Mr. Speaker, it is a great pleasure to rise in the House today to begin debate on Bill , the Canada-Jordan free trade agreement. Our government is committed to securing and deepening access to traditional markets, like the United States, and broadening and expanding access to more markets, like Jordan.
Trade accounts for over 60% of our annual GDP and, with one in five Canadian jobs generated by trade, it is a matter of fundamental importance to the financial security of hard-working Canadians and their families.
Our focused pursuit of new free trade agreements helps to demonstrate our government's commitment to helping Canadian workers and businesses compete in markets abroad, as well as our commitment to creating more jobs and economic growth for Canadian workers.
We continue to see fierce competition in the global marketplace, with emerging economies and global players continuing to climb the value chain and establishing themselves in a wide range of sectors.
This government will do everything it can to ensure that Canadian workers and Canadian businesses have the tools and opportunities to build the links needed to succeed in today's global economy. Our government is committed to bringing continued economic prosperity to Canadians by pursuing bilateral and regional free trade relationships. Negotiating and implementing trade agreements with our international partners will also help to level the playing field for our companies in an increasingly complex and competitive environment.
Pursuing free trade agreements sends a clear signal that protectionism is not the right way to achieve increased global stability and prosperity. In these challenging times, deeper trade ties are the best way to create jobs and economic growth. Our government will get that done. That is why we have an ambitious, job creating, pro-trade plan. The Canada-Jordan economic growth and prosperity act is a key part of this plan.
The Canada-Jordan free trade agreement also demonstrates Canada's support for an Arab state that, like Canada, supports peace and security in the Middle East.
We will recall that in 2007, the Rt. Hon. Prime Minister joined His Majesty King Abdullah II in a commitment to take our commercial relationship to the next level. The Canada-Jordan free trade agreement, along with related agreements on labour co-operation and the environment, signed in 2009, are a direct result of this commitment.
Canada's economy is export driven. Canadian families understand that trade is a kitchen table issue that provides jobs and helps put food on the table. We know it is in our best economic interest to seek out new opportunities for our producers, workers and exporters in as many foreign markets as possible.
Moreover, negotiating free trade agreements allows for Canadian firms to specialize and increase their comparative advantage in the global marketplace. By improving access to foreign markets for Canadian workers and businesses, this government is keeping its commitment to support economic growth and create new jobs for Canadian workers.
In a number of countries, Canadian firms are at a competitive disadvantage because their foreign competitors have preferential market access under some form of a free trade agreement. The Canada-Jordan free trade agreement addresses this serious issue by leveling the playing field with key competitors who are already benefiting from free trade agreements with Jordan, namely competition from the United States and the European Union.
Through the Canada-Jordan economic growth and prosperity act, our government is ensuring that Canadian workers and firms are on equal footing to compete with firms from across the world in the Jordanian market. Opening doors to trade and investment is the right approach for creating opportunities for Canadian workers and businesses in global markets.
The Canada-Jordan free trade agreement would create new export opportunities and strengthen bilateral ties between our two countries.
The free trade agreement with Jordan would benefit both Canadians and Jordanians by giving Canadian and Jordanian exporters unprecedented access to our respective markets and eliminating tariffs on a number of key products. World leading Canadian sectors, like forestry, manufacturing and agriculture and agri-food would benefit.
Over the years, Canada and Jordan have built a strong, mutually beneficial relationship. This free trade agreement continues to build on that important start. It is a relationship grounded in common aspirations, like peace, stability and prosperity for our citizens. This new free trade agreement would help to move these aspirations forward.
Despite the recent economic downturn experienced by the global economy, our bilateral trade with Jordan increased to $85.9 million in 2010 from $82.5 million in 2009, indicating that the longer-term trend of our trade relationship is one of growth.
For example, Canada's 2010 merchandise exports to Jordan of $66 million were more than double the $31 million total in 2003. This free trade agreement would provide the opportunity to further enhance this trend of upward growth.
Jordan's current average applied tariff is 11%, with peaks of up to 30% applied on some Canadian exports of interest. In fact, 67% of Jordan's tariff lines, covering over 99% of Canadian exports, will be eliminated when the agreement is first implemented. This is a huge step forward in the growing economic partnership between Canada and Jordan and will help to ensure that Canadian firms remain competitive globally. Jordan's remaining tariff reductions will then take place over three or five years.
Let me give a better idea of the specific sectors that will benefit if the Canada-Jordan economic growth and prosperity act is quickly moved through the House.
Top exports in 2010 included paper and paperboard, vegetables, wood, vehicles and machinery. In 2010 Canada imported some $20 million in goods from Jordan, including both knit and woven apparel, inorganic chemicals, precious stones, mainly jewellery, and vegetables, cucumbers.
Our trade relationship has clearly been growing, despite Jordan's most favoured nation applied average tariff of 11% and peaks of up to 30% on many key Canadian exports.
The Canada-Jordan free trade agreement aims to remedy this situation and promote continued prosperity for Canadian workers, producers and exporters. Once this agreement is brought into force, Canada will immediately benefit from duty-free access for over 99% of current Canadian exports by value.
What does this new agreement mean for individual exporters? Permit me to run through some specific examples, starting with the agricultural sector. Canadian exporters of pulses, lentils, chickpeas, beans and peas will benefit from the immediate elimination of Jordan's tariffs of 5% to 10% on these products. Of Canada's $7 million of vegetable exports to Jordan in 2010, the majority were lentils and chickpeas, which currently face a 5% tariff, and peas that are subject to a 10% tariff, both of which go to duty-free access immediately upon implementation of the agreement.
In 2010 exports of frozen potato products to Jordan totalled some $88,000. These exporters will benefit from the immediate elimination of a 20% Jordanian tariff and place them on a level playing field with competitors in the U.S. and the E.U., which currently benefit from duty-free access to the Jordanian market.
Canadian beef exporters will benefit from the immediate elimination of Jordanian tariffs, which range from 5% to 23% on all beef products, including fresh chilled frozen and preserved meat and offal and processed products such as sausages and jerky.
Jordan lifted its restrictions on Canadian beef products in February 2009, which will allow this sector to benefit from these lower tariffs.
Animal feed will also benefit from the elimination of Jordanian tariffs of up to 23% and some of these are currently subject to an additional 10% tariff that will be eliminated immediately upon implementation of the free trade agreement.
The Canada-Jordan free trade agreement is certainly more than just agricultural products. The elimination of Jordanian tariffs, ranging from 15% to 30% on certain wood products, could benefit Canadian exporters of doors, frames, joinery, shakes and shingles and other building materials.
Canadian exporters of paper goods, such as toilet paper, paper towels, facial tissues, envelopes, stationery, wrapping paper, boxes and corrugated cardboard, will benefit from the elimination of Jordanian tariffs ranging from 10% to 30%.
With $9.7 million in exports in 2010, mainly light passenger vehicles, Jordan is a growing market for Canadian auto and auto parts exports. The elimination of Jordan's tariffs ranging from 10% to 30% will help Canadian exporters to further expand into this market.
Canada exports a variety of mechanical and electrical machinery to Jordan, $9.2 million in 2010, including heavy construction and mining equipment, communications equipment, filtration or purification devices, pumps, machinery and components. The elimination of Jordanian tariffs, ranging from 10% to 30% on a variety of current and potential Canadian machinery exports, will certainly help our machinery manufacturing sector.
Canada's exports of pharmaceuticals to Jordan totalled just shy of a million dollars in 2010, of which 80% were subject to a 5% Jordanian tariff. That will be eliminated upon implementation of this free trade agreement.
Although Jordan is currently a small market for Canadian fish and seafood exports, the elimination of Jordan's 10% to 30% tariffs on fish and seafood could help Canadian exporters expand their presence in the Jordanian market.
I have to admit that I have covered a lot of numbers, but numbers matter to Canadian workers, producers and exporters. In an increasingly competitive world, lower tariff numbers can make the difference for exporters who are considering whether to expand or enter into a new market.
This growing trade relationship is just one of many reasons why our government continues to work with Canadian businesses to ensure closer commercial ties to the Jordanian marketplace. Our government's work to support Canadian firms doing business in Jordan has been recognized by the business community in Canada and has been met with support from a wide range of businesses, including the Forest Products Association of Canada, the Grain Growers of Canada, the Canadian Cattlemen's Association, as well as the Canada-Arab Business Council, all of which appeared before the Standing Committee on International Trade.
Members will remember that our free trade agreement was just one of the agreements we signed with Jordan in 2009. We also signed a bilateral job-creating foreign investment protection and promotion agreement, which came into force on December 14, 2009. This job-creating investment agreement establishes clear rules for investment between our two countries.
Canadian investors are particularly excited about opportunities in Jordan's resource, extraction, nuclear energy, telecommunications, transportation, manufacturing and infrastructure sectors and this job-creating investment agreement provides Canadian and Jordanian investors with the predictability and certainty they need when investing in one another's markets.
I am sure members will agree that this free trade agreement and the 2009 job-creating foreign investment protection and promotion agreement with Jordan are no doubt complementary.
We are living in very challenging economic times and the economy remains our government's number one priority. In order to ensure that our economy continues to grow and continues to be competitive in the global marketplace, trade barriers must be broken down all across the world, through new free trade agreements.
Protectionism is never the answer. Our government believes that Canada's ability to continue to recover from the global economic downturn depends, in large part, on the global trade and investment partnerships that we pursue. That is why we are moving so ambitiously on free trade negotiations with our global partners.
Since 2006, Canada has concluded new free trade agreements with nine countries, most recently, an agreement with Honduras that was announced August 12. Canada is also in discussions with many more countries, including the European Union and India, two of the largest, most promising markets in the world.
This government is dedicated to ensuring that the Canadian economy remains strong through pursuing trade relationships that work for Canadians. This ambitious pro-trade plan is important for Canada.
Passing the Canada-Jordan economic growth and prosperity act will allow for the quick implementation of the free trade agreement with Jordan in order to help Canadian workers and Canadian businesses compete.
Earlier this week, the was debated. Unfortunately, the NDP opposed the Canada-Panama economic growth and prosperity act. This should not come as a surprise, as its record is very clear. The NDP has opposed all trade agreements.
Unlike the NDP, our Conservative government is focused on broadening and deepening our trading relationship, as it protects and creates jobs and economic growth for Canadian workers and their families.
I reach out to the NDP and the Liberal Party. We need their support to pass these free trade agreements in the House. They are important for the Canadian economy. They are especially important in these trying economic times. Unfortunately, every time we reach out, we hear the same things in return. The NDP continues to represent some very narrow special interest groups. It continues with its job-killing, anti-trade agenda. It continually invents any reason at all not to support free trade agreements. On Monday, at the end of the day, the NDP said that, once again, it would oppose this agreement.
While we are focused on protecting and growing Canada's economy through our job-creating, pro-trade plan, we continually have to deal with opposition parties that obstruct this. That is the last thing we need. I would urge all my colleagues in the House of Commons to give support for a quick passage of this bill so the international trade committee can begin its work.
We have seen a very clear position come down on the side of the NDP. I do not expect that to be the position of the Liberal Party, the third party in the House. We would hope we do get its support on this bill.
However, let me assure Canadian workers and their families that our Conservative government will be strongly supporting the to ensure we continue to create jobs and economic growth. It is now time to move ahead with the legislation.
Our government and our party will send a clear message to Canadians that continued prosperity for Canadian workers and Canadian businesses is a priority, not just for the Conservative Party but for the House of Commons. The best way to do that is through ensuring a speedy passage of Bill .
This is important legislation. It was before the House in the last Parliament and it is before the House again. I urge my colleagues to send this to committee as quickly as possible and then send it back to the House post-haste.
Madam Speaker, I am pleased to rise on Bill . I will get to this particular trade bill, but I want to address a couple of comments that have come out in recent discussions.
The member for was referenced with respect to his comments relating to buy America. As vice-chair of the Canada-U.S. Parliamentary Association, I have been to Washington many times and have met with many different congressional and state representatives, as well as senate representatives, heads of committees and so forth relating to buy America and Canada's position. Many of them have argued that Canada should have had a reciprocity clause with respect to buy America by having our own buy Canada act as part of a defence that would have negotiated the removal of buy America because we have now seen it grow even further. What the government does not understand is that there is buy America and buy American. There are two acts that actually have protectionism in them.
Most recently we have seen it happen again where, despite the minister going down to Washington, we actually have more problems because we will see more legislation. There is another piece of legislation that has been tabled in the House that actually calls for the buy America act to be involved in the transportation sector, which it was not before. Therefore, there are more barriers coming up and they come with a series of issues.
Cross border trade was noted as well and the prosperity deal that was signed last week by the and President Obama. What is interesting about that deal is that it concentrates mostly on petroleum and pushing our oil in Washington, and not looking after our manufacturing sector and other trade. Our trade and manufacturing jobs have gone down to the lowest level since we have been actually taking those numbers and making them public in the 1970s. We have the lowest amount of manufacturing jobs left. That is because the government has been obsessed with oil versus that other value-added trade.
What happened today is very important with respect to the announcement last week. We learned that the failed to move on legislation to protect a new border crossing in my riding at Windsor-Detroit where 40% of our trade goes to the United States every single day. It goes along a two-mile corridor. We are trying to build a brand new border crossing, a new public bridge. It has been blocked along the way by a private American citizen who has literally bought up the Michigan legislature. He has spent over $1 million in donations and has blocked the actual construction of that bridge.
Therefore, when we are talking about trade with Jordan or with the United States, it is important to note who our number one customer is, that being the United States. The way that we have been signing deals and arrangements has actually been lowering us. We have put ourselves in a trade deficit. That is the reality. New Democrats are interested in trade. We are interested also in making sure it will be done in a fair and balanced way. There is nothing wrong with that.
There is no way a Canadian can compete here, which is what we are asking for, with sweatshops in Jordan, some of which are Canadian companies. I will give a specific example later on. These sweatshops take offshore labour, often from Sri Lanka and other developing countries, 75% of them women, house them and put them in deplorable conditions to produce clothing.
How is the textile industry in Montreal able to compete with that? Will we accept that? Should we as citizens accept to wear cheaper garments produced by people who have been put into abusive situations and who are being taken advantage of? That is well-documented.
It was interesting to hear the criticisms about us saying that the labour movement is in favour of this now and that we are offside. The United Steelworkers originally supported the 2000 agreement between the United States and Jordan with respect to a trade deal. It is one of the situations I will be looking at with respect to amendments to get that undone. The United Steelworkers went on a fact-finding mission to see what happened because it had labour and environmental agreements and a whole series of things that were included but were voluntary. It found very little change. There was very little substance to the differences it was experiencing in the past because there was no enforcement.
This week we saw how our environmental enforcements are often not working within our own country. Therefore, we can just imagine what the rights of people in a kingdom like Jordan, which is not a democracy, can subject them to.
There is a responsibility and, generally, an interest for us to find some common ground and move some of those serious issues to closure. Surely we do not want the abuse and mistreatment of women fleeing Sri Lanka to increase because Canada has signed a free trade deal with Jordan. I would hope that is not the case. We want some measures in this agreement to make sure we can eliminate those issues. Perhaps there is an opportunity.
Side issues to bilateral trade, such the environment and labour, are often very much weakened because there is no regulatory enforcement, but we can build that into the legislation, and New Democrats will be looking for that. It is a carrot and stick approach. There is an offer to Jordan to improve trade and improve access to markets, theirs and ours, but at the same time we will be seeking improved humane labour standards, improvements we all think we can agree on.
Would anybody want to diminish those things? That question has to be asked. If we were to fuel further problems, would that be something we would support and be proud of as a country? We see that we have turned a blind eye to this in many respects when we look at what has happened across the world more recently with Libya and other states. We often turn a blind eye to some of these things for corporate interests. At a certain point we need to talk about global trade and all that kind of stuff, where there is no room for rights, the environment or other things; however, we need those things to be in place to improve our lifestyles and improve our planet. There has to be some balance.
Jordan may not be able to reach our standards right away. As consumers, we will demand that manufactured goods meet certain standards. When we buy a sweatshirt, a product with a zipper, or clothing, we want those products to meet certain standards, but at the same time we allow people to work for 14 hours a day, not have time off and be housed in warehouses and unclean areas. We have to address this issue. If that is the difference in getting a sweater or sweatshirt a couple of dollars cheaper, it is wrong.
We have a moral responsibility to address this issue while we can. If we take the blind eye approach, we are actually victimizing them, because we are aware of the standards we have in Canada. We do not allow child labour in Canada, so we should not be ignoring those issues with Jordan and other states.
There are issues because of a side agreement, but the conclusion in the environmental assessment that was done under the Canada-Jordan Free Trade Agreement was this:
Even if dramatic increases in bilateral trade flows occurred as a result of the implementation of the Canada-Jordan FTA, the economic effects of this Agreement would be modest relative to Canada's overall economic activity given the relatively low levels of bilateral trade and the size of the Jordanian economy. As a consequence, related environmental impacts in Canada are not expected to be significant. Moreover, environmental impacts, if any, will be addressed and managed by the existing environmental management programs in sectors that stand to gain in the FTA such as forestry and agriculture.
What is going to happen is that there will be no new regulatory oversight or repercussions related to this deal. It is interesting because the Conservatives talk about these issues in these trade agreements as if they are going to expand increasing markets, but their own research is telling them it is going to be relatively modest. What makes it really ironic and rich is that although the Windsor-Detroit corridor has 40% of our daily trade, $1 billion, flowing through the border, we still have a problem with securing a new site; meanwhile, the government is talking about putting this deal as a priority. It has tabled legislation for Jordan, but when the was advised by his own department to table legislation to protect our number one trading partner and border crossing in Canada, he did not do it. The government's policies in this last session of Parliament have been to drive Canada down and apart, not build it up.
The government was advised specifically to take action because we are at high risk when it comes to the Windsor-Detroit crossing, since 40% of the trade crosses there, private American citizens own the bridge, and it is 80 years of age. Our manufacturing value-added system is at risk. We have watched a watershed of jobs leave from Ontario, Quebec and other places, including jobs in manufacturing across the country, and what has the government been focusing on? Panama and Jordan.
That is what the government has tabled as legislation. Our number one trading partner, our number issue, is the United States. The goes to the United States, signs a border agreement and talks about infrastructure. Meanwhile in Michigan, the new border crossing is languishing because the government has not passed a law. The government's own minister was advised in his briefing book to actually act on the Windsor-Detroit crossing to stop lawsuits and prevent it from being blocked. He never did it.
Instead we have this bill, and we have issues with it. It is important to note that when we have these issues, there has to be proper follow-up. We will see if that is going to happen.
I will give a good example. In 2011 Jordan signed the international convention on domestic work. It provides for some protection for workers on the international level. Jordan signed that agreement and adopted it, but has yet to ratify it. Even when Jordan has been out there in the world trying to promote improvements and saying to the world that it is going to do some things, it has yet to ratify that agreement.
How long does that take in the Jordanian system? It probably does not take long. It is a kingdom. The legislative process will not take years. That is one of the things we should be demanding. We should be asking when it will be ratified, when it will be implemented, how things are to be measured, and how Jordan will ensure that workers are going to be protected.
I want to talk a little about those workers and those conditions, because Canada is connected there. I am talking about Nygard, Dillard's, JCPenney, and Walmart, which are linked to human trafficking, abuse and the Jordanian sweatshops.
It is really important to note the United Steelworkers looked at a number of specific plants in different areas. They sent a fact-finding mission over there. What they found is that there are 1,200 foreign guest workers trapped in the IBG factory, and nothing helped when they actually signed the U.S.—Jordanian agreement.
They went back and found that they still had problems. The east factory has about 600 workers: 300 from Sri Lanka, 200 from Bangladesh, and 100 from India. That is an example from one of the factories. I have pictures here. It looks like a warehouse. It looks more like a place for agriculture warehousing or something like that.
An estimated 75% of the guest workers are women between the ages of 18 and 30. It is a young workforce, predominantly women, in conditions that are absolutely abysmal.
Why do we not take this opportunity to say to Jordan, “Fine, we are open to trading and improvement, but we do not want those goods and services provided through abusive behaviours. We do not want them. In fact, if you do not fix some of the stuff you are doing now, then we are not going to move forward on this agreement”.
Alternatively, we could set benchmarks with enforcement tools or ways to peel back parts of the agreement if Jordan does not meet those benchmarks, unless the objective is to turn a blind eye and allow foreign workers to be abused so that we can get cheaper clothing.
We might as well just say that if that is the way it is going to be. If we are going to ignore the photos, ignore the visitations, ignore the pleas from the workers who have actually smuggled out a number of different tags, some from Canadian companies, at their risk, and ignore their cries for help, then we might as well just say that is what we are going to do.
These side agreements on labour and side agreements on environment are not enforceable, although there are some lofty words in some of these agreements.
With regard to the issues on labour, I will provide a good example. The real problem is that they have the words in there, but there is no final accountability. The side agreement is a good example. Under “corporate social responsibility”, it says:
Recognizing the substantial benefits brought by international trade and investment, the Parties shall encourage voluntary best practices of corporate social responsibility by enterprises within their territories or jurisdictions, to strengthen coherence between economic and environmental objectives.
It is so vague it does not matter, and there is no enforcement. It is not worth the paper it is printed on. It does not help the worker from Sri Lanka who is killed in one of the sweatshops. They have pictures here. It does not help the workers who are abused on a regular basis.
It is interesting, too, because when they go to Jordan, there is a process. They are processed. This is the sad and scary thing about this situation. There is a process taking place with the full consent of the Jordanian officials.
Do members know what happens? Guest workers are trafficked into Jordan, stripped of their passports and held in slave labour conditions. Workers' passports are confiscated. Their routine is 16-hour shifts, seven days a week. They work in the factory 111 hours a week. They are cheated out of half their legal wages. Workers are slapped and threatened with deportation. There are reports of sexual harassment and abuse. If, for whatever reason, a worker misses a shift, that worker is docked two days' pay and punished. They live under miserable, primitive dorm conditions lacking heat, with only sporadic access to water and infested with bedbugs. In fact, one was actually brought back to the University of Ohio to confirm that the bedbugs were actually feasting and gorging on those people in that environment. The due diligence has been done to investigate the conditions in Jordan.
Here is a routine shift they work: 7 a.m. to 9 a.m., they work two hours; 9.a.m. to 9:15 a.m., they have a 15-minute tea break; 9:15 a.m. to 1 p.m., they work for three and three-quarter hours; 1 p.m. to 1:30 p.m., they have a half-hour lunch break; 1:30 p.m. to 8 p.m., they work for six and a half hours; 8 p.m. to 8:30 p.m., they have a half-hour supper break; 8:30 p.m. to 11 p.m., they work for two and a half hours. They have 16-hour days.
We need to address these issues if we are saying to Jordan that we want it to be our partner. If we are extending our hand, it is our responsibility to say something about these issues. It is our responsibility to ensure that bilateral trade is fair. Do we want these conditions to get worse for them, or do we want them to get better? Do we want them to stay the same?
I would argue it is economically impossible for us to compete in this way anyway, because it is not fair if they are using slave labour. All those who invest in the textile industry in North American, particularly in Canada, are going to get the short end of the stick no matter what. It does not matter how much they invest or how much they train their workers. It does not matter how much they have given back to the community. It does not matter what they have done over a number of decades: they cannot compete with those standards. They cannot compete with people basically used as slaves.
What does it say to those people who are actually investing in Canada--people who actually believe in proper work hours for their staff, believe in contributing back to the community and value the people who are employed by them? We are insulting them by doing that.
We are not doing anything to be proud of as a country if we are saying those things are all acceptable so that we can get a cheap sweater or lower-cost merchandise or fill the shelves at Walmart with cheap clothes. These are the things we have to look at.
To conclude, I want to say that we are interested in trying to make this bill work, but it has to be done with responsibility. Turning a blind eye is not the ethical or right thing to do.
Madam Speaker, I am pleased to speak to Bill I have noted many times that the government loves to put names to acts that make them sound like they are other than they really are. The government calls this one, in the short title, the “Canada-Jordan economic growth and prosperity act”. I really think it should have a different name, more appropriate to what this agreement really is. I would call it the “trade agreement with the world's 90th place economy”. It is really not huge in terms of the prosperity that it is going to create. It is the world's 90th place economy, so let us put this particular bill in the perspective that it ought to be put in.
When this agreement was originally announced in June 2009, the Arab spring had yet to occur. The instability that has overtaken the region in the past year has been nothing short of transformative. In this climate, the FTA with Jordan is about to unfold. We are supportive of the bill in principle, as we have been of previous trade agreements. However, there are serious areas of concern. My colleague from the NDP mentioned some of those. I would agree with some of them.
These areas of concern should be carefully considered during examination of the legislation before the international trade committee. Among the areas of concern are child labour matters, which have been previously mentioned, and other labour issues. These would best be resolved through an open and transparent agreement. There are side agreements on labour and the environment, but they are really not that enforceable; they are really more of a desire. I do think we have to find ways of enforcing labour and environmental agreements.
Before looking at the agreement and the situation in Jordan, there are some general points that the House must consider with respect to trade generally and the government's actions. The government's mismanagement of Canada's trading relations around the world has resulted in trade deficits for the first time in over 30 years. Under this government's watch, we have seen a merchandise trade deficit for the first time in 30 years.
If we were to listen to the propaganda machine of the government, which is so far from reality, it claims to have negotiated nine trade agreements. The minister flits and flies all around the world talking trade. Yet while he is talking trade around the world he is ignoring the trading relationship with countries where we already have strongly established trading arrangements. We are falling back in those particular areas.
There is no question that Canada is a trade-dependent nation. Eighty per cent of Canada's economy depends on access to foreign markets for Canadian exports. The Liberal Party supports the principle of free trade. We support initiatives that improve market access for Canadian businesses. We want to hear from stakeholders and carefully examine this agreement to ensure it is indeed in Canada's best interest.
Free trade with Jordan will help encourage economic stability in that region. I would go further. If the side agreements on labour and the environment can be engineered properly and some teeth put in them, free trade can even help improve social, labour, economic and working conditions within Jordan.
Pursuing new trade agreements is worthy of support. However, as I said a moment ago, we have to put these agreements in context. While the Conservatives have proclaimed the promotion of trade, it has been under their watch that the mismanagement of the file, in terms of trading relationships, has resulted in trade deficits for the first time in 30 years.
With respect to the United States, we have seen the government “surprised” by increased United States' protectionist actions, and I will list but three.
First, the government was surprised by the initial buy American provisions in the 2008 United States stimulus package, even though for months President Obama projected that he would be looking at strong buy American policies. However, the government was surprised. It was caught not watching the store.
Second, the minister was surprised in the fall of 2011 when buy American provisions returned in the Obama administration's recent job plan efforts. Again, the government was caught short and not watching the store.
Third, the minister was surprised by the announcement of the United States Federal Maritime Commission, at the instigation of U.S. senators, of an investigation into U.S.-bound container traffic being diverted to Canadian ports and whether to impose fees or tariffs as a result of that diverted trade.
Perhaps I should mention one more because this affects Canadians who are travelling by air and sea to the United States, and that is the $5.40 entry fee. In the agreement the United States negotiated, I believe with Columbia, we lost our exception. Again, the Canadian government was caught surprised and disappointed.
My point is this. Not only do we have to look at new trade agreements around the world, which is important, but our biggest market is the United States. However, the United States continues, at every turn, to catch the government by surprise and disappointment. As a result, we see an erosion of our most important economic trading relationship. The importance of that relationship exceeds $1.4 billion of trade on a daily basis.
In terms of the merchandise export rate, in 2010 Canada exported $339.4 billion internationally. However, the vast majority of that trade is with but 10 countries. In descending order, they are: the United States, 74.9% of merchandise exports; the United Kingdom, 4.1%; China 3.3%; with Japan, Mexico, Germany, Korea, Netherlands and Brazil following that. We can see that it is a long way from first place to second place, with the first place trade being with the United States.
According to the International Trade Department, we are currently conducting 75% of our merchandise trade with the United States. According to its documents, by 2040, we will still be conducting 75% of our merchandise trade with the United States.
Let me be clear. While there are all these trade negotiations being talked about, and the minister is going here and there, the Conservatives are not watching the store in terms of our trading relationship with the United States. In fact, as I said the other day, on the areas of conflict with the United States, they give up certain things and get nothing in return. The Canadian Wheat Board is a prime example. It was challenged 14 times by the Americans. They could never win as a violation of a trading agreement, but the Conservatives have given it away and gets absolutely nothing in return.
On the perimeter security deal, what are we getting in return for that? Likely nothing, but we do not really know because the Conservative government, which claims to be transparent, keeps everything secret.
Canada is a trade dependent nation. We do depend on access markets for Canadian imports. However, with respect to Jordan, there are a number of issues that must be kept at the forefront, as with any trade agreement discussion and implementation.
The Export Development Corporation, in its recent export forecast overview, indicated that while the fallout from the Arab Spring had caused political uncertainty in the region, Jordan had managed, to be fair to it, to, “sap opposition movements of their momentum through modest political reform programs and spending promises”.
However, recent indications are that the uncertainty within Jordan had been slowly increasing. A recent The New York Times article referenced the issue of stability within the wider Middle East and the concern with respect to investment pointing out that:
If Middle Eastern governments want to attract foreign investors during the current period of change and uncertainty, then Arab countries need to lead the way by demonstrating faith in the long-term promise of the region’s markets...
The International Monetary Fund has indicated that the situation throughout the Middle East is one of economic certainty. It states:
For many countries in the Middle East and North Africa, 2011 has not been an easy year. The region is witnessing unparalleled uncertainty and economic pressures from both domestic and external sources, which have triggered a marked downturn in economic activity. While the economies of the oil-exporting countries have seen a mild pickup in growth in 2011, oil importers are experiencing a dramatic slowdown.
The IMF report of November 22 went on to state that in countries such as Jordan, high commodity prices were pushing up import bills and “uncertainty has also constrained access to international capital markets and direct investment have fallen off”.
A recent article in the New York Review, entitled “Jordan Starts to Shake”, raises some serious questions with respect to the Jordanian situation. The country is mired in recession and recently King Abdullah has increased the numerous state subsidies by $1 billion. More than 21,000 security positions have been created. The birth rate has been exceeding the ability of the country to create necessary jobs and unemployment exceeds 13%. There are some major concerns within the country.
Canadian merchandise exports to Jordan totalled $66 million in 2010, up from the $30.8 million in 2003. Top Canadian exports to Jordan in 2010 included: paper paperboard, mainly newsprint; vehicles; wood products; pulse crops, mainly lentils and chickpeas; and machinery and electrical and electronic equipment.
Canadian merchandise imports from Jordan totalled $19.9 million in 2010, up from the $5.7 million in 2003. Therefore, it is clear that the trading relationship is increasing and improving.
Top imports from Jordan in 2010 include both knit and woven apparel, inorganic chemicals, precious stones and metals, namely jewellery, vegetables and pharmaceutical products.
Two-way trade between Jordan and the United States in 2009 exceeded $1.77 billion. However, on that point, there is trade with the United States and Jordan and there is now trade between Canada and Jordan. This trade agreement should open up some opportunities.
Again, I want to come back to the government's failure in this area.
One of our most important pork markets is South Korea. The United States has negotiated a trade agreement with South Korea in which tariffs will come down. As tariffs come down, that $1 billion pork and beef market of Canadian producers into South Korea will decrease. We will be non-competitive because the Americans will displace us in that marketplace. The Government of Canada is asleep at the switch in terms of the trade agreement with South Korea.
We had started negotiations. I have to question whether the is getting slapped around a little by the , who seems to be worried about the auto industry in his own backyard. Has he all the power in the cabinet? Could the government not negotiate an agreement like the United States has, which protects its auto industry and allows its pork industry to expand in South Korea as well?
I make that point because the government is talking about all the benefits of this 90th world economy and is ignoring the market we already have in South Korea for pork. The Conservatives are not negotiating or they are just not getting anything done in that area, That is what concerns me.
While I agree with the principle of negotiating with Jordan, we cannot continue to ignore those established markets that we have. Even on the CIDA agreement, where other members of the trade committee and myself spent part of last week in Brussels and in France. That too is an important market, but even if we get in that market in pork and beef, it will not make up for the loss of those pork exports to South Korea, which we are clearly losing on a daily basis because the Americans have negotiated an agreement and the Conservative government seems to be asleep at the switch.
Tariff elimination is important. There would be the elimination of all Jordanian non-agriculture tariffs, which currently average 11%. These include tariffs of 10% to 30% on many non-agriculture products of Canadian export interests, including industrial and electrical machinery, auto parts, construction equipment and forest products, such as wood building materials and paper.
There would be the elimination of the vast majority of Jordan's agricultural tariffs including: key Canadian export interests such as pulse crops; frozen french fries, which is important in my area because we make the best there is; and various prepared foods and animal feeds, which currently face high tariffs as much as 30%.
The vast majority of current Canadian exports to Jordan will benefit from immediate duty-free access to the Jordanian market upon implementation of this FTA. On implementation, Canada will also immediately eliminate all non-agricultural tariffs and imports originating in Jordan, as well as most agriculture tariffs.
As in all of its past FTAs, Canada has excluded over-quota supply managed dairy, poultry and egg products from any tariff reductions, and that is a good thing.
Ratifying this trade agreement appears to have little economic risk for Canadian industry. However, we should keep in mind that Canada's largest import from Jordan is apparel. While it seems, from what we hear and what we have questioned, the Canadian Apparel Federation does not seem to be concerned about this FTA, I think the points made by the NDP critic earlier have a lot of merit. Our apparel industry cannot compete with low-paid labour working as many as 16 hours a day under atrocious conditions. That situation must stop.
We agree with the side agreements on labour co-operation and environment. They are important. We cannot expect our businesses in Canada to be under a high cost labour regime with good safety standards, which is important and we support, to be under tougher environmental regulations, greater costs for industry as a result of meeting those environmental regulations and businesses in Jordan not facing the same situation. In terms of this agreement, we have to find a way to try to strengthen those side agreements.
The bottom line is that, yes, we support this bill going to committee. We believe it needs to be discussed, we need to have witnesses in and we need to strengthen it where possible.
Madam Speaker, I will continue in the same vein as the member opposite.
The purpose of debating a bill and examining it clause by clause is to avoid quickly signing nine bad deals. Perhaps, by doing so, we are settling for slightly fewer agreements, but they are worth the trouble and protect the interests of all Canadians and everyone in the world with whom we do business. It is important to remember what the hon. member for said earlier: as citizens and particularly as members of Parliament, we have the specific responsibility of standing up for important principles and values.
Unfortunately, it is easy to talk through our hats about international trade. Everyone agrees that free trade issues are important. On principle, the New Democratic Party can support the idea of signing free trade agreements. That is perfectly acceptable to us.
However, we always question the purpose of a possible agreement and its consequences because, clearly, those consequences go beyond simple economic issues. There are also human rights issues—as we have pointed out, environmental issues and the effects of such an agreement on Canada's reputation as a country and as a member nation of the international community. It is especially important to consider the effect on our reputation because, given how quickly things happen on the international stage, it can take a huge amount of effort to restore a reputation once it has been tarnished.
I would like to remind all members of the House that, when it comes to international trade, there are many ways to pull out and many ways to be a very effective partner and player.
First, I want to remind the House that according to our statistics on our current level of trade with Jordan, that trade has increased steadily and quickly over the past 10 years without a free trade agreement. Would a possible agreement accelerate the rate of increase of this trade? That is the type of question we need to be asking to understand the value of such an agreement.
We already have quite a lot of experience with our American and Mexican partners and with other countries around the world. It is truly worth the effort to understand whether eliminating every barrier and restriction and allowing extreme economic flexibility is worthwhile.
There are examples of countries around the world that do not have free trade agreements, but through their domestic policies find a way to be very successful players, even giants, countries that essentially end up breaking down every obstacle in front of them.
There is the example of Brazil and that of China. In the case of both countries, when we look at things truly objectively, we see that it is the will of the state and the government in place that allows these countries to be so productive and to become stronger all the time, to the extent that they are no longer just producing countries or countries that have freed themselves from the status of developing country, but they are major international players with a significant say. I noticed in London two weeks ago that they are increasingly becoming important partners in terms of international aid for developing countries.
This broadens their influence significantly without necessarily concluding free trade agreements with their major business partners.
Someone might remind me that Brazil is part of Mercosur. That is fine and a good arrangement for Latin America, but it does not explain everything, as I was saying, because Mercosur has been around for a very long time.