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37th PARLIAMENT, 1st SESSION

Standing Committee on Foreign Affairs and International Trade

EVIDENCE

CONTENTS

Tuesday, June 4, 2002

0905

The Vice-Chair (Mr. Bernard Patry (Pierrefonds—Dollard, Lib.))

Professor Isaiah A. Litvak (Faculty of International Business, Florida Atlantic University)

0910

0915

The Vice-Chair (Mr. Bernard Patry)

Mr. Keith Martin (Esquimalt—Juan de Fuca, Canadian Alliance)

The Vice-Chair (Mr. Bernard Patry)

Mr. Keith Martin

Prof. Isaiah A. Litvak

0920

0925

The Vice-Chair (Mr. Bernard Patry)

0930

Prof. Isaiah A. Litvak

Mr. Pierre Paquette (Joliette, BQ)

Prof. Isaiah A. Litvak

Mr. Pierre Paquette

Prof. Isaiah A. Litvak

0935

Mr. Pierre Paquette

Prof. Isaiah A. Litvak

0940

The Vice-Chair (Mr. Bernard Patry)

Mr. Sarkis Assadourian (Brampton Centre, Lib.)

Prof. Isaiah A. Litvak

0945

Mr. Sarkis Assadourian

Prof. Isaiah A. Litvak

The Vice-Chair (Mr. Bernard Patry)

Mr. John Duncan (Vancouver Island North, Canadian Alliance)

0950

Prof. Isaiah A. Litvak

Mr. John Duncan

Prof. Isaiah A. Litvak

The Vice-Chair (Mr. Bernard Patry)

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.)

0955

Prof. Isaiah A. Litvak

The Vice-Chair (Mr. Bernard Patry)

Mr. Donald C. Sinclair (Director General, Middle East and North Africa Bureau, Department of Foreign Affairs and International Trade)

1010

The Vice-Chair (Mr. Bernard Patry)

Mr. Keith Martin

The Vice-Chair (Mr. Bernard Patry)

Mr. Donald C. Sinclair

1015

Mr. Keith Martin

Mr. Donald C. Sinclair

Mr. Keith Martin

The Vice-Chair (Mr. Bernard Patry)

Ms. Francine Lalonde (Mercier, BQ)

Mr. Donald C. Sinclair

1020

Ms. Francine Lalonde

Mr. Donald C. Sinclair

The Vice-Chair (Mr. Bernard Patry)

Mr. Sarkis Assadourian

Mr. Donald C. Sinclair

1025

1030

The Vice-Chair (Mr. Bernard Patry)

Ms. Alexa McDonough (Halifax, NDP)

Mr. Donald C. Sinclair

1035

Ms. Alexa McDonough

Mr. Donald C. Sinclair

The Vice-Chair (Mr. Bernard Patry)

Mr. John Harvard (Charleswood St. James—Assiniboia, Lib.)

Mr. Donald C. Sinclair

1040

The Vice-Chair (Mr. Bernard Patry)

Mr. John Harvard

Mr. Donald C. Sinclair

The Vice-Chair (Mr. Bernard Patry)

Mr. John Duncan

Mr. Donald C. Sinclair

Mr. John Duncan

1045

Mr. Donald C. Sinclair

The Vice-Chair (Mr. Bernard Patry)

Mr. Stan Keyes (Hamilton West, Lib.)

Mr. Donald C. Sinclair

The Vice-Chair (Mr. Bernard Patry)

Mr. Denis Halliday (Individual Presentation)

1100

1105

The Vice-Chair (Mr. Bernard Patry)

Mr. Scott Ritter (Individual Presentation)

1110

1115

The Acting Chair (Ms. Diane Marleau (Sudbury, Lib.))

Mr. Keith Martin

1120

The Vice-Chair (Mr. Bernard Patry)

Mr. Scott Ritter

1125

The Vice-Chair (Mr. Bernard Patry)

Ms. Francine Lalonde

Mr. Denis Halliday

1130

Mr. Scott Ritter

1135

The Vice-Chair (Mr. Bernard Patry)

Ms. Aileen Carroll (Barrie—Simcoe—Bradford, Lib.)

The Vice-Chair (Mr. Bernard Patry)

Mr. Scott Ritter

Ms. Aileen Carroll

Mr. Scott Ritter

Mr. Sarkis Assadourian

Mr. Scott Ritter

Ms. Aileen Carroll

Mr. Scott Ritter

The Vice-Chair (Mr. Bernard Patry)

Mr. Denis Halliday

1140

The Vice-Chair (Mr. Bernard Patry)

Ms. Alexa McDonough

The Vice-Chair (Mr. Bernard Patry)

Mr. Denis Halliday

1145

The Vice-Chair (Mr. Bernard Patry)

Mr. Scott Ritter

The Vice-Chair (Mr. Bernard Patry)

Mr. Sarkis Assadourian

1150

The Vice-Chair (Mr. Bernard Patry)

Mrs. Marlene Jennings

The Vice-Chair (Mr. Bernard Patry)

Mr. John Duncan

The Vice-Chair (Mr. Bernard Patry)

Mr. Scott Ritter

1155

The Vice-Chair (Mr. Bernard Patry)

Mr. Denis Halliday

1200

The Vice-Chair (Mr. Bernard Patry)

Mr. Seyed Ali Ahani (Vice-Minister for Europe and the Americas, Ministry of Foreign Affairs, Islamic Republic of Iran)

1220

1225

1230

The Vice-Chair (Mr. Bernard Patry)

Mr. Keith Martin

The Vice-Chair (Mr. Bernard Patry)

Mr. Seyed Ali Ahani

1235

1240

The Vice-Chair (Mr. Bernard Patry)

Ms. Francine Lalonde

Mr. Seyed Ali Ahani

1245

1255

The Vice-Chair (Mr. Bernard Patry)

Mr. Sarkis Assadourian

Mr. Seyed Ali Ahani

1300

1305

The Vice-Chair (Mr. Bernard Patry)

Mr. Irwin Cotler (Mount Royal, Lib.)

1310

The Vice-Chair (Mr. Bernard Patry)

Mr. Seyed Ali Ahani

1315

Mr. Irwin Cotler

Mr. Seyed Ali Ahani

Mr. Irwin Cotler

Mr. Seyed Ali Ahani

1320

The Vice-Chair (Mr. Bernard Patry)

Mr. Seyed Ali Ahani

The Vice-Chair (Mr. Bernard Patry)

CANADA

Standing Committee on Foreign Affairs and International Trade

NUMBER 087

1st SESSION

37th PARLIAMENT

EVIDENCE

Tuesday, June 4, 2002

[Recorded by Electronic Apparatus]

¿ (0905)

[English]

The Vice-Chair (Mr. Bernard Patry (Pierrefonds—Dollard, Lib.)): Members, the order of the day, pursuant to Standing Order 108(2), is a study of North American integration and Canada's role in the light of new security challenges.

We have as a witness this morning, from Florida Atlantic University, Professor Isaiah Litvak, a professor of international business.

Welcome, Professor. It's a real pleasure to have you with us this morning. I understand you have a presentation for us. The floor is yours, and after that we'll pass to the questions from members.

Professor Isaiah A. Litvak (Faculty of International Business, Florida Atlantic University): Thank you very much, Mr. Patry.

Good morning, Mr. Chairman and members of the committee. It is certainly a pleasure to appear before you today. As a citizen of Canada and now a resident of the United States, I welcome this opportunity to participate in your public consultation process as you proceed to study the current state of the North American relationship.

I understand that my recent publication, The Marginalization of Corporate Canada, which was published by the Canadian Institute of International Affairs, was made available to members of the committee. Today I would like to provide a few comments regarding the questions raised in the background paper entitled “Part V--The Canada-United States Economic Relationship”, which was prepared for this committee by the Parliamentary Research Branch and dated February 5, 2002.

The overarching theme of my comments is that the status quo in the Canada-U.S. economic relationship is not likely to continue. Desired changes in the relationship will be more proactively pursued by Canadians than Americans. The agenda for change and action will have to originate with the Canadian side, led by its political and business leaders. The United States will have to be convinced of the benefits that may result from a further deepening of the economic relationship between the two countries. I don't mean to be provocative, but I'm very sincere in those observations.

There are 17 questions posed in the Canada-United States economic relationship paper. While all these questions are deemed relevant, they flow naturally from the first question--namely, “Should Canada actively develop a clear vision for the future of the Canada-U.S.--and the North American--economic relationship? In your opinion, should this vision include a deepening of existing trade and investment links?”

My short answer is, yes, I believe it is in Canada's interest to do so. From my perspective, however, the question might be better posed as follows: “In light of the deepening of existing trade and investment links between Canada and the United States, what clear vision should Canada develop for the future of the Canada-U.S. and North American relationship, and what is the path to action that will best suit Canadian interests and reflect Canadian values?”

In short, the future is here, and the challenge to Canadians is what to make of it.

My comments are largely economic- and business-centred. By now you have been introduced to numerous studies and regaled by many witnesses about the nature and the magnitude of the Canada-U.S. economic relationship, a relationship increasingly becoming deeper, broader, and of course asymmetrical. There isn't a major event or development in Canada that is not gauged against U.S. performance and U.S. criteria. Not a week, and frequently not a day, goes by without Canada's major media carrying at least one story on Canada's relations with and/or benchmarking Canada's performance to the United States.

Canada and Canadians are fixated, focused, and obsessed with respect to the United States. The flip side of the coin is that the United States hardly notices Canada and Canadians. This makes the challenge even more formidable, because when Canadians raise critical issues with Americans, they frequently are viewed as complainers. Unless Canadians and their leaders can agree not just on a vision but also on a strategy on how best to negotiate and leverage the country's economic relationship with the United States, we stand to lose ground to U.S. interests and those of other countries in head-to-head competition in the global marketplace.

¿ (0910)

Countries ostensibly do not compete, while companies do compete. This is the oft-heard expression. Locational site competition between countries for head and regional offices, research and development laboratories, and plants testify to the contrary. Capital has no nationality. Business organizations increasingly make investment and location decisions through the prism of a growing borderless world.

The relative attractiveness of the Canadian business environment, compared to the U.S., will determine not only how successful Canada will be in retaining and attracting foreign direct investment but also whether it will be successful in convincing Canadian-based companies to forgo the U.S. lure in favour of retaining corporate head offices and growing corporate business operations in Canada.

I think this has been made abundantly clear, in the past few months, with numerous speeches made by chief executive officers of corporations in not only the financial services industry but also other sectors of the Canadian economy.

The heavy economic dependence on and interrelationship with the United States demands that Canadian policy-makers, when developing initiatives in such areas as taxation, competition, technology, environment, exporting, and so forth, test the potential impact of the policy in light of this interdependence. To do otherwise is to invite potential consequences that may be somewhat negative and ones that Canada can ill afford to absorb. The challenge for Canada is one of retention and growth of investment, one that is enhanced by Canada's membership in NAFTA.

The lure of the U.S. is a magnet that attracts direct investment on the part of Canada's most competitive firms, both large and small. It also increasingly includes the transfer of headquarter operations, in part or in whole, to U.S. locations. As importantly, a growing number of Canada's brightest professionals and budding entrepreneurs are being enticed to move to the United States.

The combination of developments has added an additional competitive policy challenge to the governments of Canada and the provinces.

Let me share a recent experience of mine. I completed a five-lecture series at the Kellogg-Schulich executive MBA program. For those of you who are not familiar with this program, the Kellogg School of Business in the United States is part of Northwestern University. It's usually ranked, if not number one, in the top three, along with institutions such as Harvard. The Schulich School of Business is part of York University. It's also ranked in the top three with institutions such as the University of Western Ontario, the Richard Ivey School of Business, and the University of Toronto's Rothman School of Business.

There are 42 young Canadian executives enrolled in this program. They're jointly taught by faculty members from Kellogg and Schulich. My participation comes as a result of the fact that I'm the Pierre Lassonde Professor Emeritus from the Schulich School of Business, where I taught for about twenty-two-and-a-half years up until about three years ago.

Most of the participants are executives of large and small Canadian companies, both Canadian-owned and foreign-owned. Some of them are successful entrepreneurs who have established high-tech firms in Canada. I think we can be very proud of their contributions. The excellent quality of the executive MBA is what attracted them to the program at the Kellogg and the Schulich faculty.

However, there can be little doubt that a joint U.S.-Canada executive MBA in 2002, one that enhances one's ability and opportunity to work in the United States, is a compelling benefit offered by this type of cross-border executive MBA. I suggest there will be other such cross-border executive MBA programs in the coming years, involving some of our better schools with some of the better schools in the United States.

Many of the young executives are giving serious consideration to moving to the United States to pursue career and entrepreneurial opportunities. In essence, one of the major attractions of the cross-border executive MBA is they would have diplomas that identify a major American institution along with a major Canadian institution.

¿ (0915)

So when we talk about deepening trade and investment links, let me assure you that the business community...and certainly the professionals not only in business schools also medical schools. There's nothing unique about this in terms of our brightest physicians graduating from our top schools, be it in Ontario, Quebec, western Canada, or Atlantic Canada, also doing much the same, taking exams so they can in fact practice in the United States. So this is a trend that is being accelerated.

In brief, the issue to tackle from my vantage point is not the deepening of Canada's relationship with the United States, which to me is a reality, but rather the type of public policy environment that will help make Canada--and this is, to me, a very important point--the preferred choice for business locations and growth in the North American space. I think this is, quite frankly, a major challenge facing you as political leaders of this nation-state.

I'll stop at this point. I've taken what I would normally expect would be a reasonable ten-minute introduction. I'm more than happy to share any of my views with you.

Thank you.

The Vice-Chair (Mr. Bernard Patry): Merci beaucoup, Professor Litvak. As you just mentioned, we're going to go to question period now.

I'll start with Mr. Martin.

Mr. Keith Martin (Esquimalt—Juan de Fuca, Canadian Alliance): Thank you, Professor Litvak, for attending here today. We're honoured by your presence.

One of the challenges we have is how to put our case forward in Washington, how to be heard, or how to get on the radar map, as you said. I'd like you, please, to address that from your perspective as a Canadian working in the United States. How can we best put our case forward most effectively in the halls of Washington?

Second, in our trade battles with the United States we're looking for a better dispute resolution mechanism, perhaps a mechanism that enables us to prevent some of these challenges to our bilateral trade relationship. Perhaps you could address this.

Last, if you were the Minister of Finance in Canada, what microeconomic and also macroeconomic changes would you institute in order to make Canada a more favoured place in which to set up business, not only for Americans, but also for people in other parts of the world, and to enable our companies to be more competitive?

Thank you.

The Vice-Chair (Mr. Bernard Patry): Thank you very much, Mr. Martin. You've taken one minute and fifteen seconds per question. That's great.

Mr. Keith Martin: I'm trying to keep up with Professor Litvak.

The Vice-Chair (Mr. Bernard Patry): No, that's great.

Professor Litvak.

Prof. Isaiah A. Litvak: I'll try to tackle the three questions. Let me say that I'd like to first tackle the question in terms of how Canada can best put forward its case in Washington, followed by, if I were the Minister of Finance, what kind of policy I would put in play to make Canada the preferred choice of location in North America, and hopefully in a global context; certainly North America is the critical one. That might in part answer the NAFTA and the panel situation, if you will.

Let me give you an anecdote as a way of illustrating. I had the pleasure of being brought in by one of the sectoral advisory groups on international trade at the time the negotiations were taking place between Canada and the United States with respect to the free trade agreement. This goes back quite a few years, inasmuch as the agreement was ratified and put in play in 1989. I was spending some time in Washington. At that time the U.S. trade negotiator, the head of the U.S. Trade Representative Office, which is part of the executive in the United States, was the late Peter Murphy. I don't know if you had occasion to meet with Peter Murphy at that time. I met with him and his deputy, Mr. Bill Merkin, at that time. This had to do with obtaining insights with respect to this particular SAGIT committee.

I had no problem, as a Canadian, recognizing Mr. Peter Murphy--aside from the fact that he stood about 6'4 “or 6'6” in height. And I'm not exactly tall, so talk about an asymmetrical relationship. I saw his picture in the newspaper--whether it was in the Globe and Mail or Toronto Star or Ottawa Citizen or what have you--almost on a daily basis in the years preceding the ratification of the Canada-U.S. Free Trade Agreement. I also saw him on TV all the time.

I made note of that when I was introduced to him. I said, “My God, I feel as if I've known you for some time, thanks to the media in Canada.” He said, “Let me share an interesting experience that I'm acquiring right now. When I'm in Canada I'm recognized by people on the street. If I step out of the U.S. Trade Representative Office”--it's just a stone's throw away from the executive offices at the White House--“hardly anyone, in fact no one, recognizes me. There might be 80 people in Washington, and not necessarily the most important, with the exception of the President of the United States, who know who I am.”

I think this is rather important. When we talk about the fact that Canada doesn't have much visibility in Washington, the thing to also acknowledge is that the people who are responsible for negotiating with Canada don't have much visibility, even though they're responsible for negotiating not only with Canada but with all the countries of the world. I think that's an important point.

The other important point to recognize is that there are only a handful of American scholars who have an interest in Canada--just a handful, and they are the same scholars over and over for years. They just don't fade away; they're just there, and their numbers are not exactly growing. If I were to look at the various people who have appeared before this committee, I have no problem identifying who they are, what their views are, and they tend to be concentrated just in a few little institutions.

I might also add that these particular scholars don't necessarily appear--with a few notable exceptions, I must confess--that often on television in the United States, or are not that often interviewed on radio, and in fact would have difficulty getting their views published in important newspapers such as the Washington Post, the New York Times , and the Wall Street Journal. That tells you something about the lack of interest in the Canadian scene. By the same token, there are very few institutions that really have a course that deals with Canadian-U.S. relations. Those courses, with notable exceptions, such as Johns Hopkins' SAIS, are not exactly patronized by many of the graduate students.

¿ (0920)

In fact, when I last gave a lecture at Johns Hopkins, this past October, on Canadian-U.S. business relations, I had the distinct impression that of that group of 30 students or so who were there, at least one-third to one-half were Canadians doing their Masters in international affairs. Those are some of the particular problems.

By the same token, I now live in south Florida--I'm sharing with you some experiences here, which I think are very appropriate--and all the snowbirds are there from Canada, from Ontario and Quebec. They're coming there in droves. At some point there are thousands and thousands of these people enjoying the sun.

Is there much in the way of visibility with respect to the Canadian scene? Hardly. If you were to talk with the person who's elected to the House of Representatives about some sensitivity to Canadian issues, or Senator Graham, one of the two senators from the state of Florida, Canada just doesn't loom large.

Now, does one need to be depressed about it? Definitely not. But let me say this: There is no Canadian lobby. I live in south Florida today. I just completed three years of residency, with all the hurricanes and tornadoes associated with it. But there certainly is a Cuban lobby, a Hispanic lobby, and a Haitian lobby.

If you're in the city of New York... One of the former consuls general said to me and to a few other people, when I was working at the Americas Society, “God, it would be nice to have a Canada Day, the way you have a St. Patrick's Day and all the Irish come out.” He lamented to me and said, “If we had a Canada Day, how many Canadians do you think would come out?” There are hundreds of thousands of Canadians living in the tri-state area, but they simply melt away.

I was in Los Angeles five weeks ago with regard to the runaway of production. You have Canadians all over the place, but are people aware that there are Canadians? Could they actually come out? Do they actually make a point? Outside of Wayne Gretzky and his remarkable job with respect to the Canadian hockey team, no.

Now, that's important. Why is important? Although the United States is a global economic and political power, its particular policy is made locally. So when you're looking at, for example, the House of Representatives, and even the Senate, which has as its members some of the most distinguished statesmen in the United States, the politics are local.

I don't have to tell you, because you can explain this to me better than I can to you, about the separation of powers. The concern is with the election. So you appeal and address to local interests. Local interests will override, quite often, what we would expect American national interests to be.

How do you put the best case forward? I don't have a simple answer to that, but you're not going to be able to put the best case forward by simply linking up with a handful of people in the executive branch. You're not going to be able to put the best foot forward by having things done purely at the ambassadorial level. You won't put the best foot forward unless bridges and links are made with members of the House of Representatives and the Senate.

One of the things I would view as being very positive in 2002 is the increasing activity by provincial government leaders in meeting with their counterparts on a regional basis. I just spent some time in Saint John, New Brunswick, three or four weeks ago. There was a major conference involving Atlantic Canadian leaders, and leaders of New England.

This is important. The best way to build sensitivities that can be translated in Washington into something more significant, so that Canadian interests will have a better airing, from my vantage point, is through stronger alliances and partnerships at the local level. That means at the regional level, but not at the regional level to the exclusion of national interests. I think that's an important caveat.

Mr. Martin, if I had to say something that's sort of more unique, it's that I consider it to be rather important to work with the provincial governments and recognize the important role the provincial governments can play in their relationships in strengthening of trade and investment links. You want to strengthen the trade and investment links between Canada and the United States, but you want to strengthen the trade and investment links between the provinces and the states of our two countries. The more interdependent they become, and the more dependent they become on each other, the stronger the Canadian voice in Washington will be.

¿ (0925)

Now, this doesn't mean to the exclusion of our having able ambassadors in Washington, or parliamentarians from Ottawa meeting with their counterparts in the United States. But it is my argument that you have to work at both levels.

This brings us also into another area.

The Vice-Chair (Mr. Bernard Patry): I'll have to stop you, Mr. Litvak, because we have 10 minutes for every party.

We are now going to go to the Bloc Québecois.

¿ (0930)

Prof. Isaiah A. Litvak: Mr. Patry, you'll have to excuse me. I'm an academic, so you'll have to stop me. This is a major failing.

[Translation]

Mr. Pierre Paquette (Joliette, BQ): Thank you, Mr. Chair. Thank you for your presentation. I have several brief questions. Perhaps my question will allow you to wrap up your answer to Mr. Martin's questions.

You focus a great deal on the relocation of corporate headquarters, however, one of the features of the Canadian and Quebec economies is that they are largely based on small and medium business, which are a lot less mobile. I would like to hear your take on this feature of the Canadian economy as it relates to a potential loss of authority where companies transfer their headquarters elsewhere.

You also omitted to mention the role of Mexico. I'm aware that we are focusing mainly on Canada-U.S. relations, but I would like to know whether you have a vision for the potential role that Mexico could play in our relationship with the Americans.

You touched on the issue of a common currency. This is a topic, of broad discussion in the business community. Even the Conseil du patronat du Québec held a one-day conference on this issue. Could you perhaps comment on that issue also?

[English]

Prof. Isaiah A. Litvak: Let me say, Mr. Pierre Paquette, I think I know the gist of your question, but my French is not that good. To be on the safe side, so that I do answer and also do justice to your question, would there be a way that I could...? I made a mistake.

[Translation]

Mr. Pierre Paquette: I'll repeat what I said very briefly.

I have three questions, the first of which deals with the role of small and medium enterprise. In your presentation, you focused largely on the transfer of corporate headquarters, and although I do think that this is a concern, I also think by the same token, that we have to recognize that both the Canadian and Quebec economies are essentially SMI-driven. I would like to know what the impact of this particular feature of the economy is?

Secondly, what role could Mexico play in our relations with the Americans?

My third question deals with the current debate on a common North-American currency. This issue is a matter of current discussion, and I would just like to point out that even the Conseil du patronat du Québec organized a one-day conference devoted to this particular topic. Could you tell us what your take on all this is?

[English]

Prof. Isaiah A. Litvak: With respect to the small to medium-sized enterprises in Quebec, not only am I aware of the SMEs in Quebec, but I'm also aware of the contribution they have made to the economy of Quebec. By the same token, I also believe that the importance of SMEs is equally significant for the rest of Canada, including provinces such as Ontario.

I've had the pleasure of looking at some of the SMEs in Quebec in the past couple of years with respect to the plastics industry--plastics products manufacturers--in which Quebec has excelled rather significantly. I think one of the key things here is ensuring, as they expand outside of Quebec, outside of Canada, and particularly with respect to the United States, that they have an environment that is, shall we say, very conducive and supportive to their operations.

For example, again staying with the plastics industry, the community colleges in Quebec, the universities in Quebec, have invested heavily in the field of polymer chemistry. They've done an excellent job with respect to training. They've done much in the way of assisting the companies in terms of developing an exporting capability.

What has to be understood is that small and medium-sized companies suffer from a resource poverty. In other words, in order to survive and to grow, they need the kind of services they are not able to afford at the early stages of their development. So those kinds of services will go some distance, but as they expand and become more successful in the United States, in particular, what has to be done is to look very carefully at making the environment competitive with respect to the U.S. in order to retain them in Quebec.

I might add, Mr. Paquette, frankly speaking, in Quebec society, and particularly with respect to the francophone community by virtue of its cultural and linguistic heritage, the executives of small and medium-sized enterprises feel themselves much more anchored in the region itself than is the case, for example, in other parts of Canada. This is not to suggest that the owner-managers of SMEs in other parts of Canada are any less loyal to their provinces or to the country of Canada. But for whatever reason, and I think we know some of the reasons, there is a much greater reluctance to consider that option of expanding to the United States in part or in whole with respect to the head office operations themselves.

On the second question, with respect to Mexico, I think it is imperative that Canada develop stronger linkages with Mexico and achieve a better understanding of the economy in Mexico or the political system in Mexico and explore ways and means by which Canada can become more active in developing business with Mexican operations. We should not look at the Mexicans to do what has to be done to succeed in Canada, but we should look at the Mexicans from the standpoint of what can we do to succeed in Mexico.

I might also add that, possibly for cultural and linguistic reasons, owner-managers of small and medium-sized firms in Quebec on the whole feel a little more comfortable developing commercial ties with their counterparts in Mexico. That is a reality. Whether it is because of the language factor or... I'm not willing to comment. But on the whole they're more comfortable.

By the same token, I might add that a growing number of the medium-sized firms--and let's stay with the plastics industry as an example as opposed to ranging everywhere--throughout Canada that have been very successful in selling their particular products to manufacturers in Canada as well as in the United States are establishing operations in Mexico in order to take advantage of the labour cost differentials. They're also producing there, because many of their customers that are Canadian and U.S. and foreign-owned are setting up plants in Mexico, and in order to ensure that they don't lose business with those particular companies, they're locating their operations in Mexico as well.

¿ (0935)

So it's not a matter of being, shall we say, negative about Canada, and not a matter of turning away from Canada, but rather recognizing that the world is increasingly globalized. And in the North American area as far as the space is concerned, it's very much NAFTA, increasingly so with respect to Mexico becoming, more and more, a trading partner of the United States. So it behooves companies that are large and small in Canada to become more active in the Mexican marketplace.

As far as the common currency is concerned, quite frankly I don't think the Americans are excited about having a common currency with Canada. I think we're more excited about having a common currency.

[Translation]

Mr. Pierre Paquette: [Editor's Note: Inaudible] ...however. I would truly like to get your opinion on this, because this is a debate which is presently taking place in private industry throughout Canada. Consequently, I would think that our report should include some comment on this topic. Therefore, I just wanted to get your initial impression even though I'm aware you're not an expert on the issue.

[English]

Prof. Isaiah A. Litvak: You're quite right. I'm not a specialist on the issue. I have some familiarity with the issue. There is no doubt that an increasing number of Canadian companies that are publicly traded are inter-listed now in terms of the New York Stock Exchange, in terms of the NASDAQ, and they are reporting their results in U.S. dollars.

There is also no doubt that business people find it challenging enough to operate in a state of uncertainty when it comes to business dealings, and that fluctuations in the currency create further uncertainty. So it's understandable that there are certain business leaders and a growing number of companies who are concerned about that impact on the bottom line.

But like everything else--and I happen to be a professor of business and I associate myself, by and large, with many of the views of the business leaders in this country--I also feel it's very important to understand, from a political standpoint in terms of the government, that you have to look beyond just simply what is in the best interests of business, because business interests quite often are quite short term. And if we look at the performance in the United States and Canada in the past two or three years, I wouldn't exactly single it out for the highest praise.

So it's an important issue. I think it's an issue with us, but I would also suggest that, in the context of the paper that was prepared by the Parliamentary Research Branch, once you start talking about a common currency you'd better start thinking more in terms of an economic union or a common market. And that is critical about that way.

¿ (0940)

[Translation]

The Vice-Chair (Mr. Bernard Patry): Thank you.

Mr. Paquette, there was an article in the Ottawa Citizen this morning on that very topic.

Mr. Assadourian, you now have the floor.

[English]

Mr. Sarkis Assadourian (Brampton Centre, Lib.): Thank you very much for coming here and expressing your views as a Canadian living in the United States. But I'd like to give you our point of view from this side of the border about the strategy, and I want to make a few comments and then ask a question.

Almost two years ago, when George Bush was campaigning in the Detroit area, our famous Canadian CBC program Royal Canadian Air Farce asked a question of George Bush, saying “President Jean Poutine supports you”, and he said, “Gee, he must be a smart president.” This was two years ago.

About two months ago, four Canadians died in Afghanistan from friendly fire. He just passed by. He didn't even acknowledge the fact that four innocent people were killed by American bombs.

You spoke about educating the American public or what have you. I regret to inform you that here there was a survey done, and 70% of Americans think that 19 of 20 terrorists came from Canada to the United States. This was spread by CNN or the American administration or what have you. The fact is, of course, it's just the opposite.

On softwood lumber, the President of the United States says, “You guys are right, we're going to defend you”, and then we're stuck with almost 30% duty or tariff on softwood lumber going from B.C. and other provinces. We engage in PR in the United States. We're spending $20 million to inform the public that, yes, we have a case here, we are right.

The other point I'd like to inform you is that every time we try to engage with U.S. congressmen or senators they're too busy raising their own funds; they are constantly on an election footing, they keep on raising funds. Politics is local, but they have no time for anybody, never mind Canadians. I don't think they travel across the world. Two-thirds of them say they have no passport to travel. Their knowledge of international situations is so very limited it's unbelievable.

I'd like to ask you, what would you say to a similar grouping in the United States--lawmakers, congressmen, senators--about how to improve their relations with Canada, based on the facts I just mentioned to you?

Prof. Isaiah A. Litvak: It's quite a tall order. Let me say, in terms of my recollection, it's very rare. I'm not trying to avoid your question. You've only had the odd congressional committee hearing dealing with the Canadian issue.

If you're asking me what I would bring to their attention, first, one has to talk with respect to the security and economic well-being of the North American space. I would certainly want to remind them of the critical role Canada plays with respect to the security and economic well-being of the North American space.

The way in which I would tackle things today, Mr. Assadourian, is that I would not look at it in terms of Canada and the U.S., although it would be part of my agenda. I would be talking in terms of the regional interests of North America. I would take a look and see where the areas of convergence are between Canada and Mexico, in particular on the northern border and the southern border.

I would not try to marry myself with the problems Mexico contributes to the United States in terms of drug traffic, immigration problems, and so forth. I would certainly look, for example, at the energy base. It is so critical to the U.S. well-being as an economic power that they're able to derive benefits from what Canada provides and from what Mexico provides.

I would be thinking in terms of the North American region. I would be thinking in terms of regional interests and see in what ways I could align Canadian interests with U.S. interests.

The irritations and the frustrations you have identified in terms of the softwood lumber case and other issues are, although I hate to put it this way, nothing new. I did a number of studies as a Canadian, believe it or not, in the 1960s and 1970s on the issue of cultural sovereignty for Reader's Digest, Time magazine--you name it.

Those issues will always take place. They'll always continue. The parochial interest in the United States, by virtue of the political system, will always dominate the political agenda. We have to live with it, unless we're going to change our political system. I sincerely hope we would not.

From my particular vantage point, we need to identify the regional interests the United States has in terms of North America. What are our regional interests? How can we get our national interests into the regional context to ensure there are fewer irritations and frustrations as we move ahead?

I might also add, in considering a policy strategy, there's much to be done within Canada so that the Canadian platform appears to be less fragmented than it is. When you talk to business executives in Ontario, Quebec, Atlantic Canada, and western Canada, they quite often express frustration. They say it's easier to sell and ship products to the United States than to do so in neighbouring provinces.

We really have, I consider, a three-pronged strategy and it has to be handled simultaneously. First, address the domestic platform. Make the domestic platform healthier and stronger. Think of it in a national context, at least economically.

Two, concurrently see in what ways you can give leverage to our relationship in the context of the U.S. political system. As I mentioned earlier in terms of the provinces, I think there's something to be gained using that particular approach.

Three, I would think in terms of, as your committee is with respect to the North American space, aligning one's interests with respect to Mexico.

Fourth, do what has to be done globally. I think there is a very rich immigrant population in this country. I would say, of the 42 executive MBA students I taught in the five sessions, easily a third to a half of them are from countries of Asia. They are occupying very important senior positions.

If you look at the plastics industry, you will find there is now a second and third generation of Canadians of European descent. For example, the mould-makers are among the best in the world today, but they brought their skills from Europe. And I could go on and on.

¿ (0945)

By the same token, I'm saying that given the richness and the diversity of the immigrant population, at least as it's represented among our growing commercial and professional class, how do we leverage that strength in building stronger economic links with countries outside the North American space?

Mr. Sarkis Assadourian: Would you tie energy exports to the U.S. to lumber with respect to duties?

Prof. Isaiah A. Litvak: No.

The Vice-Chair (Mr. Bernard Patry): Mr. Duncan, please.

Mr. John Duncan (Vancouver Island North, Canadian Alliance): Thank you very much.

Your thought processes are, I think, shared by many of us who have dealt with the U.S. at various trade levels.

One thing I noticed in your paper was that you were quoting the C.D. Howe Institute in terms of how matching U.S. tax rates is not good enough. I firmly believe that if we're going to be able to operate from a position of strength against the natural strengths of our U.S. neighbours, we need to leapfrog the U.S. in terms of our tax rates. In your opinion, how would it affect our trading relationship if we had lower tax rates?

¿ (0950)

Prof. Isaiah A. Litvak: It would certainly be welcomed by the Business Roundtable and other industry lobby groups in the United States.

One of the things that really comes through loud and clear, at least in all the industrialized nations of the word, the OECD group, is that there are constant comparisons with respect to tax rates at the corporate and personal levels. I think it would be fair to say that I don't know of any industry association or business group that has argued that the tax rate is sufficiently low.

If there's another country within that group...for example, the Irish are a good case in point; their growth has been phenomenal. There is always the argument, let's lower the tax rate.

What I do feel is so important, Mr. Duncan, is that we cannot be out of step with respect to the U.S. scene. That's where the competition is really unbelievable. Let's just stay with the plastics industry. For companies that are deciding where to locate a plastics plant, when they are thinking in the context of Canada-U.S. and of serving the North American market, the tax rate is an important consideration--very important. If the gap is too great, it works to our disadvantage.

I think it would be fair to say that the taxation differential is not the only factor, of course. There are other factors that enter into the picture as well.

Mr. John Duncan: If we were going to, for example, attract any North American head offices to Canada, that would be a given, would it not, that we would have to have...? Given that we have other comparative disadvantages, we would have to have a tax advantage, for example. That would be one trump card we could have.

Prof. Isaiah A. Litvak: Yes, it's a very important one.

Mr. Duncan, I would say this, that the challenge from my vantage point--and God knows it's imperfect--in this area is twofold. How do we ensure that the environment is sufficiently attractive that some of the companies that are giving serious consideration to moving the entire head office or parts thereof to the United States are persuaded not to do so? It doesn't mean they won't do it at some point in the future, but what has to be done to persuade them not to do so?

I would also like to go to the point that was made by Mr. Paquette when he talked about small and medium-sized enterprises in Quebec. I really believe that in the Canadian context they will give birth to the new large firms such as a Nova, a Bombardier, or an Alcan, and now they're in that small and medium-sized category. What can we do to ensure that as they grow and become more powerful, the tendency to move their head office or at least critical decision-making parts to the United States is not top-of-mind?

In that context, I would obviously be looking at what it is that would prevent entrepreneurs from considering that option as they grow their companies by virtue of the fact that our environment is so much more attractive, recognizing that they will be building a growing number of plants in the United States, Mexico, and elsewhere. I don't think there's any question about it.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Duncan.

We'll go right to Mrs. Jennings for the final questions.

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Thank you, Mr. Chairman.

Thank you, Mr. Litvak. When you spoke about the Canadian government having an interest in aligning itself with the United States and Mexico, in terms of regional interests, I wonder if you have specific knowledge about or expertise on the steel industry?

I have some steel production interests in my riding, and therefore was at one point chair of the parliamentary steel caucus. One of the things I learned when I came to the Hill was that the steel industry is the most integrated industry in North America, leading by far any other sector in terms of its production integration, in terms of productivity, although Canadian steelmakers are actually more productive than the Americans because major restructuring took place here that preceded what happened in the States.

There is an interest on the part of some of the Canadian steel producers for common rules of competition and market, integrated on a North American scale. There's definite interest on the part of the Mexicans. This committee travelled to Mexico as part of our North American integration study. There was clear interest on the part of the private sector and the public sector--the government--for moving as quickly as possible to that next level.

Unfortunately in the United States, all the points you made about Canada not being on the radar screen, in terms of the government...because when one talks to the industry leaders in steel, they are very, very aware and cooperate and collaborate very closely with the Canadian interests and with the Mexican interest. In fact, in this latest kerfuffle over anti-dumping rules, the Canadians and the Mexicans actually urged their American counterparts to lobby so the U.S. administration would bring in the tariffs they brought in, but to exclude Canada and Mexico.

What do you think about the possibility of moving the American legislators so that, at least in that one sector, they are looking in terms of regional interests and alignments?

¿ (0955)

Prof. Isaiah A. Litvak: I think the sector you've identified is an excellent one, the steel industry. Let me just say this. There is a history with respect to the industry that would work to its advantage.

This may come as a shock to some of you, but before the Canadian steel industry association was established there was no national steel industry association in Canada. Dofasco and Stelco and some of the other large firms were members of the American Iron and Steel Institute. The reason you have the Canadian steel industry association is that the American steel industry moved in a certain direction, with the Canadian industry thinking they would be brought along, and they were not.

I know there are only a couple of minutes left, but if I were to look at the steel industry--which, incidentally, I'm familiar with--I would look at ways in which you can establish a North American steel industry association, of which the Americans would view the policy position as being one and the same, so that they would in fact lobby the United States government.

So what you want to do is to make sure that, as they lobby Congress, what they lobby for is consistent with the interests of Mexico and Canada. I would say that this would be one area where the probability would be fairly positive.

Mrs. Marlene Jennings: Thank you very much.

[Translation]

The Vice-Chair (Mr. Bernard Patry): Thank you very much, Mrs. Jennings.

[English]

Thank you very much, Mr. Litvak, for appearing in front of our committee this morning. It was very interesting. Thank you, again.

Prof. Isaiah A. Litvak: Thank you.

The Vice-Chair (Mr. Bernard Patry): We'll now take a short break.

¿ (0959)

À (1008)

[Translation]

The Vice-Chair (Mr. Bernard Patry): We shall now resume this meeting.

[English]

We're going to keep going, pursuant to Standing Order 108(2), consideration of the situation in Iraq.

This morning we have as witnesses, from the Department of Foreign Affairs and International Trade, Mr. Donald C. Sinclair, the director general, Middle East and North Africa bureau; and Mr. Dennis Horak, deputy director, political, Egypt, Iran, Iraq, of the Middle East division.

Welcome, gentlemen. You have a presentation or a statement to make?

Go ahead, Mr. Sinclair.

Mr. Donald C. Sinclair (Director General, Middle East and North Africa Bureau, Department of Foreign Affairs and International Trade): Thank you, Mr. Chairman and members of the committee, for the opportunity to meet with you this morning to talk very briefly about our perspectives with respect to the situation in Iraq.

Over the course of the past few months, there has been a lot of speculation about the likely course of events in Iraq, and indeed in the entire Middle East as a whole, and I welcome this chance to put before the committee some of the views of the challenges that continue to face us in the wider international community with respect to the situation in Iraq.

Canadian policy towards Iraq has long been driven by two essential priorities: on the one hand, concerns regarding Iraq's weapons of mass destruction efforts and its intentions; and on the other, our desire to lessen the humanitarian burdens being borne by the people of Iraq.

The disarmament question in Iraq remains unresolved, basically because of Iraq's refusal to comply with its UN Security Council obligations. While great progress was made by UNSCOM in monitoring and verifying the destruction of Iraqi weapons of mass destruction programs, this effort was not complete when inspectors were forced to leave Iraq in 1998. Serious gaps remain on all of the WMD files--biological, chemical, missile. Even the nuclear file, which had seen the greatest progress, had not been signed off by the IAEA prior to its departure in December 1998. There have been no inspections in the past three years because of Iraq's refusal to allow inspectors to return.

We are concerned that Iraq may have used this opportunity to rebuild its capabilities. The key to resolving the continuing impasse lies in the immediate and unconditional return of UN inspectors, and Iraq's full cooperation with them, in accordance with successive UN Security Council resolutions.

The new head of the inspection agency, now known as UNMOVIC, the respected former head of the IAEA, Dr. Hans Blix, has said that, with full Iraqi cooperation, he believes the disarmament job could be completed in only one year. There is light at the end of the tunnel. Discussions between the UN and Iraq--and these have been rather regular--have taken place to attempt to overcome this impasse, but to date no progress has been made.

With respect to the humanitarian program, there have been drastic and continuous improvements. From the earliest days, the international community has tried to mitigate the impact of sanctions on the people of Iraq. Food and medicine were exempt from the outset, and the UN Security Council tried to institute an oil-for-food program as early as 1991, only to have Iraq refuse its implementation for five years. Even once the program was set in place in 1996, continuous improvements were made, particularly through UN Security Council resolution 1284, which established lists of items that would be fast-tracked.

These efforts have now culminated in UN Security Council resolution 1409 and the creation of what is called a “goods review list”, which enumerates a list of items that would be subject to approval by the UN sanctions committee. All other items, all items not contained on this list, will be procedurally fast-tracked, greatly expanding the scope of civilian goods available for quick, immediate, and easy import by Iraq.

This change--which, I would add in parentheses, reflects the recommendations of this committee for better-targeted sanctions--should further improve the humanitarian situation in Iraq while retaining the controls on those specific items needed to ensure that Iraq does not have access to funds or materials needed to reconstitute its proscribed weapons program.

Canada will continue to press Iraq to meets its obligations and to bring an end to the difficulties it has created for its own people and the insecurity it has brought to the region. We have no illusions about the ability of Saddam Husseinto change, but we do believe effective disarmament, spearheaded by the UN, will provide important checks on the regime's ability to threaten its neighbours, to the benefit of the security of the entire region. We have a legal and moral responsibility to support this stabilization effort.

À (1010)

Canada supports the eventual lifting of sanctions. Let's be clear about that. We have worked hard for 12 years to help create the conditions necessary to bring this about, but always in accordance with the demands of successive Security Council resolutions, the will of the international community, including most particularly while we were on the council recently for a period of two years.

In our view it remains that it is now up to Iraq, as always, to take the steps necessary to bring this issue to a satisfactory conclusion. All of the elements are in place to do so.

Thank you, Mr. Chairman.

The Vice-Chair (Mr. Bernard Patry): Thank you very much, Mr. Sinclair.

We will now move to questions and answers. We'll start with Mr. Martin for five minutes.

Mr. Keith Martin: Thank you very much, Dr. Patry.

Thank you, Mr. Sinclair and Mr. Horak, for being here once again.

Of course, the concern for all of us is the U.S.'s sabre-rattling over an invasion of Iraq. I think that's our primary concern here. From your perspective, what evidence, and I underline that word, do you have of Iraq's accumulation of weapons of mass destruction?

My second question is, what is the Iraqi resistance to Mr. Blix and UNMOVIC going into Iraq and fulfilling its mandate given the fact that the Iraqi concern about UNMOVIC's predecessor, UNSCOM, being filled with U.S. spies is not there any more, as I assume?

Finally, I've been doing some work on the related issue of the trafficking of blood diamonds and a guy by the name of Ari Ben-Menashe, who has had some dealings with the Department of Foreign Affairs. He lives in Montreal, and he is a former Mossad agent. I've come up with some very serious allegations, and I just want to know what your perspectives are on them. It deals with Ben-Menashe; a guy named Victor Bout, who is an international arms dealer; and a guy named Bredenkamp, who's another international arms dealer. They allege that Israel was giving biological and chemical weapons to both Iran and Iraq during the war. Is that true or is that just a myth?

Thank you very much.

The Vice-Chair (Mr. Bernard Patry): Mr. Sinclair.

Mr. Donald C. Sinclair: Thank you very much, Mr. Chairman.

Dr. Martin, on the third question, I think you would have to ask those involved. I have not heard of this, and I wouldn't want to speak for Israel, but I would be highly doubtful in my own mind that there was anything to this whatsoever. But again, that's from my own mind. If you wanted a conclusive answer, you'd have to pose it, I think, to Israel.

With regard to your first question, evidence of WMD accumulation, I think we have to separate this into two timeframes, with the line being 1998. We are not satisfied that pre-1998 the complete elimination of WMD facilities and stockpiles was indeed finalized. So we have concerns about WMD, including missiles and chemical, biological, and even nuclear concerns, that predate 1998 and the departure of the UN inspectors.

Post-1998 is much more difficult. It's of course a grey area in the respect that there have been no UN inspectors. We really don't know what the Iraqis have been doing post-1998, and therein lies the concern of Iraq's neighbours and indeed the Security Council and the international community.

We believe the onus is on Iraq to show to us that they have not used the intervening period to produce weapons of mass destruction. We believe the onus is on them to let the inspectors in to give them a clean bill of health. That's what this is all about. If they have nothing to hide, if they haven't been doing anything they shouldn't have been doing in those three years, let the inspectors in and get a clean bill of health, which Blix says would take about a year, and we can move on and end this wretched situation.

If your question was do we have direct evidence that Saddam Hussein has been stockpiling weapons of mass destruction during the last three years, we can say a couple of things. First of all, we suspect his intentions. In other words, if he had the opportunity to do so, he most likely would. That's a belief on our part. Secondly, we do have some evidence of attempts to procure types of equipment from our various allies around the world on behalf of the Iraqi regime. These can be bits and pieces, but they're not of a humanitarian nature. These kinds of bits and pieces lead to a certain disquiet about their potential use.

À (1015)

Mr. Keith Martin: I'm sorry, Mr. Sinclair; what are those bits and pieces?

Mr. Donald C. Sinclair: They would be technical bits and pieces that you would find perhaps in a nuclear research reactor or in a missile guidance system or in a biological or chemical weapons program, but which wouldn't be used for hospitals and schools and in normal scientific research.

There have been some attempts to acquire some of these, all of which leads us back to the essential point that we can clarify this situation with the return of inspectors who, within a year, can complete their work. Then we're all satisfied and we can answer your questions.

Mr. Keith Martin: Whatever evidence you have, if you can table it with the committee it would be greatly appreciated--whatever you have.

Thank you.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Sinclair.

We'll go now to Madame Lalonde, s'il vous plâit.

[Translation]

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

I'm sure that you are well aware of the recommendation passed by this very committee. The first line reads as follows: “Reaffirm publicly the need to address on an urgent basis the ongoing humanitarian tragedy in Irak;”. The committee also recommended the following: “the delinking of economic from military sanctions” and the establishment “of a Canadian diplomatic presence in Irak”.

I have managed to get hold of a list of countries which have an embassy, or at least, some type of representation in Irak. As far as we can make out, there are about 20 of them. I would like to know what follow-up or what action has been taken on our recommendation.

[English]

Mr. Donald C. Sinclair: In taking the steps the international community has taken through the UN Security Council, in effect they have adopted the position of de-linking military and economic sanctions. In other words, they have made a stringent distinction, if you like, between what is purely military and could be used in a weapons-of-mass-destruction program and what isn't, and they have completely changed the philosophy of looking at goods that move into Iraq, in order to vastly streamline the process and make the humanitarian relief much more effective. In other words, rather than looking at everything that is to go into Iraq to determine whether it's humanitarian or military, they have de-linked it by saying, “We are now only going to look at military goods”--goods that are on the goods review list. Everything else is okay. They have completely de-linked the military goods from any other goods whatsoever.

I think on the first point the Security Council has moved, and this is a major shift in the philosophy and the way of dealing with goods going into Iraq.

On the second question, an embassy presence, we would very much like to be able to reopen an embassy in Baghdad, but we believe certain conditions must prevail. We do not want to be in a position of being seen to reward Iraq for its non-compliance with the wishes of the international community. We maintain a presence in Oman. We have an officer in Oman who is dedicated to Iraq, and when the Iraqis will give him a visa--which is not always a foregone conclusion--he travels, when he can, regularly to Baghdad. We have a property, a Canadian property that we rent, in the city of Baghdad.

There are a number of ways of moving from that situation of an officer coming from Oman to a full embassy in Baghdad. There are a number of steps in between, and we will look at those as the situation improves, as Iraq starts to take steps to do what we believe it has to do. In our view, the international community has taken all of the steps.

À (1020)

[Translation]

Ms. Francine Lalonde: I would like to come back to the situation in Irak, that we have called “a human tragedy”. I am well aware that this human tragedy is still taking place, no matter the number of sanction-related deaths that we are prepared to accept. Do you believe that the recent ruling by the United Nations Security Council will enable infrastructure in Irak, which was destroyed by the war, to be rebuilt?

[English]

Mr. Donald C. Sinclair: I think the answer is yes. There's literally the possibility for the free flow of humanitarian goods into Iraq if Iraq wishes and chooses to purchase them. They have their own resources from the sale of oil, which they can apply to the purchase of whatever goods they wish--for children, for schools, for nutrition, for hospitals. Provided that none of these goods appear on the weapons list, they're free to import these goods. People are free to sell these goods.

So I think the answer to your question is yes. Iraq now has the capability to deal with its own people the way it chooses to do so.

The Vice-Chair (Mr. Bernard Patry): Merci.

We'll go now to Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much for your expert analysis and answers to the questions we have.

I have three questions. I understand that three or four years ago, the sanctions against Iraq were about to be lifted by the UN, and everybody agreed. The U.S. came and said the resolution calls for all--not 99%, but all--requirements to be met. Is that true? Can you confirm that, yes or no, or what the background is? That's my first question.

My colleague, Keith Martin, asked a question that you didn't have time to answer. At the time, Scott Ritter was here and also Mr. Butler. There was the argument that the CIA must have had involvement with the inspectors. They were passing information on. The Iraqi position was “Why would I work with you when you're working with my enemy? How can I work with you when you're trying to sabotage my country and my state with the enemy?” And I think that's a logical explanation.

Third, can you elaborate on no-fly zones in the north and the south? How many violations do we have there? What do we do with those violations? Cynics say that every time there's an issue and they want to divert attention in the U.S., they bomb the Iraqis on the north side or the south side. Is that true? What's the situation on that?

Mr. Donald C. Sinclair: I do apologize; that indeed was one of Dr. Martin's questions, and I thank you for bringing it back.

On the question of whether or not sanctions were almost lifted three or four years ago, I think you said, you have to keep in mind that there has been a wide variety of opinion among the permanent members of the Security Council on how to deal with the situation in Iraq. Two or three years ago, in particular, I think these divisions were most prominent. You basically had a three-two split among the permanent members on how to proceed.

In fact, this was the time that Canada was on the council. With the passage of resolution 1284, I wouldn't say it was complete, it's not even complete today, but there was a growing convergence of views that was reflected in that resolution 1284.

It still maintains certain ambiguities in that resolution, which reflect the inability of the permanent members, basically, to come to a common agreement on what would actually trigger the end of sanctions, on what the steps would be, and on how to get there.

Since that resolution, in the past several years positions have come even closer together among the permanent five. The establishment of the goods review list, which was actively supported, for example, by the Russians, goes a long way towards alleviating the humanitarian concerns that many Security Council members, including Canada, are very concerned about.

So I think you've seen a growing convergence of views with respect to the need to have the inspectors go back, to the need that the inspection process itself can be short, one year...that the job can be done in a rational and effective way, and that we can move to clearing Iraq in the eventual lifting of sanctions. So I wouldn't say they were almost lifted three or four years ago; you have to convince every member of the Security Council.

On Dr. Martin's question on the no-fly zones, Dr. Martin asked, I believe, about obstacles. What did Iraq itself see as obstacles to the return of inspectors?

One is obviously the question you've raised, which has been acknowledged, about inappropriate activity of the previous inspection team. That's been corrected, that's been changed, and we seem to be well on the road to dealing with that particular problem.

Iraq also has sought to put particular conditions on the return of inspectors, on what the nationality of these inspectors might or might not be, on where they might go, on what they might do, on how long they would be there, on what their activities would be. The Security Council says they're not going to get into a detailed negotiation with Iraq on these kinds of questions. They will on logistical questions, but not on these kinds of fundamental questions. The inspection team must have the freedom or it's not going to be effective in doing its job where, when, and how it wishes to do so.

The no-fly zones are, for the most part, and I think perhaps almost exclusively, patrolled by British and American aircraft. When there's an incident we talk to the British and the Americans about the circumstances of those incidents and they inform us that they feel under attack. Ground-based defensive or offensive systems are locked onto their aircraft and they have no alternative but to respond in the way these military aircraft are equipped to.

À (1025)

They fly regularly, but there have been very few incidents of late. I think I'm correct that the number of these incidents... I can't, off the top of my head, think of the last one, where a British or American aircraft was locked onto and they responded through military means. We hope it won't happen in the future.

À (1030)

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Sinclair.

Now we'll go to Ms. McDonough.

Ms. Alexa McDonough (Halifax, NDP): Thank you very much, Mr. Chairman.

Mr. Sinclair, if I understood you and jotted down your comments correctly, you basically said the Canadian position with respect to lifting the sanctions is to support it eventually “when the time is right”. I guess my questioning, because I'd like to ask or raise a couple of questions, really surrounds the notion of what it is going to take to recognize that the time has arrived, when you've had over 800,000 children just under the age of five die since the imposition of sanctions.

I know there's an attempt to say there's more freedom under the post-1996 program of food for oil and some further opening up. It was an opportunity, really, for Iraq to acquire what is needed to prevent this happening. But the UNICEF report that came out in February absolutely indicated that the suffering is getting worse. We're not just talking about the effect, obviously, on young children. The level of severe and chronic malnutrition among the whole population is in excess of 22%, and the unspeakable suffering just gets worse.

So we're against that. We're struggling with what the evidence is of the accumulation of weapons of mass destruction. I heard you not present any evidence but say you “suspect” that if Hussein had the opportunity, he would acquire weapons of mass destruction--that it's a belief.

So those of us who are very concerned about the continuing death, the continuing malnutrition, and also the fact that this makes a political situation worse--there's no question it plays into Hussein's hands, I don't think there's any question about that--are sitting here saying, “What would it take to persuade our own government that the time has passed for us to just weigh suspicion and belief against the certainty of the death of more people?”

I would really ask you to address that question, because it doesn't leave us with very much sense that there is anything more than suspicion and belief and fears, to be sure, against this horrifying, concrete, tangible, real situation that is happening to the lives of the Iraqi people, particularly children.

Mr. Donald C. Sinclair: Thank you. You've raised a number of issues.

First of all, we have to, from our position, understand that Iraq has all of the means available to it, including oil revenues, to deal with its own issues. There are different interpretations other than the one you've given about the nature of life and conditions in Iraq or in various parts of Iraq where the situations are different. But our position is that Iraq has substantial financial resources available to it from the sale of oil that it can devote to building palaces, building the world's largest this, that, and the other thing, or to deal with its people; or it can cynically maintain a situation and not deal with this particular problem in order to attract attention to the problem. But that's a choice for the Government of Iraq.

When is the time right? I hate to give you a technical answer, but the time is right when the UN Security Council is satisfied that Iraq has fulfilled its obligations under a variety of UN Security Council resolutions that call on Iraq to accept the weapons inspectors. The inspectors would then give them, hopefully, a clean bill of health if our suspicions are unfounded, and then we're done. We're basically done.

There are a number of other issues with respect to Kuwaiti prisoners and compensation. There are some other issues. But the main issue in this awful situation remains the question of weapons of mass destruction and missiles in Iraq. And if we, the international community, can be satisfied that Iraq has done what it says it has done, and all they have to do is let the international community in to see, that doesn't seem to be an extremely egregious, or onerous, or irresponsible a request, if you like. Then we can move on to actually helping Iraq rebuild its infrastructure.

À (1035)

Ms. Alexa McDonough: You're talking in terms of the choices, as if the children have a choice, or the parents of the children who are dying have a choice. Is it not clearer all the time, if it's true they have the resources to meet their own needs, that the very continuing existence of the sanctions becomes the excuse for not doing it? Why don't we take away the excuse they use, why don't we take away the thing that allows Hussein to get the population to believe that their needs are not being met because of the sanctions and also remove I think the single biggest barrier to inspection going on because it becomes the excuse that gets used?

Mr. Donald C. Sinclair: We're concerned on a variety of levels about that approach. First, it doesn't deal with the weapons of mass destruction issue, because you just lift sanctions in order to remove the argument for having sanctions. How do you know that with the lifting of sanctions they will spend money on their own children rather than on a weapons program? How do you know--

Ms. Alexa McDonough: It would be better than being under the current situation.

The Vice-Chair (Mr. Bernard Patry): Sorry, we're over the time. We have to go now to Mr. Harvard.

Mr. John Harvard (Charleswood St. James—Assiniboia, Lib.): Thank you, Mr. Chairman.

Thanks to the witnesses.

I want to ask one or two questions with respect to sanctions as well. This is the year 2002. The sanctions have been in place for more than a decade, and even though the sanctions have been in place for that long, we as a country and I think the entire world, or most of the world, is concerned about the weaponry that Saddam Hussein may or may not have, and of course Saddam Hussein is still there as well.

So here we are more than ten years after the sanctions have been imposed and we're going to be told, Mr. Sinclair, later this morning by another witness that there remains widespread malnutrition, and mortality rates are going up. I think this witness will even describe the current sanctions as--I'll use the word--genocide. And with respect to the oil for food program, this witness is going to tell us that the oil for food program has reduced the country to the status of a massive refugee camp and the people to a collection of beggars bartering food for children's clothes, critical drugs, household goods, meat, eggs, and other dietary necessities.

So my question for you, Mr. Sinclair, is pretty straightforward. Has the sanctions program been effective? Has it paid off?

The Vice-Chair (Mr. Bernard Patry): Mr. Sinclair.

Mr. Donald C. Sinclair: I can't guess what a subsequent witness might say, but in anticipation--

Mr. John Harvard: I just indicated to you what he is going to tell us.

Mr. Donald C. Sinclair: --let me give you the remarks of the Secretary-General of the United Nations:

I should like to reiterate that, with the improved funding level of the programme, the Government of Iraq is indeed in a position to address the nutritional and health concerns of the Iraqi people, particularly the nutritional status of the children.

It comes back again to who has the money and who has the capability and who has the responsibility to deal with this particular situation and who can actually do it. The Secretary-General of the United Nations believes the Government of Iraq is both responsible and capable, and has the moral obligation to deal with this particular problem. There are different views.

On whether sanctions have been effective, I think you can only say yes to that when the conditions are brought about for their removal--namely, that we're all satisfied that the weapons of mass destruction and missile development program of Iraq is ended. When we come to that, and when the sanctions are lifted, then I think we can say that indeed the sanctions were effective. But to answer the question now of whether sanctions have been effective is I think premature. They are a means to an end, and the end is the will of the international community, as reflected in UN Security Council resolutions, to establish once and for all that Iraq does not possess and is not capable of producing weapons of mass destruction.

À (1040)

The Vice-Chair (Mr. Bernard Patry): Just a short question, Mr. Harvard.

Mr. John Harvard: You've been quite straightforward in saying on behalf of the Government of Canada that the sanctions have been effective. Would you agree, though, Mr. Sinclair, that even though you may be right that the sanctions have been effective, they have come at a very high price to most of the people of Iraq? Would you agree that the sanctions have brought a high price to the people?

Mr. Donald C. Sinclair: Yes, I agree with that. I also think there's more to the story than that. I think Saddam Hussein has brought a very high price to the Iraqi people. I think Saddam Hussein bears the moral responsibility for the situation in which he's in. In other words, the clandestine production of weapons of mass destruction, the attack on Iran, the invasion of Kuwait, the devastation in Kuwait... We must remember Kuwaiti infrastructure and Kuwaiti children and Kuwaiti prisoners--all of these are part of this horrible story.

So if you ask whether sanctions brought harm to the people of Iraq, I think the answer is yes, but if you look at the responsibility for that situation, that responsibility in our view is clearly the responsibility of Saddam Hussein.

We would like to get rid of the sanctions. If they were benign, we wouldn't need to, but they're not benign. They have had an effect on Iraq and on ordinary people. Over the ten years, the international community has recognized this and has moved a long way, including changing how it deals with this particular issue, in recognition of exactly that point, in order to free up the humanitarian side of this equation. But we still insist that, while the international community has done this, Iraq has done nothing on the weapons side. That's the impasse we're in.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Sinclair.

Now we'll go with Mr. Duncan, and we'll finish with Mr. Keyes.

Mr. Duncan, please.

Mr. John Duncan: Thank you very much.

Thank you for your presentations.

The singular question I have relates to weapons of mass destruction and the fact that the U.S. has made some very strong statements in this regard. Those statements they claim are based on their intelligence.

My question is, would Canada be in receipt of the same intelligence as the U.S.?

Mr. Donald C. Sinclair: Only if the United States decided to share it with us, I think, is the answer. They collect the intelligence. They share some--maybe all, I'm not sure--of this intelligence with their allies. They might simply share their conclusions with respect to the intelligence, rather than the actual intelligence itself. There is a variety of means and mechanisms.

Mr. John Duncan: I ask that question because, as Canadian parliamentarians, from time to time we meet with our American counterparts. Some of our American counterparts are members of the intelligence committees, and it seems to me they're quite certain of where their posture ought to be and should be because their government does share information, in a privileged way, enough that they're very certain of the ground they stand on.

As Canadian parliamentarians, we never know. The question I've posed and the answer I've gotten just tells me all over again that not only do the Canadian parliamentarians not know, but possibly the Canadian government doesn't know either. Would that be fair to say?

À (1045)

Mr. Donald C. Sinclair: No, I don't think it would be fair to say. We cooperate with our allies in a variety of locations and places. We cooperate bilaterally, we cooperate through NATO, we cooperate in a whole range of ways. The campaign against international terrorism is one such effort. There's a regular exchange with our allies of useful intelligence. So I would not accept that we're not aware of what some of our friends and allies have on their minds.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Sinclair.

Mr. Keyes, please.

Mr. Stan Keyes (Hamilton West, Lib.): Thank you, Mr. Chairman.

I just have one question to Mr. Sinclair, who is director general, Middle East. Sir, you acknowledge that there's been tremendous speculation on the likely course of events in Iraq, and you welcome the chance to try to clarify Canada's views. I think the question I have begs to be asked. If the United States launches a war on Iraq, will Canadians support it?

Mr. Donald C. Sinclair: Well, we are only public servants. Such decisions are made by politicians, parliamentarians, the cabinet. I can only remind you what the Prime Minister said when he was asked the question. He said Canada would look at these issues on a case-by-case basis, taking into account information available at the time, including information provided by the United States, and we would take our own decision at the time. But as of today, June 4... This isn't the day he spoke, but when he spoke, he said it was speculative and speculation, and he wouldn't be drawn into answering the question.

I think that is the best and safest answer I can give to the question.

The Vice-Chair (Mr. Bernard Patry): It's like question period.

Thank you very much, Mr. Sinclair and Mr. Horak, for your appearance this morning.

We're going to suspend for two minutes before the next witnesses.

À (1052)

À (1058)

[Translation]

The Vice-Chair (Mr. Bernard Patry): We shall now resume this meeting. Our next witnesses are

[English]

as an individual, Mr. Scott Ritter, former chief inspector, UN disarmament for Iraq; and also Mr. Denis Halliday, former UN humanitarian aid coordinator for Iraq.

Welcome, both of you. I understand you have an oral statement.

Mr. Halliday, could you start first, please?

Mr. Denis Halliday (Individual Presentation): Good morning and thank you, Mr. Chairman and honourable members of this committee. I'm really pleased to have this opportunity to speak yet again to this committee, although I think I'm somewhat redundant, as Mr. Sinclair has shown quite clearly that economic sanctions are indefensible. I'm not sure you actually need me here today.

I do not have a written text, and I must apologize to those handling interpretation. I should and will try to speak slowly. They have a difficult task. I'm familiar with their task, after 30 years with the United Nations.

This public hearing of this topic, UN sanctions on Iraq and its people, represents for me the high-quality government that many of us expect of Canada. Despite disappointments in recent years vis-à-vis your foreign policy as it applies to the security council on Iraq, I still believe Canada can be instrumental in ending the UN punishment of innocent civilian Iraqis, disproportionate and incompatible with the charter, the Universal Declaration of Human Rights, and many other international provisions, by having Canada urge Washington, your friend, your ally, your significant trading partner, to change its policies, to think again--for example, to have the United States forgo its sense of revenge, its need for revenge, its simplistic fear of the President of Iraq; to have the United States listen to its European, Arab and other allies, and in particular, Canada, who counsel non-violent solutions as opposed to military aggression, which unfortunately seems to be around the corner; to have the United States hear from Canada that it must end its neglect of international law begun during the Gulf War, during the Gulf War itself, and ever since, with a no-fly zone, bombing and other aggression; and to have the United States, Canada, and the United Nations reopen a dialogue with Iraq.

Let's ask Mr. Rumsfeld to go back to Baghdad, where he was in 1983 and met with Saddam Hussein. Let him reopen that dialogue. Why not?

Let's not just end the killing and suffering of Iraqis after 12 years, but bring Iraq into the Middle East discussion, because without Iraq, we're never going to see resolution of the unending crisis throughout that part of the world.

I would like to turn to the recent resolution of the Security Council, which I think is resolution 1409 of May 24, introducing smart sanctions. Let me read into your record, if I may, a piece from The Economist, a magazine of some repute, which some of you may respect much more than an aging radical like myself. The title of this article is “Cosmetic surgery”. It says here very clearly:

Twelve years after being imposed, the siege of Iraq is set to ease, a little. New rules passed on May 14th by the UN Security Council, allowing the country to import a broader range of goods with less fuss, are intended to improve the sorry lot of ordinary Iraqis—and shift blame for the country's misery away from Iraq's besiegers to the man who holds the keys to the castle, Saddam Hussein.

Letting a few more lorries rumble into Baghdad does not mean an end to the blockade... The UN controls all of Iraq's legal export revenues. It does not allow the foreign private investment that would enable Iraq to start rebuilding its shattered industry, agriculture and sanitation system. This perpetuates Iraq's dependence on the state-rationed imports, and--since oil earnings cannot be used to pay government salaries--leaves its teachers, doctors and nurses short of a living wage.

The UN's oil-for-food programme has succeeded in stopping a precipitous plunge in living standards... However, its procedures have proved so cumbersome that it takes between six months and a year for an average shipment to make it into the country. Some $5.3 billion in orders have been frozen because of American and British fears that they might serve some military purpose. In all, [since the beginning of 1997] the $54-billion-worth of oil sold under oil-for-food has translated into less than $20 billion-worth of goods arriving in Iraq.

So they got $20 billion out of revenues of $54 billion.

This amounts to a meagre 41 cents a day per person, hardly enough to mend the country's broken infrastructure and restore its people's quality of life.

I think The Economist in this article is quite extraordinary. I don't look to The Economist for that sort of statement, and I was delighted to find it there. In fact, there's probably little for me to add, except to underline that basic food, happily, is no longer the critical crisis issue that it was when I arrived in Baghdad in 1997, although quality and even quantity are still wanting for the majority of Iraqis. Vitamins, minerals, and proteins, in particular, are still missing in the diet of many Iraqi people. This is causing, as we've just heard, widespread anemia, possibly over 70%, and levels of malnutrition perhaps in the area of 15% to 20%, plus a staggeringly high infant mortality rate. As you know, I think from 1990 it was about 50 over 1,000 live births; it's now about 130 over 1,000 live births.

The monster killer today is water-borne diseases due to the deliberate, illegal bombing in the Gulf War, as somebody from the committee mentioned already, of civilian infrastructure--electric power systems, water treatment-distribution systems, and sanitation systems. Iraq was and remains an urban society. Some 70% of Iraqis live in towns or cities. They're dependent upon these water sanitation power systems.

This destruction has not been fully repaired due to UN Security Council decisions, supported by my own country, Ireland, and Canada, to prohibit such capital investment. To this day, almost 12 years later, we have not allowed the Iraqis to rebuild infrastructure, never mind the essential economy. Both Canada and Ireland, as I said, have been party to these decisions, led, driven, of course, by London and by Washington.

As The Economist indicates, to end the killing of innocent Iraqis, the UN and we must end the punishment, end the economic embargo, and by all means, enforce paragraph 14 of resolution 687, which calls for the removal of weapons of mass destruction from all the countries of the Middle East, of course including Iraq.

Let us agree to sanction the arms trade instead of the innocent people of Iraq. It is this unending punishment of civilians, and the deadly consequence, and the full United Nations Security Council knowledge of such consequence that lead many of us to consider member states of the Security Council guilty of genocide.

Now, I am not asking this committee to endorse that concept. Instead, I would like to suggest that you may want to consider the following. One, that Canada would open the dialogue with Iraq directly, as an independent sovereign state with an extraordinary history, and I think an obligation and a responsibility to make a difference. Two, that Canada would ask the United States to remove the legislation in Washington calling for the assassination, or if you would like to use Mr. Powell's term, “regime change”, so we can move on, and in a more positive light. Assassination of foreign leaders or their removal, whatever the word you want to use, is simply not compatible with the membership of the United Nations, nor, I imagine, with the constitution of this country and many others. Three, have Canada urge the United Nations, Washington in particular, to establish for Iraq a disarmament target.

I know I'm stepping on the toes of my friend and colleague, Mr. Ritter. As you know, in the past, under UNSCOM and now under UNMOVIC, the Iraqis have never been given the specific target that this can be accomplished, and therefore, of course, they never have been able to accomplish the target. I'm sure Scott will speak to this much more ably than of course I can.

I would like to see Canada recognize that only the Iraqis really understand the complexity of their history, their country, and their social and political needs. We simply cannot do that long-distance, second-guessing the people of this country.

Á (1100)

I would hope to see Canada facilitate change from within by ending UN-United States breach of sovereignty, by ending military threats and interference from without. I'd like to see us note that Iraq has accepted this year both monitoring by the International Atomic Energy Agency and monitoring by the Human Rights Commission. That is a huge step forward and it should be acknowledged.

I believe we need to have Canada try to end the dangerous isolation and alienation of Iraq today and, perhaps even more importantly, its leadership of tomorrow, and also to assist Iraq to rebuild its economy. We have to see Iraqis back to work, see them restore their income, their spending power, restore the dinar, and enhance the possibility of oil production, which has been heavily diminished since 1990. We have to see housing construction, the rebuilding of education, health care, at least to the level of 1990, before the Gulf War, and hopefully better than that.

I would also hope that Canada would be able to encourage through good offices, and encourage the Iraqi Kurds likewise to settle their differences and agree on whatever form of autonomy is acceptable to both. They're close and it can be done, but interference by Britain and the United States I think is undermining the will of the Kurds in the northern Iraqi area to do business with Iraq and that part of the world, where they themselves will tell you--and I was there recently--they belong and intend to stay. I would like to see Canada lead the effort to bring Iraq back into the international fold as a partner and begin the task of forging peace in the larger Middle East.

Finally, I'd like to see Canada begin to remove some of the tarnish that presently stains the United Nations, a Security Council of double standards. We've just had some illustration of that from our friends from Foreign Affairs.

Canada apparently has no embassy in Baghdad because Iraq neglects UN resolutions, but I believe you do have an embassy in Israel. I think there's no more blatant neglect of UN resolutions than by that of the Israeli government.

We've heard from Mr. Sinclair that Iraq can buy anything, but he forgot to mention that in fact they do not have legitimate resources under the United Nations oil-for-food program to do just that, never mind the lists and the traps and all the bureaucratic stuff that goes on in the United Nations. If Mr. Sinclair is correct that Baghdad could do better--and I would agree with him--why do we expect such high standards of the Baghdad government when we don't in fact do better ourselves? Furthermore, because they don't do better, why do we punish the people of Iraq even further?

To close, I would like to suggest that Canada perhaps should consider a hard look at the United Nations Security Council, the corruption of the veto power, the role of self-interest in the decisions of the council, all applicable in the case of Iraq and the sanctions. This is not, I believe, the United Nations that Canada has served so well for so many years.

I believe the Canadian government has an opportunity to lead, to create UN and United States policy change, and to resolve the catastrophe of Iraqi sanctions. I beg you, members of this committee, to get on with it, because such action would serve not only the people of Iraq, of course, but also the best interests of Canada.

Thank you.

Á (1105)

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Halliday.

Mr. Ritter, please.

Mr. Scott Ritter (Individual Presentation): Thank you, Mr. Chairman.

Distinguished members of the committee, it's certainly an honour to be here to talk with you today. Later on in my statement I will talk about why Canada; why am I here, as an American citizen, speaking before your body? And I would like to highlight that what's transpiring right now is an exercise of democracy that Canada should applaud itself for. This exercise of democracy, where you have representatives of your government present their case on Iraq, and then you open it up for debate and discussion, where alternative viewpoints can be brought to bear for fair and even dialogue and discussion, is not transpiring today in my country.

So I applaud you, Canada, for exercising democracy, for showing leadership in regard to democracy. That's one of the reasons why I'm deeply honoured to be here before you today.

I believe, in the end, the only way we're going to avoid...not sabre-rattling, because there is no sabre-rattling taking place today in regard to the United States and Iraq. We aren't rattling our sabres, we are preparing for war. And we will go to war if nothing is done to stop it. My Congress just passed an emergency supplemental bill for the Department of Defense that in effect rearms, re-equips our military forces in terms of the precision-guided munitions that were expended in the war on terror in Afghanistan so that they can expand the war on terror into Iraq.

Once our weapons have been reloaded, we will go to war, plain and simple. And when we go to war, the ramifications of such a war will not be limited to the United States alone, but you, Canada, will pay the price. So you, Canada, need to be involved and must be involved. You have no choice but to be involved.

Iraq is not an academic exercise. Iraq is not a game of diplomacy. Iraq is not something where diplomats can pass pieces of paper over a table at the United Nations. Iraq is a nation suffering under sanctions. Iraq is a nation that has been devastated by war. Iraq is a nation that will once again be devastated by war if nothing decisive is done.

If Canada, NATO, Europe, and the rest of the democratic friends of the United States continue to sit on the sidelines and pursue policies that are merely an academic cover for doing nothing, the United States will go to war, plain and simple.

Why is the United States talking about war with Iraq? I think it was evident here today in your discussions. Iraq's so-called continued pursuit of their weapons of mass destruction leads the itinerary of items or grievances against the regime in Baghdad.

Let's talk about weapons of mass destruction. I stand before you because I was a senior weapons inspector in Iraq from 1991 to 1998.

I think we also need some more truth in advertising about who I am. I'm a card-carrying member of the Republican Party who voted for George Bush for President. I am not here as part of the opposition with a political agenda. That's not the case at all. I'm here as somebody who is an eyewitness to history and has firsthand knowledge and information about the facts surrounding Iraq's disarmament.

Senior American government representatives continue to assert on almost a daily basis that they have concrete knowledge that Iraq continues to possess and seek the acquisition of weapons of mass destruction, and yet they have been unable to put forward any substantive fact to back this up. Why? No such substantive fact exists.

I say this as somebody who has the reputation of being perhaps the hardest inspector in Iraq, the most strong-willed, the one who took Iraq to the brink of war on many occasions over the issue of weapons inspections. I am not soft on Iraq. I am not soft on the issue of disarmament. But I am somebody who lives in the world of reality, and I will tell you this; if we applied the initial standards of resolution 687 calling for Iraq's disarmament to the situation that existed in Iraq in December 1998, Iraq has fully complied with every aspect of the Security Council resolution. Iraq is a disarmed nation in regard to the original intent of the Security Council resolution, plain and simple.

Á (1110)

Iraq was obligated to declare and eliminate the totality of its ballistic missile force. That has been achieved. Iraq has been required to declare and eliminate its capability to produce chemical weapons, and indeed to eliminate its stockpile of chemical weapons. This has been achieved. Iraq has been required to declare its biological weapons program and its stockpile biological agent, and to subject this to disarmament under the supervision of weapons inspectors. This has been achieved. The same can be said for their nuclear weapons program.

Iraq is fundamentally disarmed. Iraq does not possess a weapons of mass destruction capability in any meaning of the word. Yet we live in a situation today where representatives of your own government can sit before you and say in good faith that they are concerned about Iraq's weapons of mass destruction capability. They say this because of Iraq's own tenuous history in regard to its disarmament.

Iraq was obligated to declare the totality of its weapons up front. It did not. Iraq held on to significant quantities of its weapons of mass destruction, including means of production. It was only after several years of concerted effort by the weapons inspectors that we finally eliminated this capability. In seeking the elimination of this and because Iraq lied, we raised the standards of verification to such a level that we are unable to give absolute certainty to certain aspects of their disarmament, so there are now gaps. But these gaps do not translate into a weapons of mass destruction capability. In fact, when you examine these gaps closely, the majority of them can be resolved simply by reviewing the documentation, but much of the documentation available is rejected as unacceptable by the Security Council at the behest of the United States. Ask yourself why this is the case.

It's the United States that is prepared to go to war against Iraq, citing Iraq's continued pursuit of weapons of mass destruction. But I am here today to tell you, as a weapons inspector who was an eyewitness to American manipulation of the United Nations weapons inspection process in Iraq for over seven years, that the United States does not put the disarmament of Iraq first and foremost when you're talking about American-Iraqi policy. It is the elimination of Saddam Hussein--the elimination of Saddam Hussein. So the United States will manipulate the data available to create a situation in which the perception of continued Iraqi possession of weapons of mass destruction is used as a casus belli. This is wrong.

Ladies and gentlemen, Iraq is disarmed. There is no justification for such a war, but the war will occur. Canada, as a leader of the free world--and you are a leader of a free world, for which we in America respect you--has a historical opportunity to step up to the fold and exercise your leadership. Should you choose not to, I'm afraid you'll be made irrelevant by history. You'll be nothing more than yet another proxy of American dominance of the world. Does Canada want to be a proxy or does Canada want to resume the leadership role it once enjoyed?

I challenge you to reassert your role in the world, in the same manner in which you've embraced the concepts of democracy today, by stepping forward and demanding the truth. If this means standing up to your friend in America, so be it.

Thank you very much.

Á (1115)

The Acting Chair (Ms. Diane Marleau (Sudbury, Lib.)): Thank you very much, Mr. Ritter. Those are quite challenging words, I must say.

We'll now go to the question part of our meeting. I'll ask Mr. Martin to start.

Mr. Keith Martin: Thank you very much, Madam.

Thank you, Mr. Halliday, and thank you, Mr. Ritter, for your courage in coming here, being an American, and being so forthright with us.

We greatly applaud both of you and what you have said.

Mr. Ritter, you described the sum of my fears, and that is why you are both here today. I mean that in all seriousness. The events that may take place in the future are deeply disturbing for the reasons that you both mentioned.

I saw you with the Iraqis on a television program.You were very tough with them, questioning them. So congratulations for that.

My questions are several-fold. First, you listened to the feelings of our department officials. They had a belief that Saddam Hussein was acquiring weapons of mass destruction.

Is your evidence based on 1998 evidence or is it based on 2002 evidence? In other words, can you both say in 2002 that Saddam Hussein has not been acquiring weapons of mass destruction?

My second question, to you, Mr. Halliday, is post-September 11. You mention that the U.S. has simplistic fears of Iraq. How does one, in realpolitik, assuage American security concerns vis-à-vis Iraq?

As well, do you know if Israel supplied chemical and biological weapons to both Iran and Iraq during the Iran-Iraq war?

Lastly, what is the obstacle today to Iraq allowing UNMOVIC in, inasmuch as Iraq's concerns over U.S. spies are not there any more, and given the fact that, as you mentioned, the Atomic Energy Commission and Human Rights Watch have been accepted as a part of UNMOVIC?

I appreciate your answering those questions.

Perhaps I may finish off by saying I went through Mr. Bush's State of the Union speech at the beginning of this year, where he outlined his four points on the case against Baghdad. The last two are givens, but the first one says, “Iraq continues to flaunt its hostility toward America and to support terror.” There's no evidence to my knowledge that there's any support of al-Qaeda by Iraq. The second point says, “The Iraqi regime has plotted to develop anthrax, and nerve gas, and nuclear weapons for more than a decade.”

Mr. Ritter, can you say with all confidence that Iraq is a disarmed nation as of 2002?

Thank you.

Á (1120)

The Vice-Chair (Mr. Bernard Patry): Mr. Ritter, please.

Mr. Scott Ritter: First of all, we should remind ourselves why weapons inspectors left Iraq in December 1998. It was not because Iraq kicked them out, but because they were ordered out by the United States government on the eve of yet another unilateral military strike, which used intelligence information gathered by the weapons inspectors as a means of deriving targets for the strike. So let's keep it in mind why we don't have inspectors in Iraq today.

But what I can say is, as of December 1998, we had an accounting problem in regard to Iraq's materiel balance, or the totality of its holdings of weapons of mass destruction. We had no information--none whatsoever--that Iraq was retaining prohibited capability. We just could not account for aspects of their prohibited weapons programs. But, in its totality, what we could not account for did not constitute a program of weapons of mass destruction. It becomes less of a threat if one applies qualitative judgments to the analysis as opposed to strict bean counting.

What transpired between 1998 and today? On the surface, you could say we don't know, because we don't have inspectors in Iraq. But what you have to bring to bear is that, from 1994 to 1998, the same weapons inspectors who were carrying out the intrusive no-notice inspections were also carrying out a widespread program of ongoing monitoring and verification, in which we subjected hundreds of Iraqi industrial facilities to continuous monitoring inspections using the highest technology available. Not once during these four years of ongoing monitoring verification inspections--which Iraq totally cooperated with--did we find any evidence of retained prohibited capability or a reconstitution.

Some of these facilities were bombed during Operation Desert Fox, in which the Clinton administration said they were being used for weapons production. Well, that can't be, because, just days before they bombed them, we had inspectors in the facilities, and we knew that nothing illegal was taking place. Iraq has rebuilt these facilities. It's this reconstruction effort that is more often than not cited by the Bush administration as evidence of Iraq's continued effort to develop weapons of mass destruction; they're rebuilding a facility, bombed by the United States, that never had anything to do with proscribed activities to begin with.

You do not build weapons of mass destruction in a basement. You do not build weapons of mass destruction in a cave. It doesn't happen in anything other than facilities of the highest technological capability. The technology required by Iraq to reconstitute its programs would have to be bought in the open market in violation of sanctions, in a manner undetected by myriad intelligence services--not just the American or Canadian services, but the Israeli, the German, and others.

No single nation can come forward with anything other than rumours of tidbits being purchased by the Iraqis. These tidbits do not constitute a weapons program. In many cases, these tidbits don't even constitute a breach of international law. They constitute an effort by the Iraqi government to circumvent sanctions, to get equipment they need to rebuild their society, which they can't do under the current sanctions regime.

The fact is we have not detected any evidence of an effort by Iraq to reconstitute its weapons of mass destruction program. But the other fact is, we won't know until we get inspectors in. So let's quit speculating; let's get the inspectors in.

But now we come to one of the important things--the obstacles to getting the inspectors in. Iraq will agree to weapons inspectors who carry out the scientific and technical job of disarmament. As the man who headed UNSCOM's intelligence cell, as the man who was behind four years of cooperation with the Israeli government to achieve the disarmament in Iraq, as the man who led the cooperation with the CIA and with British and French intelligence services, I'm here to tell you that if UNMOVIC gets involved in the same intelligence game that UNSCOM was playing, for whatever honourable reasons, they are doomed from the start.

When I was there, my job was to disarm Iraq, so I needed the information. Nonetheless, the United States of America will manipulate any intelligence undertakings by the weapons inspectors, for its own unilateral policy objectives of removing Saddam Hussein.

You have to ensure that, whatever UNMOVIC does, it's focused on the scientific and technical aspects of monitoring Iraq's compliance, and does not get involved in the very dangerous game of spying. That's a big obstacle. UNSCOM doesn't exist today because it was discredited--not by Iraq, but by its own actions at the behest of members of the Security Council.

Á (1125)

What can Canada do? Canada can hold the Security Council of the United Nations to a standard that demands total adherence to the mandates set forth by the Security Council, not only from Iraq but also from the members themselves, with no deviation.

What guarantees can the Security Council provide to Iraq that the United States will not, once again, abuse the access give to inspectors in Iraq for their own unilateral policies? That's an obstacle. It's a question that must be answered.

I have no answer about Israel's provision of chemical weapons or chemical weapons capability to Iran or Iraq.

What I would say is that America's so-called security concern about Iraq is not reflective of any threat posed by Iraq to the national security in the United States; rather, it reflects a domestic political situation in America, whereby our demonization of Saddam Hussein has created an impossible situation. We cannot consider any other alternative to solving the Iraq problem than decisive confrontation seeking the removal of Saddam. America has boxed itself into a corner.

We need our friends to stand up and show us the path out. That's another thing that Canada could do. Show us that the path out of this problem is a course that adheres to international law and full respect of the Security Council, including not only the disarmament of Iraq, but also the quid pro quo agreement that calls for the lifting of economic sanctions once a finding of compliance about Iraq's disarmament obligation has been made.

Thank you.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Ritter.

Now we will go to Madame Lalonde, s'il vous plaît.

[Translation]

Ms. Francine Lalonde: Thank you very much for being here today and I would like to thank you for the work you are doing. I don't think that we will ever be able to thank you enough.

Before I get into my question, I would just like to point out that the presentations you have made this morning not only deal with the humanitarian crisis in Irak—which of course is a very urgent issue—but also with the topic of preventing military action in Irak. I would just like to add that based on my experience in Washington with this committee, I don't doubt for one minute the relevance of what you said in your presentation.

What makes you think that Saddam Hussein would be willing to rehabilitate his relations with the international community and what evidence do you have that he would agree to participate—as far as I understand it—in a more broad-based solution to the Middle East issue?

Mr. Halliday, I think you are quite right when you say that without the participation of Saddam Hussein, there can be no definitive resolution of this problem. However, I'm sure you understand that this issue is of primordial importance for us. We have made several representations to the Minister of Foreign Affairs. As a committee, we are in a position to put forward a specific line on this matter, but before we do that, we need to know whether you have seen any signs of openness from Irak.

Mr. Ritter, do you think that the United States would be prepared to agree to their northern neighbours taking action on this issue, with the support of European and Arab allies?

[English]

Mr. Denis Halliday: The fact is, neither one of us of course speaks for Saddam Hussein or for the government in Baghdad. I certainly would not want to begin to do that. However, one does listen, one has contact. I meet with the ambassador, for example, in New York on a regular basis--the ambassador to the United Nations of course. And I think we've had lots of indications that Iraq would like to get back into the international community.

Now, of course Iraq is playing a part, whether it's Geneva or Vienna or New York, but the lack of formal connections with countries of importance is surely a blow to Iraqi self-esteem, the strength of its sovereignty, and its need for good relations in the future. I think there's no doubt that those who are thinking in Baghdad feel that this change is critically important.

In terms of the Middle East, although we both discovered today that both of us took initiatives to encourage Iraq to support the Saudi Arabian initiative on Israel and Palestine, Iraq did not jump up and make a very conspicuous statement. However, they did, as you know, go along with the decision of the Beirut meeting to support the Saudi plan, which does and would place Iraq in a situation, which I think I'm aware of independently, that they will accept an Israeli-Palestinian solution that is acceptable to the Palestinians and to the Arab world. That is a significant change.

Iraq has a glorious history as a secular state, a history of good relations with all forms of religious practice. There still is a Jewish community in Iraq. Their difficulty has been Zionism, but I think they will, as they indicated, accept an independent Israel, providing it's compatible with other Arab states and is acceptable to the Palestinians.

I think there are signs. Some of them are purely economic--oil and oil sales and the need to get the economy back on its feet. These are self-serving needs. There's no need to hide that. But we've no reason to think that Iraq would refuse opportunities to re-enter the international community fully.

The Vice-Chair (Mr. Bernard Patry): Mr. Ritter.

Á (1130)

Mr. Scott Ritter: First of all, thank you for your questions and your comments, ma'am.

I think Mr. Halliday answered the bulk of your question concerning Saddam Hussein. What I would add in the area of weapons inspections is this. Iraq knows full well the capabilities weapons inspectors bring to bear when they enter Iraq, just how good we were.

I should re-emphasize to the committee that every time the Iraqis lied to us, we uncovered the lie. We were that good. That's why I'm certain that we did a good job in disarming Iraq.

Iraq would be foolhardy to allow weapons inspectors back inside their country if they were pursuing prohibited programs. The fact that Iraq today is in serious negotiations with the United Nations about the return of inspectors, I think, only underscores how serious they are about this and how much they recognize the importance of getting inspectors back to their job.

The other question was, will the United States be prepared to accept the intervention of Canada with perhaps the support of European allies? I can tell you the United States will do everything they can to oppose such intervention. It will not be easy if Canada chooses to pick up the mantle of world leadership. But then again, great things never are easy. The United States is singularly focused on going to war to eliminate Saddam Hussein from power. This war will have devastating consequences for Americans, Canadians, and the rest of the world.

I just returned from a trip to NATO. You can ask your representatives in NATO for a full record of the briefing I provided to the NATO membership about weapons of mass destruction. Unfortunately, my country boycotted this meeting.

The reason I was invited to speak to NATO was that three successive high-level delegations from Washington, D.C., travelled to Brussels: Paul Wolfowitz, the Deputy Under-Secretary of defense; Donald Rumsfeld, the Secretary of Defense; and Richard Armitage from the state department. They provided briefings to NATO on Iraq as a means of encouraging NATO to develop a policy that was supportive of the American position vis-à-vis Iraq. They did not provide substantive fact. They provided speculation, and they refused to answer questions.

After two hours of briefing and answering questions, 16 of the 18 nations present, including over 12 ambassadors, were disappointed with the American response. They felt they had been lied to and deceived, the two exceptions being the United Kingdom and Canada. The rest of the NATO membership was very disturbed by what they had heard in terms of my being able to provide substantive fact that directly contradicted the case the United States was making for war.

You have potential allies out there, but they have been cowed into submission by the dominant position taken by the United States. At some point in time somebody will have to stand up as a friend--not as an enemy, but as a friend--and say enough is enough.

In the case of Iraq, the easiest way to do this is to demand that the United States substantiate its case against Iraq and then, if they cannot substantiate the case for war against Iraq by specifically detailing the threat posed by Iraqi weapons of mass destruction, to say there must be an alternative path. This path is the path of disarmament, adherence to Security Council resolutions, and ultimately the lifting of economic sanctions to resolve this issue.

Somebody has to step into the fold and take the leadership position. I'm hoping that it will be Canada.

Á (1135)

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Ritter.

We'll go now to Ms. Carroll.

Ms. Aileen Carroll (Barrie—Simcoe—Bradford, Lib.): I have listened carefully to the testimony. I don't have a lot of questions, but I do have a few. I have one for you, Mr. Ritter, and then one for Mr. Halliday. I'll pose them and then you can both reply.

First of all, Mr. Ritter, I understand that your supervisor in Iraq was Richard Butler. I would appreciate your advising this committee if he would, as your supervisor, agree with the views you expressed today.

Then, Mr. Halliday, although you feel that the Government of Iraq--and I'll use your word--doesn't have the “legitimate” resources to buy food, does that imply that they do have illegitimate resources, and are choosing to use those resources to buy guns rather than butter?

I feel that the options are there for the government and that they are electing, whether with legitimate or illegitimate resources, to reinforce a position of power. Certainly it goes without saying that this is not a participatory democracy we're talking about. They are electing not to use whatever kind of resources they have to ameliorate the devastating plight of their people. So you come and ask governments of other nations to do what their government does not do, in whatever manner it might be able to.

I wonder if you could both comment.

The Vice-Chair (Mr. Bernard Patry): Mr. Ritter.

Mr. Scott Ritter: Thank you, ma'am, for your questions.

I'll just remind you of the history of UNSCOM. From 1991 to the summer of 1997, the executive chairman of UNSCOM was Rolf Ekéus, a Swedish diplomat. So for the bulk of my time in UNSCOM, my supervising authority was Rolf Ekéus. He agrees with what I'm saying about Iraq's disarmament status. He has gone on record as saying that Iraq has been fundamentally disarmed.

I do have a difference of opinion with Richard Butler, who assumed the mantle of executive chairman on July 1.

Ms. Aileen Carroll: Is he an Australian?

Mr. Scott Ritter: Correct, he's an Australian and a former diplomat. Currently he is a diplomat in residence at the Council for Foreign Relations. He served from the summer of 1997 through my resignation in August 1998, up until his ultimate departure from office in June 1999.

What I would say is this: There are deep disagreements between myself and Richard Butler. He does not agree at all with some of the statements I've made here today. I have been seeking to engage Richard Butler in a debate, in any format and forum that he wants to engage in, to discuss this. He has refused to enter into such a debate. I'm willing to back up everything I've said with documented fact, and I am capable of doing so. When I talk about the work I carried out in Iraq, I can document everything.

Yes, we have disagreements. I would encourage you to invite Richard Butler to appear before this esteemed committee--

Mr. Sarkis Assadourian: Actually, we did.

Mr. Scott Ritter: --and have him sit next to me, and have he and I answer in parallel every question you may have about Iraq's weapons of mass destruction.

I am here before you today. I will take any question anybody has about Iraq's disarmament obligation, and what has or has not been achieved. The fact that Mr. Butler isn't here, despite being invited, should speak volumes.

Ms. Aileen Carroll: As a point of information--I think that just moved from A to B a little quickly--we are seeing you at your convenience. We are seeing you at a time that you were going to be in Ottawa. I'm delighted to have this opportunity. However, the committee did attempt to have Mr. Butler attend at the same time that you were available. It did not provide him with a whole lot of notice. So I think you should be careful not to draw conclusions when the data aren't there.

Mr. Scott Ritter: Well, ma'am, I'm drawing conclusions based upon over two years of attempts to engage Mr. Butler in a debate. I'll give him the benefit of the doubt now. If Mr. Butler comes back, I will come back at his convenience to engage in such a debate.

The Vice-Chair (Mr. Bernard Patry): Okay, that's clear.

We'll go to Mr. Halliday.

Mr. Denis Halliday: Thank you for the opportunity to respond to the question.

I did refer to legitimate resources as those under the oil-for-food program. The illegitimate, I suppose...although that's questionable, given the fact of Iraq's situation and circulation, being surrounded by the sanctions regime. Turkey, Syria, and Jordan, of course, have insisted and demanded the right to trade with Iraq. This is well known to the United States and the United Nations. In fact, this is the reason that smart sanctions were shot down this time last year, because the United States had planned to close the borders of those three countries. Of course, that was unmanageable, unthinkable, and unacceptable to their partners in Turkey and their friends in Jordan; I don't quite know how they feel about the Syrians. So that plan died.

This is a well-known trade. We don't quite know how much it brings in, but maybe it's $1 billion to $2 billion a year. Where is this money going? That's always the key question. I think Mr. Ritter has made it very clear, it is not going into any significant rebuilding of military capacity or weapons of mass destruction. But we have to remember that Iraq, under the arrangements of the resolutions, is entitled to defensive capability. It's always been there; it was Schwarzkopf's deal. As you may recall, he even left behind, in the hands of Baghdad, the gunships and tanks that were used to put down the risings in the north and south. So there is a defensive capability that Iraq is entitled to have. But let's set that aside.

I think some of the rest of the money is going into the very reconstruction work that Mr. Ritter mentioned, the rebuilding of capacity for food production, storage, and other essential items, including some basic pharmaceuticals, like aspirin. Undoubtedly, some is going to the Republican Guard and other areas. We also know it's going into enhanced oil production, and into some of the needs in education, health care, and agriculture. We understand that it's not being used for civil servants, salaries, and such.

Of course, there's wastage. But why are we surprised? Why do we expect a higher standard of Baghdad than we do of ourselves? Let me just remind you that, in the United States, where I happen to reside at the moment, 20% of American children go to bed hungry. Yet, the Pentagon budget has just been enhanced by $50 billion. We really are no better, so why do we expect better of Saddam Hussein? In fact, if the position that you would like to take is that he's doing a very bad job--which I don't quite accept myself--it doesn't really justify us continuing to punish the people of Iraq.

Á (1140)

[Translation]

The Vice-Chair (Mr. Bernard Patry): Ms. McDonough.

[English]

Ms. Alexa McDonough: First of all, I want to thank you very much for your powerful, persuasive presentation. There are some obvious risks to you in taking such a strong public stand, and I know you've been doing that.

I think you're also aware that the previous chair of this committee is now the foreign affairs minister for Canada. Under his chairmanship, it's my understanding--I'm the newest member here--this committee took a unanimous position that the economic sanctions should be removed from Iraq.

I have a couple of questions. Are you meeting with Canada's Minister of Foreign Affairs while you're here? If that hasn't already been arranged, are you able to meet with him if this committee is prepared to recommend that such a meeting take place? As well, I'm anxious to know what other steps you may be taking while you are here in Canada, to try to ensure that your story is heard by Canadians.

It's our responsibility, for sure, to respond to your plea that we take up our own moral obligations, instead of being totally preoccupied with moral condemnation of other countries. But what other initiatives are you taking--not to put you on the spot--that you're in a position to share, or would welcome the opportunity to share with the committee?

Finally, what else can this committee do, in your view, to try to get Canadians to more broadly understand what's going on?

The Vice-Chair (Mr. Bernard Patry): Mr. Halliday.

Mr. Denis Halliday: We're on a different agenda, in a sense. I came up specifically for this meeting. I'm dashing back to London tomorrow morning; I have other things to do there. But I think Mr. Ritter has a program that I hope will include Mr. Bill Graham, whom I met the last time I was here. In fact, he was the one who called the first session a couple of years ago. I appreciated that greatly.

I'm delighted to see he's in that seat of foreign affairs. He's going to have his work cut out for him, given the history of things and some of the civil servants I know he works with. But he's a great man and I think he'll do a great job.

I think you're right that the responsibility of informing Canadians is yours, as opposed to ours. As it happened, we did a radio program this morning for CBC, and I've been on CBC, both television and radio, more times than I can quite recall.

I'll just give you an example of how much more advanced you are here in Canada than farther south. Fox television gives me about three-and-a-half to four minutes and usually cuts me off in the middle. For CBC, I've done counterSpin twice--that's two hours. I wasn't alone, but I had some friends and colleagues, so to speak, some in opposition and some not. That's a serious discussion. So I think Canadians are much better informed than most Americans.

Secondly, you have a very active group of activists from Vancouver to Montreal and everywhere in between, Calgary--

Ms. Alexa McDonough: Halifax.

Mr. Denis Halliday: Yes, Halifax.

I mean, you are in good shape, relatively. But what's upsetting to both of us, certainly to me, is that despite being in good shape, being better informed, and having a history of moral leadership, somehow Canada isn't quite getting on board when it comes to Iraq. That is shocking and frustrating to me, and that's why I keep coming back and harassing you. When I do a media interview I harass you again, because we all want to see Canada independent and free-standing of Washington.

I'm not trying to insult you, but I just feel we don't see the divide as we used to see it, and I think it's in the best interests of this country to be seen as being independent. That's not just because of the history books, but because we all know that what has happened in Iraq, and unfortunately continues to happen as we talk, is unacceptable, whether it's law, moral law, or whatever. Canada needs to be there to begin the ending process.

Á (1145)

The Vice-Chair (Mr. Bernard Patry): Mr. Ritter, please.

Mr. Scott Ritter: First of all, thank you for your extremely kind words.

You know, I don't have an agenda. I need to make this perfectly clear. I'm not advocating on behalf of a political position, etc. I'm merely here as an American citizen who had the opportunity to serve as a citizen of the world under very demanding circumstances. I was an eyewitness to history, and I'm in possession of certain facts and insights that could be of assistance to people as they seek to navigate this difficult challenge we have set before us.

I'm a tool to be used by you, your committee, the Canadian government, the Canadian media, and the Canadian people as they best see fit. If there is some usefulness in my meeting with anybody in your government, I will be more than happy to do so, but it's incumbent upon you to facilitate this. I'm not seeking this out.

For the same reason I came here today to speak to you, two weeks ago I went to Washington, D.C., to speak with 70 Republican congressmen. Next week I will go to Washington, D.C., to speak with senior senators of the Senate foreign relations committee. I will go to headquarters marine corps and brief them on the situation as I see it in Iraq--at their invitation. I do not seek these things out.

But again, I would say that it's my honour and my responsibility as an American citizen and as a member of the global community to make available whatever information or insights I might have to those who can best use them. If I can't meet with members of your government on this trip, well, I live six hours down the road in Albany, New York, and I'd be more than happy to come back and do so at any time convenient for them.

Thank you.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Ritter.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

It's really refreshing to have a different point of view, one not from Washington or the George Bush administration.

I have four questions, very short.

Some hon. members: Oh, oh!

Mr. Sarkis Assadourian: No, no, they're very short; or rather, I have one question with four sections.

First of all, I was in Damascus on May 19, where I had a meeting with the minister of foreign affairs. I asked him about Dick Cheney's trip to the Middle East a couple of months ago to organize another coalition to attack Iraq. He said to me that it was a total failure. I want to have your reaction. That's my first question.

Second, it was mentioned earlier by the Department of Foreign Affairs that Iraq was putting conditions on the new inspectors. They wanted to know about their nationality, their background, and what have you. I thought that was a standard policy internationally, that it was exactly the same thing for inspectors who were supposed to go to Jenin. Israel said they didn't like the inspectors, that they had to have requirements A, B, C, and D, and then the UN said, no, we can't comply with that. Why is it good for Israel to put conditions on the UN but not good for Iraq to put conditions on the UN if that is the case?

As well, I was in Washington a few years ago. I asked a congressman a question about foreign affairs. I said, in 1974 Turkey invaded Cyprus and there was no reaction from Washington; in 1982 Israel invaded Lebanon, and there was no reaction from Washington; why is it that now we have a reaction against the Iraqi invasion of Kuwait? The answer was, I don't live in a world with a single standard; do you? So I would like a comment on that statement by the congressman.

Finally, do you have an embassy in Baghdad, or do you intend to have one? What's the situation with the embassy?

Thank you.

Á (1150)

The Vice-Chair (Mr. Bernard Patry): Thank you.

Mrs. Jennings, please.

[Translation]

Mrs. Marlene Jennings: Thank you very much, Mr. Chair.

I would just like to make a statement.

My local riding association has been very active on the Iraq issue for the past few years. We have made several recommendations to the party at the regional and national level, demanding that Canada withdraw its support for economic sanctions and encourage the United Nations, especially the Security Council, to address the situation in a humanitarian and peace-oriented fashion.

I have two very brief questions. Firstly, in light of all the praise that you have heaped on Canada and our democratic traditions, I would just like to know when you intend to become Canadian citizen. If you haven't already applied for citizenship, when do you intend to do so?

Secondly, what can we do to shoot down the comparison that is often drawn between the situation in Irak and the apartheid system that used to exist in South Africa and in the former Rhodesia, which has now become Zimbabwe? It has been said that economic sanctions were imposed on the regimes of both these nations and that this process caused lot of hardship for ordinary people. I continue to contend that it was ordinary people themselves that wanted these sanctions. I don't really see any similarities with the situation in Irak. Ordinary Irakis don't want this type of economic sanctions. Consequently, I'd like to know how you think we can address proponents of this type of argument.

[English]

The Vice-Chair (Mr. Bernard Patry): Mr. Duncan, you have one question.

Mr. John Duncan: Mr. Ritter, it's easy to pick up a copy of the American Spectator or some magazine like that and read about dirty bombs and other weapons. These are a real threat, are they not? If Iraq is not the problem, then where is it likely to come from? I would think with your state of knowledge and exposure to inspections, your advice on that would be considered to be expert.

The Vice-Chair (Mr. Bernard Patry): Thank you, Mr. Duncan.

Mr. Ritter, you have six minutes for all five questions.

Mr. Scott Ritter: Thank you, Mr. Chairman.

First of all, thank you very much for your kind invitation regarding Canadian citizenship. I'm very happy where I'm at right now, but I love visiting your country.

Dick Cheney's trip was a failure. I think we all agree that the record clearly speaks. But it was a failure only as we, as logical people, look at it. Understand that Dick Cheney went out and returned from his 12-nations-in-12-days trip with a different perspective. While on the one hand he had unanimous rejection of the concept of support for a unilateral American intervention in Iraq, on the other hand he did receive indications from a variety of nations that in a hypothetical sense they thought the world would be a better place without Saddam Hussein. Therefore, in some ways he further reinforced the administration's conception that if it takes decisive action in regard to Iraq, even if no one appears to support America up front, the world will fall in behind the United States like so many compliant sheep if it chooses to act against Iraq.

I think, therefore, we have to be careful of such visits. Mr. Cheney briefed the national security decision-making apparatus of the United States in a very different fashion from what's been reported in the press. He views his trip as a very positive element.

On new inspectors, first of all, there can be no conditions set forth by Iraq for any resumption of inspections. I understand it is not a level playing field out there, but let's remember that the Security Council has passed chapter 7 resolutions against Iraq that require its disarmament. The council sets the standards of disarmament and the disarmament will be determined by the inspectors. The council will pick the inspectors and pick the methods of inspection. That is the only way inspections can work.

If you want to talk about disarming Iraq, it must be this way. It's up to the council to set fair standards and ensure that whoever goes into Iraq representing the council does so as a representative of the council, and not with some hostile intent that's not sanctioned by the council.

Does the United States have an embassy in Baghdad? No, we have an interest section. I believe it operates out of the Polish embassy. But it's ironic that the United States has more diplomatic contact with Iraq than Canada does.

I'll let Mr. Halliday speak to the sanctions.

As to dirty bombs, are they a real threat? Of course they're a threat, a conceptual threat, a hypothetical threat, but Iraq had pursued the research and development of dirty bombs back in the late 1980s and rejected this program. We inspectors verified this and it is not a concern of the weapons inspectors.

Where do I think the threat comes from? We're at war against terror. Out of 19 hijackers, 14 came from Saudi Arabia. The Saudi Arabian government is the single largest funder of al-Qaeda operations around the world. Pakistan provides training for al-Qaeda. Iran possesses weapons of mass destruction that Iraq does not. If you're looking for potential hot spots in terms of what can threaten the United States, Canada, and the rest of the free world, I would say focus on Iran, Pakistan, and Saudi Arabia. You're wasting your time by having your gunsight locked in on Iraq.

Á (1155)

The Vice-Chair (Mr. Bernard Patry): Mr. Halliday.

Mr. Denis Halliday: Thank you, Mr. Chairman.

Just very briefly, the subject of double standards is a fascinating one. I'm giving a lecture in London in two days on that very subject, calling for the reform of the United Nations and the removal of the veto--and all these things that will take a lifetime to accomplish, I dare say. But the examples you gave are the examples I use also. I'm afraid I have no answer, however, to justify how we do business in the UN.

In terms of becoming a Canadian, I already have lots of Halliday cousins here. There are more Hallidays in your phone books than in Ireland. But I'll give it more thought.

In terms of your question about South Africa, South Africa is often used as a model for an economic sanctions regime that worked, so we hear. Well, it's not a good model; as you've said yourself, it's unique. The ANC invited imposition of sanctions on themselves, so to speak. It was willing to pay a price. It was nothing like the price the Iraqis have had to pay.

It leaked like a sieve. There was a lot of business going on; in fact there was some economic expansion during that particular period. It was, after all, something of a white democracy. Democracies tend to be vulnerable to sanctions, whereas dictatorial systems are not.

Frankly, I believe there are no successful models. Of course in the case of Iraq, we are seen in the eyes of international lawyers to be acting completely disproportionately to the needs. We accomplished the withdrawal of Kuwait under the first resolution. That's what it was all about. Then, somewhat fictitiously...although, as Mr. Ritter has explained, massive work was accomplished by UNSCOM in the early years and so on. We've continued the resolution 687 regime, now resolution 1409. And the bottom line is, we are punishing the innocent civilians of Iraq, most of whom were not born when Iraq invaded Kuwait. Iraqis were not consulted about that invasion. This is not, as somebody said already, a democratic system. But we are punishing the people of Iraq for crimes committed by their government in Kuwait or elsewhere.

There is just no justification for that. That's why I think countries like Canada--and hopefully my own little country, which is still a member of the Security Council and is still failing very badly, I'm afraid, to play a role--can do much better in the future.

Thank you very much.

Â (1200)

[Translation]

The Vice-Chair (Mr. Bernard Patry): I would just like to thank our witnesses.

[English]

Mr. Halliday, you came here two years ago, in March 2000. It's always very important for us to hear from you.

Mr. Ritter, thank you very much. As Ms. McDonough said, those were very powerful remarks this morning.

We're going to adjourn for five minutes to have our next witnesses. Everyone is welcome to stay. There is lunch provided in the back.

Thank you.

Â (1200)

Â (1218)

The Vice-Chair (Mr. Bernard Patry): Order.

It is our pleasure to have with us today, from the Islamic Republic of Iran, Mr. Ali Ahani, Vice-Minister for Europe and the Americas, Ministry of Foreign Affairs; His Excellency Mohammed Ali Mousavi, Ambassador; Mr. Hamidreza Nafez Arefi, Director of Americas, Ministry of Foreign Affairs; and Mr. Reza Zangeneh, Second Counsellor, Embassy of the Islamic Republic of Iran.

Welcome to our committee. It's a real pleasure to have you with us this afternoon. I understand that you have a statement.

Mr. Ahani.

[Translation]

Mr. Seyed Ali Ahani (Vice-Minister for Europe and the Americas, Ministry of Foreign Affairs, Islamic Republic of Iran): Mr. Chair and members of the Foreign Affairs Committee, I would like to thank you for inviting me here today. I would just like to give my interpreter time to settle in. It is a great pleasure for me to be here today with you and to have the opportunity to take part in your meeting. I am here in Canada on an official visit, to meet with various Canadian authorities. Relations between Iran and Canada are on a very good footing currently. We are very pleased to see that this relationship is developing very solidly.

During my visit, we have engaged our Canadian colleagues on various aspects of the relationship between our countries and on the various capacities that exist but which have not yet been exploited to strengthen that relationship. We have seen an ongoing very solid development of the relationship between Iran and Canada, especially in the wake of the official visit to Tehran of your former Foreign Affairs minister, the Hon. John Manley. Following this visit, we exchanged various delegations. A case in point was the recent private-sector led delegation to Canada. This visit proved to be very useful in gaining a better understanding of our ability to cooperate.

On the political aspect of our relationship, Canada and Iran share the same position on several international affairs issues. We fully support our Canadian colleagues' desire to continue our regular consultations on political issues. In this regard, we must attempt to develop parliamentary-level cooperation. Unfortunately, over the past few years, there has been next to no contact between Canadian and Iranian members of Parliament. This is a great shame, because we have had very good experiences in terms of direct contact with parliamentarians from other countries. Parliamentarians are able to understand each other very well, and this is a very meaningful process for both our government and the governments of other nations because it allows them to move forward more quickly.

It is for this reason then, that we should try to develop this aspect of our relationship. We would be very pleased to host a foreign affairs committee delegation in Tehran. Visiting Iran would give you the opportunity to gain a better understanding of the real Iran. Our country has been in the limelight in terms of the domestic policy and social overhaul in Iran, and also in terms of the foreign policy issue and our relationship with various foreign powers. However, were you to visit Iran, I think that it would be very instructive for you to hear your Iranian counterparts speak to their own positions on domestic and foreign matters. I think also that you might find it useful to rub shoulders directly with the various components of Iranian society.

I think that you will have heard a lot about the situation of women in Iran, for example, which is totally unlike the situation in any other country in the world. In the Middle East, it goes without saying that you have to look at the situation in the particular country through the lens of the various cultural and social values in that particular country. In the wake of the revolution in Iran, the situation of Iranian women changed very quickly. Women can now be found at various levels of government and universities for example. Last year, over 60 per cent of university exam candidates were young women. Consequently, this bodes very well for the rapid and solid development of the status of women in Iran.

On the issue of reform in Iran, the democratic process is moving forward apace.

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Of course, you have to consider the cultural and social values of our society, but the process is indeed making solid headway. President Khatami is currently putting great emphasis on the continued development of this process. There is wide support for the continuation of this policy, even though, as is perfectly natural, there is some resistance to the democratization process.

You must remember that Iran and Iranians lived under dictatorship for centuries and that it was only after the successful revolution that the real democratic process got under way. Fortunately, over the past few years, we have seen major and very rapid change. We must be patient and give the entire Iranian population time to get to grips with the democratic process. We have to be patient so as to enable the democratization process in Iran to continue.

On the issue of Iranian foreign policy, we are focussing on developing good relations with foreign powers, based, of course, on mutual respect. We are also putting great emphasis on developing dialogue between various civilizations. This was the approach put forward by President Khatami, which has been well received by the world community. This demonstrates that the world as we know it today needs to move in this direction.

We have played a restraining and constructive role in terms of the situation in Afghanistan, especially in the wake of the September 11 tragedy. We have worked in good faith with the international community on the war against terrorism.

As far as weapons of mass destruction are concerned, we believe that this issue must be addressed and we have been very transparent on this topic. We have entered into several agreements, including one on chemical weapons. We are very committed to this agreement and we have complied with it fully.

We have transparent relations with the International Atomic Energy Commission. We have worked with Russia in a completely legal and transparent fashion under the surveillance of the Atomic Energy Commission, to build a nuclear power plant. We are continuing to develop our policy of improved relations with various countries. Our relationship with Persian Gulf countries and with other Arab states are on a very positive footing. At case in point, our improved relations with Saudi Arabia, Kuwait, to name but a few. We have entered into various agreements with these countries on the issues of security and trade, etc.

We hope to be able to do more to develop the various aspects of our relationship with Canada, especially, with regard to cultural and scientific issues. There are several possible avenues for cooperation on these issues, and we are very optimistic about the future of Canada-Iran relations. We will be exchanging several high-level delegations over the coming months. Next week, your Minister of Agriculture will be visiting Iran and we are currently preparing for the official visit by our Foreign Affairs Minister to Canada in the next few months.

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Iran has maintained good trade relations with Canada and we intend to stay on this current course. Of course, we require support from both Canada's Parliament as well as our own, and I hope that we will be able to organize a parliamentary friendship group, either here in Canada or in Iran, with a view to developing more direct contacts between our two nations.

I would like to conclude now. I am available for any questions you may have. I would just like to thank you for inviting me to appear before this committee today. It is a great pleasure for me to be here.

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The Vice-Chair (Mr. Bernard Patry): Thank you very much, Mr. Ahani. The pleasure is all ours.

We shall now move on to the question and answer period. We shall begin with Mr. Keith Martin. Mr. Martin, you have the floor.

Mr. Keith Martin: Mr. Ahani, I would like to thank you for coming to speak to us here today.

[English]

Thank you very much, Your Excellency, and all of you, for being here today. We are honoured.

I also want to congratulate President Khatami for his efforts to engage in political reform within your country. He is, indeed, a courageous person.

Getting down to the nub of the matter, so to speak, the evidence I've seen is that Iran has been a significant supporter of groups committed to the destruction of Israel, such as Hezbollah, Hamas, and Islamic Jihad, to name a few.

My question is, sir, does Iran continue to support these groups, and if so, why? My second question is, what is Iran's policy towards a secure, safe, and stable Israel in conjunction with a secure, safe, and stable Palestine?

I believe you are in a remarkable position, as Persians, to work with the west and with Arab nations to try to deal with a number of the security threats we all face. I would ask you, sir, whether your government would be open to acting as a bulwark to mobilize Arab support for an agreeable resolution to the Palestinian-Israeli conflict, as well as dealing with other threats in the region, such as the possible invasion of Iraq by the United States. That is a situation that none of us want to see, I think, and a situation that can be avoided.

In doing so, I think your country can play an absolutely essential role as a leader in the Middle East for peace. By acting as an intermediary between Arab nations and the west, you could help to mobilize a coalition for peace and security in the region.

Thank you.

The Vice-Chair (Mr. Bernard Patry): Mr. Ahani, you can answer in Farsi if you want, or in French. You have translation.

Mr. Seyed Ali Ahani: In respect to the groups that you have mentioned, our policy is very clear and transparent. Our analysis and evaluation of these groups are a little bit different from others' interpretations.

To begin with, the Hezbollah is a formal part of the government of Lebanon, and it's a very law-abiding group. The other groups are fighting against the occupation of their country. We do not recognize them and all those close to them as a terrorist organization. They are fighting for independence of their country. We cannot denounce this group as terrorist. Our support is for their country and their independence.

The Israeli and Palestinian issue is very complicated. The Israeli regime does not support the idea or believe in the idea of having an independent policy in the state. They will never accept the existence of a country called Palestine equal to theirs. Israel has not respected or followed all the agreements they signed with Mr. Arafat.

The way they behaved and their humiliation of Mr. Arafat shows they really do not believe in this matter of an independent Palestine. To have stability and peace in this area, we have to prepare the conditions for that, and return those refugees who would like to return to their homeland.

Of course, under the provisions of the United Nations, conditions can be achieved to provide for the possibility of the return of those refugees who are interested in coming back to their homeland. Then there will be the possibility of having a referendum and starting a democracy in that country. Based on the principles of democracy, they should have the right to choose their own government.

With respect to Iraq, it is important that the United Nations resolutions are respected, but we have to do it in such a way that the suffering of the nation of Iraqis is diminished and we listen in that matter.

Unfortunately, Iraq's population has suffered tremendously for many years, as we all know.

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Obviously we have to make sure to help the Iraqi nation have peace and stability and a more convenient way of life...and respect. Because of our historical cultural ties, religious background, and the great civilization of the two countries, we are trying to be beside them to help them alleviate the misery of their nations--the people of Iraq.

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[Translation]

The Vice-Chair (Mr. Bernard Patry): Ms. Lalonde, you have the floor.

Ms. Francine Lalonde: Thank you, Mr. Chair.

Vice-Minister Ali Ahani, I would like to thank you for coming to speak to us here today. I have a couple of questions I would like to ask you. My first question is on foreign affairs. I am not sure exactly when this process got underway, but what I do know is that for some time—and your position as Chief Negotiator, Iran-EU Constructive Dialogue is evidence of this— there has been a desire to develop constructive dialogue between Iran and the European Union. I would like to hear your thoughts on that issue.

In addition it recently came to my attention that President Khatami was somewhat discouraged at the attitude of the U.S. and that it is reported that President Khatami had decided to abandon attempts to convene talks with the U.S. Could you perhaps comment on that issue also.

In terms of the Middle East, I believe, but I am not 100 per cent sure, that Iran supported the Saudi Arabia peace plan. I would like to know whether you agreed that there should be some international move to try to get the two sides together. It goes without saying that this action would be geared to enforcing compliance of UN resolutions. I would also like to know whether you believe that a peacekeeping force is necessary for the region.

I would also like to point out that some of my colleagues from this committee and I travelled to Palestine and what I saw there—with my own eyes—was far worse than what articles in the press in Canada had led me to believe. Consequently, I think that an urgent resolution to the Middle East problem is the order of the day.

I will stop there.

[English]

Mr. Seyed Ali Ahani: We started this dialogue with the European Union way back in 1997, and so far we've had eight meetings with them at the vice-ministerial level, and of course with the other members of the union, as well.

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With respect to these discussions, there are two important issues we have to address. One is on cooperation with Iran and the European Union itself. We have organized some task forces and working groups in this matter with them. The working groups are in the field of energy, investment, and the war against drugs.

The next issues have to do with political matters we have to discuss with them, global matters of course as well as other political matters of our countries. We are very optimistic about the progress, and we are very happy that we are going in a positive direction.

Another direction we are taking is to get an agreement regarding trade and business cooperation. In future the cabinets are going to approve an agreement to continue in that direction, especially in the knowledge that Europe is our first trading partner. Therefore, our discussions and meetings with them are very significant.

In respect to the second question, I think we agree with you. President Khatami is very discouraged by the way the Americans have scolded the country in this manner. As you probably know, after September 11 our country was very important in the fight against terrorism and of course in the good new developments in Afghanistan itself.

Certainly, if it weren't for our cooperation, the fall of the Taliban would not have happened as fast as we saw. We have a 900-kilometre border with Afghanistan. After the start of the war we just closed our borders with Afghanistan to make sure there was no way al-Qaeda could enter our territory. Also, to prevent them coming from other places, especially the Persian Gulf states, we have required a visa for people to enter our country to make sure that al-Qaeda does not use another country to enter our country.

We have substantially improved our security dialogues, our intelligence service contacts, with our European partners. We made a significant contribution in the Bonn conference, which resulted in the installation of Mr. Karzai's government in Kabul. We also contributed to the Loya Jerga, under consideration now. All of these were achieved because of the conference in Bonn.

Therefore, after September, all of the conditions were good and ready for the collaboration of the international community. There was very significant solidarity within countries to fight against terrorism. It was a good opportunity for America to use the occasion to take advantage of these matters, and the historical difficulty that they had. Unfortunately, in this matter, President Bush used his aggressive and hostile approach to our country. Unfortunately, against all principles, they have put us in the category of the axis of evil, as you know.

Iran as a whole is a very historical country, with a great civilization, cultures, and moral values, reflected especially in the emphasis of President Khatami in the matter of a dialogue of civilizations, which he has proposed. He has emphasized achieving peace for the whole world. I think I'll leave it to international opinion to judge who they're blaming. Is it us or the other who is using this type of tactic and technique to brand our country in this manner?

We don't think the Iranian population deserves being categorized in the context that has been proposed. I don't think it's fair that any president of any country uses his own judgment to brand other countries in the different categories they have used. Of course, this type of hostile approach was not even supported by his American allies. Even within the population of the United States, this type of branding was not approved of by many people.

Regarding the Saudi Arabian proposal, a similar one was presented on another occasion. The obstacle is the regime of Israel, the Government of Israel, which is not accepting having another independent Palestinian country as a neighbour.

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They did not even welcome the president of the United Nations in his peace efforts to go to the country to supervise. The type of humiliation methodology they have used with Mr. Arafat is the same type of humiliation they used with the Europeans. They especially did not let the foreign minister of Spain visit Palestine and Mr. Arafat.

We have no difficulty with the terms of the negotiation and the process of negotiation. With the personal value judgment we have from the region, we are not very optimistic about this process.

The Vice-Chair (Mr. Bernard Patry): Thank you very much.

Mr. Assadourian, please.

Mr. Sarkis Assadourian: Thank you very much.

First of all, let me extend a warm welcome to you on your visit to our country. I'm pleased that you said the foreign affairs minister will visit Canada very soon. I think it will be a very positive step forward, followed up with our Minister of Foreign Affairs' visit to Iran.

I also have to say that you have a very active ambassador. He was a guest speaker at one of my public meetings in Toronto. My old riding of Don Valley North has the largest Iranian-Canadian population in the country. It is very concentrated. I live in that neighbourhood, basically, so I know quite a bit, not only about historical relations with Iran but also constituency-wise.

I have also had a chance to meet a couple of members of parliament from Iran who were here in the last few years. That reflects on the term used, “Millet”, the concept of parliament that I really appreciate, as do many people like me.

I have two questions. First, you elaborated on the Middle East peace process with the summit in Beirut. You mentioned that this proposal was not new. I agree. But under the circumstances, or in the context it was proposed, maybe it's more up to date. It was presented in 1982, I believe, at the Morocco conference.

The second question is on the conflict between Iran and Iraq. It has been about fifteen or twenty years now. We always hear in statements, news clippings, or news items that there are still some prisoners between Iraq and Iran. The International Red Cross and Red Crescent tried to negotiate. Can you give us an update on the situation on the border with prison exchanges, if you have any prisoners?

I have one final point, if I may. In the past, we discussed a parliamentary exchange program with your ambassador. I'm glad you're doing it. It shows the system of negotiation between our parliament and your ambassador was a productive one.

Mr. Seyed Ali Ahani: I'll start with the last question. Therefore, the first answer regards the exchange of parliamentarians.

We welcome the gesture. We would sincerely would like it to happen. Of course, our parliament has the final say on this. However, from our perspective, we'll be very happy to encourage them to do so.

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We have different types of exchanges with parliamentarians from different countries in Europe. One thing is that we have a parliamentary committee between our parliament and the French parliament, which makes it easier for exchanges of parliamentarians for both sides. If we could organize in Canada a committee like the one with France, we would welcome that, and I'm sure our parliament in Iran would welcome this prospect very openly.

Another way to do it is by the exchange of groups from the foreign affairs committees. This could be with the president or the vice-president and some members of the committee. Of course, the Speaker of the House can visit our parliament. During this evening's meeting with the Speaker I will invite him to come and visit our country.

We believe this is an extremely important opportunity for bonding between the two countries, and we are extremely supportive of this matter. I will request His Excellency the Ambassador of Iran to pursue this matter as much as possible with friends in parliament here in Canada.

With respect to Iran and Iraq and the difficult obstacles and problems we have, of course, after many years still there are obstacles between the two countries. In the last few years there have been some exchanges of delegates between the two countries, and this has to some extent eliminated some of the obstacles and difficulties we have had. One of the most significant humanitarian issues is the exchange of prisoners of war. It looks as if this has gotten to the point where there are very few left. Hopefully we're at the end of that process, and hopefully this prisoner of war matter will be resolved.

Iraq is interested in the expansion of trade with Iran; on the other hand, we are also letting them know that they have to respect the United Nations resolutions, and the sooner the better. Iran and Iraq's fate is that we have been neighbours for years and that we will be for years to come.

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You are very lucky that you have only one neighbour, though sometimes you have problems, such as with the lumber industry. Iran is neighbour to fifteen countries, and with each one of them we have a particular set of difficulties and problems. And every one of them has its own type of difficulties and problems. With five of them we have the difficulty of the laws and legal regime of the Caspian Sea area. The situation with Afghanistan you already know; it's very transparent and you know the difficulty and complexity of it. With Pakistan, of course, basically we have the border difficulty and illegal entry and exit and so forth from that part. Our policy of course is based on eliminating the tensions and improving cooperation within the countries, with our neighbours.

In respect to the first question, you're right that the proposal Prince Abdula presented was a little different from the previous one in Marrakesh in 1982 that you mentioned. The major difference, of course, was the promise of recognition of Israel, provided it also recognized the Government of Palestine's rights, the integrity of its country and independence.

In spite of the high expectations for this proposal, the regime of Israel was not encouraged by it. In reality, since then the regime in Israel has not believed in the existence of a Palestinian state next to them.

The Vice-Chair (Mr. Bernard Patry): Thank you.

We'll go to Mr. Cotler.

Mr. Irwin Cotler (Mount Royal, Lib.): I would like to join my colleagues in welcoming you here, and I thank you for your statements this morning, particularly those that relate to the possibility of closer relations between parliamentarians of our two countries.

As you know--and you mentioned it in your testimony--the former Foreign Minister of Canada, John Manley, visited your country in October 2001. Both Mr. Manley, during his visit to Iran, and more recently our new minister, Bill Graham, in March of this year, called upon Iran, if I can use their words, to “cease its support” for what they would characterize as the terrorist groups of Hamas, Islamic Jihad, and Hezbollah.

Now, you have mentioned in your statement today that you take a different point of view. You have a different perspective. In your view, these organizations are not terrorist organizations; rather, you regard them as groups who are resisting occupation and who, therefore, in your view, should not be characterized as terrorist groups.

I have two questions in that regard, if I may. Hamas and Islamic Jihad, for example, by their own covenants, have publicly called for the destruction of Israel; in other words, not just for an end to the occupation, but in fact an end to Israel.

As well, your former president, Mr. Rafsanjani, was quoted in December 2001 implying that he as well would not support the continuance of Israel and would even support the use of atomic weapons against Israel if need be.

My question is, therefore, leaving aside your position of resisting occupation in terms of these terrorist organizations, do you support their view with respect to their statements that they seek the destruction of Israel? And if I could just put it more expressly, what is Iran's view specifically about Israel's right to exist within secure and recognized boundaries in accordance with resolutions 242 and 338, which you yourselves have also supported?

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The Vice-Chair (Mr. Bernard Patry): Mr. Ahani.

Mr. Seyed Ali Ahani: In some areas we might think differently from the Canadian government, and of course this is natural. Dialogue means more when there are differences of opinion. Through that something comes out. If everybody agrees on everything, then there is no dialogue. So this doesn't look like a terrible problem just because we have differences of opinion on some issues.

But on many important international issues, we are very close to Canadian diplomacy and government. We are very close and think the same way as Canada's emphasis on multilateralism, human rights, and the role of the United Nations in international matters.

In respect of the matter that you mentioned, especially your point about ex-president Rafsanjani, I have to explain a few things. I do not know if you have seen the texts of ex-president Rafsanjani, but personally, I read the matters after the regime of Israel brought up these matters. So I have read these thoroughly, and would like to explain something.

The problem we have--and we are on record with this--is that some issues presented by the Israelis are accepted by the whole world at face value. Going back to the statement of Mr. Rafsanjani, the Israelis claim that Mr. Rafsanjani mentioned the use of the atomic bomb for the destruction of Israel...or regarding the kinds of ships they claimed. Mr. Rafsanjani was analysing the situation in the region. He was actually warning the western Europeans, or the west in general, about equipping the Israelis with weapons of mass destruction as well, including atomic bombs.

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As well, Mr. Rafsanjani mentioned that if the Israelis were preparing themselves for those matters, of course the Islamic countries were also going in the same direction.

And this is going to be a very catastrophic situation for world peace. If the Israelis decide to use this weapon of mass destruction or atomic bomb one day... Israel is a very small country, with one bomb it can be destroyed. On the other hand, the Islamic countries are many and they are widespread all over the world and they could not all be targeted for this weapon of mass destruction. Therefore, there is more danger to Israel than to any others in that respect.

This is what Mr. Rafsanjani presented to President Khatami, and I have elaborated on that.

Did you take any notes on my statement, as I was explaining, that this means there is a threat against Israel from us?

Mr. Irwin Cotler: No, that's why I asked you that question.

Mr. Seyed Ali Ahani: This is a regret. Israel claims that Mr. Rafsanjani threatened them with the atomic bomb. Even you thought in the beginning that perhaps this was the case, but obviously this is not the case.

Mr. Irwin Cotler: No, I asked a question. I didn't take a position.

Mr. Seyed Ali Ahani: Again, the perceptions were there, not personally yours but many others...to the Israeli position that Mr. Rafsanjani had threatened the State of Israel with the atomic bomb and weapons of mass destruction. This was not the case; this was never was the case.

Regarding the famous ship that carried...everybody knows that we had nothing to do with it. After all the claims were made I had a trip to Brussels. Mr. Saline expressed his surprise and...basically brought these issues up with him. I responded to him by saying: “We had nothing to do with it. If you have some document, or anything else, or something that we don't know of, please provide it to us.”

On behalf of the United States, I even had a meeting in Tehran, Iran, with the Swiss representative. He expressed that the Americans were very concerned about this matter and Iran's involvement in that dilemma. We asked him if there was any documentation available through any sources, to please provide it to us because President Khatami personally was interested in understanding the nature of this matter. We really asked for their help in that matter. No information was provided to us.

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The Vice-Chair (Mr. Bernard Patry): I have just one final question. It will be a very short question and I hope it will be a short answer also, because we have question period pretty soon.

What's the position of Iran regarding the current United Nations sanction regime to Iraq and about the possibility of the U.S. widening its war on terrorism to Iraq? This morning we discussed the situation in Iraq.

Mr. Seyed Ali Ahani: We disagree and we are against the use of military force against Iraq. On the other hand, we also worry about the accessibility of the weapons of mass destruction by Iraq. This is against our policy of use of weapons of mass destruction in principle. Of course we are interested in a United Nations resolution preventing Iraq's accessibility to these weapons of mass destruction. But this matter could be resolved in such a way that the nation of Iraq is not suffering as a consequence of decisions made.

The Vice-Chair (Mr. Bernard Patry): Thank you very much.

That's going to put an end to our discussion this morning. I just want to thank Mr. Ahani, your excellency, and Mr. Reza Zangeneh for being here with us this morning. I hope it's just the first of many meetings we will have together as a parliamentary friendship group between our two countries.

Again, thank you very much for being here.

We are adjourned...or before we adjourn, members, this morning Mr. Martin tabled a motion. Perhaps he could read it.

Mr. Keith Martin: Yes. I'm presenting a notice of motion. The motion will read as follows:

That the committee request the Government of Canada to ask the United States government to provide evidence that Iraq has been building, manufacturing, or accumulating weapons of mass destruction.

The Vice-Chair (Mr. Bernard Patry): I understand that we don't have quorum this morning. So you're tabling this, and it will be discussed at the next meeting.

Mr. Keith Martin: Thank you.

The Vice-Chair (Mr. Bernard Patry): Now we're adjourned.