in the world, by the end of 2005.

I would like to share with you the emotion that I felt, during the Quebec Summit, upon seeing 34 government leaders, at times the leaders of small countries with fragile and vulnerable economies, at times the leaders of very big countries with well-developed economies, and also the leaders of countries with medium-sized economies, some countries being socialist, others centrist, while others are conservative, yet all in agreement as to the path we were to take. Therein lies an extremely interesting message with respect to the path that Canada chose for itself a few years ago.

The leaders also approved a series of measures to promote participation by all citizens in the social, economic and political life of their countries in order to fully realize their human potential. They reached agreement on a Declaration on Connectivity, which is a clear statement of their commitment to bridge the digital gap. The Quebec Summit also provided an unprecedented opportunity for civil society to present its point of view.

Nonetheless, alongside these achievements, the protests in Quebec City remind us that we still face an important challenge: to demonstrate the benefits of trade to all citizens through research and analysis, engagement and discussion.

We have come a long way since Seattle in terms of discussing so-called "soft" issues, or making documents public, or giving an active role to special interest groups. By calling this, I know we can win the remaining skeptics.

[English]

I should underline, Madam Chairwoman, the fact that making progress on the FTAA is only one of our priorities for 2001. Recently our government detailed its market access priorities for the coming year in the report Opening Doors to the World.

I am especially pleased to mention that we have already achieved a number of this year's stated objectives. We have indeed concluded a free trade agreement with Costa Rica, and I would like to congratulate Claude Carrière, who was our chief negotiator in the Costa Rica agreement we signed last year. I want to thank him before this committee for his very good work on that front—as on a number of other fronts, but on that front in particular.

We have succeeded in having the United States' ban on P.E.I. potatoes lifted, and we have convinced the European Union to allow Canadian ice wine to be sold in Europe. As you are know, Canada is preparing for the fourth WTO ministerial conference, which will take place in Doha, Qatar, next November.

At that meeting WTO members could agree to launch expanded global trade negotiations, but for that to happen much work remains to be done. Canada is currently working with other developed countries to resolve differences and to build confidence among the developing countries for the launch of new negotiations at Doha, negotiations that will meet the needs and aspirations of all WTO members.

Just as importantly, to overcome some of the public concerns, Canada is leading the effort to improve the transparency of the WTO and to facilitate dialogue with the public. Improved WTO transparency is required to maintain public support for trade liberalization and rule making. WTO members must do more to listen to the public, address legitimate concerns, correct misperceptions, and create confidence in the organization and its processes.

We are also actively advancing Canadian interests in the current negotiations on agriculture and services to provide Canadians with improved opportunities in the markets of the world.

[Translation]

Canada is a nation of free traders par excellence. The polling numbers have always shown this. In fact, support for Canada's involvement in international trade has increased to 85%.

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Canadians recognize that trade is central to our economic health. It brings us higher incomes, improved productivity and international competitiveness, more choice, and more opportunity.

And it does much more. By creating prosperity, trade fosters human dignity and strengthens societies here and abroad. It provides new opportunities as well as access to better technology and to new ideas.

History has shown that trade provides the resources enabling governments to protect the environment, strengthen the social safety net and promote core values, such as the rule of law, tolerance and compassion.

We will continue to promote and pursue trade opportunities for the good of all. At the same time, we will continue to be mindful of the legitimate concerns raised through our consultation process, in the press and even on the street. Despite all the bumps and twists in the road, trade has made the world a better place for most. I believe that trade has a central role to play in establishing the basis for a better future for all of us. Thank you for your attention. I would pleased to answer any questions you may have.

[English]

The Chair: Thank you.

Mr. Obhrai.

Mr. Deepak Obhrai (Calgary East, CA): Thank you.

Mr. Minister, of course I've had many opportunities to ask a lot of questions over the course of the year. I have two questions. Then I'll ask my colleague over here to ask a question, and then on the second round my third colleague will ask questions on softwood lumber.

I've been involved in international trade in the committee for over a year and a half. I have been with you. I've been with the committee travelling. I've been everywhere. I've talked to the House. I've debated your parliamentary secretary and everybody. But at the end of the day, Mr. Minister, I come away still saying there is no transparency. You have gained some small steps, I would say. The Buenos Aires meeting—I would like to commend you for getting the others to do that. I will commend you when you do a good job. But the transparency issue still remains paramount: it is not there.

We have a concern. You have outlined in your speech on many occasions that the civil society committee is set up and so forth. But I still say that Canadians are still not getting openness from your government. I know you will say—and I've heard you say many times—that you've discussed this in Parliament, but I'm telling you from my experience out here.

You had a meeting with the provincial ministers—nobody had a clue you were having meetings with the provincial ministers. When we go out there, we get a different version of that. So I think the most fundamental question would be, as has happened in Australia and in other countries, before you sign that free trade agreement, will it come to Parliament prior to you ratifying that treaty, so that we have the opportunity to discuss before you put your stamp on it? Would you give us that commitment?

I have another question, but if you can do that... Will you give us that commitment? I know you may not be there in five years, because...

Some hon. members: Oh, oh.

Mr. Pierre Pettigrew: Oh, I think I have more chance to be there than you do, my friend.

Mr. Deepak Obhrai: I had to throw that in.

Mr. Pierre Pettigrew: So did I.

Mr. Deepak Obhrai: Give us that commitment.

Mr. Pierre Pettigrew: No, I believe that we must be very transparent and very open, but you are asking us to make a major change in our Canadian practices.

As you know, the government has had the responsibility in our British parliamentary democratic system to take on those responsibilities—to consult Parliament, consult this committee. We work very closely with one another, but at the end of the day, the government makes the decision to sign or not sign a treaty. Then we go to Parliament for implementing the treaty and for all the amendments in the legislation. So Parliament has the last word in the end, because indeed to implement the treaty the legislation process is there.

Now, you may say let's go the American way and let's do as they do in the United States. We keep saying that the poor Americans without fast-track authority—now trade promotion authority—can't do a thing, because everything has to be renegotiated with Congress. You may look into that, but that is not the orientation of my government.

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Mr. Deepak Obhrai: What you mean then is that you're going to ratify over there, and this treaty will come into Parliament, and we can actually make changes to those treaties. Is that what you just said?

Mr. Pierre Pettigrew: We have to introduce into Parliament legislation implementing international treaties, because we have to amend our legislation in order to implement a treaty that's passed into Parliament. We always do that. That's what we did when we had the free trade agreement with the United States. There was a huge implementation legislation that went through Parliament. This is the Canadian way. I know some people might be flirting with other presidential systems and all that, but here is a French Canadian now defending British Parliament. You like that, eh?

Mr. Deepak Obhrai: You have stated that you are carrying the flag of transparency. Yet at the same time you go on hiding behind the old system. What we are asking now is for you to look at and change the system to improve transparency, so that we and the provinces and everybody have a right to do that. Why can you not improve the system? Why are you hiding in the old system? If transparency was there—

Mr. Pierre Pettigrew: I believe that the present system serves the interests of our citizens very well. We can look into the American system, and I'll tell you one thing, I'm not sure it serves the American interests very well to have—

Mr. Deepak Obhrai: Why don't we look at the Australian system?

Mr. Pierre Pettigrew: You can take examples from very far, but I think that the way we are conducting things in Canada and improving them all the time with very close cooperation is a very good and very responsible approach. The government has to fulfil its responsibility.

Mr. Deepak Obhrai: True, but if transparency is handled well, then you would have fewer protests taking place on the street, minus the fact that there are others who are opposed to it because of policy or whatever. We are talking of the general public.

Mr. Pierre Pettigrew: I know, but here is an example. SCFAIT amends the legislation such as International Criminal Court. You—this committee—have done it. Why not? It's pretty good.

Mr. Deepak Obhrai: I think we're going to disagree on that, because we want that approach to—

Mr. Pierre Pettigrew: We need something to disagree on.

Mr. Deepak Obhrai: We need to have more transparency, and we're going to fight to have your government held accountable for it. So that will be one issue we'll carry on.

I'll ask my other colleague to carry on.

Mr. Rick Casson (Lethbridge, CA): I'll try to be brief.

Mr. Minister, thanks for being here.

We hear from Europeans that we have trouble with Canada's image. The imagie in Europe is still of us as a wild, open country with a cabin on the lake. They don't quite grab the fact that we are a high-tech country. We need to somehow—and I'd like to ask you what your plans are to do that—let it be known that Canada is a different country now from what it was a hundred years ago.

Also, regarding the upcoming rounds at the WTO in Qatar—if it happens, and I hope it will—and the common agriculture policy of Europeans, now they're facing some difficult times. They're going to enlarge. They won't be able to continue to subsidize at the level they have. There are some elections coming up. The peace clause comes to an end. They're spending $50 billion a year on subsidizing their agriculture and the Europeans want to know why their food is still not safe. So the time is right for us to make some inroads and get some of these subsidies in agriculture reduced.

I'd like to ask you what this government is going to do and what this country is going to do to keep the pressure on the Europeans to help push this agenda for lowering the subsidies in the agriculture area.

Mr. Pierre Pettigrew: Thank you very much.

As regards your first question, I agree with you that it is very important that we improve others' perception of what Canada has become. We must recognize that we've changed rapidly in the last twenty years, and it takes a while before it reverberates everywhere. We're branding Canada differently. The Team Canada mission that Prime Minister Chrétien led last year in Japan was very different from others, but was very much focused on the high-tech capacities of Canada.

We are conducting a survey right now in a number of cities around the world trying to find out how we could actually... We're trying a few methods of getting a better branding of Canada, and we're waiting for the results of that precisely to see what works best.

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We will continue to do that. We have received great French investment from Alcatel here in the Ottawa region in high-tech lately. There's the Swedish investment in biotech in Montreal. So it's very important—a work in progress.

On the common agricultural policy, it is our top priority in agriculture to get the elimination of export subsidies. We are working very hard at it. At the present time in the mandated negotiations of the WTO, I share your analysis that the time is right for progress on the European side.

And to the point that you have made, I would add one further inclination why the Europeans should be more willing to eliminate those distortions of export rate subsidies. It is the enlargement that they face in the next year or two. They cannot afford that level of export subsidies while welcoming new countries into it.

So I think you were quite right that this is the appropriate time to charge on, very strongly, on the elimination of export subsidies. It is our top priority in the agricultural negotiations, right now, at the mandated negotiation in Geneva. And of course they would be the top priority of any WTO new ministerial launch.

The Chair: Thank you.

[Translation]

Mr. Paquette.

Mr. Pierre Paquette (Joliette, BQ): Thank you, Madam Chair. Thank you, Mr. Minister, for your presentation.

First of all, I would simply like to point out that even the British Parliament changed the way it did things so that Parliament could approve the treaty before it was ratified by the executive, as is the case in Australia, moreover.

Perhaps the government should take the initiative to revisit our institutions. That being said, we still...

Mr. Pierre Pettigrew: It's good to see you using England as a model. That's good.

Mr. Pierre Paquette: Yes, yes, it is a sovereign country like any other.

Some Hon. members: A country that is able to evolve.

Mr. Pierre Paquette: That is able to evolve, yes. At any rate, we have three and a half years to convince you of the need to have Parliament vote on the issue before the treaty is ratified. We do have some time to play with.

Mr. Pierre Pettigrew: That's right.

Mr. Pierre Paquette: I would like to go back to some questions that are more directly linked to your presentation. My first question is very direct. When you went to Buenos Aires—and, moreover, I had said that I would wait for the action you intended to take in Buenos Aires in order to get the texts—and you came back with the answer given by all of the other international trade ministers, you told us that the text would be available as soon as the translations were ready.

Yesterday we found out—and this has been confirmed by the statement of Buenos Aires—that there was a second condition, that you had all agreed to make texts available after the Summit. We were told that this is going to be the rule in the future. So why did you give us the impression, before the Quebec Summit, that you were in favour of making these texts available as quickly as possible, before the Summit, if, technically speaking, we were able to have them translated. In my opinion, you were not very clear in...

Mr. Pierre Pettigrew: No, but I will be clear now. If I may, I will...

Mr. Pierre Paquette: I would like to know what occurred to make you forget to tell us about this second condition, which was to make the texts available after the Summit. I would also like to know when we're going to receive these infamous texts.

Mr. Pierre Pettigrew: First of all, you said that I came back with the answer from the other ministers. I came back with consent, after convincing the other ministers. That is much more than coming back with the answer given by the others. Canadian diplomats participated actively in this initiative and we did much more than simply bear the message that the other ministers had in their pockets. I can assure you that a great deal of effort went into this initiative. We are very proud of this initiative, and we are proud of the Canadian leadership shown.

When I came back from Buenos Aires... I will tell you what happened exactly. At the ministerial, there were 34 ministers sitting around the table. When, under the chairmanship of Argentina, the discussion began to head in the right direction—and God knows how relieved, content and happy we were when we saw that the support came from a wide variety of regions in our hemisphere—we managed to get one country, which will remain nameless but you no doubt know to whom I am referring, to support the Canadian initiative. However, this country wanted all of the texts to be in Portuguese before making them public, which was legitimate. As the Canadian minister, I then requested that the texts be also available in French.

Another country said that we were engaged in a very important endeavour, that we should not rush. This country said: “We should not rush into it”, so that the job could be done properly by the Free Trade Area secretariat. The chair did not reach any conclusions at that point. The chairman did not come to an overall conclusion, but this point was made without any opposition, and I wasn't going to contradict him, because I was very happy to have won this bit. When you have won something, you do not reopen the debate for fear that the countries may change their mind. So when I came back, I said that there was one clear condition: translation.

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The other condition, having been expressed, was ultimately retained by the chairman, but without any conclusion. In participating in the debate, we observed that the chair had decided to retain one country's opinion without having obtained consent on the issue. Is that clear?

Mr. Pierre Paquette: But that is part of the final declaration and we were not told about this before...

Mr. Pierre Pettigrew: In English, yes, and in Spanish.

Mr. Pierre Paquette: At any rate, from what I read in French, I can tell you that it is written that the results of the work done at the Summit will be available afterward.

Mr. Pierre Pettigrew: As you know, I am always working on my Spanish these days. I saw the Spanish text and that was not there.

Mr. Pierre Paquette: I think that there is a serious credibility problem here and I'm hoping that, at any rate, that we will quickly...

Mr. Pierre Pettigrew: No, really...

Mr. Pierre Paquette: Listen, what happened is that you arrived with this news. I don't want to spend all of question period on the matter however, this took off a lot of pressure, but people were waiting and asking for the texts before the Summit. Instead of telling them that you had agreed that the texts would be made available after the Summit, you let it be understood that this was strictly a problem of translation. This being said...

Mr. Pierre Pettigrew: Mr. Paquette, you have just said that the negotiating process will take three and a half years. There is, therefore, no immediate danger.

Mr. Pierre Paquette: No, but you have had the answer for a month now and I find that it is taking quite a long time to translate 900 pages.

Mr. Pierre Pettigrew: No, 450 pages.

Mr. Pierre Paquette: Four hundred and fifty pages. I cannot believe that it takes more than one month to translate these texts. That being said, I hope that we will have them soon so that we will be able to have more information for the debate.

Mr. Pierre Pettigrew: We will get there.

Mr. Pierre Paquette: Another issue that I would like to be able to examine quickly and, you mentioned this in your documents although not in your presentation, is the whole issue of investments, both within the scope of the Free Trade Area of the Americas negotiations as well as in NAFTA.

Yesterday, I found it very difficult to understand the government's position. Up until now, I had understood that Canada had some reservations about the conflict resolution mechanism and the definition of expropriation. I would like to know when the Canadian position will be made public. The only thing that we know is that the Canadian government will reopen the issue with its NAFTA partners before revealing its position on the Free Trade Area of the Americas. This is what Mr. Carrière told the committee last Monday. I think that we have things backwards. Canada has to make its position known, open negotiations with its partners. We now have the impression that the Canadian position will be determined based on whether or not the other countries will accept it. When will the position be made public?

Mr. Pierre Pettigrew: Our position will be made available once it has been sent to the FTAA negotiation secretariat. We have a position now and we are in the process of consulting industry, the provinces—

Mr. Pierre Paquette: Why not make this position public?

Mr. Pierre Pettigrew: Once we have completed our consultations, worded the position in a manner... sent it to the secretariat, we will make it public.

Mr. Pierre Paquette: You are referring to the North American Free Trade Agreement.

Mr. Pierre Pettigrew: May I—

Mr. Pierre Paquette: I would just like to know if you were referring to the North American Free Trade Agreement?

Mr. Pierre Pettigrew: No, no, I'm talking about our position on the Free Trade Area of the Americas.

Mr. Pierre Paquette: What I had understood Mr. Carrière to say was that you were going to first of all define your position in terms of NAFTA and then this position would be reflected in the Free Trade Area of the Americas.

Mr. Pierre Pettigrew: We are talking about two things. The current NAFTA has a Chapter 11 that was negotiated. We have never talked about reopening the agreement or renegotiating it. Over the past few months, that I had hoped to engage my Mexican and American colleagues, who have both changed since I began this initiative as we are now dealing with Secretary Derbez and Ambassador Zoellick, in a discussion to clarify, within the current NAFTA mechanisms, certain aspects of Chapter 11.

What Mr. Carrière no doubt meant was that, obviously, the position that we will be submitting to the Free Trade Area of the Americas will reflect our thoughts as well as the experiences that we have had elsewhere, particularly with respect to Chapter 11 of NAFTA.

Mr. Pierre Paquette: And when do you think your position on investment, dispute settlement, intellectual property and services will be made public? We were told that there was going to be another negotiation table on institutional matters. When will these positions be disclosed?

Mr. Pierre Pettigrew: Over the next few months, as our work progresses.

Mr. Pierre Paquette: Like the texts.

Mr. Pierre Pettigrew: Don't you worry about the texts. The Panama secretariat... Naturally, we also have a Free Trade Area of the Americas secretariat which is in the process of moving. So we have to look at how...

Mr. Pierre Paquette: The technical problems seem to be quite cumbersome throughout the process.

Mr. Pierre Pettigrew: Oh no, Mr. Paquette...

Mr. Pierre Paquette: There are difficulties with the translation, difficulties with the move.

Mr. Pierre Pettigrew: We achieved a magnificent victory. We should relax and take full advantage of it.

Mr. Pierre Paquette: I'm not trying to downgrade the victory, but I still don't want to be lulled into a false sense of security by a false victory.

Mr. Pierre Pettigrew: No, No.

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Mr. Pierre Paquette: I have one final question. A unanimous motion was adopted by the House last week regarding a transparent and continuous type of consultation and of involvement for parliamentarians and civil society.

Mr. Pierre Pettigrew: And we voted in favour of that motion.

Mr. Pierre Paquette: I was quite proud to see that the motion was unanimously adopted by the House. What do you intend to do in order to implement this resolution?

Mr. Pierre Pettigrew: I am here today.

Mr. Pierre Paquette: At any rate, you would have been here even if the motion had not been adopted. So what more do you intend to do?

Mr. Pierre Pettigrew: Your motion, Mr. Paquette, warmed my heart. I said to myself that friends of the Bloc Québécois have appropriately recognized that our government is fully involved in the consultation process. I recognized my work behind your motion.

Mr. Pierre Paquette: I don't want the motion simply to be empty praise. We are going to use this motion over the next few months. As things have evolved, Canada has opened the way on issues of transparency, to the involvement of civil society. In my opinion, there is still work to be done on that score.

Mr. Pierre Pettigrew: We are the first country to publish our position on the Web. We are the country that established the dialogue committee with civil society. And it was also Canada's achievement in Buenos Aires to institutionalize... We perhaps haven't been mentioning much, but we now have an institutionalized forum of dialogue with society throughout the hemisphere. That is also a great victory. Canada is there. We will work as closely as possible with Parliament and this committee.

Mr. Pierre Paquette: At any rate, I would hope that the implementation of Parliament's motion will be at the top of your priority so that we can review the situation next year and see what has truly changed regarding...

Mr. Pierre Pettigrew: It's not a matter of seeing what has changed. The motion doesn't mention change. The motion mentions the fact that there are things that we consider...

Mr. Pierre Paquette: The motion said to create. That means that it has yet to be created.

[English]

The Vice-Chair (Ms. Colleen Beaumier): Thank you. Your time's up.

Mr. Robinson.

Mr. Svend Robinson (Burnaby—Douglas, NDP): Thank you, Madam Chair.

[Translation]

Thank you, madam Chair.

Mr. Paquette mentioned the issue of credibility. I have several other questions to ask as to the credibility of the minister.

[English]

I found it extraordinary that the minister was suggesting that somehow because the Spanish version made reference to something that the English version didn't, he didn't understand that the translation was not the only condition for release of the texts. The minister stated on a number of occasions to the House and to this committee that the only criterion was the translation of the texts before they were going to be made public.

The minister was misleading this committee and misleading the House.

Mr. Pierre Pettigrew: I have not been misleading the committee, nor the House.

Mr. Svend Robinson: Quite clearly, either the minister misled the committee or he didn't read his own documents.

Mr. Pierre Pettigrew: You should be respectful of the members. That would be more helpful.

Mr. Svend Robinson: I want to ask the minister about another question of credibility, and that is on the issue of chapter 11 and investor-state. On April 5 of last year, the minister, appearing before this same committee, said “I can assure you that we are not seeking an investor-state provision in the WTO or anywhere else in other agreements”. The minister went on to say “No, no, no, not on the FTAA either”.

I just want to ask the minister first of all to clarify. Is it his position today that Canada is not seeking an investor-state provision in the FTAA?

Mr. Pierre Pettigrew: I am not seeking it. There might be other countries that will put it on the table. We will examine it. We will look into it, but we will take into account our experience with chapter 11 in NAFTA. We will take into account the clarification we're seeking from our partners. In my view, when we say we are not seeking something, it does not mean that we would absolutely never consider it.

You should read the words of it.

Mr. Svend Robinson: Okay, then let's go to the next words of the minister. On March 12, the minister said—and this has nothing to do with seeking:

...we would of course not sign another agreement that would have the kinds of clauses that we are seeking to clarify right now. [...] ...we will not go to the sorts of thing we are seeking to clarify in chapter 11...

Is the minister now saying he would not sign an FTAA if it included the wording of chapter 11?

Mr. Pierre Pettigrew: Give me my quote and I'll repeat it, but don't rephrase it.

Mr. Svend Robinson: I've repeated it twice.

Mr. Pierre Pettigrew: Don't rephrase it. I would not... the Government of Canada—

Mr. Svend Robinson: This is a quote from the minister.

Mr. Pierre Pettigrew: Yes, but you've rephrased it.

Mr. Svend Robinson: No—

Mr. Pierre Pettigrew: Read my quote, Svend.

Mr. Svend Robinson: Well, for the third time, the minister said “...we would of course not sign another agreement that would have the kinds of clauses that we are now seeking to clarify.” Is that what the minister—

Mr. Pierre Pettigrew: Of course. Do you think if we're doing this work of trying to clarify and improve things we would sign things that would not take into account our experience?

• 1615

My problem with you, Svend, is when you rephrase my things in the House.

Mr. Svend Robinson: This isn't rephrasing—

Mr. Pierre Pettigrew: But that's what I'm saying. I like that. It's your rephrasing that is not good.

Mr. Svend Robinson: Madam Chair, it has nothing to do with my rephrasing. The minister has been very critical up until now of chapter 11's investor-state provisions. We move from April 5 of last year to March 12 of this year to yesterday, and now—

Mr. Pierre Pettigrew: Pretty coherent.

Mr. Svend Robinson: —Madam Chair, the minister is saying... My goodness, not only is he not critical of chapter 11, investor-state, but what did the minister have to say yesterday in the House of Commons? The minister says this—and I'm quoting the minister's words now, I'm not paraphrasing. He says “The Government of Canada believes that NAFTA, including chapter 11, works well.”

Mr. Pierre Pettigrew: Works well, yes.

Mr. Svend Robinson: It works well.

Mr. Pierre Pettigrew: Absolutely.

Mr. Svend Robinson: Isn't it great? Chapter 11, which wasn't working, and we weren't going to have anything to do with the investor-state, is now working well.

Mr. Pierre Pettigrew: I am impressed by the coherence of the minister.

Some hon. members: Oh, oh.

Mr. Svend Robinson: If the minister is suggesting that chapter 11 is working well—

Mr. Pierre Pettigrew: Absolutely.

Mr. Svend Robinson: —he might want to look at the statements that have been made by Howard Mann, of the International Institute for Sustainable Development. I'm sure the minister's familiar with Professor Mann. He's a very respected analyst.

Mr. Pierre Pettigrew: He's highly regarded. I regard his work very highly myself.

Mr. Svend Robinson: Exactly.

Mr. Pierre Pettigrew: And the IISD too.

Mr. Svend Robinson: Professor Mann has stated that chapter 11 is not working well at all.

Mr. Pierre Pettigrew: Gee whiz.

Mr. Svend Robinson: He has said that the provisions of chapter 11 raise serious doubts whether any NAFTA government can regulate to protect the environment without a significant risk of having to pay compensation to private corporations. He says it is unclear whether there is any safe harbour for environmental, human health, or other new regulations that have an impact on foreign investors under the current interpretations of chapter 11. He said that chapter 11 “... is shockingly unsuited to the task of balancing private rights against public goods in a legitimate and constructive manner.”

So I'm delighted to hear the minister suggesting that chapter 11 is working well. But the fact is that for the people of Mexico, particularly in a small town like Guadalcazar, who were told by Metalclad that they had to have a toxic waste dump in the facility, for Canadians who are having their public postal services challenged by UPS, and for the people of California, who are having their ban on MTBE challenged by a Canadian company, Methanex, chapter 11 is not working well at all.

Mr. Pierre Pettigrew: Don't use Pope and Talbot—

Mr. Svend Robinson: Chapter 11 is not working well at all for those people.

Mr. Pierre Pettigrew: Well, they haven't lost yet. You're talking about cases that are all under examination right now. We'll see. Last week you would have put Pope and Talbot there, Svend, and we won it.

Mr. Svend Robinson: I want to talk about the constitutional challenge to chapter 11 that is being launched by CUPW and the Council of Canadians. The Minister is familiar with this constitutional challenge. What is the position of the Government of Canada with respect to this constitutional challenge that points out that UPS is using NAFTA to basically try to get a bigger piece of the urban courier market? They've tried twice before the Competition Bureau and failed. Now they're using chapter 11. They've taken it to the courts; they've said that chapter 11 is unconstitutional.

Will the Government of Canada be taking a position on this?

Mr. Pierre Pettigrew: This is before the courts right now, and I don't want to comment on it.

Mr. Svend Robinson: I'm asking, is the Government of Canada going to intervene?

Mr. Pierre Pettigrew: Yes, I think we are going to intervene. We are going to...

Haven't we already? No, but we will.

Mr. Svend Robinson: You will intervene. Is that what you're saying?

Mr. Pierre Pettigrew: Sure.

Mr. Svend Robinson: And what position are you going to take?

Mr. Pierre Pettigrew: I'm not going to talk about a case that is before the courts right now.

Mr. Svend Robinson: Oh, okay. So you're going to intervene.

Now, let's look at another—

Mr. Pierre Pettigrew: Well, I know you don't have to think about what it is to be in a government, but we have to—

Mr. Svend Robinson: Let's look at another real concern about the impact of the FTAA that the minister has so far refused to take a position on. He hasn't taken a position on investment. In fact, according to his own assistant, as of two weeks ago, he didn't have a position.

Mr. Pierre Pettigrew: We have a position.

Mr. Svend Robinson: Oh, you do have a position.

Mr. Pierre Pettigrew: I just said so.

Mr. Svend Robinson: Well, the minister—

Mr. Pierre Pettigrew: You should listen when I—

Mr. Svend Robinson: Sébastien Théberge... I believe the minister knows Sébastien Théberge?

Mr. Pierre Pettigrew: Very well.

Mr. Svend Robinson: As of the 19th of April, the minister's spokesperson, Sébastien Théberge, said—and I quote, this isn't a paraphrase—

Mr. Pierre Pettigrew: Oh.

Mr. Svend Robinson: The minister's spokesperson said—

Mr. Pierre Pettigrew: Word for word.

Mr. Svend Robinson: —“We have not made our position known yet because we don't have one.”

Mr. Pierre Pettigrew: Was it said in French or in English?

Mr. Svend Robinson: You don't have one, Mr. Minister.

Mr. Pierre Pettigrew: Was it said in French or in English by Mr. Théberge?

Mr. Svend Robinson: Well, the minister doesn't seem to make a difference between the two. The fact is that according to the minister's own spokesperson, he didn't have a position two weeks ago. I'm glad to hear he does now.

What's the minister's position on drug patent laws, on intellectual property, and on the provisions of FTAA on intellectual property? If you go to the website, there's nothing there. The minister will know that multinational pharmaceutical companies are trying to get even tougher protection of their patent rights, and that countries like Brazil that are struggling with a desperate epidemic of HIV/AIDS are saying no.

• 1620

I'm asking this minister in either language, French or English—or Spanish if he chooses—what is the position of the Government of Canada on intellectual property and specifically on the provisions with regard to patent rights for pharmaceutical companies?

Mr. Pierre Pettigrew: Every position we have sent so far has been made public. On the rest we are still consulting.

On intellectual property and drug patents, I'm very pleased with the leadership Prime Minister Chrétien adopted when he raised with the Prime Minister of Italy the need to discuss it at the next G-8 meeting in Genoa. I was very proud of the Prime Minister.

Mr. Svend Robinson: That's real leadership. We have to have a discussion.

Mr. Pierre Pettigrew: It's a big advancement. Many decisions follow good discussions.

Mr. Svend Robinson: Groups such as Médecins Sans Frontières and the North-South Institute are looking for a little more than a commitment to discussion. People who are living with HIV/AIDS throughout this hemisphere are looking for a little more than discussion. They're looking for some sense of what our government has to say on this issue.

I'm asking the minister again: As trade minister, does this minister have a position with regard to the demands of pharmaceutical companies for greater patent protection in the FTAA than that under the existing laws?

Mr. Pierre Pettigrew: We're not going in the direction of greater protection at this stage. I don't think that is the direction we're taking right now. Intellectual property needs to be protected. I think you would agree with that.

Mr. Svend Robinson: So the minister is—

Mr. Pierre Pettigrew: Do you agree with any intellectual property protection?

Mr. Svend Robinson: I'm asking the question of the minister. What is the position—

Mr. Pierre Pettigrew: I know, but I want to know from what basis we're starting.

You know I support intellectual property, but I am open to discussion of situations like the one you're talking about. I am proud of my Prime Minister's leadership in wanting to address the situation. I was pleased with what happened in South Africa last month over that particular problem of the—

Mr. Svend Robinson: Let me ask one final question, if I may, Madam Chair, and that is—

The Vice-Chair (Ms. Colleen Beaumier): You have half a minute.

Mr. Svend Robinson: The minister said in an interview with La Presse:

[Translation]

"I do not think that we can have democracy without redistributing the wealth."

[English]

President Vicente Fox of Mexico has suggested a development fund in the FTAA similar to the development fund in the European Union whereby wealthier countries would be in a position to assist poorer countries. Does the minister support the establishment of that fund?

Mr. Pierre Pettigrew: We have our own means to address this situation right now. We have worked very closely with CIDA on capacity building in trade terms. I think CIDA is doing great work.

We are meeting regularly with Enrique Iglesias of the Inter-American Development Bank trying to get the support of the World Bank. The Inter-American Development Bank—

Mr. Svend Robinson: The answer is no.

Mr. Pierre Pettigrew: The answer is that there are a number of means. Mr. Fox's fund is not yet defined or designed. I cannot make a decision on a concept that so far has not been designed.

Mr. Svend Robinson: The European Union has a fund.

The Vice-Chair (Ms. Colleen Beaumier): Thank you.

Mr. Pierre Pettigrew: Yes, but this is not the European Union, and we're not going into that sort of deep integration. Are you suggesting we should go into that deep integration? You resist even free trade.

The Vice-Chair (Ms. Colleen Beaumier): Time, please.

Mr. Casey.

Mr. Pierre Pettigrew: You can't want a common market and not want a free trade agreement.

Mr. Bill Casey (Cumberland—Colchester, PC): I'd like to come back to the chapter 11 issue again. You've seen a draft copy of the entire document, I assume.

Mr. Pierre Pettigrew: I have seen it. I have not spent hours and hours reading the 23 brackets in a row on the same subject. It's at a very preliminary stage.

Mr. Bill Casey: Does it now include an equivalent to chapter 11?

Mr. Pierre Pettigrew: I won't comment on the speculation of a leak that happened some time ago. But some countries have at this moment submitted positions on investment.

Mr. Bill Casey: Has Canada submitted a position?

Mr. Pierre Pettigrew: No.

Mr. Bill Casey: Not at all. Will we if—

Mr. Pierre Pettigrew: We will.

Mr. Bill Casey: What will it reflect that's different from the chapter 11 we have now?

Mr. Pierre Pettigrew: You'll have to see. We are consulting with industry, and we are still consulting with the provinces. We're looking at the way the chips are falling across the hemisphere. We will take into account our experience with chapter 11 so far and the clarification we're seeking in parallel within the existing mechanism of NAFTA.

Mr. Bill Casey: When the chips have all fallen, could you bring that chapter 11 to this committee and let us have a...

Mr. Pierre Pettigrew: Absolutely.

Mr. Bill Casey: At an early stage?

Mr. Pierre Pettigrew: Yes.

Mr. Bill Casey: I'm looking forward to seeing the draft copy. When will that be available? I think you played a part in making sure that's released. What's the timeframe?

Mr. Pierre Pettigrew: When it's ready. We're doing our work, and we want it to be done well.

Mr. Bill Casey: Roughly what time? Are we talking another week or two weeks or...

Mr. Pierre Pettigrew: On investment?

Mr. Bill Casey: No, the whole draft document.

• 1625

Mr. Pierre Pettigrew: It's in the hands of the secretariat. I've been saying the sooner, the better.

Mr. Bill Casey: Do you have a ballpark figure?

Mr. Pierre Pettigrew: No, I don't. I wish I did.

Mr. Bill Casey: Changing the subject, in the estimates there's a reference to preparatory work on the HIV/AIDS conference in June. What's our position? What's our participation in that going to be? It's on page 27, I believe.

Mr. Pierre Pettigrew: It doesn't really fall under the trade portfolio, so you may want to keep that for my colleague when he comes before you in a few days' time.

Mr. Bill Casey: All right.

Let's go to the emphasis on the United States. According to the notes, you're going to emphasize Canada's international partners, particularly the United States. How do you see the softwood lumber situation finally unfolding? What's going to happen?

Mr. Pierre Pettigrew: It's a very important file, as you know, and what I see unfolding is the continuation of a very close consultation with both industry and the provinces. I must say that the position we have right now is exactly where I think we should be, given the unfortunate circumstances whereby the Americans decided once again to investigate the excessive allegations of the U.S. producers. In those unfortunate circumstances, our industry dialogues very much between regions, and we remain in close touch with the provinces. We will defend the interests of Canadians and Canadian producers against these allegations of the U.S. producers.

We're working on building alliances in Washington. I was very pleased to see that President Bush was talking about the consumers. I can tell you that they have been more vocal than ever before. I must say that the job that was done in Washington by our embassy has been remarkably good and effective on that front.

What can I tell you about how it will unfold? I could describe to you the process of the commerce department, but I don't think that's what you expect of me.

I don't think the preliminary determinations can come before the end of August. Now, if it comes earlier, don't say I'm wrong and that my credibility should be attacked. It could come at the end of June or the beginning of July. I'm saying that given this is such a complex case, it will probably go to the end of August.

Mr. Bill Casey: The Prime Minister said in Moncton that we will negotiate. Does that mean that an export tax is a possibility?

Mr. Pierre Pettigrew: No, the Prime Minister was not referring to an export tax. When the Prime Minister made the comment when he was in Moncton, he was talking about company exclusions from that region, given the fact that for many years Atlantic Canada has been excluded because the U.S. producers don't make any allegations about them. The Prime Minister was talking about our discussions with the Americans on these company exclusions to respect what has been done over the last few years.

Mr. Bill Casey: Is the government negotiating in support of an exclusion for Atlantic Canada on countervail for softwood lumber? Is that part of the negotiating that the Prime Minister referred to?

Mr. Pierre Pettigrew: We have sought it. We indicated it during the consultations with the commerce department that took place about ten days ago.

Mr. Bill Casey: So that's the position of the government.

Mr. Pierre Pettigrew: Absolutely.

Mr. Bill Casey: What about anti-dumping?

Mr. Pierre Pettigrew: Dumping is company related. I don't have access to the numbers of the companies. It's not related to government practices or forestry management by the provinces or any federal program. It's company related.

Mr. Bill Casey: Can you tell me what the British Columbia position is on this issue? Do they want province specific? Are they negotiating themselves—

Mr. Pierre Pettigrew: They've indicated to us a preference for a national rate. Given the fact that all the allegations reflect provincial practices, we have suggested in our consultations that it should be province specific.

Mr. Bill Casey: Okay. Thanks very much.

The Vice-Chair (Ms. Colleen Beaumier): Thank you.

Madame Marleau.

• 1630

[Translation]

Mrs. Diane Marleau (Sudbury, Lib.): Congratulations for a job well done, Minister.

You are right: Canadians are in favour of free trade. However, there are several Canadians who are also worried. They are worried because they are very generous. They do not want to see people suffer any more than they should.

My question continues along the same lines as Mr. Robinson.

[English]

Mr. Robinson asked you about a development fund. I'm not asking about a development fund, I'm asking whether there were discussions between our leaders and other leaders, among ministers, as to what kind of development programming Canada might get involved in to accompany and perhaps alleviate some of the impact of a future free trade of the Americas. I think about what is happening to, for instance, farmers in the Chiapas. We know what's happening there. They are very much marginalized. It's very difficult for them. Our farmers, our agricultural practices are very good. Was there any discussion? Are you prepared to support a push towards more programming to help these farmers do better with subsistence agriculture?

I think if we could be doing that kind of programming, we might find Canadians more supportive of this free trade agreement of the Americas. They really don't want to see these marginalized people suffer more than is necessary. While I know it's not your direct responsibility, if you suggest it, if you push it, if the Prime Minister is in favour of it, it will, of course, happen. I just think it's very important, as well as democracy. Democracy and connectivity were also part of what was discussed, but some of the poverty alleviating type of programming that CIDA does get involved in, but hasn't been doing much of at all in the last few years, I'm pushing for that. I think it's extremely important.

Mr. Pierre Pettigrew: I agree with you. I think it's important.

I must say that I was very proud when the ministers speaking for the smaller economies, their representatives in Buenos Aires, after having explained the difficulty of the most vulnerable economies, outlined Canada's leadership. And that drew the attention of everyone around the table to what Canada had been doing, Canada's sensitivity to it. I was very proud of that.

Of course, in all the negotiations we will be quite open. We've always been open to a longer phase of obligations, for instance, for the developing countries. And we will demonstrate that openness in this particular case again.

We will also accompany, either through international institutions... And there again Canada has a role to play. I have myself developed a good working relationship with Enrique Iglesias. We're putting $40 billion over the next five years, following the Quebec City summit, precisely in support of initiatives that will make the free trade area of the Americas more accessible to the smaller economies. That is a lot of money. And we should add to that, of course, what individual countries will be doing. And Ambassador Zoellick sent a very clear signal on it. We will do things too outside CIDA.

For instance, one of the problems of these economies is that a lot of their income comes from tariffs. So what do you do when you eliminate tariffs? You lose your income. So we need to help them build taxation systems in their country, perhaps through income tax, which wouldn't be very good, because as you know, there is also sometimes a problem of income redistribution.

So you can count on us to play, across the board, the most constructive role, with the best engagement we can.

• 1635

Ms. Diane Marleau: I think it's very important on the agricultural front, because I think there were a lot of people who could benefit from some of the practices we've learned here.

There's also the aspect of the drug trade, which is a really big challenge, I think, for all of us. It's a challenge because it's a cash crop that pays a lot. How do we convince farmers not to be in that kind of a cash crop even more?

For me it was a very important question to ask. I will ask all of the other ministers, as well as the minister responsible for CIDA, because it's not an area we have really targeted over the last few years.

Mr. Pierre Pettigrew: You're right. It is not an area that we've targeted even in trade negotiations.

One of the problems is that in agriculture it is all pretty new. There has been a waiver of international trade discussions on agriculture since 1954. Therefore we are not very used to discussing international trade in agriculture. Many of the problems we live with in agriculture are precisely because there's been a lack of it.

Ms. Diane Marleau: It reassures me somewhat, but I hope we can get some more concrete plans before too long.

Thank you.

The Vice-Chair (Ms. Colleen Beaumier): Thank you.

Mr. Duncan.

Mr. John Duncan (Vancouver Island North, CA): Thank you, Madam Chair, and welcome, Minister.

I have a follow-up to a question I asked I believe late last week on the monitoring of softwood lumber exports. I understand that you're going to keep the April numbers non-public. So my question is, how do you dialogue with Canadian industry if the numbers become a concern unless they're published? Secondly, do we have any idea as to whether the U.S. monitoring numbers agree with ours or not?

Mr. Pierre Pettigrew: If American numbers agree with ours?

Mr. John Duncan: Yes. I understand they're monitoring it at the same time we are.

Mr. Pierre Pettigrew: Yes.

Mr. John Duncan: Are we actively comparing or not?

Mr. Pierre Pettigrew: We're talking to them, of course, but we don't share our numbers with the Americans at this stage. Our numbers are still too preliminary. We don't want to affirm too many things around them because the numbers are too preliminary. It's just one month.

However, we are informing both industry and provinces on the preliminary numbers we have right now, but just region by region so that they can actually adjust to the reality here. But we don't want to share them with the Americans at this stage. We do it through the softwood lumber trade associations, region by region.

Mr. John Duncan: So what you're confirming to me is that the numbers are out there but the public's being denied those numbers.

Mr. Pierre Pettigrew: No, we are negotiating with the Americans, and I'm not going to weaken Canada's position at this stage with preliminary numbers that could be used in all kinds of directions.

We want to use them tactically and strategically so that the people who can do something about them make sure they go in the right direction. But we don't want to play politics with an issue that is extremely important to the interests of so many Canadians. So it's not depriving the public. It is really making sure that the people who can do something about it can do the best possible with these preliminary numbers.

Mr. John Duncan: Thank you. That answers my original question.

On the log export decision, I understand the details regarding the WTO decision that was favourable to us are not going to be released until a later date, which is normal. First of all, can you give us an estimate of when that date will be? Also, these results would've been so much more helpful if they had come earlier. Why did we wait until September to make that reference when the industry was promoting that we do this as early as the previous January?

Mr. Pierre Pettigrew: I've been congratulated warmly for taking a pre-emptive strike. It is a very unusual way to go, raising a problem at the WTO level in a pre-emptive way. So now you're saying great, you've done it months ahead of time, because we normally go to the WTO when the problems actually occur, but you should've thought about it before.

• 1640

Fine. Yes, maybe we should have thought about it many years ago, but going in a pre-emptive way to the WTO is very unusual. It's very rare that we do it. I'm very proud we've saved some months on it.

I cannot comment on the preliminary report at this stage, but should it go in that direction, I don't think it would be harmful to our case at all.

Mr. John Duncan: Thank you.

The estimates from industry sources are that our legal fees for the softwood lumber dispute are going to cost somewhere in the range of $35 million on an annual basis. Some people have contrasted this, for example, with the cost of an export tax. If we were to sell, 15% would be in the order of $750 million.

Fear can divide Canadian industry and erode their resolve on this issue. What can we do to counteract the fear-mongering tactics of the U.S. lumber lobby so Canadian industry remains firm in their resolve?

Mr. Pierre Pettigrew: First of all, we should remind Canadian industry that last time $800 million was refunded because we won the case.

My view is it is an industry that is well prepared and has been establishing its councils. They're better organized than ever before and have found allies in the United States on the consumer front. They are very determined to make sure their interest is protected. They will promote it, and we will help them in that as best we can.

The Vice-Chair (Ms. Colleen Beaumier): Mr. Harvard.

Mr. John Harvard (Charleswood St. James—Assiniboia, Lib.): Thanks, Madam Chair.

Thank you for coming today, Mr. Minister.

I was happy to hear earlier so much support from both sides of the room for the British parliamentary system. I'm not too sure whether my good friend from Calgary understands the fundamentals of the parliamentary system as we know it in this country.

We have responsible government, responsible to Parliament, and the government has the right to negotiate treaties. Any impact those treaties have on statutes or laws provides a role for Parliament.

Mr. Pierre Pettigrew: I think it's very important that members can express themselves at this very prestigious committee of the House. I think Mr. Harvard has a lot to contribute to Canada's trade policy.

Mr. John Harvard: I want to say that the opposition likes to lead Canadians to believe there's no role for Parliament. There is a role.

Mr. Pierre Pettigrew: Absolutely.

Mr. John Harvard: If there's an impact on our statutes and our laws, that's where the role of Parliament comes in.

Minister, while we're saying positive things, I wish to congratulate you on your work to get release of the documents. We know it's a slow process, especially the translation, but it will come. I don't think two or three weeks will make a lot of difference. I understand you're not planning to have this work done until 2005, so we still have some time.

I have two questions on rather disparate subjects.

I'm a member of the heritage committee. I'd like to hear you say something regarding our cultural industries vis-à-vis the FTAA. I know some cultural nationalists are concerned about possible implications from the FTAA—although, on the other hand, there may be some great opportunities for our cultural industries. I wouldn't mind hearing a comment from you on that.

On the other subject, it's quite different. You pointed out in your opening remarks that there is this huge increase in trade around the world; it's up 15% from last year. Of course, most of that trade, about 85%, is with the Americans. That demonstrates that the Americans are dependent or reliant on our goods and services. They need our goods and services, and of course we need to sell them.

You would think with that kind of two-way trade there would be greater sensitivity for some of the problems we face. Yet we have, for example, softwood lumber, or, perhaps in some ways a better example, P.E.I. potatoes.

Why is it, Mr. Minister, we have these difficulties with P.E.I. potatoes, when the Americans need our goods and services? Why does there seem to be this imbalance in what really should be a reciprocal agreement, not only in terms of hard trade, but just in the way we relate to each other?

Mr. Pierre Pettigrew: Let me start, John, with the second question.

• 1645

We can negotiate protections, but we can't negotiate protectionism. That's the problem. There is protectionism in the United States. There is a tendency for softwood producers not to accept the competition from more productive and more modern Canadian mills. That is very frustrating, but we have to put it in perspective.

Trade disputes affect less than 5% of our trade with the United States and with other countries in general. It is frustrating, but our system still works very well. The disputes affect very few items. We have to fight for them.

The softwood lumber is a very good example. The Americans need our wood. They know it. They just want to slow us down and want to impose all kinds of things on us. They know at the end of the day they need our softwood lumber in an important capacity and quantity.

On the culture, you are right. Of course we will apply at the free trade agreement of the Americas what we are promoting elsewhere on culture. In my view, as a country, we're trying to protect culture. Cultural exports are important, and it is a very dynamic industry. We all want to export and import cultural goods. We are an open society and we're interested in seeing what other countries produce.

What is at stake here is the ability of government to continue to be able to promote culture and to invest in and help certain products to be developed in a country. That implies we cannot apply the same trade remedies and trade laws to cultural goods. You would not be able to do anything, because it would be considered to be a subsidy.

The usual trade laws that work very well for trade should not apply to cultural goods. As a country, we are promoting another instrument to deal with culture. It should not be subjected to the usual trade remedies and trade laws. We are in favour of trade in cultural goods. We all like to go and see foreign films and theatre, buy foreign books, and all those things. However, we want to protect the ability of government to invest and regulate in the field of culture so we keep some room for ourselves to develop. That's what we're trying to achieve.

[Translation]

The Vice-Chair (Ms. Colleen Beaumier): Madame Lalonde.

Ms. Francine Lalonde (Mercier, BQ): Thank you, Madam Chair.

At the end of an interesting period, minister, I want to ask you a number of short direct questions. First of all I'll come back to Chapter 11 and try to pull together the treads and ask two specific questions.

Mr. Pierre Pettigrew: First of all there is the issue of clarifying the NAFTA agreement. It's extremely important because there are cases pending and certain corporations are threatening to use Chapter 11 in order to have governments back down on certain issues that are of concern.

Yet on the weekend, you said to L'Express, with some frankness, that you had been asking your partners to clarify what this chapter was all about for some 18 months now but without success, you said. Tell us where we stand, because a great many things depend on where we stand. That's my first question.

And here's the second. Given this huge question mark regarding the NAFTA agreement, how is it—and now I know that you stand firmly with the government—that Prime Minister Chrétien, with fanfare, signed the Free Trade Agreement with Costa Rica, which repeats the contents of Chapter 11?

Mr. Pierre Pettigrew: No.

Ms. Francine Lalonde: Yes, I have it before me.

Mr. Pierre Pettigrew: There is no chapter on investment in the agreement with Costa Rica.

Ms. Francine Lalonde: I'm sorry but there is. We could perhaps discuss it after the meeting.

• 1650

Mr. Pierre Pettigrew: Do you have something that I'm not aware of? Mr. Carrière is obviously...

Ms. Francine Lalonde: It is a reference to the 1998 accord.

Mr. Pierre Pettigrew: To FIPA, but not to Chapter 11. No, the agreement... I'll let you continue.

Ms. Francine Lalonde: When we read the 1998 text, which again was signed with great fanfare, we see that it has the same difficulties as Chapter 11. Perhaps that escaped you and in preparation for the Quebec Summit you were proud to demonstrate that in other areas you had positions which would gradually lead to the elimination of tariffs. There is section 8 on expropriation which is very clear. That is my second question.

Other than Chapter 11, there are two other questions. Well, there are several, but as to the fight against poverty in those countries south of the United States, it was said at the Quebec Summit that efforts would be made. A fund was created and money was mentioned, but where will this money come from? As far as I know, Canada's contribution to the Inter-American Development Bank this year is exactly the same as it was last year. And as to CIDA, we know that in percentage term contributions are down. Therefore, where is this money going to come from? Are we going to have a supplementary budget? We are currently looking at the budget. How will this all come about?

And lastly, since you are at the head of the EDC...

[English]

Mr. Pierre Pettigrew: I wish.

[Translation]

Ms. Francine Lalonde: Well, you are to a certain extent. Let's say that you are the minister responsible.

Mr. Pierre Pettigrew: Yes, but it is a Crown corporation.

Ms. Francine Lalonde: Yes of course. That is my last question.

[English]

The Chair: I want to remind you that it's the five-minute round.

[Translation]

Ms. Francine Lalonde: For corporations, ethics become extremely important. We have critics of the EDC from all over. As the minister responsible, you are in a position to provide indications. Are you working on this?

Mr. Pierre Pettigrew: Ms. Lalonde, on this last question, I am very involved in the issue of corporate social responsibility. I worked closely with Mr. Axworthy, Mr. Manley's predecessor. There is some work being done on that score and we are going to take it into account in our relationship with the Export Development Corporation. And that will be part of the legislative review and the discussions we will hold with them.

You are quite right in saying that it is a very important issue, that of corporate social responsibility. Obviously, I would hope that we would move forward with other countries. It is always much more beneficial when we can work with Great Britain, France and the United States, to ensure that there is no unfair advantage anywhere. I agree.

[English]

I'm done?

The Chair: Perhaps you would like to address the—

Mr. Pierre Pettigrew: Other three questions.

The Chair: Wait till the next round or address it in writing. I have to be very strict with everyone, because it's—

Mr. Pierre Pettigrew: No, you're the chair, Madame.

Mr. Svend Robinson: Madam Chair, could you give him the opportunity to briefly reply?

[Translation]

Mr. Pierre Pettigrew: Would you like me to give it a go?

[English]

I can try in two minutes, Madam Chair.

The Chair: One minute.

[Translation]

Mr. Pierre Pettigrew: Fine.

This is why I have been demanding that for the last 18 months. You will have noticed that I have had a lot more success in my talks with the new governments. Mr. Derbez, who is my Mexican counterpart, and Mr. Zoellick have demonstrated an availability that, quite frankly, was not the case in the past, specially from the Mexican government. I will be in Washington next week at a trilateral meeting with Mr. Derbez and Ambassador Zoellick. This meeting will take place on Tuesday.

In terms of Costa Rica, we are referring to a FIPA, which stands for Foreign Investment Protection Agreement. This agreement existed already. Essentially, there are 400 million dollars of Canadian money invested in Costa Rica while no Costa Rican money has been invested in Canada. More than anything else, this agreement is geared to protecting Canadian investments in Costa Rica. It is not a matter of revisiting negotiations, or anything of the kind.

• 1655

In terms of addressing the issue of poverty, as the prime Minister said, we intend to increase CIDA's budget. In terms of the Inter-American Development Bank, the World Bank and the 40 billion dollars available from them, we will have to see how the Bank intends to reallocate this money and investments. As members of the board, we intend to support the Bank to follow up on Mr. Iglesias' proposals, which seem quite attractive. We were very happy with the proposals he made at the Quebec Summit.

Please excuse me. It was a bit brief, but...

The Chair: Mr. Paradis.

Mr. Denis Paradis (Brome—Missisquoi, Lib.): Thank you, Madam Chair.

First of all, Minister, I would like to congratulate you on having taken the initiative to convince your colleagues to publish the texts. It wasn't an easy task. I think that Mr. Paquette should at least recognize what you have done. There was undoubtedly some resistance from some countries, and you worked hard and you returned to Canada victorious, if I may pick up on the term that Mr. Paquette used. This victory has meant that the texts will be made public. You succeeded in convincing other countries. Therefore, I would just like to congratulate you on that.

In terms of trade relations, as you pointed out in your presentation, “Canada is a nation of free traders par excellence”. I won't follow Mr. Robinson's example. I am quoting exactly what you said. We are used to trading with our great southern neighbours, the United States. Within the FTAA, we will be required to increase our trade with Latin American countries.

As I have mentioned several times before, in Canada, we have both a civil and common-law code. This will undoubtedly be of use to us within the Free Trade Area of the Americas. Canada also has both a Latin and anglo-saxon culture. This is also a major advantage within the Free Trade Area of the Americas. We also have French, which is closer to Spanish. I would like to congratulate you on the courses that you are taking.

David Foot, who is an eminent population expert and professor at the University of Toronto, and is the author of a book entitled Boom, bust and echo, said that in terms of demographics, South America is going to become very important in the coming years. Perhaps it will be even more important given the creation of the Free Trade Area of the Americas.

I have one question. Do you think that additional concrete measures could be taken to assist our Canadian small and medium business? Larger companies are perhaps more aware of these international systems and are perhaps more used to doing business in different countries, but could we take additional steps to raise awareness among our Canadian small and medium business in terms of the size of these markets?

Mr. Pierre Pettigrew: Yes. First of all, thank you for your kind words on our victory in Buenos Aires. It was a very important issue.

I think that it is very important to emphasize the advantages that we have, specially our dual legal system. This allowed us, for instance, to be very helpful in South Africa, where CIDA and the Department of Justice really applied our different and complementary legal traditions to ensure that justice was done. I know that this was very useful. I refer especially to South Africa, because Diane and I worked on this in CIDA and we are very happy with the results. The Africans are also very happy.

Regarding SMEs, I did something last year that I would like to do more of, because I have been doing less of it for the past few months. In Canada, we are doing much more of what we call outreach. This year, I organized about 10 meetings in cities other than the large cities. I went to London, to visit Pat O'Brien. Small and medium size enterprises attended a seminar that lasted all day, with people from the Export Development Corporation and the Canadian Commercial Corporation in attendance. I invited four or five trade commissioners to these meetings from different cities all over the world. They came and told us what they could do for companies. It is working quite well.

• 1700

Mr. Denis Paradis: In view of what you just said, I officially invite you to come to Brome—Missisquoi.

Mr. Pierre Pettigrew: Bravo. With pleasure. We sell a great deal of Brome ducks in Argentina. I was impressed by the fact that fancy menus in Buenos Aires always offer Brome duck. It really is "Brome".

Mr. Denis Paradis: Terrific.

Mr. Pierre Paquette: Champagne does not always come from the region of Champagne.

Mr. Pierre Pettigrew: No, but it is...

Mr. Denis Paradis: Real Brome Lake duck.

Mr. Pierre Pettigrew: ...Brome Lake duck.

[English]

Mr. Svend Robinson: Madam Chair, I had a couple of follow-up questions for the minister, and I'll try to leave some time for the minister to answer the questions. I'll put the three brief questions to the minister.

The minister in his statement referred to the Quebec City Summit of the Americas among other things as fostering democratic rights. The minister will perhaps have had an opportunity to read the report of the five independent observers who were appointed by the Quebec government to monitor police actions in Quebec City and will be aware of the fact that they raised very grave concerns about a number of elements of the police action. In particular, they referred to the abusive use of tear gas and the firing of plastic-coated rubber bullets against protesters without any provocation whatsoever.

Mr. Pierre Pettigrew: One of them did.

Mr. Svend Robinson: In fact, hundreds of plastic bullets were fired. The Sûreté du Québec themselves indicated they fired over 300, and we still don't have the figures from the RCMP.

I want to ask the minister what his position is with respect to the call for an independent inquiry into this conduct. I want to be really clear that we're not speaking here about the response to violent protesters. I have spoken out strongly and clearly in categorically rejecting the violent attacks that were made on the police. They were quite unacceptable. But we're talking here about peaceful demonstrators. As the minister knows, I personally witnessed one particular incident in which the police fired tear gas and plastic bullets on people who were actually walking away. This is undemocratic. This is abusive. This is an assault.

I want to ask the minister for his position with respect to the call for an independent inquiry, including by former judge Marc Briere, into the conduct of the police. I would note as well that one of the protesters, Jaggi Singh, is being held without bail. He could be held for many months, and it would appear that he's being held in circumstances that are quite unacceptable, Madam Chair.

Mr. Pierre Pettigrew: Can I answer?

Mr. Svend Robinson: Yes, he can answer about the the independent inquiry. I'll put the second question and then the minister can respond.

I want to ask the minister as well about concerns that have been raised about the primacy of international human rights and fundamental ILO conventions over trade. The minister will know that the group Rights and Democracy, Warren Allmand's group, has urged that international human rights be given primacy over international trade law in the FTAA, and of course labour has as well suggested the same with respect to ILO conventions. What's the minister's position on that call?

Mr. Pierre Pettigrew: On the security issue I must first make it clear that I am not a security expert. I have heard very laudatory comments about the work of the policemen, that they have done a remarkable job. I know one of the five observers said that possibly an independent inquiry would be necessary because they could not be all over the place at all places.

I'll tell you that I think these people were under a great deal of pressure, very tough pressure, and faced tough conditions, and they were restrained and quite responsible. They made it possible for a meeting of 34 leaders to be functional, and to start on time and to do all of it on time. The 34 leaders were commenting and complimenting the Prime Minister on the extraordinary restraint of the police forces in our country, and I think we can be very proud of them.

Mr. Svend Robinson: How many were outside the wall and saw the police firing plastic bullets?

Mr. Pierre Pettigrew: We could see them pretty well. In any case, I've also seen a lot of other observers who have been saying very laudatory things and made very positive comments about their work.

On the primacy of individual rights, I am a Liberal, and there is nothing more important to me than individual rights. I will always fight for individual rights. I believe it is extremely important that we allow individuals to grow, to be healthy and better educated. This is absolutely imperative to me. And if there is one thing I'm aware of, it's that trade contributes to the ability of governments to provide better education and better health systems. To me, it is quite clear that trade leads to development and development leads to a better respect of individual rights. When the borders are open for the markets and the economies are open, it's very hard to have a political system that is closed.

• 1705

Mr. Svend Robinson: Look at China.

Mr. Pierre Pettigrew: Yes, look at China. I am confident that when they open their economy, it will lead to a better political system. That's the reason we're engaging them.

The Chair: Mr. O'Brien.

Mr. Pat O'Brien (London—Fanshawe, Lib.): Thank you, Madam Chair.

First, Minister, to one of our colleagues you mentioned that there's no need to reopen NAFTA chapter 11. I think you were quite clear about that, but I wonder about the clarification you seek to achieve. I wonder if you could tell the committee exactly how that might be done.

I've listened to my colleague Mr. Obhrai several times now wanting to change the system of how we handle trade and to have this vote before there is a negotiation, but what's very interesting—and he cites the Americans, and other of his colleagues have done that—is that what the Americans seek right now is fast-track authority or trade promotion. Aren't they, in effect, trying to achieve a system that is more like ours, where you wouldn't be hidebound because of a whole bunch of congressmen and senators sitting around negotiating every comma in all these clauses? That's how it seems to me, so I'd be interested in your view there, Minister.

Lastly, Canada and Costa Rica are two such different countries. I know Costa Rica will gain substantially from this deal, and I think that's great. What will we get from this deal? Which of our industries are going to gain? And is the deal with Costa Rica about more than just trade.

Those are my questions, Madam Chair. Thank you.

Mr. Pierre Pettigrew: Thank you very much.

On Costa Rica, we are demonstrating that it is possible for a small, less-developed country and a larger, developed country to go the route of free trade. I think it is an interesting signal to send to the Americas, leading to 2005, demonstrating clearly that we've been successful at negotiating one. It will be good for our businesses, because there is an opening of Costa Rica, on a slower schedule, so they can adapt, and this is our contribution, in order to give our people better access. I think it will be good for investment as well, because it gives you some security for the investments.

On the chapter 11 question, obviously, the parties are sovereign and may interpret the provisions of chapter 11 as they want, or as they do in their own culture. Our view is that we want to clarify some of the provisions in chapter 1, which would give future tribunals clearer and more specific understanding of chapter 11's obligations, as originally intended by the drafters. There are mechanisms to do so within the agreement, so it is not a reopening, but it is a parallel thing to help tribunals and guide them in their future interpretations, to make sure they don't go in a direction that does not reflect the true intentions of the drafters.

The Chair: Thank you.

Mr. Casey.

Mr. Bill Casey: Thanks very much.

I want to return to the softwood lumber for a few minutes. The four Atlantic premiers have asked repeatedly that the maritime accord be reinstated. Is there any effort to renegotiate the maritime accord?

Mr. Pierre Pettigrew: We're not negotiating with the Americans. Let me be very clear—every word is so important in this job. We are not renegotiating, and we are not negotiating anything with the Americans right now. We're in dialogue, we are consulting, we are exchanging. I'm in Washington next Tuesday, and I'd be surprised if the issue is not raised when I meet Zoellick. I have a trilateral meeting, but I'll certainly have a bilateral too.

• 1710

We are not negotiating with the Americans. We have expressed our views very clearly that we should take a province-specific approach. We have encouraged the Americans to stay aware of the fact that there is no allegation concerning any Atlantic commercial practices that involve subsidies subject to countervailing duties. We are encouraging them to think like that, and we are certainly going to keep that in mind in any future consultations with the Americans.

Mr. Bill Casey: If you do start to negotiate at some point—and I think that will probably happen—the four Atlantic provinces have asked repeatedly for a maritime accord. Will you negotiate for a maritime accord?

Mr. Pierre Pettigrew: You say “if”. I cannot answer a hypothetical question. I continue to work very closely with the industries of this country and with the provinces. We will see where it leads, but we are not negotiating, and we are encouraging the commerce department to respect the fact that U.S. producers have not made any allegations of subsidies in the Atlantic provinces. I hope very much that this company exclusion leads to the sort of practices we've been having for 20 years in Atlantic Canada. That's the Canadian position.

Mr. Bill Casey: So the present strategy is to establish arguments against the actions of the Americans. Is that what the department is doing?

Mr. Pierre Pettigrew: Absolutely. We're going to fight them on behalf of British Columbia, Alberta, the prairies, Ontario, Quebec, and Atlantic Canada. We're going to fight all the allegations of the Americans.

Mr. Bill Casey: The other question I have—my understanding is that we discussed this in the House one day—is to ask whether the duties from countervail and anti-dumping could be retroactive if the Americans imposed the worst-case scenario of special circumstances.

Mr. Pierre Pettigrew: It would take critical circumstances.

Mr. Bill Casey: Critical circumstances. That is a possibility. It's probably not likely, but is it a possibility? Does industry know this? Has the department made any effort to inform industry?

Mr. Pierre Pettigrew: Trust us. We have. The industry knows this very well, and that's why I put softwood lumber on the export control list just a few days before the end of the softwood lumber agreement. I am monitoring those numbers, I have shared them, and we are sharing it now with industries region by region, so they know very well where we're going. For the time being I can reassure you that we have not met the critical conditions. So far there is no export search that would justify the Americans going in that direction.

Mr. Bill Casey: Okay. Thank you.

The Vice-Chair (Ms. Colleen Beaumier): Thank you.

Mr. Obhrai.

Mr. Deepak Obhrai: I just wanted to say, Pat and John Harvard, you don't have to protect the minister. I know him well; he can handle himself.

Mr. Pierre Pettigrew: No, but it feels good to have the majority on your side.

Mr. Deepak Obhrai: I have all your reports and everything,and it's fine about trade. You know what my position—and our position—is. A question here that bothers me, which is a flag, is the reason our 10% of GDP has gone to 45%, almost half, and most of it is with the U.S.A. Our trade with Japan and everybody else, including the European Union, is going down. With the exception of Costa Rica we have no new trade agreements we've concluded with either the European Union, Japan, or anyone else. We are really putting all our eggs in one basket, and this trend is getting bigger and bigger.

We need to diversify our markets. Even your Team Canada trade missions have not led to any new markets per se if you look at your trade figures. You have said you have a lot of trade officials all over the world. We need to be cautious of the fact that everything is with the U.S.A. Where is your initiative? Where is your department's initiative to really move this into a bigger, diversified market?

• 1715

Mr. Pierre Pettigrew: We support our exporters to the United States very strongly because it's a blessing to live beside a market that wants your goods so much. It is to me a very great advantage. Indeed, we have consulates and an important presence the Canadian government supports there. There are lots of visits in that direction. Our trade with the rest of the world is not going down. Relatively speaking, it is not going up as much as our trade with the United States, but what do you want? We live beside the most dynamic economy in the world, an economy that is extremely consumer-oriented. Of course we accommodate them.

Frankly, if after my years as Minister for International Trade they conclude that Pettigrew corrected the situation so we now have 50% of exports to the U.S. and 50% to the rest of the world, I would be happy only if that 50% amounted to more than the 85% does now. All these things are relative numbers.

For me, what is important is that we export $2.5 billion a day. The Americans buy most of it, and so be it. Some of that is rerouted to Latin America or to Asia as well. When we ship from B.C. to Seattle, Statistics Canada looks only at the first destination. It does not look at the second or third destination, so we have to take this with a grain of salt.

Our efforts with Team Canada and with other means are certainly designed to sensitize business people and to open new markets as well because we believe we should be selling everywhere.

Mr. Deepak Obhrai: You tell me that the committee is going to Europe. Maybe we should cancel that trip and concentrate on the U.S.A.

Mr. Pierre Pettigrew: Go for it! Sell!

Mr. Deepak Obhrai: Thank you.

The Vice-Chair (Ms. Colleen Beaumier): Madame Lalonde, I'm going to allow you a little question.

[Translation]

Ms. Francine Lalonde: Thank you, Madam Chair.

Regarding the free trade agreement with Israel, in 1999, the United Nations General Assembly asked Israel to make a list of products made in occupied territories. Are we are interested in finding out whether products imported from Israel to Canada come from occupied territories or not? I know that this is a specific question, but it could be important in view of the difficult situation there.

[English]

Mr. Robert G. Wright (Deputy Minister, International Trade, Department of Foreign Affairs and International Trade): The answer to that, if I may respond to it, is that the agreement itself indicates quite clearly that the products subject to the free trade agreement with Israel must come from the customs area controlled by the State of Israel. The customs union defined by the State of Israel covers the products under that agreement.

[Translation]

Ms. Francine Lalonde: We do not know.

[English]

Mr. Robert Wright: We do this through the establishment of rules of origin, and our customs agents look at the determination of where the product comes from as defined by the customs area of the State of Israel. I think that's the answer.

[Translation]

Ms. Francine Lalonde: Thank you.

[English]

The Vice-Chair (Ms. Colleen Beaumier): Thank you.

And thank you, Minister. Your staff let me know at the beginning that they wanted you out by five, and we thank you for the additional time.

Mr. Pierre Pettigrew: Thank you.

The Chair: Okay, thank you.

The meeting is adjourned.