Mr. Speaker, this is going to be an interesting debate today, because the member for just said that we should not make a deal. Well, the deal was made and the deal was clear, and it is quite the contrary to what the Province of Newfoundland is trying to say, that it is something besides what it was.
I participated in a number of those stakeholder meetings, with the industry in Newfoundland and the rest of Atlantic Canada and the unions. It was all very clear what was being discussed. In my mind, there was nothing untoward, nothing secret.
The Government of Canada agreed to put a fund in place if Newfoundland and Labrador showed losses, because the agreement was getting rid of their minimum processing standards. The reality is that the industry and many of the fishermen in Newfoundland and Labrador want the deal and saw the merit in getting rid of the MPRs. They looked at this as an opportunity to do that and, if Newfoundland and Labrador lost money, the federal government would backstop it up to a maximum amount. That was the deal.
As for what the NDP members are talking about here today, I have no idea. That part of the $400 million would be from the Province of Newfoundland is the only way I can figure it, because the federal government never put $400 million on the table.
There are a number of issues here, and let us take the politics out of them. Let us look at the trade agreement, CETA, for what it is worth. Never mine the posturing. Never mind picking a fight with the federal government to maybe give oneself a better chance at re-election in the provincial government. Quite frankly, everyone in this place can be guilty of that. I think we have seen movie before, and that is exactly what is going on in this case.
I want to talk a little about CETA, but before I get to the gist of my speech, there are a number of issues that need to be put on the table and, frankly, that need to be clearly understood by the public who out there listening.
The NDP members already said that they are not supporting CETA. Now they want a part of CETA that was never agreed, and then they are still going to vote against it. I am confounded. I really cannot figure that one out. The Liberals are saying that they will support the motion and are also going to support CETA. The provincial premiers outside of Newfoundland and Atlantic Canada are saying that if we give a special deal to Newfoundland, we have to give them a special deal too.
The reality is that Newfoundland has a particular and special system. It has minimum processing standards in place, with a guarantee that a certain amount of the fish and seafood are to would be processed on the island of Newfoundland and in Labrador. It made good sense maybe 30 or 40 years ago, but in today's economy, in today's world market, not so much.
The industry and fishermen saw this as an opportunity to move away from the MPRs. We cannot defend them at the WTO and quite frankly, if we are challenged at the WTO, we will lose that challenge. Therefore, everyone wins here if we stick to the original agreement.
I want to drill down on the MPRs a little more. I listened to the NDP talk about the minimum processing standard as if there were one. There is not one minimum processing standard at all. There are 25 minimum processing standards. They are different for the different species. Arctic char, dogfish, salmon, shark, swordfish, trout, and tuna only have to be gutted. That is a long way from completely processed.
There are other minimum processing standards, such as for billfish, hagfish, and smelt. There is blackback flounder. There is capelin and mackerel. Those are three more categories. There is clam, cockle, periwinkle, and quahog, as another category. Some are frozen and packaged whole. Some are whole packaged. Some are solid and packed in a carton not to exceed 110 kilograms.
There are 25 minimum processing standards. It is not that every piece of fish that comes ashore on the island of Newfoundland and on Labrador gets processed into a fish stick. It is far, far from it, because that is what the industry demands today.
We have a modern, dynamic seafood industry in Atlantic Canada. We can compete with anyone in the world. It is a valuable industry.
Today, Newfoundland is paying an 18% to 20% tariff on cooked and peeled shrimp. That is something it has been trying to get rid of for a long time. We have been totally unsuccessful in getting rid of that. It will go down to zero in this agreement. In 2006, cooked and peeled shrimp was worth $124 million. Today, that shrimp bloom is down a little bit because the cod, its predator, is coming back. The shrimp is disappearing but is still worth $91 million. If we take 20% off of that and give it to the processors and the fishermen, it is a win-win situation for the Province of Newfoundland and Labrador. Shellfish was worth $134 million in 2006. Today, it is down a bit because the cod, a big predator, is coming back. However, it is still worth $98 million. That is almost $20 million that would go back into the pockets of Newfoundlanders and Labradorians. That is 8% on lobster and a high of 20% on other products. It is straight down the line with respect to cod, mackerel, and other groundfish. Therefore, we have a seafood total that was somewhere in the neighbourhood just shy $200 million in 2007, $173 million in 2006, and $104 million today. Over $20 million would go back to the Province of Newfoundland and Labrador.
If we want to look at the background of this, as I said before, this is a contentious issue with the WTO. It is a restrictive trade barrier that would be difficult to defend. At the very best, if Newfoundland and Labrador want to keep it in place, the federal government and the Province of Newfoundland and Labrador would probably pay through the nose to do that.
In the meantime, we have the best trade agreement that we have ever signed with any country anywhere in the world on the table. Now, is not the time to fight amongst ourselves. Now is the time to reach common ground. We already reached common ground with the Province of Newfoundland. We put a package in place for the fish and seafood industry in Newfoundland. That package would allow the provincial government in Newfoundland to get rid of the MPRs. If it were to suffer losses because of that we would be there to help backstop it. That was the agreement. There was never an agreement to say that it had a blank cheque to give it an advantage over the rest of the seafood industry in Canada. It would not make sense for the federal government to do that, nor would it make sense for the Province of Newfoundland and Labrador to even ask for it. What it did ask for and what was negotiated and settled on was a fund to backstop it if it were to lose money. That is not that much different from the agreement we had with the dairy industry in Quebec. If it were to lose money, then we would help backstop it. That was the agreement. Anything else is pure fantasy on the part of the NDP.
I want to talk a bit about CETA. It is all about creating jobs and opportunities for Canadians in every region of the country. We know that at this time our economy depends more than ever on global markets. Canada is an exporting country and we need to participate in that global supply chain. Trade and investment are the twin engines of growth for the global economy. Our prosperity requires expansion beyond our own borders into new markets for economic opportunities that will serve to grow Canada's exports and investments.
The Canada-European Union comprehensive economic and trade agreement, CETA, will make a significant positive contribution to Canada's economy by opening markets for Canadian businesses and creating jobs for hard-working Canadians across the country.
The success of the Canadian economy is increasingly linked to our trade with other countries and the ability to sell our goods in other markets and integrate our industry into global supply chains. This has made Canada more prosperous and allowed Canadians to enjoy a higher standard of living, with more and higher paying jobs than would be possible if we relied only on our internal market.
In fact, more than 60% of our GDP is directly related to trade and nearly $1 out of every $2 of Canadian manufacturing output is sold outside the country, over 50%. CETA is a major win. We should all be celebrating this new opportunity that will be created by unlocking the world's largest integrated market. For example, in 2012, the EU's imports were worth $2.3 trillion, far surpassing Canada's GDP of $1.8 trillion. Canadian exporters of goods and services will also benefit from the lucrative European government procurement market that alone is worth $3.3 trillion annually.
I want to talk about the services opportunity here for Newfoundland and Labrador, as 49% of Newfoundland's income is derived from the service industry. Here we have an opportunity to work on a level playing field and participate in a $2.3 trillion import and service market in the EU, which I will talk more about later. Is Newfoundland and Labrador going to pass that up? I do not think that would b a good idea at all.
CETA will provide new access to the EU market of over half a billion of the world's most sophisticated, affluent customers. It will also provide a competitive advantage for Canadian businesses over other exporters, including those from the United States. Once the agreement is implemented, Canada will be the only G7 country in the world with preferential access to both of the world's two largest markets, making Canada the envy of the trading world, as our exporters will have preferred access to both the $16 trillion U.S. economy and the $18 trillion economy of the European Union. That is a golden opportunity for Canada.
A joint Canada-EU study that supported the launch of negotiations concluded that the agreement would raise our GDP by $12 billion annually, add $1,000 to the average Canadian family income, and create almost 80,000 new jobs for Canadians.
The government's approach to CETA has been unprecedented in its openness. The negotiations were the most transparent and collaborative in Canadian history, which explains why Canadians from coast to coast have also hailed CETA as a landmark achievement for the country. Negotiations were open and we did deal directly with the provinces, who were at the table during the negotiations. If anything affected any individual province in this country, they had the opportunity to speak up about it. While the provinces did represent the municipalities, the also had regular briefings with municipal leaders across this country.
In short, is this a good deal? It is not just a good deal; it is a great deal. This is a fantastic deal. Let us look at some parts of it. First, with respect to trade in goods, we are all familiar with the richness and diversity of our primary sectors, but we also know that manufacturing, including obvious sectors like the automotive, chemicals, and plastic industries, touches every part of the economy.
There are also significant manufacturing interests within the primary sectors, such as agri-food, forest products, fish and seafood, and metal fabrications, to name just a few. CETA will provide benefits for all of these manufacturing sub-sectors and for every hard-working Canadian employed in them.
For example, on the day CETA comes into force, 98% of all EU tariff lines will be duty-free, ensuring that Canadian goods can compete on a level playing field in the world's largest and most sophisticated single market.
Mr. Speaker, I see that you are holding your hand up for five minutes, and I have way more than five minutes of speech, but I will try to conclude in the time I have.
What is this about? This is primarily about tariff elimination. It is secondarily about non-discriminatory treatment of Canadian products in the EU and parameters aimed at limiting the use of other import-export restrictions. For example, CETA contains provisions that will commit governments to pursue policies that are transparent, clear, and fair and that will minimize the costs for our respective business communities. The agreement will also provide for favourable rules of origin that are consistent with Canada's established value chains and that will more easily allow Canadian goods to qualify for duty-free treatment in the EU.
If we look at agriculture and agri-food products, 93.6% of the EU's agricultural tariff lines will be eliminated immediately on the day of implementation under CETA, rising to 95% after seven years. That is a remarkable achievement.
Do members know what tariff-free access for agriculture products is in the EU today? Maybe the NDP should take a look. Maybe it should listen. It is 18%. It will rise from 18% to 95%, and to 93% immediately. Let us be clear. We accomplished all of this while keeping in tact the three key pillars of supply management and without changes to the current level of EU access for poultry and eggs.
Again, this is unprecedented access. If we compare Canada's position to the rest of the agri-food countries of the world, such as Australia and the United States, here we are with preferential access, primarily against the United States, which will not have tariff-free access on the day we conclude CETA. Quite frankly, they will have a very difficult job concluding a CETA-like agreement, because they will have a very difficult job getting sub-national procurement in place with the system they have and the powers the individual states have.
We have reached an agreement on genetically modified crops, which had formally been a non-tariff trade barrier. These discussions will be anchored on the principle of regulatory co-operation, promoting an efficient science-based approval process and minimizing the adverse trade impacts of regulatory practices.
In the time I have left, I want to get back to the gist of this debate today and the fish and seafood sector. In my part of the world, in southwestern Nova Scotia, it is absolutely the most important sector of the economy. There is a lot of manufacturing as well. We have a pretty diverse economy in the part of the world I live in, but the fish and seafood sector is extremely important.
On fish and seafood, CETA will eliminate 100% of the EU's tariff lines, some as high as 25%, on Canadian seafood, 96% of which will be eliminated on the agreement's entry into force. Again, this is an even better agreement than we were able to get for agriculture, and we got an outstanding agreement for agriculture. This significant new access to the EU's fish and seafood markets led some stakeholders to refer to CETA as a game-changer for the Canadian fisheries.
Others have also stressed the benefits of CETA to the Canadian fish and seafood producers, indicating that CETA would increase shrimp and lobster exports. Shrimp exports, as well as lobster, are extremely important to Newfoundland and Labrador. Certainly lobster, in my part of the world, is an extremely important export to the EU. For fresh lobster being shipped out of Nova Scotia to the EU market, we are paying 8%. It is nearly 10%. That will be money gained. That money will go back to the processors, and a portion of it will go back to the producers, the fishermen themselves.
It will increase shrimp and lobster exports, facilitating the fisheries sector market diversification strategy and allowing Canadian seafood products to compete on a level playing field in the world's single largest integrated market and the world's largest fish and seafood market. It goes on and on for the automotive sector, the forestry sector, and the regions of Canada.
This is a great agreement, and it is one the province of Newfoundland and Labrador needs to be a player in. It should not be standing on the sidelines. It needs to take advantage of this, and I certainly hope the NDP will change its mind on this motion today and support CETA when it comes before the House.
Mr. Speaker, first, let me make it crystal clear. At no time have I heard my colleagues on this side of the House, including our critic, say that we categorically reject CETA. What they did say, which is what any wise parliamentarian would do, was that we wanted to look at the wording. We want to see what is in the deal, to consult with Canadians and engage in getting input. Only after we have done that will we support or reject it. We are not like other parties that without seeing a bill would say that it is great and that they will support it, then live to regret it at a different time.
The more my colleagues across the way try to change the channel by giving information that is very clearly misleading does the House and parliamentarians a huge disservice. We are here today to debate a broken promise, a betrayal. A deal was made.
Let me make it clear that the premier of Newfoundland and Labrador asked our leader for help. It is a beautiful province, by the way. If people ever have a chance to visit it, they should. Not only is the province beautiful and the people are great, but the seafood is amazing. Our leader was asked to take up this issue in the House and to hold the government to account for the commitments it has made. That is why we are debating this today.
I forgot to tell you, Mr. Speaker, that I will be splitting my time with my esteemed colleague, the member for .
I want to start off with a quote from Paul Davis, the Conservative premier of Newfoundland and Labrador. He said:
It really solidifies that you can’t trust the federal government, you can’t trust Stephen Harper's government…We bargained in good faith. We believed that we had an agreement in place, that we had a deal set.
He is saying loud and clear and very explicitly, with no reading between the lines, that he does not trust the government, that he does not trust the and that he feels very betrayed.
Governments lose their credibility when they break their commitments. However, why am I surprised? I have been in the House since 2011. Over and over again the government has broken its commitments.
There is one that is very important in my riding. A recently released report noted that crime was on the rise. Not only that, but we have a very low level of policing compared to other jurisdictions around us. The government made a commitment to add X number of RCMP officers to the force. It has failed to do that. If I were to stand here and list all the promises it has broken, I would run out of time. I think all my colleagues would run out of time.
There are also the commitments we made to our veterans, who are also feeling very betrayed. There are the commitments we have made to those who lose their jobs and who pay into a fund in good faith, thinking EI will be available for them when they are out of work. However, due to the taking of the money from the EI fund, first by the Liberals and then by colleagues across the way, and then changing the rules, they now find that the rules are so hard they cannot even access the support they need.
Just today, the minister had to respond in the House about a fund to create access for those with disabilities. The fund has been underutilized by billions of dollars. It appears that a vast majority of that funding is going into Conservative held ridings. Surely this is not the way we want to run a country.
I also want to take this opportunity to say that this feeling of betrayal runs very deep in my riding. I was at a rally on Saturday held by truckers who had been laid off. They were given notice summarily that they would no longer be given entry into the port. Some of these truckers have 20 to 28 years of experience driving into that port. Their families and children were there and it was heartbreaking because they could not understand how this happened. It was only last year when they signed a deal. They did not realize, and were not told at the time, that the deal had some hidden components and some other output that would lead to a massive number of layoffs of people trying to make a living. That is unconscionable.
I saw the little children. I talked to either the drivers or their wives, and learned their stories of betrayal. They feel betrayed by the federal and provincial governments. This is being treated like a hot potato, being passed from one level of government to the other to the port. Those drivers want a solution.
Today, I also appeal to Minister Raitt, because I know how thoughtful she is, to do some kind of an intervention—
Mr. Speaker, it is my pleasure to dip my toe into this debate for a few moments. It is an important issue. I also want to commend the mover of the motion, the MP for .
As members are aware, the motion calls on the federal government to respect its promise to Newfoundland and Labrador of $400 million for development and renewal, based on a 70/30 split, through the province's fishery investment fund in exchange for lifting minimum processing requirements as part of the Canada-European Union comprehensive economic and trade agreement.
Why this is so important and was brought forward by the member is that the Province of Nova Scotia, under the undertaking of the federal government, has a piece of legislation within its provincial jurisdiction with respect to mandatory minimum processing requirements that has some influence over the processing of fish, as in Newfoundland and Labrador, so that the fish are not scooped out of the ocean and then processed either on these factory freezer trawlers or shipped over to Europe or somewhere else. Newfoundland and Labrador have held onto this legislation because it does create jobs in many communities, outports and otherwise, throughout Newfoundland and Labrador. It is an important economic driver in that province, and it is probably unique. Quebec also has a similar requirement, but it is not as closely adhered to in that province as it is in Newfoundland and Labrador.
When CETA was being negotiated, the European community demanded that Canada get rid of this particular legislation in Newfoundland and Labrador, which would somehow give a province within our jurisdiction preference. Of course, the Europeans wanted the product that was caught on our shores, if they could manage it, to simply go to Europe and be processed there. That was what the thinking was.
However, it is curious that when the European community began to engage with Canada in negotiation of this trade deal, it knew how Canada was set up and that it was a federation. The Europeans knew how many powers Canada's provinces had and they wanted to have the provinces at the table, or at least close enough to the table that if they signed off on various provisions with the federal government they would also have the agreement of the provinces. This was one of the issues.
There were matters with respect to the dairy industry and supply management, which affected the provinces, and there was the European community's attempt to extend patent protection by another number of years, which would have added a billion dollars in costs to this country and many hundreds of millions of dollars to some provinces. Just on those three items alone, it was important for the European community to have the provinces at the table.
However, in some of these instances, the populations in those provinces were concerned. They were concerned about the impact of giving up minimum processing requirements in Newfoundland and Labrador. Many provinces became increasingly concerned about the impact on their health budgets as a result of the extension of the patent legislation. The dairy industry in some provinces, particularly in Quebec as it related to cheese and other milk products, was also concerned and began to pressure the government.
I certainly have had the opportunity to talk to a number of provincial officials about these very items and we have heard these issues talked about in the House. In order for the federal government to tie down this deal on those issues, it gave assurances to the provinces. In the case of extending the patent legislation—which would potentially increase the cost of pharmaceuticals—it said to the provinces, “Don't worry, we don't believe that to be the case, but if it is the case, we've got your back. We'll backstop you. if there are increased costs due to the impact of extending the patent legislation, we will make sure we cover that off.” For some provinces, Nova Scotia was one, Ontario and Quebec were two others, they got those assurances from the federal government and agreed that they would allow this to go forward.
In the dairy industry assurances were also given. I have spoken to people in the dairy industry and various officials in the provinces, and again the federal government gave assurances to the industry and the provinces that they would be compensated. In the case of Newfoundland and Labrador, the policy of having minimum processing requirements have been around for maybe 30 years or more. Those exist in an industry that generated $1.1 billion in production value in 2013 and provided direct employment to more than 18,000 people, mainly in rural parts of the province.
The restrictions on minimum processing requirements are extremely important to the province and are held to by people in the industry, municipal officials, and others in various communities throughout Newfoundland and Labrador. When the Province of Newfoundland and Labrador understood this was on the table, that the federal government was going to be negotiating it away, there was quite an outcry. There was quite an outcry because it is fair to say that the fishing industry in Newfoundland and Labrador, particularly as it relates to the cod fishery, has been experiencing some problems. The stocks have been rebounding, but people are concerned that if the government gives away those rights and abolishes that legislation now, when stocks return and greater processing is required, there will no longer be any requirement that fishing companies bring their products onshore to be processed.
There was quite an uproar about it and the government said very clearly to provincial officials, “Don't worry, we are going to contribute to a $400 million fund to the tune of 70% in order to make sure that you are properly compensated for any impacts that may arise as a result of losing that legislation with respect to minimum processing.” That was the deal. I heard it. I was part of the trade committee that was in Halifax and heard witnesses from Atlantic Canada, and that was the understanding that people in the industry had. It was very clearly communicated by the government and provincial officials that this was negotiated on behalf of the Conservative government of Newfoundland and Labrador to make sure that part of the deal was checked off with respect to CETA. It was understood that the federal government would kick 70% of $400 million into a fund to make sure that it dealt with the adjustment caused by losing this legislation.
That is the issue. That is why the motion is so important. We call on the government to stand by its promises and to stand by its provinces.
Mr. Speaker, it is a pleasure for me today to join in the debate on the NDP opposition motion concerning the minimum processing requirement fund in the province of Newfoundland and Labrador.
Before I begin, there may be some questions. People in this House or perhaps those who are watching on television may be wondering why a member of Parliament from a land-locked province like Saskatchewan would be joining into a debate on a fisheries issue that primarily deals with some concerns the Province of Newfoundland and Labrador would have. The answer to that is very simply because the larger context of what we are debating today is really about the Canada–Europe trade agreement, also known as CETA.
I am joining in this debate because CETA would positively affect every region of Canada. Whether it is the fisheries industry in Newfoundland and Labrador, the forestry industry in Quebec and British Columbia, the manufacturing industry in Ontario, or the grains and oilseed industry in the prairies, CETA would have a positive impact on literally every sector of the Canadian economy and every industry within Canada. That is why this debate is so important: to be able to point out to members opposite and to those who may be listening to this debate that signing the Canada–Europe trade agreement is one of the largest and most significant trade deals this country has ever engaged in. In fact, it is not an overstatement to say that it is the most important trade agreement our country has ever entered into.
The reason is quite simple. First, the European Union has 500 million consumers that Canada would now have preferential access to. Second, since we already entered into an agreement several years ago with the United States, the North American free trade agreement, Canada would now be the only G7 country that has preferential access to two of the world's largest consumer bases: 500 million people in the European Union on one side and 300 million people in the United States on the other side. We are the only country that would have preferential access to that consumer market.
In real terms, this would mean to Canada about an additional $12 billion in economic activity. If we want to drill that down to a per-household level, it comes out to about $1,000 per household. That is how much money this agreement with Europe would mean. It is the equivalent of about 80,000 additional jobs in Canada. It is a huge deal. That is why we have had unprecedented support from industry leaders, from union leaders, from consumer groups, and from trade analysts. Everyone who has examined this agreement agrees that it is a big win for Canada. That is why all of the provinces are on side with this agreement as well. All of the individual sectors in the industry within Canada's provinces and territories would also benefit from this agreement.
However, what we have here today is a situation in which some people are suggesting that this agreement would not be a good deal for Newfoundland and Labrador. In particular, the complaint coming from members opposite is that removing the minimum processing requirements would be injurious to the fish and seafood processing industry in Newfoundland and Labrador.
Perhaps I should first take a moment to explain, at least as I know it, what the minimum processing requirement is.
It was set up several decades ago as a policy imposed by the Government of Newfoundland and Labrador to assist and in many ways protect the fisheries processing industry. In other words, quite simply it states that there has to be a minimum processing element of all fish and seafood from Newfoundland and Labrador before they can be shipped to the European Union or anywhere outside of Canada.
Why was this requirement put on? Again, to stimulate the processing industry in Newfoundland and Labrador and to protect those jobs. In other words, if I were a cod fisher, I could not necessarily ship all of my raw product to Europe. I would be required to give a certain amount of that raw product to the processing industry in Newfoundland and Labrador so they could then process it and sell it as a value-added product worldwide. In particular, we are talking about the European Union.
The only problem with that is that while it may have been good at the time for the processing industry in Newfoundland and Labrador, it is viewed, and quite correctly, as an unfair trade policy. In this day and age of global trading, there are mechanisms in place to ensure that trading practices between countries are fair and just. Because this would be a distortion of fair trade policy, if we entered into CETA with the European Union, any one of their member states could look at this minimum processing requirement in Newfoundland and Labrador and say, quite correctly, that it was an unfair trade policy and demand that it end. It was a legitimate concern of the European Union.
During negotiations, our government negotiators agreed that the practice should in fact end, but we also recognized in discussions with Newfoundland and Labrador government officials that this could have some negative impact on the processing industry. In other words, the Government of Newfoundland and Labrador pointed out to our trade negotiators that ending the minimum processing requirements might result in some lost revenue. It might even result in some job losses, because if fishers were not required to use the processing industry before their products were shipped overseas, it could have or might have a negative impact on the processing industry in Newfoundland and Labrador.
We recognized that argument. Our government said that if it could be demonstrated that there is injury, that there may be some lost revenue, that there may be some job losses, that there may be some problems that the removal of the minimum processing requirement creates within the industry, we will then agree for some compensation.
This is not unusual. As we negotiated CETA, various sectors and various regions of the country pointed out there could be some negative impact as a result of signing this deal. Time after time, we were able to negotiate with the respective sectors some sort of a counterbalance, some negotiated settlement to offset the potential revenue loss or job loss. That is what we did in this case with Newfoundland and Labrador. We said that if there is to be injury, if there is to be lost revenue, if there are job losses, we will be there.
Hence, the agreement was to set up a fund, the minimum processing requirement fund. It was a $400 million fund agreed upon by both the province and the federal government. The federal government would fund up to 70%, or $280 million, if there was proven, empirical evidence that there was injury because of the removal of this requirement.
I keep using the word “if”, because it has not been demonstrated yet that there would be any loss of revenue or loss of jobs. In fact, I recall that when this agreement was first announced, the then president of the fisheries union in Newfoundland and Labrador, a gentleman by the name of Earle McCurdy, said he did not think there would be any problems caused by removing the minimum processing requirement.
He pointed out that they were better off than processing plants in Europe, China, and the United States. Their wages are higher, and electricity and energy costs are higher. We are closer to the marketplace. In other words, we do not have to have a minimum processing requirement because our processors will be able to compete quite favourably with anyone else in the world. We do not need the protection that the minimum processing requirement currently affords. That was the president of the fisheries union.
I understand that recently he has changed his tune somewhat; he is now a nominated NDP candidate in the province. Once he became a member of the NDP his initial thoughts have changed, and now removing the minimum processing requirements will be a terrible thing for the province. It shows how myopic the New Democrats truly are, who do not want any trade deals with any country. That is clearly the reality.
Some hon. members: Oh, oh!
Mr. Tom Lukiwski: Mr. Speaker, I see that we have touched a nerve. Every time we talk the truth about the NDP and how members hate free trade, it touches a nerve across the floor, and we can see that today as well.
The point is that if there were to be injury to the processing plants, the canneries, and the industry in general, the federal government agreed to provide monetary compensation, but only if there is empirical evidence to suggest that injury has taken place. We are standing by that commitment. We are working with the province of Newfoundland and Labrador to try to set up a process and system that would empirically identify any monetary loss experienced by the fisheries industry in that province. We would then be there for them. We would step up to the plate with this fund.
However, the fund was never established to simply give money if no injury, job loss, or revenue loss has taken place. We have never done that when negotiating compensation with any other sector in Canada. We did not do that for CETA, or any other trade deal for that matter. It makes sense. Why in the world would any government simply say to a province, “You may not be having any problems whatsoever. There may not be any loss of revenue, loss of jobs, or any injury to a certain sector, but, what the heck, we will give you $400 million anyway because we are good guys.” That has never happened.
Sector by sector, when negotiating, we have sat down with the provinces and said that if there is demonstrated lost revenue, demonstrated loss of jobs, or demonstrated injury as a result of this agreement, we will then compensate, and there will be a transition to allow them to be whole. That is a responsible stance that the government has taken, and it is the right stance for a government to take.
I started by talking about all of the benefits of CETA, and they are immense. This is, without question, the best free trade agreement that our country has ever entered into. However, we need to have the co-operation of all of the provinces. To date, the provinces have been generally extremely supportive because they know the type of benefits they will receive by having preferential access to this huge market.
Whether it be the fishing and seafood industry in Atlantic Canada, the manufacturing sector across Canada, the agriculture and agri-food sector in my home province of Saskatchewan, having access to 500 million consumers will be a tremendous boon to every single sector in the Canadian economy. That is why we need agreement from all provinces as we move forward. That is why we, as a federal government, have dealt with the province of Newfoundland and Labrador in a responsible manner, by agreeing to compensate its affected industries if it can demonstrate it has been negatively impacted. No government would enter into an agreement simply to give a blank cheque, to say that it does not matter, take the money and run.
There has to be an agreement. There has to be a demonstration that injury has taken place. That is what we are prepared to do, and that is what we have stated from the outset. If there is to be lost revenue, or trade-distorting injury on behalf of the fishing industry or the province of Newfoundland and Labrador generally, we would be there to work with them, to ease the pain, to enter into a transition plan that would allow affected industries to remain whole and not be negatively impacted. We stand by that agreement, and it is the right position for the federal government to take.
We are not here today during this debate to try to spark some confrontation with the province of Newfoundland and Labrador. We are more than willing to continue to work with them to identify if there are problems with the removal of the minimum processing requirement. From a financial standpoint, we will be there. We will step up to the plate. However, to date, we have not seen any demonstrated loss of revenue, job losses, or any negative impact on the fishing and seafood industry. We want to work with the province to develop a process that would identify any of these issues, and, if they occur, we will be there as a willing and able partner.
In conclusion, let me say this. It is important for every province, region, and territory in our country to recognize the massive benefits that the Canada-European Union trade agreement would have on our economy. It will benefit every single province, territory, and sector of our economy. Let us not lose sight of that. Let us not allow a relatively small dispute to stand in the way of the most comprehensive and beneficial trade agreement that our country has ever seen.
Mr. Speaker, I would like to thank the member for for putting this motion forward. It is extremely important that this be debated in the House. I am shocked to hear the member for call it a waste of time to talk about something involving federal-provincial relations between Newfoundland and Labrador and Ottawa. It was an agreement made between two levels of government at the request of the Government of Canada.
I was supposed to be here earlier today. A taxi left my house at 6:30 a.m., Ottawa time, to get a flight to get here. I got here around 3 p.m. This is a big, diverse country. Each province and jurisdiction has its own industry, issues, problems and jurisdictional responsibilities. Each province acts in a different way within its provincial jurisdiction.
The Alberta government runs its oil and gas industry and royalty regime program differently from other parts of the country. Agriculture is a very important sector in Quebec, Ontario and out west. They all have different ways of doing things. Inside the jurisdiction of Newfoundland and Labrador, the Government of Newfoundland and Labrador had certainly policy tools at its disposal to protect, develop and grow its industries, and to support the rural culture.
The Newfoundland and Labrador government has had a system of minimum processing requirements for a long time so Newfoundlanders and Labradorians can benefit as much as possible from the resources around their shores. Newfoundland and Labrador brought this into the Confederation in 1949, along with all the oil and gas resources in the offshore, as a contributing member of the Canadian Federation.
A lot of the talk around slush funds reminds me of the attitudes of some Canadians about treating Newfoundlanders and Labradorians as some sort of a handout province within Canada. Nothing could be further from the truth. It is only recently that Newfoundland and Labrador has been considered a have province, with oil and gas prices at a very significant level. That may or may not change as a result of the drop in oil prices, but we are very proud to contribute on a fiscal level in a way that we had not before. However, we have always contributed to Canada in terms of our resources, our human resources, our educated and skilled people who went throughout Canada and helped to create the wealth of Ontario, Alberta, and British Columbia. That is part of what Confederation is about.
We do have divided jurisdictions in Canada. We have federal responsibilities and we have provincial responsibilities. International trade is a federal matter. It is up to the Government of Canada to negotiate trade deals. CETA is one of them, and it is an important one. There is no question about it.
However, this is not about CETA and whether it is good or bad for Canada and Newfoundland. We know that there are big advantages to the Newfoundland fishery of the removal of the tariff on shrimp and cod fish. It has been an irritant for many years. In fact, Newfoundlanders and Labradorians have complained about the fact that the Government of Canada has not used its influence with Europe to fix this in the past. There have been complaints for decades, going back 30, 40, 50 years, about the failure of the Government of Canada to protect the offshore fish stocks in Newfoundland and Labrador, instead of allowing them to be overfished and reduced to the point they were.
There is a lot of history around this. The jurisdiction of the Newfoundland government to have control over fish processing and minimum processing requirements is part of a policy tool that the Government of Newfoundland and Labrador has had.
Seafood production and the provincial seafood sector are extremely important to Newfoundland and Labrador, with over $1 billion in production value in 2013 alone and more than 18,000 people directly employed, mainly in the rural parts of the province. Minimum processing requirements are one of the policy tools within the jurisdiction of the Newfoundland and Labrador government.
What happened? This conflicted with the negotiated requirements and expectations of the Europeans, who said to Canada that they wanted it off the table. They wanted Newfoundland and Labrador to withdraw that policy tool. That was not said by Newfoundland and Labrador; it was said by the Europeans.
Then the Government of Canada, the and his department, called and asked the Government of Newfoundland and Labrador to do this. They said that it was a demand at the table and they would like Newfoundland and Labrador to get rid of this policy tool as it affected the deal with Europe. It was not just for next year but forever. The province was asked what it would like in return for giving up this policy tool. The negotiations then began in good faith and resulted in an agreement.
However, this was not solely about compensating individuals who may have lost a specific job. I think that was what the federal government wanted initially, but it was very clear that was not what resulted at the end of the day. In fact, the negotiations, the exchange of letters, all of those things have been examined by independent people, including, for example, Professor Saul Schwartz, the public policy professor at Carleton University. He looked at the documents, the exchange and the correspondence, even correspondence from the minister responsible for ACOA. He concluded that the province's interpretation of what went on in the final deal was absolutely right.
A CBC story reads:
Saul Schwartz said based on his analysis of letters between former International Trade Minister...and Keith Hutchings, the former provincial fisheries minister, the deal is broader than what the federal government is now saying.
Schwartz said the letters show the money is meant to build a fishery of the future.
Therefore, when the minister said that this was only for adjustment and Mr. Hutchings said, no, that they wanted it for both any harm that might be done and for industry development, the positions were clear. In the end, the caved and said that the province could use it for industry development as well.
The article continues with:
Schwartz said the federal government could not have believed the fund was to be used for displaced workers only.
This is consistent with the debate we have heard from the member for . He quoted a lot of correspondence and letters on what went on for many months.
This is a matter of great controversy in Newfoundland and Labrador. It is not something that just slid under the table. The Newfoundland government was criticized by people in rural Newfoundland and Labrador, by people who were concerned about giving up this policy tool, people who said that it should not do that. The government had to take the criticism on chin, but made it very clear that this agreement was about fisheries development, fisheries research, marketing development and other aspects of the fishery of the future.
I mentioned earlier about different jurisdictions. The federal government is responsible for fisheries, but the Newfoundland government is responsible for fish processing and other aspects of the fishing industry. However, because this is such a big concern in Newfoundland and Labrador that the federal government has let it down, Newfoundland has gone into paying for its own scientific research because the federal government has failed to do so.
This is not a waste of time today. We are asking the House to recognize that it is very important for the Government of Canada, in dealing with the province, to deal in good faith. When one makes a deal, one makes a deal. The deal was $400 million.
I can say without question that the premier of Newfoundland and Labrador would never be able to say to anyone in the House that this $400 million was only for individuals who would lose their jobs in the next two, three or four years in the implementation. Not a chance. In fact, the premier of Newfoundland and Labrador and Keith Hutchings, the minister of intergovernmental affairs and former fisheries minister, told me that they were told by the federal government to think outside the box, that this was not just about the fisheries. Whatever the province wanted to put on the table, the federal government wanted it to give up this jurisdiction, this policy. This was not talking about how the workers individually might be affected. The federal government wanted the province to give up the jurisdiction and asked what it wanted from the federal government in return.
There were lots of things on the table. What it came down to in the end was a joint fund. The Government of Canada would put up as much as $280 million and the Province of Newfoundland and Labrador $120 million.
What was that for? Was it to compensate individual workers? No. If there were demonstrable effects, they would be compensated, but outside of that, it was designed as a fund.
This $280 million is in the federal budget now. It is not there for 2020, when this deal might be implemented and we might be seeing some effects; it is in the budget now, and it is designated for the fisheries investment fund. It is an investment fund, not a compensation fund. It is a fisheries investment fund to deal with marketing, development, innovation, research, and all of those things that are important to Newfoundland and Labrador because of the significant need for the province to develop its fishery, independent of some of the other problems that are going to come about.
Therefore, this is not something one could even argue about. When the came to Newfoundland and said, “This is not meant to be a slush fund”, what an insult it was to the people of Newfoundland and Labrador. What an insult to the Government of Newfoundland and Labrador to suggest that is what Newfoundlanders and Labradorians are trying to pretend it is, that they want slush from the Government of Canada. I am shocked and shamed that the minister would say that.
Not too long ago, before the minister was responsible for ACOA, the minister was the regional minister for Newfoundland and Labrador. For him to come to Newfoundland and Labrador and say that I found insulting and not worthy of him, frankly. The Minister of Justice knows Newfoundland and Labrador. He has lots of good friends there. He goes fishing in Newfoundland and Labrador. I found it offensive for him to say that.
We have even heard it suggested that this was a fund for all the Atlantic provinces. I do not know who said that. I hope the minister can say that he did not say that and that he never intended that. Of course, why would Newfoundland and Labrador put up $120 million for an Atlantic fund if no other provinces were doing anything to do with that?
However, that is how far this debate has gone. It seems that it is like shifting sand to sit down with the Government of Canada and make an agreement in good faith. It was something the Government of Canada wanted. It was not Newfoundland and Labrador going cap in hand to Ottawa and asking the government to do something for it because it might be affected by this deal. It was a specific policy option that the European negotiators said to Canada they wanted off the table or there would be no deal. The Newfoundland and Labrador government, in good faith, entertained the request from Ottawa to do this, knowing it was a policy option that whatever its use or effect was now, was something they could not do in five or 10 or 20 years' time, because this was an agreement that was going to last forever.
There were negotiations and discussions back and forth between two mature partners, each with its own constitutional jurisdictions. This is not someone coming cap in hand looking for a handout from a parent. This is a jurisdiction that has it as a right under its law, whether we like it or not. Some people might call it protectionist. I can call Buy America protectionist too, but it does not change the power of the United States to do it.
We can argue whatever way we want about the trade deal itself and on the whole net benefit question, and that debate is going on in Canada, at least in some quarters. The Liberals have decided they like the deal. They did not need to read it. They did not need to see the text. They did not need to see anything. Whatever the government does on it, they support it.
We are having a look at that, and at the end of the day we will decide what our view is on it. In the meantime, this debate is not about that. It is about a specific detail that involves the Government of Canada, which we hope and fully expect can deal in good faith with the partners of Confederation.
We know the does not meet with the provincial premiers as a whole. He had a meeting with our premier in December, and our premier came away and said, “I don't think we can trust this guy.”
That is a shocking state of affairs. A Conservative premier of Newfoundland and Labrador came to Ottawa to meet with the , knowing the background and expecting that it was obviously some misunderstanding because the , even in early October of 2014, was referring to it as a fishery transition initiative and by the end of the month was saying something different.
The premier came to Ottawa with the minister of intergovernmental affairs and said, “Obviously this is a misunderstanding. We'll go to the source. We'll talk to the and it'll be sorted out. If there's a misunderstanding, we've got the documents, we've got the correspondence, we've to the whole shebang.”
He did not hear anything from the , by the way. He was absent from this discussion. He is the guy who made the deal, but he was not around. The was put on the hot seat and told, “Okay, you're going to take this position now”, but he did not negotiate the deal. I do not think the was at the table.
The and his representatives were, including, according to John Ivison of the National Post, the now principal secretary for Minister of International Trade, who was at the table and who did write to the and the Newfoundland government about this matter.
However, all of these people who were involved were not around. It was just the minister responsible for ACOA who was asked to carry the bad news to Newfoundland and Labrador that we were not going to follow this agreement.
Newfoundlanders are a trusting group of people. When they make a deal, they feel that the other party is going to follow through in the good faith that the deal was made, so the premier came to Ottawa to see the and had a meeting, apparently on very short notice, with the Prime Minister, which was a good thing. I am certainly pleased to hear that it took place. Unfortunately, the results of that meeting were very dissatisfying for the Government of Newfoundland and Labrador because, lo and behold, the repeated what now appear to be talking points. We heard the repeat those talking points today, saying “Why would we do that?”
Well, the fact of the matter is that the government did do that. Why? It was because it wanted Newfoundland and Labrador to give up this jurisdictional policy tool that it had at its disposal and was using and wanted to continue to use. The idea was “We will give it up, not for the benefits of CETA in general but in response to the program that the Government of Canada put on the table after much negotiation.”
As John Ivison says:
The solution is simple. The [Conservative] government should stump up the $280 million it agreed to pay on the implementation of CETA. And Ministers Hutchings and King should stay home and save their breath....
That is the problem we have. The problem is that the government is not meeting the agreement that it made and is not following through on its commitments. Unfortunately, given those circumstances, it cannot be trusted.
I do not think this can be belaboured very much, but I do want to say there was an email to the Newfoundland government in October of 2013—so this agreement is not new; this is old—to Mr. Bill Hawkins, chief of staff to the , who is now the 's principal secretary. The email says:
...a transitional program of up to a combined total of $400 million that would address fish and seafood industry development and renewal, as well as workers whose jobs are displaced in future.
That was the deal. It is known to be the deal, and this government is trying to back out of it.
Mr. Speaker, I will be splitting my time with the member for , who is also the hard-working .
I am pleased to stand today to speak to the issue that has been raised and to the benefits of the Canada-EU comprehensive economic and trade agreement, also known as CETA. I will focus today on the fact that the agreement will have great benefits for the fish and seafood industry, in addition to the Canadian economy more broadly.
The agreement will provide new and expanded economic opportunities for those who make their living from the fishery and seafood sectors, both in Newfoundland and Labrador and across Canada. The timely implementation of this agreement is in the best interests of hard-working fishermen and seafood producers throughout our nation.
As members are aware, CETA is a key component of our government's ambitious trade agenda, which is aimed at creating jobs and economic prosperity for all Canadians.
First I would note that this is Canada's most ambitious trade agreement ever. The agreement would provide Canada with preferential market access to Europe's 500-million-strong consumer economy and $17 trillion of economic activity. In fact, a joint study conducted with the EU prior to the outset of negotiations concluded that the agreement could boost Canada's income by $12 billion annually and bilateral trade by 20% across all sectors.
CETA would have significant benefits across the spectrum of all fishing and seafood activities, from wild harvest to aquaculture to processing. Aquaculture, as well, is a big player in the Newfoundland and Labrador economy.
Between 2011 and 2013, Canada's fish and seafood exports to the EU were worth an average of about $390 million per year. These exports are currently subject to high tariffs, averaging 11% and reaching as high as 25%. Between the years 2008 and 2012, Canadian firms paid between $20 million and $30 million annually in tariffs on the export of seafood products. Those tariffs are what the negotiation is about. They will be removed, and as processors in Newfoundland and Labrador are quite willing to acknowledge, this will be a tremendous aspect of the agreement, and it will create opportunities for Newfoundland and Labrador.
For example, Newfoundland and Labrador exports a significant amount of seafood to the EU, which is subject to these tariffs. Such charges include up to 12% of the export value of frozen shrimp.
As a member of the fisheries committee a few years ago, I was in Newfoundland and Labrador visiting some of the processing facilities. I remember clearly a visit to St. Anthony, at the northern tip of the peninsula of Newfoundland, and a huge state-of-the-art factory there. I think Clearwater was part of that. The amazing factory there was open in 1999. It processes something like 14 million pounds of shrimp every season and employs between 200 and 215 people. It can also make 120 metric tonnes of ice per day. That is a big operation. It is state-of-the-art and very impressive.
That factory and others like it would have unfettered access. The tariff on exported shrimp, cooked and peeled, in retail packages currently is a rate of 20%. That tariff would be removed when CETA is finally signed. The agreement has been signed in principle on both sides, but it will be finally implemented on both sides as all the legal drafting goes through. In Canada, we deal with two official languages, and when we are dealing with international agreements, they have to be translated and the text has to be agreed upon. However, in Europe, where they have 22 official languages, it takes a little longer to work through some of the legal processes. That process is playing itself out right now.
There is an 8% tariff on snow crab and an 8% tariff on frozen scallops. These additional costs have negatively impacted the competitiveness of Newfoundland and Labrador's seafood products in the European market. They have made it an uphill battle for our industry to attract new consumers and expand its market share.
Those tariffs and barriers will be removed under the new CETA.
Today Canadian seafood producers export about 377 types of fish and seafood products to the EU. Because of our ambitious trade agreement, led by our government, tariffs on 360 of those will be eliminated on day one of the agreement being in force. That day has not yet arrived, which is why the negative impacts that are the subject of the discussion today have not appeared at the present time. If there are negative impacts, they will need to be assessed, but that agreement and those impacts will not be in play until the agreement comes into force.
The tariffs on the other 17 products will be phased out after three, five, or seven years, but it will not be necessary for fishermen and seafood producers to wait to see these benefits accrue. If it is a three-year timeline, the tariffs will drop by one-third the first year and two-thirds the second and will be completely removed by the third year.
As I stated, the Canadian seafood industry will see real benefits of this deal accumulate quickly, once the agreement is brought into force. The reductions in tariffs will translate into savings that can be either reinvested into businesses to make them more competitive and more innovative or to help them grow their share of the European market through more competitive pricing. The bottom line is that tariff elimination will make Canada's seafood products more competitive and lucrative in Europe, which means more jobs and greater prosperity for the sector and for Canada's coastal communities here at home.
I should note that all of these figures are based on recent exports of Canadian fish and seafood products. The numbers do not account for the increased opportunities CETA will provide for additional Canadian fish and seafood products as new demand is generated in the European market.
CETA also contains important flexibility for Canadian industry, such as rules of origin, which will benefit Canadian fish and seafood processors and ensure that they remain competitive in a global marketplace. Rules of origin allow customs authorities to determine where a product originates or is wholly obtained so that they can apply the relevant tariff to the product as it enters the country.
In practice, these favourable product-specific rules of origin will allow Canada to import fish to our country from a non-party, like the United States, and enable the Canadian industry to process the fish for export to the European Union under the preferential tariffs granted through CETA. This will benefit the Canadian seafood processing industry greatly and those who work in the field. For example, in my home province of British Columbia, the industry processes Alaskan sockeye salmon for export, in addition to Canadian catches. On the east coast, New Brunswick processes Maine lobsters to sell abroad.
The fact is that these favourable rules of origin will result in more opportunity for seafood processors across Canada, including Newfoundland's processing industry.
Our government has managed to achieve all of these benefits while maintaining Canada's full discretion over licensing of fishing and related activities, including the government's ongoing policy of preventing foreign firms from having greater than 49% ownership of a processing plant and from holding a commercial fishing licence.
With regard to port access, CETA does not change how we control port access or how we apply the Coastal Fisheries Protection Act. We will still have the power and the authority to require the vessels entering our fishing waters to do so under the authorities of the , and the minister will continue to have the discretion to grant a licence for them to operate in our waters or to transit our waters to a Canadian port. Therefore, this agreement does not change our current operations with regard to European vessels.
Our government has embarked on an ambitious trade agenda, and we are opening other sections, such as the trans-Pacific partnership and the Canada-Korea Free Trade Agreement. Korea is our seventh largest trading partner. All of these measures bring new opportunities for Canadian producers.
Therefore, I hope that all members will support CETA and that the members who raised the concerns today will allow the process to work through and will allow negotiations to take place with the federal government and the Province of Newfoundland and Labrador. As was indicated, we are in a position to and are willing to negotiate the terms.
However, to expect to have a fund administered without demonstrable harms is not reasonable and is unfair to other agreements with other provinces. I hope members will appreciate that as we carry on with the discussion today and support the CETA in every way.
Mr. Speaker, the Canada-European Union comprehensive economic and trade agreement, CETA, is an historic accomplishment that will benefit hard-working Canadians across our great country.
CETA will be good for Canadian companies eager to expand their businesses in Europe, good for attracting jobs and creating investment in Canada, and definitely good for the one in five Canadians whose jobs depend on trade.
Free and open markets have long contributed to Canada's prosperity. In fact, since the coming into effect of the historic North American free trade agreement, NAFTA, 4.5 million jobs have been created in Canada and our country's annual income has risen by nearly $1 trillion. These figures speak for themselves.
CETA is our most ambitious, comprehensive and far-reaching trade initiative ever. Accordingly, we expect that CETA will create jobs, prosperity, and opportunities for Canadians that go well beyond what was achieved under the NAFTA.
The reason is threefold. First, the European market is larger and more integrated than the North American market under NAFTA. The EU market has some 28 member states, over 500 million consumers, and annual economic activity of almost $18 trillion. The EU is the world's largest single integrated economy. It is also the world's largest import market for goods. The fact that total imports by the EU totalled $2.3 trillion in 2012, half a trillion more than Canada's total economic activity of that same year, means that the EU represents a stable, long-term growth opportunity for Canada's world-class exports.
Second, through CETA, our government has managed to achieve unprecedented access to Europe's large and lucrative markets. For example, approximately 98% of all EU tariff lines will be duty free on the first day CETA comes into force. By comparison, only 29% of tariff lines were duty free on the first day that NAFTA took effect.
For my riding of Oshawa, home to General Motors Canada, CETA will provides historic new market access opportunities for the automotive sector, and will allow significant increases in exports to Europe. The removal of tariffs, along with flexible rules of origin, will benefit vehicle and auto parts producers alike.
This unprecedented access is perhaps most impressive in the agricultural sector, where duties on 93.6% of the EU's agricultural tariff lines will be eliminated on the day that CETA takes effect. This is an extraordinary accomplishment considering that only 18% of EU agricultural tariffs are currently duty free.
This impressive new access to the world's largest market will benefit hard-working Canadians across our country. For example, the elimination of EU tariffs in the agricultural sector and the fish and seafood sector will mean that lobster fishermen in the Maritimes, maple syrup producers in Quebec, apple growers in Ontario, grain producers on the Prairies, cherry growers in British Columbia, and Arctic char farmers in Yukon who export to the EU will gain first mover advantage in the EU market compared to exporters from countries that do not have free trade agreements with the EU.
Finally, CETA will provide Canadian goods, services, and investment with a competitive advantage over our international competitors, including the United States. When CETA comes into force, Canada will be the only G7 country with preferential access to both the massive U.S. economy, itself valued at $16 trillion, and the European Union.
It is no wonder that individuals, businesses, governments, and other stakeholders from all parts of this country are heralding CETA as a historic win for Canada. Do not take my word for it. The Standing Committee on International Trade recently submitted a report on CETA that is full of examples of Canadian businesses and stakeholders eager to take advantage of CETA's many benefits. For example, the committee heard testimony from Canadian business leaders praising CETA's opening of new partnerships and technology, development in technology licensing, manufacturing, distribution, and investment opportunities.
These new opportunities will help Canada diversify its trade and reduce its dependence on the United States while ensuring that Canadian businesses will continue to benefit from any more favourable treatment the EU may grant the United States on rules of origin, services liberalization, and recognition of standards in any agreement that they reach.
From the services and information communication technology sectors, the committee has heard business leaders laud CETA as a new generation trade agreement that will provide improved access to various services in the EU, including engineering, and professional and environmental services, by addressing the majority of the tariff and, more importantly, non-tariff barriers to trade and investment.
From Canada's world-leading agricultural and agri-food sector, the committee heard that CETA will result in $1.5 billion in new Canadian agri-food exports to the EU. It will be worth more than $600 million to Canadian beef producers and will increase Canadian pork exports to the EU by $400 million a year.
These clear and direct messages of support from Canadian business leaders across various sectors of the economy are a testament to the government's unprecedented transparent and collaborative approach to CETA.
We have ensured that industries' interests were represented by consulting Canadian stakeholders across a wide spectrum of sectors throughout the negotiations. We have also promptly published summaries of the deal, including detailed information on goods, services, investment, government procurement, intellectual property, and other areas to explain how CETA can benefit Canadians and businesses, even while the technical details of the agreement were still being worked out.
We have also provided details on how CETA will benefit key sectors of our economy, including advanced manufacturing, agriculture, forestry, information and communications technology, and others. All of this information has long been available and remains accurate in light of the final negotiated text, which was placed online for all Canadians to see, in conjunction with the Canada-EU summit marking the end of negotiations on September 26, 2014.
Governments from Canada's provinces and territories have also been crucial partners throughout the negotiations and have publicly expressed support for CETA, because they are confident that this deal represents their best interests. We committed to the spirit of openness and transparency from the onset, and we will continue in the same spirit as we move forward with the next steps to bring CETA into force.
We will continue to develop a range of tools to inform Canadians on key areas covered in CETA and how they can benefit. This will include national outreach and meetings with businesses and stakeholders across Canada to share information about the benefits of CETA, to ensure that Canadians understand the vast opportunities provided by CETA and that Canadian businesses have the tools and support they need to take advantage of CETA's many benefits as soon as possible.
The comprehensive information provided by the government underscores our commitment to transparency. It is, no doubt, our extensive consultations and collaborative approach to CETA that have helped to engender the enthusiastic support from the broad range of stakeholders called to testify before the committee and from Canadians from all parts of the country.
These Canadians already recognize the immense opportunities presented by CETA, and we are committing to continuing to provide all stakeholders with the information and support they need to take full advantage of our most ambitious and comprehensive trade initiative ever. By doing so, our Conservative government will continue to demonstrate not only its commitment to transparency, but also its commitment to ensuring that CETA delivers on its promise to create jobs, stimulate economic growth, and sustain long-term prosperity for all Canadians.
Mr. Speaker, it is with great pride that I stand today in support of this very important motion made by the hon. member for . He has demonstrated in the House, year after year, since he was elected, that he is a passionate champion and rigorous defender of the interests of the people of Newfoundland and Labrador, along with the member for . The two of them represent a duo of members of Parliament who routinely and consistently stand in the House and stand up for fairness, justice, and the people of Newfoundland and Labrador. They should be applauded by the people of that province for their efforts on their behalf.
I want to talk briefly about what the motion today is about, but, more importantly, what it is not about. The motion is about the commitment made by the federal government to the Government of Newfoundland and Labrador to secure provincial government support for the comprehensive economic and trade agreement with the European Union. In short, it is about the official opposition, the New Democrats in the House, requesting that the governing Conservatives honour the clear commitment they made that the people of Newfoundland and Labrador would get a $400 million transition fund, made up of $280 million from the federal government and $120 million contributed by the provincial government, in exchange for Newfoundland and Labrador giving up a very important policy tool, the minimum processing requirements for their fish products in Newfoundland.
What the debate is not about is the merits of CETA. It is not about the economics of trade. It is about one thing, the ability of a province in our federation to expect its federal counterpart to honour a clear commitment that is made to it. That is what this debate is about, and now I will go into that in more detail.
First I want to talk about the importance of fisheries and seafood to the people of Newfoundland and Labrador. I do not think we have to belabour this point. I think every Canadian is well aware of the importance of that sector to the people of Newfoundland and Labrador, and in fact all people who live in the Maritimes, as well as the rest of Canadians who benefit from the hard work of those people in that sector.
In 2013, the seafood sector in Newfoundland generated $1.1 billion, and provided employment for over 18,000 people, mainly in the rural parts of Newfoundland and Labrador, where alternate sources of employment are not so easy to get. Therefore, the fisheries sector is critically important to the people of Newfoundland and Labrador.
The average annual export value of fish and seafood products from Newfoundland to the European Union is approximately $120 million per year. CETA does contain a comprehensive schedule of tariff reductions for seafood exports that we all think will benefit the people of Newfoundland and Labrador, and in fact all of Atlantic Canada. There are tariffs as high as 25% on seafood products. Ninety-six per cent of the European Union fish and seafood tariff lines are expected to be eliminated by CETA once, and if, it is in place at some point.
Let us review some of the basic facts of this dispute. Newfoundland's fish processing sector generates hundreds of millions of dollars in value to the Newfoundland and Labrador economy. The minimum processing requirements policy tool has been used by Newfoundland to secure value-added jobs in rural areas across that province, regions that have suffered from low employment since the cod fishery's collapse.
Newfoundland and Labrador has tightly guarded the right to manage MPRs to generate employment in the past. In short, the policy tool of minimum processing requirements has been very important to the Government of Newfoundland and Labrador, and, more importantly, the people of that province.
In January 2012, Ocean Choice International, a major seafood corporation, requested a permanent exemption for MPRs to permit the export of flash-frozen whole fish for further processing overseas. The Newfoundland government refused that request, highlighting the need to “ensure the long-term security of resources for the benefit of future generations of Newfoundlanders and Labradorians”. Members can see that two or three years ago, the Newfoundland and Labradorian government was emphasizing the importance of minimum processing requirements.
In January 2013, the Newfoundland government stated that it was pushing for maximum local benefits in the CETA deal. Minister Hutchings of that province added, “We will only support a deal that is in the best interest of Newfoundland and Labrador.”
What happened is that the heavy-handed tactics of a secretive and insecure government started to show its hand. CBC reported that the federal Conservatives were in the province to negotiate with Newfoundland over the removal of MPRs. In other words, the European Union was requesting the Canadian government to give up MPRs, and that, in turn, caused the Canadian Conservative government to turn to its counterpart in Newfoundland and request that the government give up its historic important tool of minimum processing requirements.
In a speech to the St. John's Board of Trade, Premier Dunderdale said at that time that “...the Muskrat Falls loan guarantee nearly fell apart when Ottawa suddenly demanded [that] the province give up the requirement that fish landed in Newfoundland and Labrador be processed within the province.”
It was the first time that we saw the pressure on the Province of Newfoundland by the federal Conservatives, going so far as to threaten the pulling of federal loan guarantees for a very important electrical generating project in Newfoundland.
On October 23, 2013, Bill Hawkins, the chief of staff to the Minister of International Trade, wrote an email to the Newfoundland government, which said that transitional programs “of up to a combined total of $400 million that would address fish and seafood industry development and renewal, as well as workers whose jobs are displaced in future” will be provided by the federal government.
What happened here is clear. Newfoundland negotiated the agreement with the federal government. In exchange for giving up the important policy tool of minimum processing requirements in that province, the federal government agreed to provide transition funds to help the province, in the sum of $280 million. Combined with $120 million from Newfoundland, the fund would be $400 million, which would be integral and necessary for the people displaced by the ending of minimum processing requirements in Newfoundland to transition to other employment. There was zero mention at that time that those transition funds were in any way linked to Newfoundland and Labrador having to demonstrate that there were job losses or negative consequences as a result of the removal of minimum processing requirements.
I am the official opposition critic for international trade, and I can tell members that when the Conservative government does link the payment of federal transition funds to provinces for displacement due to CETA, it says so.
The Conservatives said directly to the provinces that if there are negative consequences suffered by the provinces over changes to the intellectual property provisions of CETA, in other words, costs to the provinces for increased prescription costs as a result of CETA, and if the provinces can demonstrate losses, the federal government will compensate.
The federal government has said to the dairy industry of this country that if the dairy industry suffers losses and those can be demonstrated, it will provide funding.
The Conservatives said no such thing to Newfoundland and Labrador when it came to the provision of transitional funds.
Here is the other thing. On October 2014, the was quoted as using the term “fishery transition initiative”. At that time, in late October 2014, ACOA officials, for the first time started to say that the province would have to demonstrate damages to the federal government as a result of the elimination of MPRs before funding would flow.
On December 11, 2014, the new premier of Newfoundland, Premier Davis, met with the to discuss this issue. He clearly said to the that the federal transition funds were unconditional. They had nothing to do with Newfoundland demonstrating losses. It was money that was intended to flow to the province of Newfoundland purely as a result of giving up the minimum processing requirements and there was no condition attached to that.
Here is what Premier Davis said, coming out of that meeting:
[It] really solidifies for me that you can't trust the federal government.... You can't trust [the Prime Minister's] government.... We bargained in good faith.... We believe[d] we had an agreement in place, that we had a deal set.
That is not the official opposition saying that the federal government reneged, that the Conservatives reneged. Those are the words of the Premier of Newfoundland.
Let us explore the argument the Conservatives are making in the House that, “Oh, no, the federal Conservatives always intended the Newfoundland government has to demonstrate losses.”
I met with ministers of the Newfoundland provincial government. This is what they said to me—and I put this out for Canadians to judge themselves—“If the $400 million was intended as a fund only to be paid in the event of demonstrated losses to compensate Newfoundland for the losses they could demonstrate, why are we contributing $120 million? Does the federal government expect us to compensate ourselves?” They do not need to have a deal to compensate their own displaced fisheries workers. Not only that, but there was never a word mentioned in any memo, in any news article, anywhere, by the current Conservative government that ever tied the payment of transition funds to the demonstration of losses.
The Conservative government has also said, “Oh, well, this isn't fair to the other provinces, Atlantic provinces, which also may suffer losses as a result of CETA.
Here is the fact that all Canadians can weigh, that punctures to the heart of that matter. The other Atlantic provinces do not have minimum processing requirements. Only Newfoundland and Labrador does. Only Newfoundland and Labrador was asked to give up minimum processing requirements. Only that province nogotiated with the federal government what it would get for giving up that important policy tool.
Does it really seem reasonable to anyone that this is unfair to that the other Atlantic provinces did not get a fund? Of course it is not unfair, because the other Atlantic provinces did not have minimum processing requirements.
Now, to add insult to injury, the states that the fisheries fund was never intended to be a “slush fund”. What an insult to the Premier and the Government of Newfoundland. What an insult to the cabinet ministers of Newfoundland. What an insult to the people of Newfoundland and Labrador to call this money a slush fund when it is compensation for those people, compensation that the current government admits is owing, compensation that it knows is necessary, because Newfoundland and Labrador gave up something important to it and will suffer losses as a result
What has happened since then? On January 20, 2015, Newfoundland announced that it is withdrawing from Canadian trade negotiations and withdrawing its support for CETA.
The Conservative government's credibility is on the hook here.
I want to talk about integrity and respecting agreements.
When a country signs a trade agreement, like any contract, like any agreement, the value of that agreement is not just in the words on the paper. The value of that agreement is in the good faith and the intent of the signatories to that agreement to implement the terms of that agreement in good faith.
Trade agreements are only as strong as the good faith of the parties implementing them. I will give an example. Non-tariff barriers are notorious in our world. Stories are legion of parties signing trade agreements, only to have the benefits of those agreements undermined by parties that go away and implement every single conceivable kind of non-tariff barrier to defeat the purpose of that trade agreement.
In this case, for the federal Conservative government to break its word with the province early on, in the agreement's genesis, demonstrates a lack of good faith. It demonstrates bad faith. That is inconsistent with the federal government's proper role in implementing trade policy, which requires the utmost of good faith.
When we speak of integrity, commitment, and honour, I want to relate a story of a person I know in Vancouver: Mr. Jeff Gourley. Jeff Gourley is the head coach of the senior boys' basketball team at Vancouver's Sir Charles Tupper Secondary School. For over a decade, Jeff has volunteered his time to create and coach this small eastside school basketball program. Prior to his arrival, Tupper had not even made the playoffs for the better part of 20 years. Through his leadership, he has inspired the Tupper Tigers to bring home city championships and rank in the top five in the province while excelling in school and, more important, growing as people of responsibility.
Several of his charges have gone on to win university scholarships and played at the highest levels in Canada and to achieve success in every area of endeavour. Jeff has done this by teaching the boys under his charge to see the game as a metaphor for their lives. In his words, “All I am doing is giving them the opportunity to dream, to think and most importantly for them to understand that each and everyone of them has the ability to try and succeed at what ever they want to do.”
Inspiring young athletes from a lower eastside neighbourhood who have not had a track record of success can be one of the most difficult tasks for any coach to accomplish, but Jeff has done this by teaching them about teamwork, respect, honour, and to trust in themselves and each other and to keep their commitments.
That is a lesson for us all, but it is a lesson for the federal government more than anything, because Mr. Gourley and the players at Tupper School in Vancouver know one thing: they know that when they give their word, they keep it. They know that when they make a commitment, they honour it. They know that when they tell someone they are going to do something, they do it. That is what makes those young fine men. The government should listen to what those young men are learning in that school.
I want to talk about the consequence of this. I hear the government stand every day in the House and mislead Canadians by saying that this Conservative government has secured trade deals with the two largest markets on earth, a reference to the United States and the European Union. It has indeed secured an agreement with the United States, but it is wrong to say it has secured agreement with the European Union. There is no agreement in force with the European Union. CETA is not in force and, frankly, it is jeopardized by the behaviour of the government.
The Province of Newfoundland and Labrador has already stated publicly that it is not going to honour the commitments in CETA. The number one ask of the European Union at the bargaining table in CETA negotiations with Canadians was to have access to provincial procurement, to sub federal procurement. What kind of message does it send to the European Union when Canada gets into a public conflict with one of its own provinces, which has now withdrawn from its commitments under the agreement?
Second, Germany and France just two weeks ago went to the European Commission and stated that they wanted changes made to the text of CETA dealing with the investor state relations. It is well-known across Europe that CETA is a mixed agreement, meaning that it will require ratification by every single member of the European Union, including Greece, which is now put into jeopardy. The point is that we do not have an agreement yet with the European Union.
Some hon. members: Oh, oh!