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37th PARLIAMENT, 1st SESSION

Standing Committee on Foreign Affairs and International Trade

EVIDENCE

CONTENTS

Tuesday, May 7, 2002

0915

The Chair

Professor Stéphane Roussel (Political Science, Glendon College, York University)

0920

0925

Professor Stephen Clarkson (Political Science, University of Toronto)

0930

0935

The Chair

0940

Mr. Day

Prof. Stéphane Roussel

0945

The Chair

Mr. Stockwell Day

Prof. Stéphane Roussel

0950

Mr. Stockwell Day

Prof. Stephen Clarkson

0955

The Chair

Mr. Stockwell Day

Prof. Stephen Clarkson

1000

The Chair

1005

The Chair

Prof. Stephen Clarkson

Mr. Sarkis Assadourian

Prof. Stephen Clarkson

1010

Mr. Sarkis Assadourian

Prof. Stephen Clarkson

1015

Mr. Sarkis Assadourian

The Chair

Prof. Stéphane Roussel

The Chair

Mr. Stockwell Day

Mr. Day

1020

Mr. Sarkis Assadourian

Mr. Stockwell Day

The Chair

Prof. Stéphane Roussel

The Chair

1025

Ms. Sarah Blackstock (G-8 Campainer, Greenpeace Canada)

1035

The Chair

Ms. Sarah Blackstock

The Chair

Mr. Stockwell Day

Mr. Day

1040

Mr. Sarkis Assadourian

Ms. Sarah Blackstock

The Chair

1045

Mr. Sarkis Assadourian

Ms. Sarah Blackstock

Mr. Sarkis Assadourian

Ms. Sarah Blackstock

1050

Mr. Sarkis Assadourian

Ms. Sarah Blackstock

The Chair

Ms. Sarah Blackstock

Mr. Sarkis Assadourian

Ms. Sarah Blackstock

The Chair

Ms. Sarah Blackstock

The Chair

Ms. Sarah Blackstock

1055

The Chair

1100

The Chair

1105

Mr. Stockwell Day

Mr. Lawrence McBrearty

Mr. Stockwell Day

Mr. Lawrence McBrearty

Ms. Sheila Block (Researcher , United Steelworkers of America)

1110

Mr. Stockwell Day

Ms. Sheila Block

Mr. Stockwell Day

Ms. Sheila Block

Mr. Lawrence McBrearty

The Chair

Mr. Lawrence McBrearty

1115

The Chair

Mr. Sarkis Assadourian

Mr. Lawrence McBrearty

Mr. Sarkis Assadourian

Ms. Sheila Block

Mr. Sarkis Assadourian

Ms. Sheila Block

Mr. Sarkis Assadourian

Ms. Sheila Block

Mr. Sarkis Assadourian

Mr. Lawrence McBrearty

Mr. Sarkis Assadourian

Mr. Assadourian

1120

Mr. Lawrence McBrearty

Mr. Sarkis Assadourian

Mr. Lawrence McBrearty

Mr. Sarkis Assadourian

The Chair

Mr. Lawrence McBrearty

1125

The Chair

1130

Mr. Gerry Barr (President, Canadian Council for International Cooperation)

1135

1140

1145

The Chair

Mr. Stockwell Day

1150

The Chair

Mr. Gerry Barr

Ms. Miriam Mukutuma (Deputy General Secretary, Zimbabwe Congress Trade Union)

Mr. Salihu Lukman (National Director of Education, Nigerian Labour Congress)

1155

The Chair

Mr. Sarkis Assadourian

1200

The Chair

Mr. Gerry Barr

Mr. Sarkis Assadourian

Mr. Gerry Barr

1205

Mr. Sarkis Assadourian

Mr. Gerry Barr

The Chair

1210

Mr. Gerry Barr

The Chair

1215

Ms. Anita Zaenker (Chairperson, British Columbia Component, Canadian Federation of Students)

1220

1225

The Chair

Mr. Stockwell Day

Ms. Anita Zaenker

1230

The Chair

Mr. Sarkis Assadourian

Ms. Anita Zaenker

1235

The Chair

Mr. Sarkis Assadourian

Ms. Anita Zaenker

Mr. Sarkis Assadourian

Ms. Anita Zaenker

1240

Mr. Sarkis Assadourian

Ms. Anita Zaenker

Mr. Sarkis Assadourian

The Chair

Mr. Stockwell Day

Ms. Anita Zaenker

Mr. Stockwell Day

Ms. Anita Zaenker

The Chair

1355

Mr. Ernie Regehr (Executive Director, Project Ploughshares)

The Chair

Mr. David Albright (President, Institute for Science and International Security, Project Ploughshares)

1400

1405

1410

The Chair

Mr. David Albright

The Chair

Mr. Stockwell Day

Mr. David Albright

Mr. Stockwell Day

1415

Mr. David Albright

The Chair

Mr. Sarkis Assadourian

Mr. Assadourian

1420

Mr. David Albright

Mr. Sarkis Assadourian

Mr. David Albright

Mr. Sarkis Assadourian

Mr. David Albright

1425

Mr. Sarkis Assadourian

Mr. David Albright

The Chair

Mr. Stockwell Day

Mr. David Albright

Mr. Stockwell Day

Mr. David Albright

1430

The Chair

Mr. David Albright

The Chair

Mr. David Albright

The Chair

Mr. David Albright

The Chair

1435

Mr. Ernie Regehr

The Chair

Mr. David Albright

Mr. Ernie Regehr

The Chair

Ms. Danielle Goldfarb (Policy Analyst, C.D. Howe Institute)

1445

The Chair

Ms. Danielle Goldfarb

1450

1455

The Chair

Mr. Stockwell Day

Ms. Danielle Goldfarb

1500

The Chair

Mr. Sarkis Assadourian

The Chair

Mr. Sarkis Assadourian

Ms. Danielle Goldfarb

1505

Mr. Sarkis Assadourian

Ms. Danielle Goldfarb

Mr. Sarkis Assadourian

Ms. Danielle Goldfarb

Mr. Sarkis Assadourian

Ms. Danielle Goldfarb

The Chair

Ms. Diane Richler (President-Elect and Secretary General, Inclusion International)

1520

1525

1530

The Chair

Mr. Stockwell Day

1540

1545

Ms. Diane Richler

Mr. Stockwell Day

Ms. Diane Richler

1550

Mr. Stockwell Day

Ms. Diane Richler

1555

The Chair

Mr. Sarkis Assadourian

Ms. Diane Richler

1600

Mr. Sarkis Assadourian

Ms. Diane Richler

Mr. Sarkis Assadourian

The Chair

Ms. Diane Richler

The Chair

Ms. Salimah Valiani (Researcher-Educator (Asia), Kairos)

1605

1615

1620

1625

The Chair

Mr. Stockwell Day

Ms. Salimah Valiani

Mr. Stockwell Day

Ms. Salimah Valiani

1630

The Chair

Mr. Stockwell Day

The Chair

Mr. Sarkis Assadourian

Ms. Salimah Valiani

Mr. Sarkis Assadourian

Ms. Salimah Valiani

Mr. Sarkis Assadourian

Ms. Salimah Valiani

Mr. Sarkis Assadourian

Ms. Salimah Valiani

Mr. Sarkis Assadourian

The Chair

Mr. Stockwell Day

1640

Ms. Salimah Valiani

1645

Mr. Day

Ms. Salimah Valiani

Mr. Day

Ms. Salimah Valiani

Mr. Day

1650

Ms. Salimah Valiani

Mr. Stockwell Day

The Chair

CANADA

Standing Committee on Foreign Affairs and International Trade

NUMBER 077

1st SESSION

37th PARLIAMENT

EVIDENCE

Tuesday, May 7, 2002

[Recorded by Electronic Apparatus]

¿ (0915)

[English]

The Chair: For those of us who saw Professor Clarkson's article in yesterday's Globe and Mail, I'd like to assure you that the committee has not prejudged the results of our study. It's important for me to put this on the record. We're hearing from Canadians.

In regard to the G-8 issues, the committee will be tabling its report by the end of this month, in advance of final preparatory meetings for the summit. In the case of the North American study, all aspects of Canada-U.S. and Canada-Mexico trilateral ties are open for examination, with a final report envisaged for the fall.

I want to thank all of our witness who will be with us today for taking the time to contribute to the committee's deliberations. We hope this is an ongoing dialogue. Welcome.

From Glendon College, York University, we have Stéphane Roussel, assistant professor; and from the University of Toronto is Stephen Clarkson, professor of political science. Welcome, professors. You have an hour with us. You can proceed with opening statements and then there will be questions and answers from the members around the table. Thank you.

[Translation]

Professor Roussel, please.

Professor Stéphane Roussel (Political Science, Glendon College, York University): Thank you very much, Madam Chair. If I may, I will be making my presentation in French; however, I could discuss the issues and answer any questions in English. You probably know that Glendon College is a bilingual institution and I represent this institution.

First of all, I would like to thank the committee for inviting me here today. Canadian-American relations and the security perimeter in particular are subjects that have been of great interest to me for a long time.

I have been studying these issues for many years now and I appreciate this opportunity to be able to share my ideas on the topic with you.

I will be concentrating on this concept of a security perimeter in my presentation and I will be defending a position that could be described as being institutionalist. This is a position which strives to defend the role of international institutions and organizations in the process.

First of all, what do we mean by this concept of a security perimeter? I must say that there are no definitions that have been unanimously agreed to. Generally speaking, the definitions are based on statements made by American ambassadors: Paul Cellucci, who is currently ambassador, and his predecessor, Gordon Griffin, clarified what was meant by this concept.

This concept involved, first of all, closer cooperation between the two states. Secondly, it means strengthening already existing measures. Thirdly, the concept involves the systematic use of new technology to enhance border control and speed up the border crossing process. Fourthly, and this is the most important point, it means harmonizing the policies of both governments in areas that include, in particular, immigration, border control, intelligence, defence and security, and, in particular, law enforcement.

This morning, I will be focusing on three issues pertaining to the future evolution of the security perimeter. Obviously, this presentation is based on the following postulate: although the security perimeter already exists—I do believe that the groundwork has already been laid— the process is not yet complete. We should expect new initiatives in this area in the months and years to come. Recent security perimeter initiatives include the December 3 agreement, the federal budget of December 10, 2001 and the Canadian-American agreement of December 12, which are detailed very well in the documents prepared by the Library of Parliament.

There are three problems that pertain to the evolution of the security concept. The first difficulty is the limitation of operational sectors covered by this concept. This means immigration, border management, intelligence but, as well, many other sectors where there is a great deal more ambiguity.

For example, on December 19, American Ambassador Paul Cellucci talked about the need to cooperate more closely in the energy sector, tying this cooperation to the strengthening of security in North America. So he is using the pretext of security to call for negotiations in the sectors that are quite far removed from security. This also applies to the health sector. Preparation in the event of a bioterrorist attack can be used as a pretext for greater cooperation between the two countries in health matters, and, as a result, this could eventually have an impact on the Canadian health system. This is also true for the carrying of weapons, and, as well, if we want to carry the argument even further, the sale of potable water. Indeed, very few sectors are excluded from the pretext of security, explaining why it is so important for Canada, in particular, to define the limitations of cooperation between the two states very carefully.

The second question that arises from this concept of the security perimeter is, obviously, that of geographical limitations. The question that we must ask ourselves is as follows: should we invite Mexico to be involved in the security perimeter? Opinions vary on this issue. Some stress the fact that the problems found at the Canadian-American border are totally different from those found at the Mexican-American border, and if we were to invite Mexico to participate in the security perimeter, we may well find ourselves forced to Mexicanize the process at the Canadian border, which would involve much more rigorous restrictions and controls than we currently have.

The opposing argument, and one that I agree with, is that it is not possible to have a two-tier free trade agreement. It is not possible to have a second-class member. And by that I mean Mexico. Economic integration requires security integration. The two are closely linked, and I do not think that we can leave Mexico on the sidelines for very long.

I think that the Canadian government should look into this matter because my discussions with my Mexican colleagues reveal that Mexico is somewhat uncomfortable about Canada's attitude.

The third and final issue that I would like to raise this morning,and which, in my opinion, is perhaps the most important one, pertains to the way that the security perimeter is organized. Very briefly, I would say that this perimeter could evolve in four different ways.

The scenario would be to create a formal security perimeter, either through a treaty binding the two or three governments, or by an executive statement, a statement setting forth the long-term objectives that the members of the security perimeter hope to attain as well as the operational limitations of this security perimeter. So this would be a statement of principles setting forth the long-term objectives and principles. If you would like some examples of models that this could look like, there is the Schengen Agreement in Europe, the Ogdensburg Declaration of 1940 that led to the creation of the Permanent Joint Board on Defence, and, ultimately, NORAD. With this first scenario, we could create a formal organization like NORAD or the Permanent Joint Board on Defence.

The second scenario would be one whereby we would have an informal security perimeter. This is something that you are already familiar with because 95% of our Canadian-American relations fall under this category. These are purely operational measures, with no formal treaty, without any declaration of principle. Essentially, this scenario would call for a strengthening of existing measures. Such models would be the agreements of December 3 and 12, which appear to follow along these lines. This is the approach that the Canadian government tends to prefer.

The third approach would be to establish a multilateral agreement that would go well beyond the North American borders. We could envision something that would have ramifications that would be felt all the way up to the UN, with the NATO members, within the G-8. So there are several options under this scenario. Canadians would find this approach very attractive because they would be able to find partners and allies that would enable Canada to act as a counterweight to the excessive influence of the United States.

This approach poses major problems as well, because neither the Canadian government nor the American government are very warm to the idea of entering into a multilateral framework. First of all, such agreements require a great deal of time to negotiate. Secondly, this scenario would dilute the scope of the agreements that may be in effect. Thirdly—and this pertains to Canadians in particular—this concept of acting as a counterweight to American influence has rarely ever worked in Canadian history. International institutions do not fulfill this role, contrary to a well-established myth in the historiography on Canadian foreign policy.

The fourth approach, which I would call the unilateral approach, is almost an anathema when you talk to people from Foreign Affairs. What I mean by this is a series of unilateral measures taken by the Canadian government in the hope that they will meet the expectations and allay the fears of the American government. So there is no explicit cooperation and the measures are decided on exclusively by the Canadian government, the Parliament in particular. Such measures could, for instance, be in the form of bills such as bill C-36, C-44 and C-55, or yet again in the budget of December 10, 2002.

This too is a very attractive approach because it enables us to protect Canada's sovereignty, at least in theory. In practical terms, the problem is that, in my opinion, it will not enable us to meet the requirements and expectations of the American government and we may very well find ourselves in delicate situations such as the one we were in on the morning of September 12, 2001, when the borders were virtually shut down.

What is my position on the matter? I would defend the first approach, the institutional position, namely, a formal treaty that sets forth long-term objectives. In Canada, we are very sensitive about taking such an approach and we have some fears when it comes to institutions. I believe that such fears have no basis. Historically, the bilateral Canada-American institutions have served the interests of Canada very well. I will briefly describe four reasons why this is so.

First of all, the institutions and formal treaties enable us to put some limitations on the fields of activity, thus avoiding spillovers into other sectors that have nothing to do with security.

Secondly, formal agreements enable us to provide long-term guarantees to member states and, as a result, to restore trust between the states. For Canada, this means that the Americans will make a commitment to not shut down the borders or to not limit traffic at the borders as they did on September 12. For Americans, this means that Canada will do its bit in fighting terrorism and will try to deal with the threats directed against American territory.

¿ (0920)

The third advantage is flexibility. Contrary to what we may think, the history of Canada-U.S. relations shows us that institutions are flexible and able to correct their mistakes. This was the case with the PJBD and NORAD, and this has also been the case in many other institutions.

The final advantage is that it ensures an exchange of information between two or three governments. Not only are they able to exchange daily information that allows for the smooth running of security agencies, but they also obtain information on their partners' long-term plans. This is very important for the Canadian government.

In conclusion, I would say that the integration of security between the two states is, in my opinion, inevitable. Accordingly, it is preferable to manage the situation rather than try to thwart it. About 30 years ago, the diplomat John Holmes, who is well known for his work on Canadian foreign policy, said that continentalization was a force of nature which requires us to impose the discipline of institutions.

This was true then, and, Madam Chair, I believe that this is still true today. Thank you very much.

¿ (0925)

[English]

Professor Stephen Clarkson (Political Science, University of Toronto): I'd like to also applaud the committee for taking on this issue of North American integration. He's not here, but I think Gerry Schmitz's work needs to be recognized. I'm sure it is. I think he has done absolutely superb work with his team of colleagues in the past on the background document we were talking about before we started formally. It's a really superb review of the situation and raises so many questions, most of which I would have liked to engage him on, since I, like my colleague, have spent a lot of time on these issues. It's a really good piece of work.

If I cited in the paper yesterday one set of questions that didn't leave open another possibility, it's a very minor critique of a very excellent document. I hope it is generating a really significant response from people you're consulting in this country and elsewhere.

You're on the leading edge of crucial issues facing Canada, and this time, perhaps unusually, you're not alone. There are many other institutions in Washington, Toronto, Montreal, and around the country raising the question of the next stage in North American integration.

What makes you distinct from the other institutions is that you have direct contact with the public. All of these institutions are elite groups. Whether they're university-based, think-tank-based, or straight business-financed institutions, they have a particular point of view. On the whole, their assumption is that the next stage of North American integration needs to be some kind of big leap forward. But I hope this committee, while probing all the possibilities, will adopt some skeptical views on the big ideas that are being presented.

I'm sure we'll come back to this in discussion.

I know that you really want to talk about the future, but I would like to spend a couple of minutes with you--in fact, the bulk of my time--raising the question, even though I'm not an historian, of how successful was the last big idea? I think that will give us some guidance about what a possible new big idea might look like or what kinds of results it might have.

Clearly, in this area the last big idea on North American integration--NATO was mentioned, but I don't want to go that far back, because that's really a security issue--was Donald Macdonald's royal commission proposal of an across-the-board major free trade agreement. This was taken up by Mr. Mulroney's government, produced the bilateral free trade agreement of 1988-89, and then led to the extension to Mexico under NAFTA--not to mention the WTO, which is quite a different animal.

Now, I think free trade as a big idea was packaged brilliantly. It was sold, I think, somewhat deceptively to the public as free trade. The general consensus in this country would be that it's been a huge success, the prime indicator being the very significant increase in trade between the two countries. But I'd like to draw your attention to other aspects of it that have not necessarily been such a big success.

Even in its own terms, Canada's share of foreign investment globally has declined, job increases have been disappointing, and the standard of living of Canadians has not shot up as promised.

The most basic indicator, which was used as a promise by those who pushed free trade in the late eighties and is now again on the table, is Canadian productivity levels. In the 10 years since free trade, there's been a fall of about 50% compared to the productivity growth rates in the 10 years before free trade, and then in the two decades before that they were even higher. By a key indicator of free trade success, it's turned out to be extremely disappointing.

Then on the institutional side, which my colleague is most interested in, the major failure of Canada-U.S. and then Canada-U.S.-Mexico free trade was not getting exemption from the prime anti-free-trade quality of the American system, namely the anti-dumping and countervail laws, which the Canadian government had as its major objective in negotiating a trade deal. They wanted secure access, which of course they didn't get.

The dispute settlement mechanisms set up in exchange or as a kind of recompense have on the whole been very disappointing, and let's not forget to mention the innovation of investor-state dispute settlement in chapter 11 of NAFTA. This is now a notorious institution, one that has caused a very high level of dismay among major NGOs in this country as well as in the U.S. and Mexico. Institutionally, the big idea did not just fail, it had a sleeper in it.

In 1993, when NAFTA was being debated, this investor-state dispute settlement was virtually invisible. I think it's pretty clear from research that our negotiators didn't understand its significance, the public didn't understand it, and I don't think the government understood it.

I say this, Madam Chairman, because if you're being presented with proposals for another big idea, I refer specifically to Wendy Dobson's important paper, published about three weeks ago now by the C.D. Howe Institute. There she argues that the only way to get the Americans' attention is to offer a really big idea. This is because Washington is such a circus of different interests and different ideas that the only way we can really do something with the Americans is to present them with something especially attractive.

¿ (0930)

So one has that argument in favour of a big idea, plus the position of those who say free trade was basically the right approach but there were problems with it and it needs to be fixed. Robert Pastor has talked to this committee already in the fall and maybe even more recently. He has a great coherent argument that it needs to be fixed and we need institutions like a permanent trade corps or some kind of institution, maybe borrowed a bit from the European Union.

It's not, Madam Chairman, to contest the coherence of these proposals. It's to say maybe two things. One is that there's an extremely low possibility that the American system would respond this time. We can go into that if you want a discussion. Secondly, there's a very big danger that within a big idea, there may be small ideas that aren't adequately discussed and understood, like the time bomb that was the chapter 11 dispute settlement mechanism, which we buy into without knowing what the consequences are going to be.

My conclusion is fairly simple, unspectacular, and maybe not attractive. It's to go issue by issue, to be more cautious, to deal with the issues that have to be dealt with. Professor Roussel has outlined many of them very clearly. If any big idea is to be considered, it strikes me that it ought to be a rebalancing of the market state relationship.

It's hard to make this statement without some ideological content to it, but my own assessment of the last twenty years' experiment with downsizing the state, to put it neutrally--budget cutting, public service cutting, privatization, and the whole range of neo-conservative measures--is that it has been very unsatisfactory as far as the public is concerned. One just has to say “Walkerton” and one realizes that for good reasons or bad, the state system in Canada--federal, provincial, and municipal--has been cut back. Elites like this because elites feel...

Canadian elites are very much wannabes. They want to be part of the American system--if I were an American professor, my salary would be roughly double what it is at the University of Toronto--on the one hand, but on the other hand, the public, which knows it has to live in this country, has a long history of a pragmatic relationship with its governments that has resulted on the whole in excellent services, which the public appreciates. I don't need to belabour the point that health care is seen by Canadians now as a defining element of their identity.

Schools, infrastructure, all these things are not only goods in themselves, but on the economic side they are attractive to investors and necessary, whether it's the automobile industry, which is right now on the agenda, on the front page of the Toronto paper, or high-tech or any other kind of economic problem that I know this committee doesn't deal with explicitly, but has to bear in mind. These issues do come back to a better balance between state and market than has been achieved in the last twenty years, a quite radical change.

Just to conclude, there's lots and lots we can discuss. If there's any big idea, I think the politicians such as you, in touch with the people as you are, surely know that there are big concerns about the quality of the public domain. That should be the priority, with the secondary issues being how to deal with the United States, how to deal with the border, how to deal with the concerns of Washington. If this issue is on the agenda at all, it's because of September 11 and the Americans' understandable paranoia about terrorism, which now is deflating somewhat, making it easier to cope in a more sensible, pragmatic, long-term way with these issues.

Thanks very much.

¿ (0935)

The Chair: Thank you very much for taking us back and having us reflect, because we are reminded that those who don't understand the past are condemned to repeat it. I'm not too sure who the famous person was who said that, but we'll go directly into questions, starting with Mr. Day.

¿ (0940)

[Translation]

Mr. Stockwell Day (Okanagan—Coquihalla, Canadian Alliance): Thank you, Madam Chair.

Mr. Roussel, I do not think that the purpose of this meeting is to initiate a huge debate with the people making presentations. We should be listening and trying to build bridges between the groups and the individuals who, like you, are making presentations, and the members of Parliament who are representing or trying to represent citizens, in order to determine whether or not there are initiatives that we could take in order to enhance their standard of living.

It is not always easy to resist a debate, particularly when one has just heard comments such as those made by Mr. Clarkson, but I will try.

[English]

I'd like to pose a couple of questions on your presentation in this effort to glean from a variety of presenters like yourself, Mr. Clarkson, the possibilities that can move us down a road to looking at initiatives that can in fact increase the quality and the standard of life for Canadians and further the interests of Canadians first and then expand out to our neighbours.

In Europe so many of the borders are invisible in terms of people transferring back and forth, and yet when you look at some of the historic clashes between those countries that now have wide-open access, and even some of the cultural differences, which are arguably greater than some between Canada and the U.S., how is it they have achieved this ease of movement among what were previously sometimes warring nations and we have not quite achieved, although it's a relatively friendly border obviously, that same ease of access as some European countries? Could you give us any thoughts on that?

Also, do you have any comments on the initiative for a northern command now coming out of the United States and the, at least on the surface, lack of energy on the part of the Canadian government to really engage in that discussion?

And lastly, can you discuss the type of security perimeter you're talking about and that you envision in relation to the issue of a missile defence in the continental context, which the Americans are talking about?

And then I have some questions for Mr. Clarkson.

[Translation]

Prof. Stéphane Roussel: Thank you for your questions, Mr. Day.

I will begin with your second question, which pertained to the Northern Command, because it is a more tangible issue and relates directly to the decisions that will soon have to be made. As many commentators have pointed out, the Northern Command does not have a direct impact on Canada-U.S. relations, and the changes that are currently being made by the Americans do not require the Canadian government to take any initiatives. This may explain, in particular, the fact that the government is not taking any action for the time being. I think this is a defendable position.

So on the surface, you don't see anything happening. However, in the medium term, I would expect that the establishment of this Northern Command will force us to think much more seriously about the institutionalization of sectors other than aeronautical defence. NORAD looks after aeronautical defence. With the creation of the Northern Command, we are going to have to consider cooperation in the area of naval and land defence.

I think that the government should start to think about these issues. How do we want to see such cooperation evolve, because it will, out of necessity, evolve? Northern Command initiatives tend to show us that, if we do not take action quickly enough, if we are not creative enough, if we don't show enough initiative, then the Americans will be setting the table and discussing the agenda. Past Canada-U.S. relations have shown us that Canada gained a great deal more when it took the initiative. Often the situations are very different.

The way that NORAD was negotiated is an example of poor management. The initiative came, to a large extent, from the American air forces and Canada, partly because of a changing government, lost control of the process.

The case of the PJBD, however, despite the fact that it is not as effective today, is an example of good negotiations because initiatives were taken in a timely fashion.

Your first question was about Europe. How did the Europeans manage to achieve this and what lessons can we draw from their example? One objection that we very often hear about why we cannot use the European model in North America revolves around what we call the asymmetry of power. It is said that North Americans are very different because a large power is living next to a small power.

Apparently the Europeans have been able to achieve progress much more quickly because of a type of balance of power in Europe that allowed more equal states to negotiate. That is not necessarily my assessment. The process used for integration in Canada-U.S. relations is totally different from that of the Europeans.

First of all, it is quite remarkable to observe that there has not been any war between Canada and the United States in 200 years. This is almost a record. It is very difficult, even impossible, to find any other similar situation. Integration has been gentle, and it has occurred in the transnational as opposed to intergovernmental manner. This process became political only very recently.

We have now reached the point where we must deal with this political integration. So the European experience, at the start, was not very useful to us. It is much more useful to us now that we have reached the point of political integration.

Your last question pertained to anti-missile defence. Unfortunately, I think that this too constitutes an unavoidable process. This is one of the rare concepts put forward by our neighbours to the south that is clear. Indeed, the Bush administration is not very clear about the big concepts; it has not come forth with a lot of ideas. But homeland defence is a concept that will guide American foreign policy in the years to come, and anti-missile defence is an essential component of that policy.

Prior to September 11, my position was that anti-missile defence was not going to have as big an impact on Canadians' daily life as, for example, the security perimeter, which is another component of homeland defence. So I said to myself that it would be better, for the Canadian government, to accept some compromises in the area of anti-missile defence to demonstrate goodwill in Washington and to say that the country was prepared to contribute to the defence of North America, even if that called into question certain aspects of firearms control policy and even if that generated some discomfort on the international scene. Saying yes to anti-missile defence may give us some flexibility enabling us to negotiate other aspects that may have a much more direct impact on the lives of Canadians. By this I mean the security perimeter, border control, law enforcement. The harmonization of policies is something that will have much more of an effect on the lives of Canadian citizens than anti-missile defence.

From this standpoint, and I know that this is in sharp contradiction with the views expressed by others, I think that if we can negotiate, I would tend to make a lot more concessions in the area of anti-missile defence in the hope that this would give me more elbow room when discussing other aspects of the security perimeter, thereby ensuring that we would be able to preserve those matters which Canadian citizens care deeply about, such as the health system, immigration, the Firearms Act, and potable water. All of these sectors must be preserved, and we may be able to gain some flexibility by doing this.

Thank you.

¿ (0945)

[English]

The Chair: Thank you.

Mr. Day.

[Translation]

Mr. Stockwell Day: Mr. Roussel has presented a few positions that Canada could adopt. I think that the second position pertained to informal agreements. Do you think that, if we were to have informal agreements, it would be easier for us to adjust to the circumstances than if we were to have very strict treaties?

Prof. Stéphane Roussel: No. Informal agreements, just like formal agreements, create attitudes, expectations, modus operandi.

There are very few cases, in the history of Canadian-American relations, where it was decided overnight to rip up an informal agreement because we didn't like it.

Secondly, these informal agreements are frequently interconnected. You cannot eliminate one without having an impact on the others. Consequently, though such agreements may look like they are flexible, they in fact tend to create ties that are more pernicious, in my view, because they are invisible, they are not discussed in public and they do not set forth long-term, explicit objectives. They give the appearance of being more flexible, but in reality, because of the way these agreements are linked to each other, they are just as difficult to undo.

In fact, I would say that informal integration like that is more difficult to undo than formal integration because we are unable to foresee all of the ramifications.

¿ (0950)

[English]

Mr. Stockwell Day: Thank you. Those are helpful insights.

To Mr. Clarkson, skipping over some areas where I think we'd have some broad disagreement, I happen to agree that we haven't seen the productivity or the standard of living increases since 1988 that we would have liked to.

My study and practice in analysing reasons for that I think would differ from yours, sir. I believe the fiscal and industrial policy of this government, which is based on things such as regional subsidization of specific industries, has had a deterring effect on investment, especially those industries that don't happen to be the happy recipients of the arbitrary largesse of the government. Lack of vigour on the federal government's part in terms of debt reduction, lack of legislative vigour and political will, and a comparatively higher tax regime vis-à-vis the United States have been, in my view, the key components to deterring long-term capital investment--and capital taxes too, I'll include as being too high--and have had a diminishing effect on productivity.

Then, of course, as regards that other area of productivity, the difference in the value of the dollar has enabled a lot of our exporting and export manufacture to be competitive without having to really aggressively upgrade, especially on the technological side. We'd probably have a difference in where that lack of productivity comes from--some of the underlying factors--but I would agree with you, it hasn't been there.

I agree with you also in terms of the United States' big talking on free trade. I think philosophically they're there, but they seem to be much more prone to their interest groups in terms of their protectionist leanings.

What advice or insight would you have for us related to ways to deal with the protectionist reactions we get, especially as a congressional election cycle comes around every couple of years? Is there a way to have a dispute mechanism system that's more rapid in terms of coming to a conclusion that would enable, for example, the softwood lumber dispute to be settled one way or another more rapidly but fairly, recognizing the jurisprudence and consistency that's required there? Do you have any suggestions on how that can be expedited, so we can come to conclusion when these protectionist cases come up?

Prof. Stephen Clarkson: Thank you very much, Mr. Day.

To go back to your opening comments, I think that your position is completely coherent. One difficulty we have is that there's really no way to tell who is right, because in all these issues that end up as a simple question about the dollar or productivity so many factors are involved that one makes the choice in trying to figure out what has led to what. So I can have a coherent position and you can have one and it's very, very hard to know who is right.

My own sense is that whether we call them neo-conservative or neo-liberal, the reaction against the allegedly too generous Keynesian welfare state of the fifties, sixties, and seventies that took place in Canada a little late in the mid-eighties has had quite a fair time to be tested. We've had at least 15 years of the new system, and it has not delivered. The interesting thing is that the bad old Keynesian welfare state had much higher productivity growth rates, much higher job creation rates, much higher increase in the standard of living. And those are facts.

Now, we don't know whether a more generous, more active state in the last decade would have produced better results, because the trend was going in the other direction. Anyway, this isn't the place to debate that any further.

On the question of what to do now with American protectionism, I differ from my colleague, basically because a small country negotiating with the global hyper-power is very weak. I would argue that the free trade agreement increased the disparity in power between Canada and the U.S. because in the process of negotiations we not only gave away a lot of our powers, but we didn't get the kinds of institutions that would have given Canada a voice in Washington similar to Denmark's voice in Brussels. All we have is that beautiful--or ugly, depending on what you think of it--building on Pennsylvania Avenue looking out at the Congress, and our embassy is no more effective than it was before. They're good people, and they're doing what they can. So we are now in an institutional relationship where we are weaker than we were.

I think that's not true for Mexico. Mexico got strengthened by NAFTA. But that's another debate.

My own feeling is that we're better off in the multilateral institutions, namely the WTO, and putting our emphasis there because there are rules the United States signed on to. You know all this just as well as I do. The problem with NAFTA is that it affirms each country's trade protection rules, and the dispute settlement mechanisms are really minor. Did each country apply its rules properly? But the problem is it doesn't address the rules of anti-dumping and countervail, whereas at least the WTO has world rules, and we can go there and say the Americans have violated those rules.

In terms of how we deal with egregious U.S. protectionism, bilateral relations obviously don't do it. Mr. Chrétien, if he were somebody else, might carry more weight with Mr. Bush, but Mr. Bush doesn't control that process. It's Congress that controls it. Even if it were Mr. Clinton, I doubt that the result would have been very different on softwood lumber, because that lobby has the rules it put in place through its own politicians to serve its interests.

I don't have a very satisfactory, helpful solution. I think we weakened our position in not solving those problems back in the mid-1980s. We didn't get an exemption from those things.

Congress is so much dug in on those issues. It loves those rules. You referred to it yourself, sir. I think you made an allusion to the congressional elections this fall. Mr. Bush wants to get control of the Senate. He needs control of it. He's not worried about 2004; he's worried about 2002 maybe as a stepping stone to 2004.

This goes back to what I said about the chances of a big idea being very low anyway. The U.S. system isn't in a state to envisage one with us, because we are too small an issue for a big idea to be relevant for them.

I don't think there's any better means at our disposal than the WTO. We are not good at bargaining. We can't shut our border the way the U.S. would shut its border because we are now even more dependent on trade with them. I think we have to recognize we're in a very weak position.

¿ (0955)

The Chair: Thank you.

Mr. Stockwell Day: I'd like to ask one more question, if I could, Madam Chair.

Mr. Clarkson and I probably disagree on the benefits of the free trade agreement, but I do hear what you're saying about the WTO probably offering us a better venue in terms of obtaining a settlement. Thank you for that comment.

As far as the differences we have with Mr. Keynes and the whole approach to a growing welfare state are concerned, when he was presented with the fact that growth in the state itself would in the long run be absolutely unaffordable and would collapse, his reply was that in the long run we will all be dead. Well, I may be dead, but my grandchildren won't be. That's why you and I would have some differences in terms of some of the aspects of Keynesianism and the growth of government and of programs.

Prof. Stephen Clarkson I think Mr. Keynes would have agreed with you, Mr. Day, that an excessive gap between expenditures and receipts is not tenable in the long run. And he would not have been happy with the 1970s behaviour of the Trudeau government. I think he would have wanted higher taxes to pay for the higher services.

Mr. Stockwell Day: Yes.

Prof. Stephen Clarkson: And he would have confronted Canadians with their contradictory position of wanting European-style social services but American-level taxes.

I don't think it's proven that a system with a higher tax regime is necessarily less attractive to foreign investment or local investment, depending on how those taxes are used. If it leads to efficient infrastructure--and the health care system, as we all know, is a big incentive for American car companies to have their assembly plants in Ontario--then that's an analysis to be made. I don't think one can say a priori that it's necessarily bad. But again, we don't want to get into that any further.

À (1000)

The Chair: We'll move now to Mr. Assadourian.

I know, Professor Roussel, there was something said earlier, I think something to do with one of your colleague's disagreement on an issue, that you might want at some point in time to address. You might want to clarify that, given the opportunity.

Mr. Assadourian.

Mr. Sarkis Assadourian (Brampton Centre, Lib.): Thank you very much. It was really refreshing to see a different point of view from that of the politicians or other people who come to be witnesses here.

I have a few questions. I'll try to make them short questions so you can give me extended, long answers.

You said NAFTA is not helping us. My question to you is are we better off with or without NAFTA after eight or ten years? For me, NAFTA is like the UN. People say the UN is useless, but I don't think we can do without the UN. The same thing can be said maybe for NAFTA. NAFTA may not be exactly what we expected, but my question is are we better off with or without NAFTA, especially given the fact that the Auto Pact expired a couple of years ago? If you put that Auto Pact factor in with NAFTA or free trade, are we better off now, or would we have been better off without NAFTA? That's my first question.

Second, in today's Globe and Mail it states that 30% of Americans think we are the 51st state of the U.S.A. Surely something must be wrong either with us taking a position or with them learning about their history. It's only 200 or so years ago we had a war between Canadians and Americans, but they still think we are part of them. Is having more integration with the Americans helping us? Because a similar number comes from Canadians saying that we are like Americans; 35% of us think we are just like another state, like Michigan or Oregon. That was in The Globe and Mail today.

I have another question. Yesterday we were in Manitoba, and some farmers there were very upset with the farm bill because they think it's going to hurt them with subsidies in the U.S., and what have you. Then the question arises as to whether what we're discussing is integration in the American economy reality or domination? We discussed earlier the European aspect of it. Professor Roussel mentioned the fact that Europe was made up of many states with similar power and economic output and what have you, but when we measure ourselves with the United States the United States has half of the world's productivity--not half of the North American productivity, but half of the world's. So the elephant and the mouse concept comes into practice.

The question is are we discussing integration because we have no choice, or will the actual domination of the U.S. economy of North America, especially given the fact of the U.S. Farm Bill differences, softwood lumber, security concerns, military cooperation...? Are these just happening by accident, or are these part of the overall plan, and never mind integration because we like to use the word “integration” when actually it's the domination of U.S. policy in North America? And it's easier for them to dominate us, for example, than Mexico because we're culturally much closer to them than Mexico is.

Those are a few questions I have. Maybe I'll have a few more when you give me the answers.

À (1005)

The Chair: Thank you.

Professor Clarkson, would you like to start?

Prof. Stephen Clarkson: Mr. Assadourian, those are really big questions. I'll try to be succinct.

In terms of the power, whether you want to use the word “domination” or “hegemony” or “influence” or “asymmetry”, it's obvious that the difference between Canada and the United States is enormous. When it comes to the U.S. Farm Bill, Canada is not alone in being appalled at the huge increase in American subsidies to the agricultural industry, but other countries around the world are realizing their impotence to do much about it, except--and this comes back to the exchange with Mr. Day--that the World Trade Organization now does have rules including agriculture. I would think it's very likely that a case against the subsidy would get somewhere in the dispute settlement trial in Geneva.

In that sense--and this comes back to your first question--we are better off in the WTO than in NAFTA. If I had to give a yes or no answer to whether we are better off without NAFTA, which is obviously too simple a question, I would say we would be better off without it because in many areas the WTO rules are better than the NAFTA rules.

Mr. Sarkis Assadourian: The WTO is a recent creation; NAFTA was ten years ago.

Prof. Stephen Clarkson: Well, there was only one year's difference. NAFTA was 1994 and the WTO was 1995. In some areas they're almost identical; intellectual property rights are very close because the model for both was the same document.

It may help you to think of it the way I now think of these agreements. I see them as components of Canada's external constitution because they define limits to government, they create rights for certain categories, and they have institutions. I don't want to go into the whole argument, but if you think of it as an external constitution, NAFTA has elements that are really repugnant. I've mentioned already that chapter 11 investor state dispute settlement mechanism. It gives foreign companies greater rights than domestic companies to sue Canadian governments--federal, provincial, or municipal--which is a violation of the notions that went into the original charter in 1980-82, during that debate, when it was decided that property was not to be a right. We've given rights to foreign corporations to sue governments, which is an aberration, and now the Americans are even realizing it's an aberration. I think Senator Kerry was raising this issue recently.

There are aspects of NAFTA that I think are really bad, but on the whole, the important institution is the WTO. NAFTA is now receding as an issue for us.

The other issue you raised was the question of American ignorance. I think American ignorance about Canada is well established. I don't think we need to be shocked by it. It may even be something of an advantage to us, because the less the U.S. thinks about us, often the better it is. I don't know what Mr. Day's view of the Canadian Wheat Board is, but I know a lot of westerners really find it an important institution that has helped them sell their grain, market their grain. When the Americans become aware of it, this is seen as dangerous socialists creeping down from the Soviet Union to create an unfair and unlevel playing field. As I see it, it's better for the Americans to be ignorant about some of our differences than to be too focused on them.

It becomes very serious if former ambassador Holbrooke says, kind of off the cuff, that Canada is the Club Med for terrorists. It becomes serious if The West Wing has a program that says terrorists cross the Ontario-Vermont border. We know it's a joke, but the joke is funny, because it raises this question of the tendency to blame Canada for lapses of security that affect the American attitude towards harmonization of all our policies.

Again, I disagree slightly with my colleague, because I think harmonization should be resisted in certain areas. Most of us don't want American gun control laws. It would reduce my sense of security if I felt that Professor Roussel here had a weapon concealed in his pocket and if he started a disagreement might use it.

There are certain areas where Canadian rules, as far as I understand, are superior to Americans in security questions. I don't know how many of the terrorists of September 11 learned how to fly airplanes in Canada.

Coming back to the ignorance, I don't think we should make a big thing of it. Obviously the Americans know less about us than we about them. That's appropriate, given the disproportion in our power.

Mexico has been mentioned. I think we have to welcome that aspect of NAFTA that has drawn us closer to Mexico. Mexico is suffering huge problems, as you know from having been down there--some of them created by NAFTA, some of them alleviated by NAFTA. All these issues are extremely complex.

I welcome the fact that I now have to teach about Mexico in my courses. I've learned Spanish because I am now dealing with colleagues down there. It has broadened our horizons, and it does give us someone with whom we can negotiate in Washington on some issues.

I agree with Professor Roussel that on the border questions we're going to be pushed to deal with them in a common way. We can't just say that the Canadian border is so totally different from the Mexican-U.S. border that we don't want to talk with the Americans and the Mexicans at the same time. We're going to have to deal with those issues, because whether we have NAFTA or not, the continental economy is developing.

Coming back to the exchange I had with Mr. Day on the investment question, on the front page of The Globe and Mail today, the president of the Royal Bank was bemoaning the loss of Canadian head offices as they are bought out--perhaps because of the low dollar--largely by American companies and even successful Canadian companies going to the United States, moving their head office or moving their research and development operations to the United States. These shifts into a corporate continent are happening, and we have to monitor them. We have to see to what extent we can change what governments do here to make it a more attractive place for head offices to be. NAFTA plays a role. It can't be unscrambled.

I answer your theoretical question with a theoretical answer, but in fact we have to deal with this as part of our constitution. It's extremely difficult to change these rules now that they're in place.

The FTAA, which I'm sure you've been talking about too, is important because when you're creating a new organization there is the chance to make new rules. The role of NGOs in this, which is a Canadian priority, is important. It's pretty unlikely the FTAA will succeed; but if it does, there can be changes in these rules that we accept as part of our constitutional life now.

À (1010)

Mr. Sarkis Assadourian: As to the demise of the Auto Pact, what kind of impact has it had?

Prof. Stephen Clarkson: If the Auto Pact is over, it's partly because Canada made a mistake in negotiating exemptions in the General Agreement on Trade in Services at the WTO. It's a highly technical issue, but we lost an important case at the WTO over the GATS question. This is a services issue.

I agree with you that functionally the Auto Pact is pretty well useless. Given this situation, NAFTA is very important for the big three American companies. It gave them some protection of defence because of the rules of origin. Whether that's good for Ontario compared to Mexico is being fought out now.

It seems there's very little government can do other than provide the infrastructure advantages: excellent education, because Canadian workers are apparently very, very good--they're well trained; the physical infrastructure of roads for just-in-time production, which of course means the frontier has to be open; technological infrastructure such as telecommunications, fibre optic networks; and the health system, which is a big subsidy to companies, because they don't have to buy private health insurance for their workers. I think what governments can do is basically contextual policies to provide the conditions in which the automobile industry can flourish.

NAFTA itself is now in place, and little is to be done about that, except perhaps the rules of origin may be challenged ultimately in WTO cases. We don't know about that yet.

I'm not sure if I've been very helpful to you.

À (1015)

Mr. Sarkis Assadourian: Yes. Thank you.

The Chair: Professor Roussel.

Prof. Stéphane Roussel: May I comment?

The Chair: Yes, before we close off.

Prof. Stéphane Roussel: I will do my best to do it as quickly as I can.

I totally agree with my colleague about being invisible and notable in Washington. If the Americans are ignorant about Canada, it's not necessarily a bad thing. They will start to think you should raise the defence expense, that you should harmonize with them in fact. So the less they're thinking about us, the better it is, I think.

Second, about power in North America, I disagree with this logic, because there's a fundamental contradiction. If we're saying that the power asymmetry is so important, then there is a problem with that logic, because the power asymmetry is so huge that we can't explain why we're still here--why we're not Americans. In terms of power, it's very hard to find a relation with such a small country like Canada and a superpower like the U.S.

I'm a liberal in terms of international relations. I don't believe that power is the most important variable to explain the relation between Canada and the U.S. That the two states are democracies, that there are institutions between them, and that there is a huge interdependence at the economic and cultural levels explains the relation better than power by itself. If we think in terms of power, it simply doesn't work.

I think we should build on other aspects, such as institutions and interdependence, to explain not only the dynamics of the relation, but also to build for our future. My point about the institutions is precisely because I don't want to have the same regulations as in the U.S. regarding gun control or regarding health or regarding many of their political and social aspects of life. It's precisely because I don't want it that we need institutions. Institutions, from my point of view, can stop and put some limits to the harmonization process. Without institutions the harmonization process could be very dangerous, because it's not under control. We need to have institutions to put limits on that harmonization process. I think it's inevitable in certain areas, but we have to find the limits.

I think integration both in economic and security levels is inevitable. Every experience in the past where the Canadian government tried to stop that process was a failure. The best example is the “third option” from the Trudeau government in the seventies, where we tried to find other trade partners. We tried to diversify our economy. It was a huge failure.

To use another quotation from John Holmes, there's no other way to deal with the U.S.; there's nothing we can do except manage this integration process the best we can. The history records show us that we Canadians are very good at negotiating with the U.S. when we're taking care of their anxiety and taking care of their concerns. We are very good at negotiating satisfying agreements that preserve not only the fundamental interests of Canadian society but also the values that we cherish as well as the sovereignty of Canada. Strangely, institutions helped in the past to protect Canadian sovereignty rather than harming that sovereignty.

Merci.

The Chair: Thank you very much.

We've reached--

Mr. Stockwell Day: Perhaps I could make just one brief comment.

Before we all get too smug about the lack of historical knowledge vis-à-vis Canada and the U.S., I think we would be in for a surprise if we asked Canadian grade 12 students to write down on a piece of paper our ten provinces and additional territories and then asked them to write the provincial capitals. I think we would be in for a real shock there.

If you had asked a year ago in Saskatchewan and Ontario, both of whom had premiers with more than one mandate, you would find that the percentage of students in Saskatchewan who knew the name of the Ontario premier was far greater than the percentage of students in Ontario who knew the Saskatchewan premier. This is not because Saskatchewan is less important. It's every bit as important. But size disparity alone will deal with the information shift.

So we shouldn't get too smug about what Canadians know and don't know. We may be in for a shock.

À (1020)

Mr. Sarkis Assadourian: The survey was not done among grade 10 students, though.

Mr. Stockwell Day: No, they asked Canadian adults too. It was the same thing.

The Chair: Thank you so much for joining us this morning. You can see you've started our day with a really good debate and you've put on the record information that will help us as we pursue and peruse this issue and hear from other Canadians. Thank you for being part of the dialogue.

If there is anything further you want to convey to us, our researchers are always very happy to read, to amend, and to add to the discussions we hear face to face. So thank you for being with us.

[Translation]

Prof. Stéphane Roussel: Thank you very much, Madam Chair.

[English]

The Chair: Now I think we'll go directly to our next set of witnesses.

À (1021)

À (1024)

The Chair: Continuing our discussion, we have with us, from Greenpeace Canada, Sarah Blackstock.

Sarah, you have about ten minutes to speak to us and then we'll engage you with conversation. I think we have a total of about half an hour with you.

Thank you.

À (1025)

Ms. Sarah Blackstock (G-8 Campainer, Greenpeace Canada): Thank you and good morning.

The upcoming G-8 summit is of great importance, not only to the people and environment in G-8 countries but to people and environments around the world. As chair of the summit, Canada has a responsibility to develop an agenda that provides opportunities to discuss and make concrete decisions regarding the most critical problems facing the world today, including climate change, the unsustainable model of globalization currently being pursued, and the growing gap between the rich and the poor.

It is particularly important that these issues be given priority at the upcoming G-8 summit, given that the World Summit on Sustainable Development is going to be happening in Johnannesburg at the end of the summer.

In this regard, the comments that Greenpeace would like to offer the committee today are primarily related to the G-8's concerns with strengthening the global economy, a process that we believe must take into account environmental sustainability and the preconditions for true global security.

Greenpeace is concerned that the G-8 continues to prioritize trade liberalization, resulting in increased corporate power, greater environmental damage, greater social inequity, and unsustainable development, conditions that are profoundly contrary to real security. Therefore, Greenpeace calls on Canada to exercise leadership to ensure that the Kananaskis summit turns the tide; that is, the Kananaskis summit needs to move away from the sort of empty rhetoric that we are used to at these sorts of events and towards meaningful change that is backed up with the necessary resources to make such change. The summit needs to produce real commitments, real timelines, and real financing, and this is something the G-8 doesn't have a very good track record on producing.

Further, the Kananaskis summit must demonstrate that the privileged G-8 countries have taken a leadership role in meeting their commitments from the Rio earth summit. Such outcomes would indicate not only a successful G-8 summit but also contribute to ensuring the Johannesburg earth summit is successful.

I'm sure you're not surprised that we, as an environmental organization, want to talk about climate change and renewable energy, and specifically the Kyoto protocol. There's no doubt that human-induced climate change is a serious problem faced by both developed and developing countries.

In its third assessment report in 2001 the Intergovernmental Panel on Climate Change concluded that global temperatures will rise by nearly six degrees celsius globally by the end of this century. The rate and extent of this change outpaces the adaption capacity of life on earth. There will be increased extreme weather phenomena and sea levels will rise. In human terms, this means cities will flood, crops will fail, and there will be mass migrations of people. Most observers believe that change on this scale is not consistent with maintaining our present societal structure.

Most certainly climate change poses identifiable and serious risks to international and national development goals, both social and economic goals. Global economic growth that is based on traditional approaches to energy provision will lead to increasing environmental insecurity and ultimately destroy the planet.

After more than ten years of negotiations it's now time to ratify the Kyoto protocol to the United Nations Framework Convention on Climate Change, as most members of the G-8 have recognized. Canada is the only remaining G-8 member that is party to the Kyoto protocol that has not given a timeframe for ratification. Given the profound impacts of climate change and that the earth summit is a natural point to show broad international support for the Kyoto protocol, ratification of Kyoto needs to be on the G-8 summit agenda.

More specifically, because the G-8 countries are some of the greatest polluters, and the G-8 represents a significant concentration of wealth and power--which is required to effectively combat climate change--it is crucial that the G-8 leaders discuss climate change and the Kyoto protocol. The G-8 environment and energy ministers started these discussions. It's clear that the leaders need to finish them.

As I just mentioned, we are already seeing and feeling the ramifications of climate change. As energy demands continue to increase, we can only expect things to get worse if we continue to follow the existing approach to energy provision. The global biosphere is threatened. Greenhouse gas emissions must be significantly reduced. To achieve such a goal, renewable energy needs to replace energy-producing fossil fuel. While making the transition from traditional energy sources to renewable energy sources will require significant resources, there are strong indications that the development of industry related to renewable energy provision will be an important growth sector in the future.

Additionally, rich countries, in particular G-8 countries, need to take action to ensure that the two billion people currently without access to basic energy services gain access to these services--specifically, energy services produced from renewable energy.

In the paper prepared by Michael Dewing, James Lee, and Gerald Schmitz for this committee, the questions were posed: “Does a growth agenda sufficiently capture the approach that is needed to global economic management? What else should the G-8 consider, for example, in terms of sustainable development?”

To be sure, if the current growth agenda continues on the course it is on now, the environment will be devastated, and the gap between the rich and the poor will continue to grow. And there will be greater insecurity as a result of these two things. It is clear to Greenpeace that the current growth agenda is not sustainable in the long term. In the short term it will lead to further economic, social, and environmental insecurity.

Greenpeace suggests that the G-8 take concrete action to reshape the dominant approach to global economic management. Specifically, Greenpeace recommends that developing a new energy policy based on renewables would be a very useful step in this direction.

The energy choices the world makes in the next twenty years will determine our collective development path for decades to come. Are we going to choose to continue to go down the conventional energy development path, using fossil fuels, nuclear, and other 19th and 20th century technologies, despite the fact that they are ultimately unsustainable and have not delivered even the most basic energy services to the two billion of the world's poorest? This is a question the G-8 summit should address.

Making a commitment to renewable energy will help us move toward a sustainable development model and begin to eradicate poverty. In Dewing, Lee, and Schmitz's paper, it is also asked, “How should the G-8 work with other international organizations...to advance equitable and sustainable global economic growth objectives?”

Greenpeace suggests that there are a number of policies Canada should adopt and recommend to its G-8 partners and work with other international bodies and institutions to implement. I would like to quickly outline these.

First, Greenpeace would like to recommend that the recommendations made in the report of the G-8 task force on renewable energy be adopted. However, the report's target of providing renewables to only one billion people within a decade should be replaced with a target of two billion people. In this regard, it should specifically commit to make available the finance and infrastructure to bring basic affordable and sustainable energy services within a decade to the two billion people who currently live without electricity. This commitment should include new money, as well as the creation of systems and networks to deliver seed capital, institutional support, and capacity building.

Second, the G-8 should commit to immediately target 20% of energy sector lending and support in the form of guarantees via export credit agencies to renewable energy development and energy efficiency programs.

Third, the G-8 should commit to ensure that all the international financial institutions target 20% of energy sector lending to renewable sources and efficiency, followed by a plan to phase out support for conventional energy sources within five years.

Fourth, the G-8 should commit to phase out subsidies to conventional energy sources within ten years.

Finally, the G-8 should commit to developing national renewable portfolio standards, energy efficiency standards, and other measure to help build renewable energy markets domestically.

À (1035)

The Chair: It has been about ten minutes. Is it possible to quickly summarize your remarks? Then we'd have a bit of time for questions.

Ms. Sarah Blackstock: Sure.

Along these lines, trade is obviously a significant issue to the G-8. Greenpeace, like other environmental and social justice organizations and NGOs, is concerned that trade regimes are overriding multilateral environmental agreements and human rights agreements. Certainly Greenpeace is calling on the G-8 to take a leadership role in reaffirming the authority and autonomy of MEAs; in clarifying the objectives, principles, and provisions of MEAs; and in ensuring they're not subordinated to WTO rules.

I think that for Greenpeace the upcoming earth summit is of great importance. I realize Canada is also considering this in the preparations for the G-8 summit. In this line, we're concerned that in the preparatory commissions for the earth summit, renewable energy has become an important topic. So we're urging the G-8 to contribute to that discussion. Specifically, we're calling on the government to consider the discussions on renewables held by the G-8 and the energy and environment ministers. It should place renewables on the summit agenda, with the goal of establishing real commitments and real timelines--something the G-8 energy ministers have failed to do--and, specifically, discuss the recommendations I made earlier.

Finally, I just wanted to touch on democracy and dissent in light of the G-8 summit, though I know this wasn't something we were asked to comment on. After the death of Italian activist Carlo Guiliani in Genoa last year, the world is going to be watching Canada to ensure people are able to protest. The world will be watching to see if the G-8, and specifically the Government of Canada, misuses people's concerns about terrorism to target protesters.

I'm sure you'll all agree that dissent is a crucial element of democracy. The G-8, and Canada in particular, often speak of promoting democracy and good governance, and talk about transparency in these international processes. Indeed, I think democracy and good governance also need to be protected in the G-8 countries, including Canada. So we're urging the Government of Canada and the Canadian security forces to ensure that protesters are able to exercise their democratic rights.

I will end there.

The Chair: Thank you very much for that well-thought-out paper, which we'll keep as part of our record.

We'll now go to questions. You're going to have questions from Mr. Day, a member of the opposition, and also from the government side, Mr. Assadourian.

Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair.

Thank you, Ms. Blackstock, for the presentation.

As I indicated earlier to other presenters, we try to avoid some of the philosophical debate, which naturally springs up between differences of opinion--though certain items in some of the more glaring presentations will probably elicit some response. So I'd like to pose a couple of questions and make a couple of observations.

When you talk about renewable and alternate energy sources, what is Greenpeace's position on the significant hydro development we see, for instance, in China and other nations? Of course it's argued that is a clean power source, but there are obviously environmental effects there. So if you could help me with that...

As a suggestion--I guess it could be an item of debate over coffee some time--when I read in a presentation that the earth is coming to an end, my tendency is to go sailing, or to get into more extreme sports, or to do some of the wilder things in life rather than deal with the more boring aspects of government. You say “The rate and extent of this change outpaces the adaptation capacity of life on earth.” You're predicting this by the end of the century. I'm just suggesting that we've heard these predictions before--certainly at the turn of the last century, when people like Malthus and others said the world was coming to an end because we wouldn't be able to feed ourselves. Because of technology now, of course, we can feed ten times the population of the world--although we have some difficulty in distributing it, and there are some problems there.

I'm just suggesting that from a presentation point of view, I'm not sure how convincing that is.

I agree with you as far as democracy and dissent are concerned. I think dissent is obviously something that has to be permitted in a very vigorous and robust way--not violent dissent. Most of the dissent I saw in Quebec at the conference of the Americas was in fact peaceful but robust dissent. Some of it was loud, but that shouldn't be offensive to people in and of itself. What I felt bad about was that some chose a very visibly violent approach, which diminished some of the pertinent messages of Greenpeace and others.

When we look at the last century, we see that the countries and nations that did not support freedom of enterprise and did not support freedom of democracy and dissent had the most outrageous examples of environmental degradation--the Soviet Union, the eastern bloc. Their levels of environmental destruction because of the lack of attention to private enterprise and private property were huge.

I rarely saw denunciations by Greenpeace of the eastern bloc, the Soviet Union. Today Greenpeace goes aggressively after G-8 nations, which is fine. Do you take a position on the lack of democracy we see imposed on so much of the population in, for instance, Cuba, China, and the African nations?

Those are my questions, Madam Chair.

À (1040)

Mr. Sarkis Assadourian: You have only two minutes.

Ms. Sarah Blackstock: Well, you started off mentioning that you want to avoid philosophical debate, and I think that our values are critical to answering these questions. So in some respects I disagree with you there, because I think that some of that philosophical debate in determining what our values are is what guides us through these processes. I think those are the sorts of questions government does need to take quite seriously.

In terms of your question about renewable energy and hydro, Greenpeace does not support big hydro development. It does support small hydro development. We are a big supporter of solar and wind technology and are involved in a number of projects in Europe and in Thailand, looking at solar and wind. We would certainly call on the G-8 to support that.

In the G-8's own report on renewable energy, which was actually written by someone you might think an unlikely supporter of renewable energy, the former chair of Shell Oil, they acknowledge that the technology is there--it's the political will that's missing. There is technology available for solar, wind, and small hydro to spark that renewable revolution that we so much need.

Greenpeace was quite concerned that at the G-8 energy ministers meeting that just happened in Detroit there was a lot of emphasis on nuclear energy as a way forward to deal with climate change.

In terms of your question about Greenpeace's position on the lack of democracy in Cuba and elsewhere, Greenpeace is an environmental organization and we try to maintain our focus on the environment. We were actually quite active in Russia and in the eastern bloc, specifically around nuclear issues.

In terms of the G-8, we're quite aware that the current model of capitalism is having a devastating effect on the environment, and the failure of government to create the regulations that we need to control capitalism is a major problem.

Professor Clarkson spoke about external constitutions, the new constitutions that the WTO, FTAA, and NAFTA have created. Those constitutions are overriding our own constitutions and the efforts that people have made over the last few decades in terms of creating multilateral environmental and human rights agreements that could put some of those checks on, and it's very much a result of government supporting a relentless form of capitalism. So I do think we need to be concerned with capitalism in the destruction of the environment and attacks on social and economic justice in general.

The Chair: Thank you.

Mr. Assadourian.

À (1045)

Mr. Sarkis Assadourian: Thank you very much.

I have to say I have a soft spot for Greenpeace.

Ms. Sarah Blackstock: I'm glad to hear that.

Mr. Sarkis Assadourian: Lots of us have the same feeling; I'm not the only one. We have some who don't have a soft spot, too, so we have a balance in the House.

I have a question to do with technology. I was watching a documentary the other day that said Russian oil producers spent $7 per barrel to extract oil, and the western companies use only $2 to extract oil because of advanced technology in the west. Would you comment on advances to technology?

My second question has to do with trees. Someone on TV said that we have 20% more trees now than we did in the past. They mentioned the fact that trees need carbon dioxide to live, and carbon dioxide emissions are harmful for human beings. How do you balance this? How do you explain this contradiction, if I can use the phrase? Is that an accurate number, that we have 20% more trees than we had in the past because of reforestation by major companies? That's two questions.

Third, why do you think we are not catching up with solar and wind energies as substitutes for regular energy we use now? What are the difficulties? Is it the government, research by corporations or companies, a lack of commitment to this kind of energy, a lack of education? What do you think the reasons are for staying away from solar or wind energy?

Ms. Sarah Blackstock: I wasn't entirely clear on your first question, regarding oil extraction and the difference between western and Russian technology. Can you just repeat the question?

Mr. Sarkis Assadourian: The reason I said that is that if we believe in technology advances as benefiting humanity, then how come Greenpeace is not pushing that technology to other third world countries, in this case Russia, to help them advance their technology to reduce the cost for emissions from the technology we're seeing?

Ms. Sarah Blackstock: Greenpeace isn't a supporter of oil, but in terms of other energy technology, Greenpeace is very active in working with.... Right now we're working on a project in Thailand, working with local people to set up solar panels to create villages that are entirely powered by solar energy. We are working with industry in Europe to develop technology and then to share that with southern counterparts.

I think the debate over whether the technology to support a renewable revolution exists is pretty much over, because the technology does exist. It is a matter of political will. What Greenpeace is trying to do is to say yes, the technology exists, and it's really up to the west, the rich countries, to help export that energy.

As it is now, what we're exporting is a lot of dirty energy, which I think relates to your third question about why it is that we haven't been successful in starting a revolution of renewable energy, especially in terms of solar and wind. It is because of the very significant part the oil and gas industry has in the west, specifically in Canada and the U.S.

Two years ago the G-8 identified that renewables was an important thing, climate change was an important thing, and renewable energy was a reasonable way to start dealing with the problem. They established a task force. The task force wrote this report and came up with recommendations. Greenpeace was surprised that we actually supported most of them. Canada and the U.S. were actually the countries that were most adamant in blocking that report and making sure the recommendations were not adopted and the report didn't go forward.

It's Greenpeace's position that this is largely to do with the power of the oil and gas industries in Canada and the U.S. I think it's a matter of political will and the power relations in Canada and the U.S. that are stopping solar and wind energy.

The general public has concerns too about what that would mean for our economies. Certainly in Canada we're well aware that people are scared that Kyoto is going to destroy the economy. It's up to the government to work with industry to figure out a plan to implement Kyoto and to figure out how we could do that without destroying the economy. And that research is being done.

In terms of your question about forestry, I'm not a forestry campaigner so I'm not sure I can answer your question. You said there's 20% more compared to... More than what? I don't know when the past is, because--

À (1050)

Mr. Sarkis Assadourian: The point was made that replantation of trees is very successful, so they're way ahead of tree-cutting programs. That's the point I was...

Ms. Sarah Blackstock: Well, I'm not sure about that. I am sure that--

The Chair: Maybe you can have one of the campaigners on trees and reforestation speak with Mr. Assadourian and send us some information.

Ms. Sarah Blackstock: Sure. I would like to make one quick comment though. Even when forests are replanted, they're not a forest any more; they're a tree farm. The ecosystem is severely damaged. While the trees are there, the habitat is gone. The ecosystem has been severely damaged. That's a major problem.

Mr. Sarkis Assadourian: If I could clarify my first question about technology, this is the point I was trying to make. Why is it Greenpeace doesn't help these countries--in this case Russia is the example I give--with advances in technology so they could overcome difficulties and help the environment with less pollution? That is the point I was trying to make.

Ms. Sarah Blackstock: Greenpeace does do that. Greenpeace has offices in Russia and around the world. We are working with counterparts in the global sense to develop renewable technology, to bring technology that's being developed both in the north and the south to people in the global south. We're also trying to say that it's actually the west that produces the majority of greenhouse gas emissions and are the greatest polluters, and we need that technology as much here as we do in a small village in Thailand, for instance.

The Chair: Thank you, Ms. Blackstock. I just want to ask one question before I thank you for joining us today.

The new partnership for Africa is very much an item on the agenda of the summit. I notice that your paper is devoid of any reference whatsoever to Africa or to that new partnership. Is there a special reason why you selected out that issue? Did you feel that the focus of your paper today was more on environmental rather than broad issues--the three issues on the agenda?

Ms. Sarah Blackstock: It was deliberate. Greenpeace is not an expert on Africa. We do support the call that is being made by civil society organizations throughout Africa that NEPAD actually should go back to Africa before it goes to the G-8 summit. It should go back to Africa to be discussed in Africa and developed in Africa.

We're concerned that the Government of Canada.... Mr. Chrétien has been a keen promoter, as has Bob Fowler, of NEPAD. Most Africans don't know what NEPAD is. While it has been developed by a few African leaders, there has been virtually no consultation in Africa of NEPAD. So we share that concern. I'd also like to point out that the amount of money we're spending on the summit is about half as much as we're offering to put into African aid, which is also quite concerning.

The Chair: Thank you.

I just want to raise one thing. All of the African leaders do know about NEPAD, so it's not just some--

Ms. Sarah Blackstock: Just to be clear, I wasn't talking about the African leaders; I was talking about African civil society and African citizens--the people who are going to be affected by NEPAD.

There are some fantastic critiques of the neo-liberal model and the structural adjustment model upon which NEPAD is based. The position of Greenpeace is that if the G-8 is concerned about NEPAD, they should be listening to African civil society and the critiques that are being offered there. I know the CLC is involved in facilitating that discussion.

À (1055)

The Chair: It's a work in progress.

Thank you for joining us today.

We'll now call to the table the United Steelworkers of America, to continue with our discussion. Mr. Lawrence McBrearty is national director, and Ms. Sheila Block is from the United Steelworkers of America research department.

Welcome. Thanks for joining us. Our committee is in two areas of the country today, so we are represented here by Mr. Assadourian from the government side and Mr. Day from the opposition side.

Everything that is done today will be documented; therefore everyone will benefit from your presentation today and have access to it.

Mr. McBrearty.

Mr. Lawrence McBrearty (National Director, United Steelworkers of America): Thank you.

Good morning. As was mentioned, my name is Lawrence McBrearty. I'm the national director of the United Steelworkers, and I'm accompanied by Sheila Block, from my research department.

Our union represents about 190,000 Canadian workers in every sector of the economy. Our union's roots, like mine, are in mining and steel. While the union continues to have a strong presence in those sectors, we represent members in workplaces across the economy. Our members work in factories, hospitals, university campuses, hotels, warehouses, bakeries, banks, and railways. We also represent 25,000 security industry workers across the country, mainly in airports.

I would like to thank the members of the committee for providing me with the opportunity to speak to you this morning. I know that these hearings are addressing two important issues. The G-8 issues include the world economic situation and security and terrorism and development strategies. The Canadian Labour Congress has made a presentation to you on these important issues.

I am here today to speak to you about Canada and the future of the North American relationship. This is one of the most important issues facing our country. As a director of an international union, with members in both Canada and the United States, I can bring a unique perspective to the issue.

We also know that Mexico, the U.S., and Canada do not have a relationship of equals. In fact, the trilateral relationship among the three countries barely exists. We have a series of bilateral relationships. Differences in size and power mean that these unequal relationships are unlikely to change.

It is our relationship with the U.S. that is the focus of these hearings. The policies of governments over the last 15 years have made our economy more dependent on the U.S. Over the same period, governments have become more concerned about the interests of corporations than the interests of citizens. This means that the U.S. has become a primary policy focus for the Canadian government.

I cannot talk to you about our relationship with the U.S. without speaking about the two documents that shape it: the FTA and the NAFTA. They both held out the promise of access to the U.S. market. This promise was not fulfilled in either agreement. The U.S. maintains powerful policy levers to protect their industries.

Our current experiences with both softwood lumber and the steel industry are examples of this lack of secure access. Our exemption from the recent U.S. trade actions on steel was the result of an intensive lobbying effort. It was led by our union in the United States. This was no different from what would have happened before the free trade agreements. Just like then, sometimes we win and sometimes we don't. Softwood lumber is an example of what happens when we lose.

We have traded away our sovereignty for the illusion of access to the U.S. markets. NAFTA, while it doesn't provide secure access, does limit the actions our country can take on behalf of its citizens. Here are two main examples. Ethyl Corporation has successfully used NAFTA to revoke a Canadian ban on the gasoline additive MMT. Our government paid Ethyl $13 million for costs and lost profits while the act was in place. SD Myers sued the Canadian government for $20 million because of a ban on exports of wastes contaminated with toxic PCBs. These are clear and concrete examples of our loss of sovereignty.

The government must take action so that global corporations can no longer limit its ability to act in the interests of its citizens.

While NAFTA has protected corporate rights, other rights have not been protected. NAFTA has no minimum standards on labour, environmental, or human rights. In this agreement, providing a subsidy is considered an unfair trade practice, but unsafe workplaces are not. It encourages lowest-common-denominator competition.

This committee has asked questions about measures that would increase integration with the U.S.--from a customs union to adopting the U.S. dollar. I urge you not to recommend anything that will increase our economic dependence on the U.S. We are against any further compromise of our sovereignty.

The committee raises the issue of moving to a currency union with the United States or adopting a U.S. dollar. Monetary policy is one of the most important policy tools our government has. It is a valuable policy for this country. It helped us through the Asian crisis in the late 1990s. It also helped us stay out of recession this past winter. There is no legitimate reason for the federal government to lose control of monetary policy.

Increased integration with the United States is not our only alternative. I am saddened by the way in which some are using the tragic events of September 11 to say that we must give up even more sovereignty to maintain our economic relationship with the United States. We should not be defined only by our economy; we are also citizens. As citizens, we must work to preserve our unique culture and values. These include our treasured universal health care, the distinct linguistic and cultural nature of our country, and our respect for collective individual rights.

We ask this committee to look at ways to reaffirm and maintain these Canadian values and institutions.

Thank you.

Á (1100)

The Chair: Thank you very much, Mr. McBrearty.

Again I want to--as I did at the beginning of the morning--state outright that the committee has made no definitive decision as to an outcome. Those are questions posed. We will again be looking to Canadians, like yourself and others, who are thinking about those issues to put their perspectives to us.

We have not pre-judged. We have not written. We have not projected. We are asking the questions because I think you expect us to ask the questions. They come up in discussions and in varying arenas where, as parliamentarians and as a committee, we feel we want to respond.

We are hoping that by the fall we will be able to make some recommendations on the basis of what we hear as we go across the country. We've been in the province of Quebec and in Atlantic Canada. The committee, as I said earlier, has listened to the west and Ontario. We're hoping to hear from Canadians and to take what Canadians say to us and make some recommendations to our government.

We thank you for again raising the issues and being prepared to dialogue with us. We've heard from various affiliates of the Canadian Labour Congress. They've been putting some of the issues before us and raising questions with us that we think are important to be raised.

We'll go to questioning. Mr. Day, I'll ask that you begin, please.

Á (1105)

Mr. Stockwell Day: Thank you, Madam Chair.

Thank you for the presentation, Mr. McBrearty.

Setting aside some philosophical differences we may or may not have on a number of the issues that have been touched on here, we've heard a comment that over the last 15 years governments have made our economy more dependent on the U.S. Which individual businesses would you tell not to deal with the United States?

Second, how do you instruct business people that in fact they shouldn't be dealing with the U.S. so they won't be so dependent? Can you give us your insight and any advice you may have in terms of trade dispute mechanisms, namely NAFTA mechanisms or WTO mechanisms? Which do you think offer us the greatest possibility of seeing more rapid resolution of disputes, for instance, on the softwood lumber dispute?

Mr. Lawrence McBrearty: First of all, on the question of trade with the United States and how you tell a company not to deal with the U.S., this is not the purpose. We're not telling companies they cannot deal with the U.S. After all, companies in Canada always dealt with the U.S. before NAFTA and even before the FTA, but it was wide and flexible trade with different commerces.

As an example, I remember there was an industry in Nova Scotia for which I was negotiating a collective agreement. They needed to have a contract for railroad rails to maintain the shop. They had a contact with an African or some other country on the basis that the same Canadian company would export, buy, or exchange some other material under the contract, and they had a broker in New York to bid for them.

We're not saying that we have to find a way to stop dealing with the United States. That's not what we're saying. We're saying that we're probably depending too much on the United States for our policies, and sometimes we lose our sovereignty.

Mr. Stockwell Day: I'm sorry, chairman. If it's a concern of yours that we're too dependent on the United States in terms of commerce, I am sincerely looking for ways to answer the question, how do we fix that? What do we tell investors, small, medium, or large? How do we become less dependent, and would that be a good thing?

Mr. Lawrence McBrearty: Our unions in Canada and the United States just went through the question of the steel imports and dumping. I testified in the U.S. before their committee so Canada would be excluded. Our NAFTA agreement does not say that Canada will definitely be excluded from any import restrictions. We did have exemptions here, and we are exempt for now, but if our imports to the United States had kept on increasing, we could be touched by a penalty.

Another thing is that U.S. producers are day after day complaining that Canada is subsidizing either the steel industry or other industries in Canada because of our universal health care. These things are dominating factors that we feel are hurting the sovereignty of our country.

On your first question, Sheila can add some examples and some answers also. I'll come back to your second question.

Ms. Sheila Block (Researcher , United Steelworkers of America): I don't think the question is whether we would direct exporters to export or not to export or direct investors to invest or not to invest. I think the question is the general policy environment the government sets and the role of government in the economy to provide support for industry and also for diversification and markets.

The more closely linked we are to the U.S. market and the closer dependence we have.... Some 90% of Canadian exports at this point are from two-way trade between the U.S. and Canada. That provides huge amounts of vulnerability to the downturn in the U.S. market. Just as any business would be wise to have a diversity of customers, in case one of their customers has some difficulty, the country should similarly have a wide variety of countries to trade with.

Á (1110)

Mr. Stockwell Day: I would just add that countries don't trade. It's individuals and businesses that trade back and forth. I and our party take a position against corporate welfarism, or against the government subsidizing certain chosen industries. It sounds like you're suggesting that the government start to give taxpayer dollars to certain industries, which the all-wise government knows needs those dollars.

Ms. Sheila Block: You said you wanted to avoid philosophical differences. I think we're running into one.

I don't think our union or the labour movement would consider the government as having no role in the economy. We consider the government as having an important role in the economy.

At this point, I think we are going to move into a philosophical debate here.

Mr. Stockwell Day: I'm just trying to keep it very specific in terms of which businesses or industries you think the government should give taxpayer dollars to.

Ms. Sheila Block: An industrial or economic policy doesn't specifically only have to involve subsidies to specific industries. There is a wide range of policies in terms of encouraging research and development, encouraging industries that aren't harmful to the economy, and providing adjustment assistance to industries in decline. There's a whole range of areas, including trying to develop industries in which we could trade with countries other than the U.S., and provide some diversification for our industrial base.

Mr. Lawrence McBrearty: On your second question, you mentioned trade disputes and which mechanism should be used, either NAFTA or the WTO. I would just like to expand a little bit on this.

Our trade agreements between Canada and the United States differ completely with regard to disputes. In the United States, citizens, communities, employers, unions, and individuals can file a complaint under the NAFTA agreement. In Canada, only producers can file complaints. We, the United Steelworkers, would have filed a complaint over a year ago in Canada, under the steel imports or dumping, if we could have. But we couldn't. We had to pressure government, and mainly the producers. After 12 months, we finally did file a complaint for safeguards. So there is a big difference there in equality.

With regard to which mechanism is the best, you can say right now NAFTA is probably the best. This is because NAFTA countries can be treated under the NAFTA agreement, rather than the trade rules or laws. But regardless, you always have to keep in mind that they must not be subject to being questioned or appealed to the WTO--the same way the decision of President Bush on the import of steel is not questioned very publicly by European countries.

So you can't say which is the best and which is not the best right now. But what differs a lot in Canada--and which, unfortunately, is a big mistake or a tool we need in Canada--is we cannot have trade agreements that are lesser in Canada than any other country we sign with. With regard to disputes, the NAFTA trade agreement now prefers the U.S. a lot more than Canada.

The Chair: Thank you, Mr. Day.

I think we were told this morning by one of the professors who was with us that the WTO rules were better than the NAFTA rules. I'm not sure the rules were what we were trying to get your perspective on. But I think you did make your point.

Mr. Lawrence McBrearty: When we're talking about trade, commerce, or trade agreements, it's very difficult to determine which rule is best when companies outside of our own country can sue our government, and our government, under the rules, has to pay $20 million or $30 million. This is where we feel our sovereignty has been really, really touched.

Á (1115)

The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

My question is about the same subject you had in your closing. On the second page of your presentation you say: “We have traded away our sovereignty for the illusion of access to the U.S. market. NAFTA, while it doesn't provide secure access, does limit the actions our country can take on behalf of its citizens.” Isn't the same true for the Americans?

Mr. Lawrence McBrearty: I can tell you the industries we deal with.

Mr. Sarkis Assadourian: No, no. My question is, this paragraph, this statement, applies for U.S. corporations as well as for Canadian corporations. What I'm saying is if a company violates NAFTA rules in the U.S., the Canadian government can sue that company and ask for the money. Am I right?

Ms. Sheila Block: I think that is correct.

There are two things, one of which is that as Canadians, we're concerned with Canadian sovereignty rather than U.S. sovereignty. I also think that your discussion paper talked about the asymmetrical relationship we have with the United States. The U.S. wasn't concerned about getting access to Canada, or the promise of access to Canada wasn't what motivated the United States to sign the FTA and NAFTA. That's what motivated Canadians to do that. We were promised secure access. We didn't receive it and we had a loss of sovereignty.

You can say that the U.S. also had an equivalent loss of sovereignty, and we don't think that's a favourable event as well. We think that really we need to re-establish the ability of the state, whether it's the Canadian state, the Mexican government, or the U.S. government, to legislate according to the wishes of their citizens.

Mr. Sarkis Assadourian: I take your point. But when you make a statement that we lost our sovereignty, it's misleading. You should have a different way of expressing this. I agree with the sentiment of what you're saying, but you need to say it other than using the phrase “we lost sovereignty”. As you said, they lost sovereignty, so two minuses don't make--

Ms. Sheila Block: Two minuses make an even bigger minus, I think.

Mr. Sarkis Assadourian: In theory it also makes a positive, two minuses. Am I right? In mathematics.

Ms. Sheila Block: No. A minus and a plus makes a zero, or two minuses--

Mr. Sarkis Assadourian: Two minuses makes a plus, too.

Ms. Sheila Block: Maybe.

Mr. Sarkis Assadourian: What I'm saying is if we lost something, the Americans also lost something. What I'm saying is maybe it's more acceptable to people like me or more realistic to come up with a better phrase than say we lost sovereignty without mentioning the fact that the same rules also apply to them. It's like putting security guards on two sides of the U.S. border and we say that Americans are coming here. We'll also be going over there, so we haven't lost anything, basically. We exchange some portion of our sovereignty with the Americans and they exchange some portion of their sovereignty with us. That's how it works in this case. That's what I'm trying to find out.

Mr. Lawrence McBrearty: I'd be very surprised if the Americans would exchange any part of their sovereignty with the Canadians. That would be very, very surprising.

Mr. Sarkis Assadourian: They just proved the fact that--

Mr. Lawrence McBrearty: What we're saying here is that we were told that with the NAFTA, the FTA, there was open access to the U.S. markets. We also have to understand that every country around the world wants to have access to the U.S. market. We're not disagreeing with this. But we're saying that as citizens we were told that we would have that. We were signing these agreements to have access to the U.S. market. We have to fight to have access to the U.S. market--softwood lumber, the steel industry, and others. We're not saying that there can't be any access to markets from the United States to Canada; the U.S. does want the U.S.-Canadian market also. The understanding of those agreements was there was going to be a flexibility and a free exchange of access markets. People don't believe that today because there's more knowledge. People are more knowledgeable now of the trade issues in the trade markets, because that's what we read in the papers and see on TV every day.

Mr. Sarkis Assadourian: Is it possible that the U.S. government or the style of the U.S. government is such that sometimes the President cannot control the House, the House controls the President? This may be the case, because as far as I know, the President's sensibility to our Prime Minister is in favour of softwood lumber--it's in our favour. But he cannot support it because Congress is totally against it.

Is that a possibility--not because of NAFTA, then, but because of the structure of the U.S. government?

Á (1120)

Mr. Lawrence McBrearty: I'm not questioning the political system of the U.S. We have our political system in Canada, which I feel is a lot better than the U.S. system.

Mr. Sarkis Assadourian: I agree with you there.

Mr. Lawrence McBrearty: They have a presidential... whatever. I don't want to get into the politics.

We feel--and I think a lot of surveys would probably show this--that when our country signed the FTA, and then expanded the FTA to the NAFTA... There are a lot of concerns around the world, especially in Canada and the other countries of the Americas, that when the NAFTA is expanded to the 34 countries of the Americas, we're again going to be talking about the access of markets to the U.S. Those countries want access to the markets of the U.S. Are they going to have free markets to the U.S.? We haven't had it in our agreements up to now.

So with regard to the sovereignty, when our government wants to pass rules or regulations with regard to Canada--its market policies, investment policies, or whatever--and then there is another tribunal that permits companies to sue our government because of decisions we are taking in our country, I believe this touches on sovereignty a little bit.

I feel a little disturbed when my tax money--$20 million and more--through my government, has to go to corporations. And we know there was a sum of over $200 million. Canadians are concerned about this, and we have to admit there is a problem there. That's probably why we're having a commission right now.

Mr. Sarkis Assadourian: I agree with you, but at the same time I submit to you that similar companies have said similar things, as in the case of softwood lumber--“Oh, we've lost our sovereignty”, or “We have to go after Canadians”, or do this or that. The argument goes both ways. I'm not saying it's right or wrong; it goes both ways.

I hope you agree with me that this phrase in this whole paragraph on the second page does not represent accurately the exact situation on the ground. That's what I'm trying to find out.

Mr. Lawrence McBrearty: It represents exactly what our members and the labour movement feels. I'm not asking that people agree with this; we're meeting because there are disagreements. But this is our feeling. I understand it's not yours, and I accept that.

Mr. Sarkis Assadourian: No, I agree with what you're saying, but I'm saying that it should also state that the same rules also apply for U.S. companies.

The Chair: All right, Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you.

The Chair: Thank you.

You somehow dismissed Mexico. One of the things the committee is trying to do is some exploration of trilateralism. Is there some way in which we could include Mexico in these discussions? Can you say something about that relationship?

Mr. Lawrence McBrearty: Yes, thank you. In fact I think we could say quite a bit about Mexico.

Our union has quite a few projects and has been working with Mexican workers--groups, unions, and social groups--for many, many years. We have the Steelworkers Humanity Fund, of which I'm president. We do projects in Mexico. The NAFTA agreement and the way the Mexican people also understood it is that their living conditions, their way of life, their incomes would definitely increase, somewhat--to a certain level.

If we go to the maquiladoras we see that the Canadians, Americans, Japanese, French, and whatever countries have invested there have beautiful shops with a high level of technology. But in the communities where the working people and their families live--if we can call them communities--I don't think we have any Canadians who would use what they have to use for a home, or call it a home. There are no floors. It's not even what you'd call a building--ten feet by ten feet with no floor, no running water, no washroom. It's made with cardboard, pieces or slabs of wood. I'm sure some of you on the committee have seen those areas.

The trade agreements and the bilateral, the three-way... We say they're non-existing or not equal--not equal in environment, not equal in human rights, not equal in labour laws. Our union in Canada has filed the first ever complaint under NAFTA with regard to the side agreement on labour with a company called Dana Corp. We were happy because we thought we had won. We didn't win anything. We won our argument, but we lost the battle. The only thing it does is the ministers of labour have to meet to see how they'll deal with it, but it hasn't moved any further up to now.

Unfortunately, a lot of people use the language that we're “losing our jobs” to Mexico. We're losing our industries to Mexico, and by losing industries, we're losing jobs, definitely. But it has to be understood we are not fighting or trying argue that the Mexican people should not have their fair share. They should, and we feel that they don't.

Every time we do an exchange--we have sent some of our members, some of the women, especially, to Mexico on these projects--everybody comes back here really distressed about what's going on, because people in that country had understood, the same way people in other countries of NAFTA did, that this was going to be good and it would increase their wages.

Just in closing on that, I want to give you one of the best examples. Here in Ontario we had a plant in Waterloo with 1,200 men and women who were making fair wages, had a fair collective agreement. They were getting $13, $14, $15 an hour. The name of the company was Custom Trim. Inside a period of two to two and a half years, we were notified that the company was going to be closing here and moving to Mexico. They moved to three different spots in the maquiladoras in Mexico--in different states, because in different states they pay different wages. They are producing the same products they were producing in Canada, using the same technical equipment, selling on the same market.

Workers are receiving approximately 68¢ per hour, and they have to fight if they want to be represented by the union--and I think we all understand the system in Mexico. When those workers walk out of that beautiful plant that has flowers in the corners, that has a nice lunchroom, and they have to walk to where they live with their families.... It would make any Canadian--any human being--cry to see the way these men and women are exploited in the workshop, and especially in their community.

I think we have to understand, and we probably all know, that these corporations that go into the maquiladoras in Mexico do not pay any tax. They're not touched by a tax system, like the corporations are here in Canada. When we ask the Mexican people we meet, and we meet a lot of them in all the maquiladoras, why they don't try to fight or argue for a corporate tax system here to permit them to build communities with houses, running water, and washrooms--have the living conditions--those people tell us, “We don't want that because we know the money will never come back to us”. That's what they tell us, rightfully or wrongfully.

Just to add on that--I'm sorry if I'm taking so long, but these issues really touch me--what's happening with Mexico right now.... As a consequence not only of NAFTA, but with all our trade aroud the world, we are now seeing companies and very large corporations leaving the maquiladoras in Mexico now to go to China. And we're going to see that more and more in our three NAFTA countries.

Á (1125)

The Chair: We want to thank you for coming before us today and for leaving your brief with us. Mr. Rob Hilliard, from the Manitoba Federation of Labour, did mention some of that work. It's in his brief, which is also with us.

Thank you, Mr. McBrearty, Ms. Block.

I invite to the table the Canadian Council for International Cooperation. We have the president, Mr. Gerry Barr; Miriam Mukutuma, deputy general secretary to the Zimbabwe Congress; and Salihu Lukman, national director of education in the Nigerian Labour Congress.

I was fortunate to have met these two individuals with Mr. Barr in Montreal, where there was a discussion, or at least a CIDA conference, or round table, town hall, opportunity to network--I would imagine it went by several names--over the weekend.

Welcome to Canada. We're very pleased that you're here and that you can see how the process works. Maybe, if there are practical or underground questions from members--since you are visiting here--you could substantiate some of the presentation that Mr. Barr will make.

Gerry, you're with us. You're well known to this committee. You've been before us several times in the past. You have about ten minutes or less to make a presentation, and then there will be questions.

Thank you.

Á (1130)

Mr. Gerry Barr (President, Canadian Council for International Cooperation): Thanks, Madam Chair.

I did think it was a terrific opportunity. We were sort of making this up as we went along, but I noticed there was an informal atmosphere, and my two colleagues were with me, as you pointed out, during the weekend. I thought it a terrific opportunity for them to be available to you for some discussion and comment on some of these matters I'm going to be addressing, which touch on NEPAD, of course.

[Translation]

The Canadian Council for International Cooperation is pleased to be able to testify before the Standing Committee on Foreign Affairs and International Trade with respect to the next G-8 meeting, that will be held in Kananaskis.

[English]

At Kananaskis the G-8 leaders will be dealing with issues concerning global economic growth, African development, and terrorism. I hope to offer a few comments about all these, especially in the context of African development.

Arrested development and the sharp inequalities that separate us on the planet don't cause events like September 11, but they certainly do set the stage for more than 40 conflicts around the world today. Holding terrorists lawfully to account is a key priority, to be sure, but global security will certainly elude us all if the vast economic and political disparity that keeps the world in turmoil is left unrepaired.

The major strategies for addressing the threats of terrorism until now have been focused on military and police measures. This year the U.S. is spending $89 billion on anti-terrorist military and security measures. That's nine times more than it will spend on international development cooperation. But every day terror is available around the world, and sadly it is available in industrial quantities.

Poverty is the overriding cause. Pneumonia, diarrhea, malaria, measles, HIV/AIDS, and malnutrition are the main killers.

At least 1.2 billion people around the world are living in absolute poverty. That's a kind of ghastly category invented by the World Bank, which in a sort of dark sense high-grades misery, as if people living on less than $2 U.S. a day were not also themselves teetering on the edge. The harsh truth is that strategies for economic growth currently pursued especially by the G-8 have led to dysfunctional economic relationships between industrialized nations in the north and developing nations in the south.

International institutions like the IMF and the WTO are dominated by G-8 countries. They are promoting an economic model that has done more to aggravate global inequity and insecurity in the world than create the conditions for sustainable development and human security. To put it mildly, the third world has done poorly with globalization.

Sub-Saharan Africa, home to almost a quarter of the developing world's hungry, saw 28 of its countries become poorer between 1980 and 1996, during a period of unprecedented trade liberalization. Even when the north's prescriptions for economic growth are followed to the letter, poverty reduction has not been a major spinoff.

Ghana, for example, has been a star pupil of both the bank and the fund, following its advice on liberalization and adjustment to the letter since 1982. The promised reward was economic prosperity and poverty reduction. Its economy actually did grow, but few rewards have materialized for Ghana's people, more than 30% of whom still live far below the poverty line.

In 2001 Ghana was offered the opportunity to participate in the HIPC II debt program, which was itself an admission on the part of the international financial institutions of the bankruptcy of Ghana's financial accounts, but also the bankruptcy of the policy advice to which it had been made to adhere.

The so-called new approaches to global economic growth coming out of the recent WTO Doha meeting or the UN financing for development meeting in Monterrey offer the same kinds of prescriptions focused on rapid trade and investment liberalization. The early signs are that the NEPAD plan and Kananaskis won't go much further.

It's important for the committee to know that more of the same here is not just inadequate; it risks further entrenching of the processes of global impoverishment and relations of inequality and insecurity.

So what about the New Partnership for Africa's Development, or NEPAD? Through dialogue with African colleagues and partners, the CCIC working group, called the Africa-Canada Forum, has developed a detailed commentary, a copy of which has been submitted to the committee. I know it will be available to you for your record.

While the idea of supporting African-led development strategies is critical, there are two overarching critiques. First, the document has emerged out of a process that lacks roots in the expressed aspirations of African citizens, civil society, or parliamentarians in Africa. It seems that the Prime Minister of Canada and other G-8 leaders and some African heads of government have been planning Africa's future, but they have left out a crucial partner--the citizens of Africa.

This past weekend in Montreal--as the chair knows--I participated in a CIDA-hosted conference called “Canada and Africa: A New Partnership”. At this conference, serious questions were raised about the legitimacy of this partnership and the soundness of the plan.

NEPAD has uniquely placed urgent African development needs on the international agenda, which is a badly needed thing, to be sure, but many of the Africans gathering in Montreal called for NEPAD to be sent back home for debate.

Á (1135)

Members of the committee will be interested to know that at least 60 of the organizations, most of them African, prepared a joint statement at the conference that calls for a broad national debate in Africa on the question of the direction of African development and of strategies alternative to the bank and WTO models, which are so central to the NEPAD plan.

This brings me to the merits of the NEPAD plan itself. It's a bad economic idea. The need for debate and rethinking is thereby made all the more critical. You'll find at NEPAD's centre--at its core--repackaged, old, and unsuccessful strategies that have been tried in Africa before. In particular, the optimism of NEPAD rests on the confidence that foreign direct investment will be a primary source of resources for development. This is risky, because the same measures designed to attract investment, applied in the past, have not achieved that goal. Foreign direct investment has actually declined, and development outcomes have been minimal, to say the least.

African economies constructed initially to support the industrialization of colonial powers through resource extraction remain internally weak and linked to a global economy that continues to extract resources with little beneficial return to African citizens. We need to support Africans' efforts to rework local and regional economic arrangements to turn this around.

Rather than focus on what policies African states need to undertake the deserving of investment and aid dollars, we urge this committee to send a message to Canada and the G-8 to focus on their own roles as developed economies. A truly new partnership to eradicate poverty and redress injustice will require as much change in the policies and practices of the north, including Canada, as it does in Africa's.

As a member of the G-8, what can Canada do to meaningfully address African development in human security?

First, it can support debate in African civil society on the NEPAD. A plan should be sent back to Africa for consultation.

Second, it can support full and unconditional cancellation of the debts of poor and highly indebted African countries. In this respect, Canada has already made a very significant démarche. It's in a good position to offer leadership to the international community.

Third, it can launch a G-7 timetable for increasing of the aid levels towards 0.7% of GNP and focus those resources exclusively on eliminating poverty, promoting the rights of the poor, and shared accountability without externally imposed macroeconomic conditionalities.

Fourth, Canada should also follow through with support for a tax on foreign currency speculation and promote that proposal at the G-8 summit. This tax would create a pool of money for development and help prevent a destabilizing speculation. The chair will know, I'm sure--but I can say, I think, without having checked the record--that she may have been one of the Liberal members of Parliament who voted to support the application of the Tobin tax, in concert with other countries around the world.

Fifth, work to transform international trade rules and the process for negotiating them. To better support the development needs of African and other poor countries, trade agreements need to acknowledge the imbalance between industrialized and developing countries. For example, Canada and other G-8 countries should support the creation of development-box provisions in the agreement on agriculture so that the livelihoods of small farmers and agricultural producers can be protected, and so as to encourage local food production and promote food security. African countries need to have flexibility on intellectual property rights to ensure protection of farmers' capacity and rights to save themselves seed, to ensure access to affordable medicine, and to stimulate technology transfer.

Á (1140)

NEPAD's arrival on the scene and the interest in it by the Prime Minister and other G-8 leaders has put the fate of Africa on the international public and political agenda. But that fate cannot be improved without the involvement of citizens and without a commitment from African governments and donor nations to listen to the real alternatives put forward by African civil society. In our submission, only then can the social, economic, cultural, political, and civil rights of the African peoples be affirmed and realized.

There is a terrific opportunity in this upcoming event at Kananaskis to reshape and redirect some of the development energy that has until now been so misplaced in the projects for the development of Africa. We really hope that parliamentarians and government leaders will take the opportunity, and it's a delight to be able to be here to talk to you about some of these things today. I'm delighted especially to be joined by these two colleagues who shared a discussion this weekend on this subject.

Thanks very much, Madam.

Á (1145)

The Chair: Thank you, Mr. Barr.

We'll go directly to questioning. Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair. I can assure the presenters that though my colleague and I appear to be sitting on opposite sides of the table, our concern is linked with yours to see prosperity and opportunity and a higher standard of living for the people we all represent and the people that you represent in your own country. So we are agreed on those things. Sometimes the road map to get there isn't something we always agree on.

I share your concern about the IMF and what it imposes on countries that are struggling. I believe it can be shown that many of those impositions, in fact, are counter-productive and wind up hurting the countries in the long run. So I agree with you on that, as well as with your comments that unprecedented trade liberalization still has not appeared to help many countries. Trade liberalization in and of itself is only one spoke in the wheel of better fortunes for citizens. If the other spokes aren't there, it's going to be a wobbly vehicle at best.

I couldn't agree with you more, if there is a sense that the NEPAD needs to be going back to Africans, to the people, for debate. No policy, either continental or national, will be successful unless the citizens feel they've had a buy-in, so I agree with you on that. You talk about the expressed aspirations of African citizens that have not been gleaned from this. For our insight, what aspirations do you think have been overlooked and are not being addressed?

Also, in your comment on page 6 about foreign investment declining in many cases, I believe that to be true. Investment needs stability. Investment needs security, not security granted by governments in terms of financial security, but it needs to know there is going to be protection of contract law, of private property, of personal rights. What progress do you think is being made there?

As I have said, I think the Prime Minister is correct in saying investment will follow where there is constitutional democracy, rule of law, and protection of rights. Investment then, at least, has the opportunity to follow. And if our citizens here in Canada, who increasingly, through the Internet and other ways, have access to all kinds of information, if they sense that taxpayers' money is going to regimes that are corrupt--I'm not only talking about Africa, but others around the world, possibly even governments in western nations; no government is free of corruption--there is going to be a greater reluctance for citizens to transfer their hard-earned dollars to those countries that don't have in place constitutional democracies, rule of law, methods of dealing with crime, and so on.

Perhaps you could address that, the cancellation of debts, which countries, and if you cancel debts to regimes that have been irresponsible... Again, I'm not just looking at Africa. We have businesses here in Canada that have looked to the government to cancel or reduce their debt, despite the fact that their management has been very irresponsible.

How do you deal with that? Which countries do you look at in terms of cancelling debts and therefore simply passing the carrying of those debts onto other taxpayers, in Canada, for instance? When you cancel a debt, somebody else has to pick it up because the banks will be paid whether we like it or not. How do we determine that?

Then you talk about protecting the livelihood and the intellectual property of small farmers. What progress is being made to protect the property rights of farmers so they don't have to worry about their property being expropriated?

These are rapid questions, and it would be great if you could deal with as many as you can.

Á (1150)

The Chair: Mr. Barr.

Mr. Gerry Barr: I offer these comments not in order to evade other points you've made, Mr. Day, but just to say that there are really two core critiques. One is that the NEPAD contains within it and further articulates it.... This would be captured in the question, what is new in NEPAD? What's new in the new partnership? Is there a new economic model there? Our contention is that there is not. Although there are a great many important and useful development flags, as it were, run up on this vehicle, the real engine of the NEPAD plan rests inside core economic approaches that have until now been deleterious for the development of African national economies and have actually weakened and shaken the internal strength of African economies.

The core idea is that money will be used in the NEPAD strategy to effect legal and institutional reforms that will themselves serve to attract and retain foreign direct investment. We need to ask ourselves the question, if a development scheme depends for its success on attracting and securing foreign direct investment in a context in which foreign direct investment has sharply declined, and notwithstanding this two-decade-long history of implementing the very reforms that are being talked about, what are the real prospects of development spinoffs here?

Foreign direct investment in sub-Saharan Africa in the mid-nineties was 1.3% of global flow, so it had a miniscule share of the world's foreign direct investment. Today that amount is 0.8%, less than 1% of all foreign direct investment. For a scheme that is predicated on this FDI thing, how likely is it to succeed in the long term? When will the foreign direct investment arrive? In the next half decade? In the next 10 years? I think there are lots of reasons for skepticism.

Then there are, of course, the process criticisms, for example, the cutting out to date--perhaps not in the long run--of the participation of African citizens.

I'll turn the mike over to my colleagues.

Ms. Miriam Mukutuma (Deputy General Secretary, Zimbabwe Congress Trade Union): Thank you, Madam Chair.

I don't have much to say, other than that with NEPAD there is a need for involvement of civil organizations in Africa and that they have been left out already. I don't know whether our heads of state can give us the opportunity to contribute to the document.

I also want to say that already on the continent we have many issues that need immediate attention, such as the civil wars and HIV/AIDS, from which a lot of people are dying. Inasmuch as we want development, we also want assistance to deal with HIV/AIDS and civil war.

Thank you.

Mr. Salihu Lukman (National Director of Education, Nigerian Labour Congress): Thanks, Madam Chair and members of the committee. It's quite a privilege and an honour to participate in this particular hearing.

In terms of the substance of the issues and the discourse, I think there are two points I'd quickly want to bring to your attention as a mark of emphasis. The first is the whole issue of NEPAD. The salient point there is about good governance. Good governance generally is a mark of consultation, a process that accommodates and brings out the feelings and expressions of people, those being reflected in the policies of government.

I think that is where the critical issue lies. The presentations so far have addressed that. For us, as Africans, the main point that is being made is that the whole conception and the way NEPAD is being driven so far has not taken that into account. But that is not to say that one will not recognize--we as Africans I think will also recognize--that governments have a duty to initiate programs. It is also our duty to initiate actions that compel government to listen to the views and wishes of the people.

And it is in that context, since the first reference point... and that is the paradox of it. When the document was drafted, the first thing Obasanjo and Mbeki did was to take the document to the G-8. As Canada is a member of the G-8...we feel it will be incumbent on the G-8... Since it is an issue that borders on promoting good governance, African government should broaden the process by taking civil society and all other segments of society along in the conception and the way the whole program is going to be driven. I think that is at their level. I don't want to flog that.

But on the substantive issue of debt relief--or debt consolidation I think is the language--the issue is not a moral issue. It's also economic, because the reality of Africa today is that countries that have taken loans, and on terms that are clearly unfavourable, are today living with very high incidents of interest rates. As a result of that, those countries cumulatively have paid multiples of the loans they have initially taken. But that is not just it.

The second dimension of it is that through international financial institutions, pressure is being piled on these countries as a way of renegotiating those so-called releases to entrench further new liberal policies that have so far made miserable the lives of the people in Africa. Again linked to that is the irony that the NEPAD document as it is has a very wide gap in terms of bringing some of this reality. If we are talking of a partnership, the document should have contained in it some sort of terms for that partnership.

Á (1155)

The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much. I am really pleased to hear your comments and your presentation.

The comment I want to make is in general, but because we're discussing Africa, it pertains to Africa. But it is not to say corruption doesn't exist anywhere else, as the point was made earlier.

But I really have a concern with your recommendation 1 and especially recommendation 2. In recommendation 1 you say the plan NEPAD should be sent back to Africa for consultation.

How much consultation do we need? I think we've consulted on this thing for the last 25 years. To send it back for consultation to come back with the long-term promotion of democratic principles for a government is pushing the file backwards, not forward. That's how I see this, unless I'm reading it wrong.

If there's going to be consultation, it has to be with a deadline for reporting back. There's no deadline here.

We could have a G-8 now, this year, and another G-8 next year and the following year. How long are we going to consult on this before we become serious and take action to give governments back to the people rather than corrupt leaders in, in this case, as I said, Africa?

On the second point that my colleague referred to, I could never, ever--I repeat, never, ever--support full and unconditional cancellation of any debt for anybody, not even for my children. If debt is going to be cancelled, there must be a good reason, and you mentioned in the first recommendation good government or whatever. Then it's totally unconscionable to ask some nation to give money to another nation with the intent to help, knowing full well that the money didn't go to the people for whom it was intended; it went to Swiss accounts.

As I say, this is not only for Africa in particular. Lots of nations I could mention, outside Africa, do the same thing. I find it very hard in my conscience to justify any kind of cancellation when I know the money is not going to that country.

Secondly, there is no guarantee that when the loan is cancelled and no more payments are made to Canada--or to the G-8, but in this case to Canada--the saving will go back to the people who were supposed to get it in the first place.

So give me a good reason why I should cancel the debt of any nation, and in this case African countries.

Â (1200)

The Chair: Briefly, please.

Mr. Gerry Barr: I think my colleague has already spoken pretty eloquently to some of the questions having to do with debt, but simply to say, and to help if I can on the conscience question, there are now countries in the sub-Sahara and Africa that are spending more on debt servicing than they are on education and health combined. It is a lead weight on development, if you can characterize it in this way.

Proposals that call now, for example, for alleviating 60% of the burden of debt servicing really don't do much when they refer to a country that, in any event, can only manage to service about 20% of its debt burden. In that case, what has happened is the books of the lender countries have been changed, but circumstances on the ground have not been changed at all in conditions like that.

I think the other issue is debts that were afforded in pernicious debt, debt that has been granted in ways to national entities, to countries, to states, but in circumstances where there was no popular mandate, where there were dictatorial, non-accountable regimes. Some of them are long gone, but the debt is not. Those debts that were accrued in circumstances of non-accountability are now being required to be paid--

Mr. Sarkis Assadourian: What about dictatorships now? Do we have to give them money, too?

Mr. Gerry Barr: I think there are lots of circumstances in which you have non-accountable governments, and there are lots of reasons to doubt whether or not loans provided to those non-accountable governments ought to constitute a burden on people who have never authorized those debts.

So I think that is the circumstance you have. There are others who can carry on this discussion a lot more fully than I. The Jubilee movements, both of the north and south, have been arguing this question with very great effect, and the Government of Canada has been listening. I think the proposal of the Government of Canada to essentially cancel debts to the most highly indebted countries is absolutely commendable and has shown enormous leadership in the international community.

I just want to move on to the second point. I know it's a contentious issue and can't be resolved in probably one or two comments. The question is, how long will debate go on?

Ambassador Fowler, who is the Prime Minister's principal representative on the NEPAD arrangements and indeed on the G-8 meeting, has said to us frequently that NEPAD is a process; it ought not to be understood as something that has a quick beginning and end.

The minister herself, on the weekend, said the same thing. This is the beginning of a long process.

I guess what we are saying with respect to this question of national debate on development direction is, first, the architecture of this plan--the building blocks--is an area of contention. Not all agree that these development directions are the appropriate ones. This is not just a fly-by-night worry. There are large numbers of African analysts and organizations that think this way.

There needs to be a debate about development direction, if we really mean that ownership is going to take place and that Africans themselves are going to steer the future of the continent. So that debate has to happen.

What will the timelines be on it? I guess adequacy is the issue here. It needs to go on as long as is required for there to be some national consensus about direction.

Â (1205)

Mr. Sarkis Assadourian: Meanwhile, Africa is suffering. This is the point I'm trying to make.

Mr. Gerry Barr: Africa has been suffering for countless generations. We should and need to stop this. The way to stop it is with legitimate political processes at the base in Africa, so that development directions can be authentically owned and managed by African citizens.

The Chair: Thank you.

I just want to make a comment or two, because I have been following the progress of the discussions around NEPAD.

I'm a little saddened with the terms “sent back to Africa for consultation”. They conjure up all kinds of other things in my head. It seems to me that, as Canadians, our responsibility...I think Mr. Lukman said governments have duties to negotiate programs and to work for the best aspirations of their people, etc. This is what I see happening. Some leaders are working with the aspirations of their people. This is really an African plan given to us by the Africans and African leaders.

To debunk something else that was said, I think there were times when the climate was right for an opportunity that presented itself. Other plans have been on the table before, other things have happened in the past, other great visions have been put before us, yet they didn't go any place. It seems to me stars are lining up in a particular fashion at this point in time, with globalization and some of the other crises, the dumb turns we see on the continent.

To aim for perfection is really a kind of human condition. But I see an opportunity here. I see the opportunity as the developed countries looking for ways and means to make room for the continent of Africa. The discussion and the consultation, and the inclusion on the ground, has to happen with African parliamentarians, with African people, and with African civil society. Thus I'm not too sure that with Canada as host of the G-8, it's our role to debunk NEPAD, or to set it off whatever course, simply because of some of the reasons you outlined.

But again, this is just my initial reaction to the paper you presented to us and to the opportunities I see could be lost if we, as Canadians, feel somehow that NEPAD is ours, or our responsibility. I think it is the responsibility of African leaders and African people. Hopefully, as they go back to their various avenues, everyone--including the two presenters before us--have a responsibility to make sure they talk about this paper and this exchange and find some ways to involve their political leadership and governments, amid whatever appropriate changes are made. I think we should not lose an opportunity here to have the G-8 focus on Africa.

I'm not expecting an answer from you. It's just my gut... Thank you, Gerry.

Â (1210)

Mr. Gerry Barr: Here's just a tiny comment for the chair.

I think it's really important that the perfect doesn't become the enemy of the good. I guess if one were to write a NEPAD, and write it in a way that would grasp some of the debates now going on about it, I guess it would be a NEPAD that builds in at the front end an accountable and transparent debate within the national economies of Africa on the question of appropriate development directions. And it would be a NEPAD that makes room for alternative ideas and models. It would be one that honours, for example, the Lagos Plan of Action, other approaches that have been imagined and developed by Africans, and concepts that were carried as recently as just months ago to the Doha meeting at the WTO about how African development could move forward.

A lot of these ideas are nowhere to be found in this document, and that may be sadly one of the reasons for the agreement that we see--which is so exciting, of course. But if we say the thing about NEPAD is that Africans have authored it, that reveals, underneath it.... There is an acknowledgment in that commentary, and the acknowledgment is that in the past, plans have not been African-authorized. Concepts that have driven the national economies of Africa have not come from Africans themselves but from the general context. We need to ask ourselves the question, what is it in this document that supports and strengthens the capacity of Africans to drive and direct their own economy?

The Chair: I think that's a bigger question I don't want to start a whole debate on, because we can go on in terms of authorship. As I said earlier, things are lined up in such a way that the opportunities are here, and I think there would be opportunities missed if we began to analyse this.

Again, I think my final word would be that this is a plan that was written in Africa, combining the millennium, combining all kinds of other papers that were with the Organization of African Unity, combining works of other African leaders and African thinkers, etc. It seems to me it is an African plan by Africans for the recovery and the renaissance of Africa, and that as Canadians it is our responsibility to support this, which is the attempt that's being made. Anyway, it's ongoing, a work in progress. If we can make some leeway, the end of June is before us. It's number two on the agenda. I somehow have great difficulty with the phrase “send it back to Africa”. It just seems a little bit westernized.

Thank you for appearing before us. I guess I should apologize for being very personal. It's kind of a gut thing for me, and I've spent a lot of time reading, studying, looking at directions, and making all the comparisons, and I just don't want to see this panned and watch it die, because I think there is a window of opportunity here, and we need to work with what we have before us, in light of the times.

Thank you so much.

Anita, you're on your own. Welcome to our committee. You have about ten minutes to make a presentation to us; then we'll engage you with questions, and the chair promises not to be...

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Ms. Anita Zaenker (Chairperson, British Columbia Component, Canadian Federation of Students): Thank you very much. Michael Conlon couldn't be with us today.

Since 1981 the Canadian Federation of Students has been the democratic voice of students at Canada's public colleges, universities, and institutions. Today the Canadian Federation of Students is comprised of over 400,000 students from St. John's to Victoria at the undergraduate and graduate levels.

We firmly believe that education is a right at all levels and that it is in government's interest to maintain education as a public good both in Canada and abroad. It's in this context that I want to address some of the questions that you've outlined in the discussion paper on Canada's role at the upcoming G-8 summit in Kananaskis.

We believe that some of the priorities that Canada has identified can be advanced through the further development of education as a public good and as an accessible system both in Canada and in developing countries. We believe that Canada should play a very strong role in advancing education, particularly higher education, as a public good among G-8 countries and as part of any economic growth and African aid strategy.

It goes without saying that education is an essential tenet of democracy and is vital both to the social and also to the economic sustainability of any country. However, we do not believe that education should be included in multilateral trade agreements such as those currently being negotiated at the World Trade Organization, such as the GATS, the General Agreement on Trade and Services. Canada should commit to removing education from negotiations on the GATS at the WTO and should assist other nations as well.

I'd like to spend a few moments just outlining why we feel education should be removed from multilateral trade agreements. The GATS, as such, would remove the right of nation-states to regulate in their interest and to regulate on a service such as education that can act in the public good and in citizens' own interests. The GATS would remove what are perceived to be barriers to trade. Those could be any pieces of legislation such as those that protect citizens from the rising cost of education, those that protect the rights of employees in the education sector, and also those that protect the ability for communities to determine the content of that education. We believe that education is not a commodity much like other commodities or other services; it is actually a right and a public good and as such should not be negotiated.

Currently Canadian students are very much affected by reforms in the vein of World Bank and International Monetary Fund reforms in higher education in Canada. Since the 1990s public funds have been systematically reduced from investment in public education and the burden of payment for education has been shifted more and more onto individuals and less from government funding. Tuition fees have risen at an unprecedented level since the 1990s. That's something I'm sure you're all quite aware of. Student loan debt is at its highest, with the average student loan debt at $25,000.

This has severe consequences for accessibility of education, particularly in the higher education arena. As Canada transitions into a knowledge-based economy, we need to be finding ways to make education more accessible and not less. Reforms such as those outlined by the World Bank and the International Monetary Fund, which would see increased user fees and less public investment, do not help Canada advance that goal.

As such, Canadian students also don't need debt management strategies. We need to be looking at measures to reduce debt for students such as the implementation of grants and the reduction of user fees--the reduction in tuition fees--to make education more affordable.

Jane Kelsey, who's a legal scholar in New Zealand, published an article in 1998 in the Journal of Law and Society that outlined the effects that World Bank policies are having in the higher education arena. In particular, she highlights the case of New Zealand, which underwent quite rigorous restructuring as a result of World Bank directives. In it she identifies that the combined student debt load of the country of New Zealand is now higher than the actual national debt.

When we're looking at measures to evaluate whether or not policies are effective, looking at GDP is not always the right way. We need to be looking at what kind of effect our policy is having on the individual citizens of a nation, especially in the area of reform of higher education.

Jane Kelsey also points out that some countries, particularly those with well-developed privatized infrastructures in higher education, can handle the type of change the World Bank proposes for higher education, but the education systems of poor and small countries will be most vulnerable.

It's particularly with those comments in mind that I think about the Canadian strategy on Africa, and how, if we are looking at ways in which to help the African economies develop and become more self-sustainable, it is best to not look at World Bank strategies for higher education.

At the national student union, we work closely with other national and international student unions. We've come to hear and see first-hand the effects of the type of reform policies advanced by the World Bank and International Monetary Fund on the accessibility of higher education. Committee members might be aware that in Mexico in 1999 tuition fees were implemented at public institutions. It resulted in a ten-month strike by students and faculty at the country's national university, amidst fears that education was being priced out of reach for average citizens in Mexico.

We work closely with the All Africa Students Union and have had occasion to have visitors from the All African Students Union address our delegates at our national conventions. In the presentations, they have outlined the effects of high user fees, tuition, and other user fees on accessibility of higher education to students in Africa.

In addition, they highlight the absence of true democracy in their country and the ability to organize as a civil society. It is a goal Canada also wishes to advance at the upcoming G-8 summit in Kananaskis. We hope Canada will advocate for true respect for civil society, including the rightful role of students and student unions to advance positions in educational democracy.

We hope, at the upcoming summit, Canada will advance a few positions. First of all, we wish Canada to play a leading role in removing education from the table at the GATT, as I've outlined earlier. Canada can also foster true internationalization of higher education that isn't linked to the global trade agenda of World Bank reform.

As such, we hope Canada will further remove barriers for international students to come and study in Canada. Currently, many institutions charge tuition fees that are double, triple, or quadruple the rate that domestic students pay. This has an effect on the kind and type of international student who has the ability to come and study in Canada. We hope Canada will scrutinize its own practices of implementing barriers to international students in getting the education that will be very useful in furthering the stability of democratic institutions around the world. We look to Canada to play a role in reducing tuition fees for international students.

We applaud the recent initiative Canada has taken to eliminate the working restrictions for international students. Prior to this year, international students were restricted from working anywhere outside of campus during their stays in Canada. With the high cost of education for international students in Canada, we think this is a very important move to have made to make it possible for students to work in Canada.

We also want Canada to play a very strong role in developing a regime outside of trade to ensure justice and equality in development. We certainly heard from other presenters to this committee on the importance of ensuring there is a regime that will enforce justice and equality measures in addition to trade liberalization.

The G-8 summit has a responsibility to look beyond the single-minded focus on liberalization on trade and investment as the answer to economic and social development. In fact, education should be seen as such a tool.

In conclusion, students, both in Canada and internationally, are directly affected by trade agreements and the World Trade Organization style of globalization. As students in Canada in the national student movement, we believe education is a right. Rights are not for sale and should not be included as part of the trade liberalization package. It is why many students are involved in organizing for alternatives to the type of agenda promoted by the World Trade Organization, the World Bank, and the International Monetary Fund.

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Students in Canada have been involved in articulating such alternatives in the past around Canadian involvement in Asia-Pacific economic cooperation, the multilateral agreement on investment, and the free trade area of the Americas.

We believe that Canada has an important and strong role to play in ensuring that civil society is protected, both in the results of the discussions at the G-8 summit in Kananaskis and during those discussions in Kananaskis. Our ideas of democracy and dialogue with civil society are contingent also on our ability to demonstrate our commitment to those here at home in Canada.

Thank you.

Â (1225)

The Chair: Thank you very much.

We'll go directly to questions.

Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair, and thank you, Ms. Zaenker, for an excellent presentation.

Could you give us some advice and insight on a couple of areas you've talked about? You mentioned that some of your colleagues in Africa talk about the absence of true democracy in Africa. Do you have any guidance for us on how true democracy can be promoted in Africa? Again, along the lines of what the chair was saying earlier, it's not something we want to impose, but is there a proper role for us?

Also, you mentioned removing barriers for foreign students. We had a presentation from some African ambassadors a couple of weeks ago, and they talked about the effect of brain drain from Africa to Canada, where they were losing their best and brightest, if I can use that term. Those students were staying here because they enjoyed, quite understandably, the high standard of life, the good salaries, etc. Do you have any advice on that? That was a problem articulated by African ambassadors themselves.

In the area of alternatives, with the capabilities of the information age, the electronic and technological age, and the ability to transfer information and provide forums for debate and discussion on the Internet, it seems to me to be a huge opportunity to reduce the giant costs of post-secondary education. We're in this marvelous technological information age, yet many people still seem to think within the box. They think unless you're sitting on a giant and expensive campus, within huge brick walls, surrounded by steel and glass, somehow you're not going to be able to learn. You can have interchange, debate, and assimilation of information with the electronic age. Any comments you could help us with on that would be appreciated.

Ms. Anita Zaenker: Those are all very good questions.

On the question of true democracy, I speak specifically about the recognition of student unions and their right to organize. We've had presentations from student advocates, student activists, particularly in Nigeria. I think of the example where many students who spoke out against military oppression were threatened with their lives. This is something that we, the Canadian student movement, can't stand by and watch idly, to see fellow students in their countries who are advocating for a more just and democratic society be threatened with their lives. Many students have gone underground, have fled to other countries, because they've been involved in a student union.

I'm sure you've heard the same from other presenters about trade unions and the right of trade unions to be recognized as important and integral components of civil society.

So we need to work with governments to recognize the important role of distinct groups within civil societies, including student unions, and I think Canada has a model where there is recognition that this dialogue and process is important to advancing a common goal.

As for removing barriers to foreign students and the issue of brain drain to Canada, I'm sure that has been and continues to be very much a concern when there are inequities in education systems between the north and the south, between developed and developing countries. There are other mechanisms to promote greater exchange of scholarship, of study and training, that don't involve increasing user fees to such high levels here in Canada that certain students will have no option to participate.

Partnerships can be forged between Canadian institutions and institutions outside Canada that allow for practicum training to happen here. In particular, we should look at ways we can work internationally to establish relationships between institutions of higher education outside Canada. Currently, there are a number of initiatives under way at many Canadian institutions that are also facilitated by national organizations that have exchanges and partnerships. Working with African countries to do the same would be important.

The Internet does provide lots of opportunity for education, and much of that opportunity is under way. There are a number of innovative projects too that use the Internet as a tool of communication between students in one country and another.

However, there is something to be said about the importance of a country being able to develop its own education system, one that reflects its values, goals, and culture. There is no such thing as a one-size-fits-all model of education. It's something that needs to be refined and shaped by the individuals it will affect.

To those extents, I would say that the Internet should be used as a tool but that it shouldn't be used as a replacement for the types of learning that will best facilitate economic and social stability and social development. We should be looking to that as an option but not as a replacement.

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The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

It has been really refreshing to have two out of five witnesses this morning so far who are young individuals such as yourself. I hope you continue the activities you may have, because as leaders of the future you need to put that thing in your consideration. We have to take your advice very, very seriously.

I have two points. One was raised by my colleague, and I'm going to bring it forward in a different way.

Recently, we announced new immigration criteria, and we emphasized higher education. Also, we discussed yesterday and are discussing today, this week, and for the next few weeks how to help Africa, especially in this case because it's hurting Africa.

If Africans are to stand up on their own and be masters of their own destiny, they need leadership. Leadership will have to come from education, yet we keep the level of our demand for people to come with degrees. African students have gone to university, paid for by their own government, their own estate, or whatever. They leave everything there and come over to this country to live a better life. I don't blame them, mind you, but at the end of the day, if the brain drain referred to earlier is hurting that country, it's becoming a vicious circle. We're taking their goods and unloading them here; then we have to load something there to deal with the vacuum. How do you address the immigration policies of our own government that are creating a brain drain in third world countries, in this case Africa?

The second point I want to make--it was mentioned by the opposition that this G-8 meeting in Alberta will cost $300 million in security expenses. Of course, this is based on what happened in Seattle, Vancouver, and most recently in Quebec City. Can you comment on this fact that people associate violence, exaggeration of expression, or, if I can use the term, freedom of expression with a meeting like this to stir up the movement? Is there a relationship there, is there reality there, or is that the way some people like to present it in order to downplay the protest of youth? If you can, please comment on those two.

Ms. Anita Zaenker: Yes. That's a very good question, and I'm going to take that one first.

There's no question that throughout history the student movement has played a role in Canada and elsewhere in shaping the future of any kind of development. Sometimes that movement has been more boisterous than the rest of society would care for it to be. I will say that students are very much concerned about the agenda at the G-8, as well as those of the World Trade Organization and the free trade area of the Americas, particularly as it affects education. As I outlined earlier, it affects us very directly, not just as to our ability to pay for education and get an education that reflects our values, but also as to shaping the kind of society we want to live in.

This desire for a more just, a more democratic society is very strong amongst young people who see that the agenda promoted by the World Bank or the World Trade Organization doesn't reflect democratic principles.

Certainly there will be a lot of students at Kananaskis, and certainly there will also be a lot of trade unionists and a lot of other civil society advocates who want to see the agenda of economic globalization reflect true democracy more and not just trade liberalization. They will be articulating that in a number of ways.

We as an organization are involved in helping to create the people's summit at Kananaskis with other organizations of civil society, to articulate a vision for true globalization. That's something we have done in the past as well, at the MAI, APEC, and so on.

As for the high cost of security, I wish to make the point again that I hope Canada ensures civil society is protected from police brutality that could happen at Kananaskis, and that certainly Canada has an obligation also to ensure diverse views are communicated, which is in part why this forum is being conducted across Canada. I think that's a tremendous initiative, and I'm sure you've heard from a number of different groups. But until the process becomes more transparent, until people can begin to see the results of their ideas and visions for a more democratic view of globalization reflected with their nations' leadership, I think you'll always get dissenting viewpoints presented in different fashions.

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The Chair: Thank you very much.

Mr. Sarkis Assadourian: Can I make a point? It's about the brain drain negotiations; you didn't comment on that one.

Ms. Anita Zaenker: One of the keys, it would seem to me, to reversing brain drain is to provide or help create the conditions in those sending countries that produce more equality and more equity. Canada is considered also to have a situation of brain drain in regard to our more powerful neighbour to the south, and that's something the opposition has made a point of stating frequently. It's not to the same extent as developing countries have with their best and brightest leaving to other nations. I think Canada's best way of helping to reduce brain drain is to create structures in those developing countries that will provide for excellence in training and education opportunities, and for creating more democratic societies where people will feel pride in investing their life's work, as well as have their contributions respected.

Mr. Sarkis Assadourian: Can I ask a short question--a very important short question?

The Chair: Go ahead.

Mr. Sarkis Assadourian: As I said earlier, I'm really happy that we have two out of five witnesses who are young, which is really good. I also appreciate the fact that young people participated in the protest, as I mentioned, in Quebec City and Vancouver. But when it comes down to participating locally here in the democratic process, there's a lack. Nobody participates. My colleagues can testify it's very difficult to bring young people to join the parties, participate in meetings, debate resolutions. It's very difficult. Why is that? Why do we focus on things every other year, or every year, but not on a regular basis in our own country here? What's the explanation?

Ms. Anita Zaenker: If I had the answer to that, I should be Prime Minister, really.

Mr. Sarkis Assadourian: Well, it's never too late.

Ms. Anita Zaenker: I think young people see there is a distinction between the parliamentary process and the forces of economic globalization. It seems at times pointless to be involved in parliamentary process, where you elect a leadership only to find that your views are subverted by market forces steered by non-parliamentary organizations such as the World Bank--non-accountable, non-democratic organizations--or where the mechanisms of accountability are so vague they're not clear.

I speak perhaps on behalf of a segment of young people who don't participate in parliamentary party structure, because they don't see that their voice makes a difference because of the unaccountable external bodies that ultimately control whether or not you pay $25,000 or $2,000 for your education. Parties and Parliament have a really strong, important role in demonstrating that they do take viewpoints and opinions into strong consideration and are actually changing structures to reflect them, to be more in the public interest.

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Mr. Sarkis Assadourian: Are we more in your favour or are we not?

Ms. Anita Zaenker: Canada is playing a good role in dialoguing with civil society--partly as a result of some of the protests that have come around since Seattle and so on. That point was made very strongly and Canada is responding more to that. This summer's summit in Kananaskis will also be another opportunity, hopefully, for Canada to say that we identified these concerns on behalf of Canadians and this is what we've put forward as an agenda. So I wish you all the best of luck on that.

Mr. Sarkis Assadourian: Thank you.

The Chair: It seems as though my members want to keep you here with them.

Mr. Day has a final question.

Mr. Stockwell Day: Further to what my colleague was saying, the proper and deeply felt concerns of the students, at least those who are at gatherings like G-8 representing students, in terms of influencing the public mind, which is why you want to demonstrate, which is why I want to demonstrate--I want to catch the public's imagination on something and hopefully move public opinion. I've been involved in those demonstrations and I will be in the future. But when a very small portion of that group, either who were at Quebec or who will be at Kananaskis, resort to violence, unfortunately your good message is diminished, if not evaporated, because the taxpaying public sitting at home says, there they go again.

I've been involved in a number of demonstrations over the years. When I was in Quebec, I saw, I would say, 98% of the demonstrators being boisterous, as you said, for sure, but trying to get a message across. But I saw that being totally diminished by the few who walk up to the police officers.... I saw someone actually spit in one officer's face. They hit her with a brick. Those front lines of police officers will take that for about 15 minutes, then they take a couple of steps back, and the fresh troops arrive. And it's very unfortunate.

On the plane back from Quebec, I talked to one of the students who was protesting there. He was very discouraged because he had watched the news and watched the write-ups, and a big part of their message was lost because of those few. So anything that we can work together on to diminish that...your message will get across.

As to what Sarkis has said, I talked to a high school student just this week in my constituency who wants to join a constituency board in my area. I was very encouraged by that. Her ideas are going to go all the way to the convention floor. As important as a demonstration is--and they are important--anything we can do or any advice you have, not just for our parties, but for all parties, to become more attractive to young people would be appreciated. Being involved in a local constituency association, bringing forward a resolution, let's say, on student fees, seeing that successfully go through a convention and eventually become policy appears to be the more prolonged process. Whatever we can do to make that more attractive and whatever advice you can give us in the weeks ahead would certainly be appreciated.

Ms. Anita Zaenker: May I respond quickly to one point? As with any movement, as with any profession, there will be some people who undertake actions that may not reflect the majority. As politicians, you're fully aware of this fact. I would encourage people to really try to view the social movement against economic globalization as being as diverse as it is, as being made up of a number of different people representing a number of different interests and concerns. That message is often not conveyed through conventional mass media, which tends to focus on the isolated incidents of perhaps interaction, brutality, and violence, as opposed to the tens and hundreds of thousands of people who turn out for events. That would be something that I would challenge you to look beyond--the images that are conveyed.

Mr. Stockwell Day: We'll work with you on challenging the media on that--to not always go for the extreme in any particular profession, but to the hardworking people, students, politicians, whoever it may be, who have an important point of view.

Ms. Anita Zaenker: Thank you.

The Chair You've taken us right up to our lunch time, and the members are willing to give up some of the hour that we prescribed for lunch, so we'll ask you to keep engaged with us in the process. We thank you so much.

We'll call for an hour's lunch break now. This means we should be back here by 1:30 p.m. That is not an hour, if I calculate correctly, but it is about 40 minutes. Let's be back by 1:30 p.m.

Thank you.

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The Chair: We are continuing our public hearings on North American integration and Canada's role in light of new security challenges and the study of the agenda of the 2002 G-8 summit.

We have with us Mr. Ernie Regehr, the executive director of Project Ploughshares, and Mr. David Albright, president, Institute for Science and International Security, Washington. Welcome, gentlemen.

Mr. Regehr.

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Mr. Ernie Regehr (Executive Director, Project Ploughshares): Thank you very much, and thanks for the opportunity for us to come visit your committee.

This afternoon we're going to have a fairly significant switch in topic from what you were discussing this morning. We're going to focus our attention on nuclear terrorism issues.

Our organization, Project Ploughshares, which is a Canadian NGO on peace and disarmament issues, has hosted two workshops and briefings on terrorism and weapons of mass destruction. Over the weekend our local affiliate in Calgary, with the support of the Department of Foreign Affairs and International Trade G-8 planning group, held a workshop to examine the full range of threats related to chemical, biological, and nuclear weapons and materials. In an all-day briefing session in Ottawa yesterday, we looked at the nuclear terrorist threat in particular, helped by Mr. Albright here as well as a former IAEA official and officials from the Department of Foreign Affairs and International Trade.

You will hear about the nature and extent of the nuclear terrorism threat and appropriate responses from Mr. Albright in just a minute, but I want first to note briefly the basis of our interest and concern regarding these issues. First, Canadians need a much better understanding of the nature and extent of the threat and the possible responses related to the danger of nuclear weapons getting into the hands of non-state actors.

Second, we think it's important to examine the threat of nuclear terrorism involving non-state actors within the context of the overall threat posed by nuclear weapons in the arsenals of states, the traditional nuclear powers, the newly emerging nuclear powers, and the threshold states.

Third, it is also important to emphasize that the response to the nuclear terrorist threat be both multi-dimensional and multilateral. It should be multi-dimensional in the sense that it requires a combination of intelligence, police work, and international cooperation in controlling and accounting for nuclear materials, as well as political, social, and economic measures in support of conflict prevention and conflict resolution. A multilateral approach is required in the sense that counter-terrorism also requires the international community to work together to build a universal, non-discriminatory, rules-based nuclear non-proliferation regime.

Fourth, and finally, we address the issue of weapons of mass destruction and terrorism in the current context to encourage you, the committee, and the Government of Canada to urge all G-8 governments to significantly increase both political support and financial resources for a multi-dimensional/multilateral commitment to addressing the nuclear threat in all its aspects.

To understand that threat better, we're very pleased that Mr. Albright, who was with us yesterday in the briefing, has agreed to stay here today. I could go into a very long introduction of him, but I won't do that, except to say that he is a physicist by training and president of the Institute for Science and International Security, as you've said. He has worked frequently with officials of the Canadian Department of Foreign Affairs and International Trade and links in Canada and has a very wide scientific and arms control publishing record. We're pleased that he's able to be with us.

The Chair: Welcome, Mr. Albright.

Mr. David Albright (President, Institute for Science and International Security, Project Ploughshares): Thank you. I'm pleased to be here.

After the attacks on September 11, we've been forced to consider a whole range of threats that we did not focus on prior to the attacks. Few expected a terrorist group to take over commercial airlines and convert them into powerful cruise missiles. We have no choice but to rethink a wide range of threats, which, while they may have been recognized earlier, were really not seen as possible. Certainly many of the threats did not invoke large investments by the international community in terms of resources and coordination.

As Ernie mentioned, I would like to discuss one such threat of nuclear terrorist attacks. In the past few decades, many efforts have focused on understanding the threat of nuclear terrorism. I've personally been involved in two such efforts, one in the mid-1980s and another one in the mid-1990s. However, there was a prevailing view that terrorists were unlikely to obtain or use nuclear weapons. In addition, while the use of a radiological dispersal device, or a dirty bomb, by terrorists was recognized, this concern rarely achieved much visibility.

What has changed? We all feel more vulnerable. September 11 attacks also continue a trend toward attacks with larger numbers of casualties. More terrorist groups also show little interest in bargaining, but instead focus on destruction and destabilization. There has also been a sobering realization, reinforced by documents found in Afghanistan after the fall of the Taliban, that al-Qaeda was pursuing weapons for mass destruction, including nuclear weapons, and was making progress in building nuclear weapons.

The analysis at my institute, which certainly was greatly accelerated after September 11, leads us to conclude al-Qaeda's nuclear weapons program was not very advanced or sophisticated. In essence, it was nipped in the bud, but its effort was growing more serious and involving foreign assistance. In essence, al-Qaeda was trying to create a quasi-state nuclear weapons effort based in Afghanistan with the collusion, or at least tolerance, of the Taliban government.

Fortunately, al-Qaeda's nuclear weapons effort has been stopped, and certainly its efforts have been severely disrupted. In essence, the campaign against the Taliban and al-Qaeda has bought us time, but great uncertainty remains about whether all the nuclear capability of al-Qaeda has been destroyed. More importantly, there is a dearth of information about whether al-Qaeda is reconstituting any nuclear capabilities, supplementing its capabilities, or planning a nuclear attack. Unfortunately, we therefore must remain concerned that a nuclear terrorist attack will occur.

We need to worry about three types of nuclear attacks: a nuclear explosion, an attack on a nuclear facility, and a radiological dispersal device. I think certainly a nuclear weapons attack is by far the most severe. I won't go through the consequences of such an attack. I will say it has been known for years that al-Qaeda wants nuclear weapons and has been seeking them for almost a decade.

However, it's very important to consider al-Qaeda's accomplishments and capabilities in this area. Toward that goal, I'd like to quickly consider two paths to acquiring nuclear weapons. One is to steal a weapon or acquire a complete functioning weapon. The other is to acquire the nuclear explosive material, plutonium or highly enriched uranium, and then attach a device.

In terms of acquiring a complete functional nuclear weapon, there have been many media reports that al-Qaeda possesses nuclear weapons. In our own view, the reports are not very credible. Our assessment is there's no evidence al-Qaeda or other terrorist groups have acquired nuclear weapons. They're not as easy to acquire as is often believed. We would conclude there is a very low probability that they will acquire functioning weapons in the future.

The other path I'd like to quickly consider is if the al-Qaeda, or other terrorist groups, acquire separate plutonium or highly enriched uranium and turn it into a crude nuclear explosive. Certainly, we worry most about Russia and the former Soviet Republic.

I forgot to mention, in the case of a functioning nuclear weapon, the concern really focuses mostly on Russia. Again, acquiring this nuclear explosive material is a great concern. A lot of money is being spent to try to bolster controls in Russia and strengthen the accounting of the materials.

So far there's no evidence that al-Qaeda has required any significant quantities of plutonium or separated highly enriched uranium. I must add, while I say there's no evidence of such an acquisition, we can't know everything. You can't know what you don't know. You have to remain concerned that there's a slight chance they've acquired something.

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If they do acquire it, they need to make the nuclear weapon itself. It would be a crude weapon. It would be fairly large. We would assess that it's within their capabilities--just--but it's not that easy to do. There are some significant hurdles to actually building a nuclear explosive device. I think al-Qaeda would need some time to do that. We do believe they were starting to work on it, and they were taking some steps that other countries have taken, which has helped them dramatically, namely, seeking foreign assistance. We believe their efforts to recruit Pakistani nuclear scientists were based on their realization that they can't do it alone.

The second type of attack I'd like to mention is an attack on a nuclear facility. I'll just mention two types.

One is the power reactor or associated spent fuel pond. Here the goal is to spread radiation. After September 11, the image of a plane crashing into a nuclear reactor became very popular. I think we're forced to deal with the question of how good security is at the world's power reactors. Are we satisfied or comfortable with the security of these sites?

Another type of site--which is of more relevance in the United States--is the nuclear weapon production site. These sites have very large quantities of separated plutonium or highly enriched uranium. So the question is, will a terrorist group seize control of a vault and try to disperse the material through explosive devices or fires--to try to achieve a criticality--or even produce a low-yield nuclear explosive? Doing that is not a high probability. It's an unexplored area, but if you've got hundreds of kilograms of highly enriched uranium and you start throwing them together, there's a theoretical possibility you could have a nuclear yield.

The last type of attack I'd like to consider is the radiological dispersal device. This is probably the one that has captured most of the public's imagination and does remain the easiest. In this regard, I think we have to assume that if al-Qaeda wanted radioactive material, it has radioactive material.

Radioactive material is quite widespread at tens of thousands of facilities, and it's poorly protected. The goal of such a device is to force evacuation of a major city or to contaminate agricultural land. There's a long history of radiological weapons in the United States, Britain, and Russia. So some of these things are understood quite well.

What isn't understood is how the public would react. There's an expectation that there would be a great deal of panic if there were such an attack. Based on the kinds of capabilities that terrorists probably have, they're not going to kill a lot of people. They're certainly going to cause radiation exposure to a significant number of people. We'll be dealing with quite a mess. We may have to evacuate significant parts of a city and then decide how we will re-occupy it and what we will actually tear down. In a certain sense, what happened with the World Trade Center may be our response to a radiological dispersal device, which is basically to tear it down and haul it away. The World Trade Center composed 16 acres. So that may be one of the solutions, if we are attacked in such a way.

What should the G-8 do with the question of the threat of nuclear terrorism? It's a very difficult issue. I'm sure there's a lot going on. But I would like to outline a few things based on our experience. The first thing is that the G-8 should review the nuclear threat. Do terrorists want to launch a nuclear attack? We don't really know. They've made it clear they want nuclear weapons. But we don't really understand very much about their actual plans or intentions. There is a widespread belief that if al-Qaeda had nuclear weapons they would use them. But I think we need to look at that more.

The other and more important thing is actually to determine the risk of a nuclear terrorist attack, based on an assessment of capabilities and opportunities of terrorists to acquire the wherewithal to launch a nuclear attack. This assessment needs to be done carefully, to calibrate the risk properly and to place it into a comprehensive terrorist risk assessment. There's a desperate need for this. I think the public also needs to know this.

The third is to figure out what steps the G-8 needs to accomplish collectively to prevent or reduce the chance of a nuclear attack by terrorists. There are many things going on in terms of protecting nuclear materials in Russia, but much more needs to be done.

I think the G-8 needs to do serious collective thinking about the threat of a nuclear terrorist attack and ways to reduce that threat.

¸ (1405)

As I've mentioned, the work is sorely needed. In terms of the fact-based analysis that exists, it isn't very good on the nuclear terrorist threat. In the United States it has led to two points of view. One is you either dismiss the threat or you create a shadow government, and we haven't quite worked out our proper response to this. The G-8 can play a productive role in creating an international consensus on both what is the risk and what to do.

I also think the G-8 needs to act collectively to implement a plan to reduce the threat of nuclear terrorism. I would also add that such an approach is not only important in the nuclear area, but also in the chemical and biological areas.

I'd like to conclude by picking up something that Ernie said, which was that in attempting to reduce the risk of nuclear terrorism, we should not lose sight of the importance of international arms control and of efforts to achieve nuclear disarmament. An international foundation that creates controls over nuclear weapons, nuclear explosive materials, and nuclear activities in general is necessary in fighting nuclear terrorism. In addition, bolstering international norms against chemical, biological, radiological, and nuclear weapons and attacks is also important in our fight against terrorism. With a strengthened foundation for arms control and disarmament, the chances of preventing a nuclear terrorist attack will be much greater.

The G-8 should reconfirm its commitment to arms control and state that achieving international arms control and disarmament agreements is a vital part of the global effort to prevent nuclear and other WMD terrorism.

Thank you

¸ (1410)

The Chair: Thank you, Mr. Albright.

Mr. David Albright: I apologize for this. I waited until I got up here to produce my testimony, and I didn't bring a computer.

The Chair: It's okay. I will say that the Americans have not yet gotten the new technology, because we allow you to cross the border with it.

Thank you.

We'll go to questioning. Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair, and thanks to both you gentlemen for your time in offering your expertise, insight, and advice to us.

I understand, Mr. Albright, that you have personal experience in terms of being in Iraq. Can you tell me, as a layperson, even if you're granted access, how could you ever know, with all your good efforts and good intentions, that in fact a potentially hostile country, albeit letting you come in to inspect, is letting you see all the possible sites where either a nuclear capability could be being developed, albeit in a limited way, as you're suggesting, or biological products are being made? How can you have any sense of knowing you're being shown all the sites, as it were?

Mr. David Albright: You assume they're not going to show you all the sites. Again, the situation in Iraq is that the inspections are implemented as a consequence of ceasefire agreements. It's not international arms control, and so you assume they're cheating.

I don't know the biological and chemical and missile area. I worked with a group in Vienna, the International Atomic Energy Agency, on nuclear, and on the nuclear it's easier. You can design a system that will give you pretty high confidence--never 100%, but pretty high confidence--that they don't have undeclared activities. The only exception is if they acquire fissile materials, plutonium or highly enriched uranium in Russia. You may not be able to detect that. Iraq can make a nuclear weapon if they have the nuclear explosive material. With that exception, you can approach 100% confidence that they don't have an undeclared facility able to make highly enriched uranium, for example, for nuclear explosives. It will take them time. Actually, prior to the inspectors leaving in 1998, the system had been worked out in great detail.

On the biological weapons, I don't think we'll ever have high confidence that they don't have biological weapons. What you fall back on there is that you'll get lucky, there will be a defector--and that you're deterring them, and member states are cooperating to try to increase the ability to find out things and to deter Iraq.

I'm not sure that's a satisfying answer, but I would just say that I think the inspections are extremely valuable and they should go back in as soon as possible. They can provide a useful test of whether Saddam Hussein is going to comply with the Security Council on this issue.

Mr. Stockwell Day: I agree about the importance of the tests.

I'll ask you also then what advice or insight would you give to policymakers who are trying to convince other nations of the need to confront a potentially belligerent country that is developing biological or nuclear weapons--if that is indeed within the realm of possibility--while at the same time encouraging these countries to disarm.

As I say that, I see the lack of sense with a MAD approach, let's say, to biological weapons. If we know somebody is making nasty biological weapons that can kill off a city over a period of a week, it doesn't really help us if we are developing those too. It's the factor of deterrence.

Especially with the United States--and to a degree in Canada--how does one sell the argument that we have to press toward disarming, especially in a nuclear sense, when there is a very clear possibility that--albeit in a limited way--there are belligerents who are arming?

¸ (1415)

Mr. David Albright: You have to do it with your eyes open. There are cheaters, and how to deal with people who are violating their commitments is a major issue in arms control. I believe Iran has a nuclear weapons program in violation of the non-proliferation treaty. We need to have a strategy to deal with Iran.

And we don't know. Right now, it's touch and go. Iran feels equally what's going on in Iraq. It is a target of an Iraqi nuclear weapon. Iraq probably would have used nuclear weapons against Iran in the 1980s. So I think you have to look at these cases.

In the case of North Korea, I think there a policy of engagement has been the best approach. North Korea violated its agreements, but to avoid war on the Korean peninsula it was decided that there would be a set of incentives for it to come into compliance. I think that's working. But again, it's hard.

Right now you have to deal with these things on a case-by-case basis, but you have to be fully aware that these countries are going to cheat. You have to confront it.

I don't believe military force is that effective. Certainly I'm not for it. But we may have to do that in Iraq. I would just say it's not a question of overthrowing the regime; it's a question of Iraq complying with its commitments under the Security Council resolution. I think the Bush administration is mistaken to turn it into an issue of regime change, kind of a country's personal vendetta.

On the other side, we want these laws. In a sense, it's really just trying to create on the international level what we have in a nation. We want laws, predictable behaviour, people held accountable. We should strive for a higher form of morality. I think nuclear, chemical, and biological weapons should be seen as illegitimate things.

Speaking as a U.S. citizen, we have nuclear weapons. I'm not sitting in the United States advocating that we give them up now, but I do believe that under the non-proliferation treaty, we should take seriously our commitment to get rid of these weapons over time.

Thank you.

The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much. It's refreshing to have a point of view on this issue that's different from George Bush's.

Mr. David Albright: We see eye to eye on many things.

Mr. Sarkis Assadourian: Every time there's a discussion of terrorism or nuclear weapons or weapons of mass destruction, we lump together the Arab countries or the Muslim world, and we give the September 11 tragedy as a reason for doing so.

I'm sure your memory is as good as mine. The bombing in Oklahoma City happened because of a so-called American mercenary. I understand it was mentioned at that time that there were 300,000 to 500,000 members of this mercenary force who thought of the U.S. government and Congress as enemies of the people that they must destroy. For this reason they bombed the building in Oklahoma and killed 200-plus innocent people.

Soon after September 11, 10 or 15 people died in an anthrax letter campaign. It was, again, a homegrown weapon for mass killing. The FBI and CIA said it was done locally, not through a foreign government. And the letter-bombing campaign last week in some rural area mailboxes was again the work of a local individual.

I know from newspaper reports all over the country that high-grade weapons materials are stolen more in the U.S. than anywhere else in the world.

I'm trying to say there is more danger in our own backyards, but experts like you come here and only talk about one segment of this and totally ignore locally grown terrorism here.

I want to make one more point before I ask you for the answer. When the September 11 attacks occurred, a reporter in Ottawa phoned me. After a discussion of a few minutes, I asked her why she had called me. She said, “Oh, you're from the Middle East”. I said, “Okay, good. Did you phone the Irish members of Parliament when McVeigh bombed Oklahoma?” When she said no, I asked why not. She said that was a good question. I said, “When you get the answer to that question, get back to me.” I'm still waiting.

Why do we associate things happening with one group--rightly so--and forget the other one? It is wrong to forget, because killing is killing. I don't care whether I'm shot by an Arab, an American, or a Canadian bullet. It doesn't matter; I'm dead. That's the way I feel. That's the point the Oklahoma victims' families made when they said, “Why are you looking at these guys from a different point of view from those who died in Oklahoma?”

I'm just saying there seem to be two standards. Tell me if I'm wrong.

¸ (1420)

Mr. David Albright: I can only speak for myself. We study anybody who tends to get nuclear weapons, whether it's a nation anywhere... and a terrorist group can be anywhere. In the study I was involved with in the mid-1980s, we searched around for terrorist groups that might have had the capability of making nuclear weapons. The effort was focused on Germany and the Red Army Faction, and no Middle East terrorist groups even came under our purview. We just thought they weren't interested and they didn't have the technical capability.

From our point of view, we look at anybody or any country that seeks nuclear weapons. We don't distinguish between nuclear weapon states and non-nuclear weapon states.

In terms of the terrorist threat, we've been focused on al-Qaeda because we do assessments of secret programs. We know, in theory, terrorists can make nuclear weapons, and it may be a U.S. domestic group that eventually does it. But we need real concrete information in order to try to understand the risks, etc.

Mr. Sarkis Assadourian: Are you saying you don't have any information that U.S. terrorist groups--

Mr. David Albright: Have ever tried to make nuclear weapons? We have none, really.

Mr. Sarkis Assadourian: Is it the same thing with anthrax--

Mr. David Albright: But that's a real case. The anthrax case is interesting, but we don't work on biological weapons in the same way. That's a very interesting case to understand and pursue.

In terms of the material in the United States, you're quoting information about material accounting. I was actually involved in trying to track down about a tonne of plutonium. It was in nuclear waste in Idaho. It was unaccounted for, from a weapons production site near Denver, but it was accounted for, as well as you can account for material on a waste site. There was a determination that nothing had actually gone missing or been stolen.

I think the U.S. has declassified a lot of information about material accounting, which other countries haven't done. I think if they did it, particularly in places like Russia, you would see just huge numbers. But it's an accounting phenomenon more than a statement that material is missing.

Mr. Sarkis Assadourian: I have one final question. The President named Iraq, Iran, and North Korea as the axis of evil. Which one of them, in your estimation, is the most dangerous?

Mr. David Albright: I wouldn't use those terms. We call them proliferative states and countries of concern. We've tried to engage with Iran. We certainly support engagement in North Korea and are starting to make direct contact with the North Koreans. So I don't think these kinds of terms are helpful.

On the biggest threat, it's hard to know. There's a sense that North Korea could have nuclear weapons soon, if it chose to. Some say it has some hidden away.

The Iraqis are not seen as possessing nuclear weapons, but there's growing uncertainty as to whether that's really the case as time with no inspection increases. Intelligence has proven itself miserable at predicting proliferative behaviour.

¸ (1425)

Mr. Sarkis Assadourian: Then why focus on Iraq?

Mr. David Albright: I think there it's reaching ahead and they're in violation of the Security Council. There's a few... something has to be done.

I don't want to predict, but I think there is a growing recognition in the United States that some of these commentators and some of the people at the Pentagon got ahead of the game. I mean, if you think about us attacking Iraq, it's really going to be U.S. forces, maybe some British, but probably not anyone else. And assuming we could get Saudi Arabia, or just Kuwait and Turkey behind us, you're creating a very hard problem--not you, but a regime change policy creates a very hard problem for the military.

One is, Saddam knows he's going; therefore, any weapons of mass destruction are probably going to be used. What does he have to lose? So we have to protect our allies, troops, citizens in the Middle East. I mean, God knows who Saddam will target. You would certainly think Saudi Arabia and Israel, so those people have to be protected. Then you must also think about the issue of the day after. Are we going to occupy Iraq indefinitely?

I think there is some reassessment that's starting to happen, that what this is about is Iraq complying with the Security Council resolutions. If they don't comply, then the international community, led by the United States, can take action. But if they comply, we'll have inspections and try to make the thing work as well as possible, and then respond if there's non-compliance later.

Mr. Sarkis Assadourian: Okay. Thank you.

The Chair: Thank you, Mr. Assadourian.

Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair.

To Mr. Albright, perhaps you can give me a perspective from your point of expertise. If the present administration is determined to and continues to develop the potential for national missile defence, possibly space-based, would that not be a deterrent to nations, certainly those looking at ballistic nuclear capabilities? If there really was a thought that the chances were pretty good that their attempts would be successfully knocked down, would that not take the edge off a destruction program?

Mr. David Albright: I'll give you a technical response and a human response.

I think anything one can do to protect one's own people needs to be thought through. I think our awareness of that was heightened after September 11, so it makes sense to have missile defence systems from that point of view. Technically, the problem has always been that you can't build them in a cost-effective way. The other part is, is that the most important risk to deal with?

There's been a lot of debate. Is North Korea really going to launch a missile against us? Is Iran? Certainly, Iraq would try, but they're pretty far from having an intercontinental ballistic missile. There is a consensus, I think, to develop the system, to understand it. Where there's a divergence is whether it makes sense to deploy it.

I don't think that battle has really been fully fought in the United States, because funding is going to be a budgetary battle. I think, post-September 11, there's so many things we have to spend money on that I would personally opt to spend the money on the more immediate threats, not just nuclear. There's a range of threats that we face and need to protect ourselves against, and expenditure in that area makes more sense.

I would see how things go. I think North Korea may come around. We'll know soon. The inspection process there will tell us all and that should start within a few years.

Iran is a tougher problem, but there's also more time there. I think there is still assessed to be ten or.... I don't want to keep saying 2010, but I don't think they could have an intercontinental ballistic missile before 2010 or 2015.

Mr. Stockwell Day: Did you say Iran is a potentially bigger problem just because of their technical capabilities?

Mr. David Albright: Well, they're getting a lot from Russia. It's a huge amount of assistance on missiles from Russia that hasn't stopped completely, and soon Iran will be somewhat self-sufficient. The other is that Iran has this problem with Iraq. The U.S. doesn't really have a policy on Iran, other than isolation, and the reformists in Iran haven't become dominant.

There are a lot of forces there that may push Iran in what I would consider an isolationist way. There are other forces, and we were part of an effort to bring them into an international security arrangement where they would depend on the international community more for their security against countries like Iraq.

¸ (1430)

The Chair: It seems to me, Mr. Albright, that most of this is discussed under the rubric of secrecy. I just wonder how the G-8 could discuss this without a lot of that information being made public, because one of the things that I would imagine they attempt to do is not to have the public alarmed with this discussion about terrorism, especially the kind that's radioactive and otherwise.

Mr. David Albright: Certainly part of it would need to be secret, but I think there is need for a public discussion. We see in the United States tremendous concern about, say, a dirty bomb, and you see reports that are preposterous, that a simple dirty bomb is going to make Manhattan uninhabitable. So from our point of view, there's a need for countries to engage on this debate in a public manner, for a couple of reasons. One is, we don't want our people scared. The other is, we don't want a terrorist weapon to be so effective. A radiological dispersal device of the type that a terrorist would launch is really intended to cause panic, so we should work through education to reduce panic.

The Chair: In your experience, what is a copycat syndrome?

Mr. David Albright: Oh, that's out there. It does happen, but these things have been so widely reported that if someone wants to do it, they'll do it.

Unfortunately, nuclear accidents happen. That's why we understand radiological dispersal devices better, because there have been nuclear accidents involving radioactive sources. I think there will be more nuclear accidents, and I also unfortunately think there will be a radiological dispersal device attack somewhere in the world.

Mr. Stockwell Day: Sorry, what kind of attack?

Mr. David Albright: An attack by someone dispersing radioactive material. So on that one, we'd better get prepared. We have to educate people more about the effects of radiation; we have to have better preparation by local and national governments on what steps to take in terms of evacuating people, controlling access to areas, understanding that even if an attack has happened...

One of the types of attacks that could happen is that someone sets a radioactive source out in public in a very crowded place and there is no explosion.

A voice: Chechnya.

Mr. David Albright: That's right. They put it in a park in Moscow and called a reporter.

There was an accident in Brazil where four people died because they didn't know they were being exposed to radiation from a source.

So we have to think through all those things, and I think the G-8 can play a productive role because intellectually we're not there yet on understanding the threat and then thinking through what to do.

I think it needs to be international. It doesn't help if it's done in the United States and then nothing is learned in Russia or in Europe.

The Chair: Could I ask you to tell us very briefly about the state of nuclear weapons in Russia? You've mentioned Russia few times. Do you know what material or what is there right now?

Mr. David Albright: The number of nuclear weapons is better understood, but not fully understood. Russia still considers this quite secret.

On the nuclear explosive material, there is great uncertainty in estimates of how much Russia has--20% accuracy is about what we've seen. On highly enriched uranium stocks, which number around a thousand tonnes, there are a lot of question about whether the Russians even know how much they have. They didn't run a system so that they would account for this. We didn't either, originally, and I think we woke up in the 1970s and spent billions of dollars to improve the accounting.

In fact, what your colleague was referring to was accounting procedures that were done back in the early days of the bomb program, where they really didn't know where the significant amounts of stuff were. So in the case of Russia, it's very important that countries put pressure on Russia and provide funding to improve the controls over the nuclear explosive material and also work to dispose of this material. With the highly enriched uranium, you blend it down to low-enriched uranium and you don't have to worry about it any more.

The Chair: Maybe I'll ask one final question, just out of curiosity.

Mr. Regehr, how is Project Ploughshares funded? Is it through membership? Could you say just a few words about that?

¸ (1435)

Mr. Ernie Regehr: Yes, I'd be pleased to.

We're a national organization sponsored by the Canadian Council of Churches, and our main source of funding is from a national donor base of 8,000 to 10,000 people. We have an active fundraising campaign and raise about half a million dollars a year from Canadians; that's an average of about $60 to $70 per donor per year. Then we raise a roughly equivalent amount from foundations, the Department of Foreign Affairs, CIDA, and the International Development Research Centre. So we have a budget of about $1.2 million.

We do some work in the Horn of Africa on security issues--research into small arms programs.

The Chair: And the Sudan?

Mr. Ernie Regehr: In the Sudan we have an active program of track two diplomacy that relates to the official peace process. We work there with a partner agency based in Nairobi--the Africa Peace Forum--on informal diplomacy and informal reconciliation activities related to the Sudan conflict.

The Chair: Thank you.

We'll take this opportunity to say thanks for joining us, for being very patient as we did little bits of business in between hearing you and having you wait after the lunch hour. I notice you were here before lunch. We appreciate this; thank you very much.

Mr. Albright, all the very best to you in the work you do, and thank you. Come again.

Mr. David Albright: Thank you very much for having me.

Mr. Ernie Regehr: Thanks a lot.

The Chair: We'll have a five-minute suspension.

¸ (1436)

¸ (1440)

The Chair: Continuing with our witnesses, we have, from the C.D. Howe Institute, Ms. Danielle Goldfarb, policy analyst. You have ten minutes to make a presentation, and then there'll be questions from the members. Please begin.

Ms. Danielle Goldfarb (Policy Analyst, C.D. Howe Institute): Thank you, and good afternoon.

I'm pleased to appear before you today to speak on shaping an agenda for the future of the North American relationship. I'm particularly pleased because the C.D. Howe Institute has recently launched a series of papers on precisely this topic. Our series is called “The Border Papers”. The first article in that series, written by economist Wendy Dobson and published in April, is called “Shaping the Future of the North American Economic Space”.

Today I'm going to talk about a number of the issues this series will address in the coming year, and I hope it can contribute to the work of your committee. In my brief comments I'm going to speak about Canada's key interest in the North American relationship and describe the type of broad strategy I think would most effectively meet those interests.

I would define Canada's key interest in the Canada-U.S. relationship as obtaining secure access to the U.S. market in terms of reducing obstacles to the flow of goods, services, capital, technology, and people while at the same time maintaining control over policies that are important to meeting our social and economic objectives as a country, such as determining the profiles and numbers of permanent immigrants.

If these are our ultimate goals--secure access to the U.S. market while not impeding our ability to pursue the economic and social goals of the country--then what strategies do we currently use to pursue them, and are they effective? If I had to use one phrase to describe how I believe Canada manages the Canada-U.S. relationship today, it would be on an as-needed, reactive basis--issue by issue, event by event--with NAFTA as a framework. This is not necessarily a bad thing, but it's not a strategic vision of where Canada wants the North American relationship to go.

I would argue that at times, this as-needed, event-by-event approach does seem to work. For example, we have the NAFTA chapter 19 trade dispute resolution mechanism, and it has provided a reasonably good check on the overzealous use of U.S. trade remedy laws. A lot of practitioners have noted that rulings under the chapter 19 mechanism have been based on law rather than politics.

So working within that current framework, improving it and dealing with problems as they arise, is probably a good thing for Canada.

Similarly, in the post-September 11 period, the Canadian and U.S. governments have moved quickly to improve border management, both in economic and security terms. This was an important move to fix border congestion, a problem that existed long before September 11.

There are appropriate times for using the framework we have for reacting to events and dealing with issues and change incrementally as problems arise. But there are other times when this approach fails terribly in meeting our goals of increased access to the U.S. market, as has hit home all too painfully in the recent softwood lumber decision. In that dispute, a number of powerful U.S. interests won out over Canadian interests, and even other U.S. interests. For obvious reasons, the U.S. political system failed to look out for Canadian interests.

With respect to border management, joint work at the border to ensure continued access to the U.S. market has been an impressive reaction to the threat of a seized-up border as a result of September 11. We've focused on fixing what is broken and making it better through the use of technology.

But as time passes from September 11, interest in the border will fade. In the event of another terrorist attack--we don't know where it is going to come from, but it will obviously come in a different form from the ones we've seen previously--the U.S. will not hesitate to shut down its international borders. This, of course, will threaten Canada's long-term interest to secure access to the U.S. market.

So while I would argue that the smart border declaration is a really important and necessary step, something the government should be commended for, it is an insufficient step. It's making incremental improvements to the existing framework rather than a proactive step in terms of a fundamental rethinking of what the purpose of the border is, what we need to do at the border, and what we could do elsewhere.

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The Chair: You speak beautifully, but you speak very quickly. Our interpreter is translating in French and is really trying to catch up with you.

Ms. Danielle Goldfarb: I appreciate that. I'll speak more slowly.

Where an as-needed approach is not working or is insufficient to enable us to have secure access to the U.S. market, we should really start thinking in terms of a proactive big vision or big framework, so that, for example, with the next terrorist attack, or prior to the next softwood lumber battle--we could argue we are already in the midst of the next softwood lumber battle--we already have a vision of where we want to be. A big vision could really open up new bargaining possibilities in which Canada could leverage its advantages in exchange for what it wants and would otherwise be unlikely to obtain if we continue to use a piecemeal approach.

In developing such a big vision, we need to be acutely aware of U.S. interests. A great vision, or a great framework, no matter how interesting, proactive, or beneficial to Canada, will effectively go nowhere in terms of the Canada-U.S. relationship if we are not able to engage the Americans.

The U.S. now has a priority interest in security above all--security at the border, energy security, and continental defence. An advantage of a big vision to engage the Americans is that it would deal with the big picture, so it would be harder for single-issue lobby groups, particularly in the U.S., to hijack the process, as they did, to a large extent, in softwood lumber.

One potential policy vision that could draw U.S. attention to Canadian concerns is a Canada-U.S. strategic partnership. Wendy Dobson, in her first paper on this for our institute, talks about this in more detail. In this type of strategic partnership, each of Canada and the U.S. could identify a package of initiatives they would be willing to cooperate on in order to achieve their goals.

Canada could ask, for example, to eliminate U.S. anti-dumping and countervailing duty laws--something we could never hope to achieve without its being framed in terms of a larger package of initiatives. And the U.S. could, for example, be interested in greater energy security and defence cooperation. By identifying interests of both parties, we can interest the U.S. in meeting Canadian goals and can thus achieve more secure access to the U.S. market.

I just want to briefly consider two areas that could potentially be included in a strategic partnership such as I'm speaking about: one is the potential to link to or adopt the U.S. dollar, and the second is the increased integration of our defence policies. Evaluate those two possibilities to see whether they meet the test of (a) being in Canada's interest, but (b) being interesting enough to the U.S. to get it to focus on Canadian interests. If they do meet those two tests, we might want to include them as part of the strategic bargain.

Some argue that in the context of Canada's increasingly being integrated with the U.S., Canada should link to or adopt the U.S. dollar to reduce the costs of cross-border transactions. The question here is whether the gain from the reduced cost of transacting cross-border is more significant than the loss of control over monetary policy. If the answer to that is yes, then adopting or linking to the U.S. dollar might be in Canada's interest. But really, the answer to the question of whether the loss of monetary control is worth it is not completely clear. Furthermore, in order for such a policy to work in Canada's interest, Canada would require the U.S. Federal Reserve Board to make a number of concessions, such as, for example, providing a chair on the board of the Federal Reserve or providing liquidity support. But the key question here is what incentive the Federal Reserve has to make any of these concessions. What's in it for the U.S.? Canada would probably have to give something up to get the Federal Reserve to make these concessions.

So this idea of linking to the U.S. dollar, though it could in theory improve cross-border trade and be beneficial, would allow a loss of control over monetary policy; furthermore, it would not be able to interest the U.S. in Canadian needs.

With regard to defence policy, I believe it's in Canada's interest to be more engaged in North American defence. It's not costless in Canada to choose not to participate in a number of American-led initiatives such as the new Northern Command. By choosing not to engage itself, Canada loses out on the ability to influence decisions that affect its soil and it also loses out on potential intelligence information. From the U.S. side, the Congress and administration are clearly focused on security, as we all know, and all policies that are framed in this light will appeal to them. So defence integration, being in both Canadian and American interests, may be a potential card Canada could use as part of a package to gain more secure access to the U.S. market.

These are just suggestions or ideas. There are other areas we could think about as potentially playing a role in a strategic partnership, such as energy security, for example.

I just want to point out that a vision that includes this type of strategic cooperation, or a bigger-picture idea, does not necessarily mean Canada could not or should not continue to make improvements on existing NAFTA structures in a sort of incremental way--such as, for example, by extending the NAFTA visa program to technical personnel. Similarly, a vision that interests the U.S. does not necessarily mean Canada would have to harmonize to the U.S. standard.

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Mutually recognizing each other's standards would greatly facilitate movements between our countries without harmonizing policies. That has been done quite successfully in Europe, for example.

In brief summary, I believe incremental changes are both necessary and important, but will not ultimately draw U.S. attention to Canadian interests. Crisis management does not make a vision. Canada should initiate a bold, proactive strategy to achieve its goals in the North American sphere. The C.D. Howe Institute, as I mentioned, will be publishing in the course of the next year a number of papers on a number of the themes I have raised in much more detail than I've raised today, so I hope that can contribute to your committee's work.

Thank you.

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The Chair: Thank you. I like the way you made the arguments. You posed the questions and you attempted to answer them. But we have some questions that we'd like to pose to you in turn.

Mr. Stockwell Day.

Mr. Stockwell Day: I have a couple of questions, one which we entertained earlier today with one response, and I'd be interested in yours. In your closing comments, you talked about mutually recognizing not only each other's standards, but needs and the harmonization of policies. You mentioned in Europe they seem to have done that more satisfactorily or in a more effective way. What have been the impediments in your view to that degree of harmonization with Canada and the U.S., where historically we are closer culturally--I don't want to offend any Canadians who might take offence at that--to the United States than many of the European countries, which have wide open borders, total harmonization when it comes to visa policies, trade, etc.? What has impeded us from having that higher degree of harmonization, in your view? It would be interesting to know.

I agree with what you're saying related to crisis management as opposed to a longer-term view. Certainly our perspective is that we saw that in the softwood lumber dispute. There wasn't enough preparing of the ground beforehand to try to avoid that. But are either you or the institute going to have some detailed examples of how crisis management can be avoided on some specific issues, some which you might see as part of the big vision issues?

Also, you've articulated the debate in terms of dollarization. Again, does the C.D. Howe Institute have a position on this? You've put the question “if”--if the merits of dollarization are of more benefit than losing monetary sovereignty. Are you developing a position, or do you have one now?

Ms. Danielle Goldfarb: I'll start with the last question first about dollarization. The C.D. Howe Institute will be publishing something in the next couple of months on this. But I should say that the C.D. Howe Institute has not taken a policy in the past. We've published papers on both sides of the debate with respect to dollarization. I'm not going to go into it in too much detail, except to say it is a question of balancing whether the benefits of dollarizing or linking to the U.S. dollar in some way.... A common currency option is probably not feasible in terms of U.S. interest. There's probably no U.S. interest in developing a third common currency. So the only option available to Canada is probably linking in some way to the U.S. dollar or adopting the U.S. dollar.

This study that I'm talking about in the future will examine the question of whether the benefits of a reduced cross-border friction from using the U.S. dollar exceed the loss of control over monetary policy, and whether Canada would be able to gain the concessions it needs from the U.S. Federal Reserve that would enable it to continue to maintain what it thinks are effective policymaking levers.

I'm not giving you an answer to the question, except basically to say it's going to be a cost-benefit analysis and it's not clear if the benefits of doing so exceed the costs. We're going to look at that in more detail, so you should expect something from us on that.

On the question of crisis management--and you asked how we avoid crisis management and whether we're going to have something on that--I want to clarify one thing. One of my main points was that we still need to deal with crises. That's just the way of the world. Simply, if you have a framework in place, if we have pre-decided upon a vision, when a crisis occurs we can respond with the common vision and not fall back on dealing with that issue in isolation. That's the broad answer to that question. But, again, in the course of the next year we'll be elaborating on those types of issues.

On the question of mutual recognition and Europe and what has impeded that degree of harmonization in the Canada-U.S. relationship, I should point out that the European Union has been in development for many more years than the North American community, if we could call it that. It's a project that has developed over a long period of time, and we have not had that same long period of time for the development of the North American community. It would be unrealistic for us to expect what happened in Europe over 50 years to happen in North America in a really short period of time.

Having said that, I do think there are some reasons.... In Canada we have this view that we have to have distinct policies so that they are distinct, rather than thinking about what is in our social and economic interests. I think it's a mistake for us to pursue distinct policies simply so that they are distinct. We need to pursue the policies that are in our economic and social interests. I don't know what the solution is to convincing people of that.

The advantage of mutual recognition is that it requires us to say we recognize your standards as appropriate standards and you recognize our standards as appropriate standards. That doesn't mean you have to change your standards or we have to change our standards. I think that is potentially much more politically feasible, and it doesn't require us to harmonize to the U.S. standard. That's a potential way of moving this relationship forward and ensuring more secure access to the U.S. market while avoiding this issue of requiring harmonization.

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The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

Earlier we had witnesses from York University, the University of Toronto, and the United Steelworkers of America. They all said basically that NAFTA stinks. They said we are better off without NAFTA, and if the FTAA is going to go on, it's going to be worse than what we have. They said the WTO is the way to go, because the WTO is based on law and rules, and the NAFTA and FTAA are based on politics. Can you comment on those suggestions?

The Chair: I don't think they used the word “stinks”.

Some hon. members: Oh, oh!

Mr. Sarkis Assadourian: They're saying we are worse off with them. We're losing cooperation here; we're losing sovereignty; everything is bad.

Ms. Danielle Goldfarb: I would disagree. I won't use such strong terminology as you've used to describe their position.

As I spoke about briefly in my remarks, I think a lot of mechanisms that we have in place in the NAFTA were put in place specifically so that decisions are made based on law rather than on politics. One of the ones I talked about was the NAFTA chapter 19 trade dispute resolution mechanism, where practitioners who are involved in this from all three countries have said that in fact when there have been trade disputes, they have been decided on the basis of law rather than the U.S. Congress.

This rules-based framework is very positive for Canada. Any rules-based framework is very positive for Canada, particularly in the North American relationship, where we're dealing with an asymmetrical relationship between Canada and the United States. The United States and Mexico also constitute another asymmetric relationship. There are a number of rules in place already in the NAFTA that actually help Canada, and we're better off than if we did not have those rules in place. One of the things I argue for is a more established rules-based framework, one where we're expanding that beyond what we have currently.

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Mr. Sarkis Assadourian: Do you think the softwood lumber decision by the U.S. or their Farm Bill is based on the rule of law or the rule of politics? We've lost 100,000 jobs.

Ms. Danielle Goldfarb: Well, okay. I would say that this is the one notable exception. It goes back to what I argued previously, that we have some frameworks in place, but that we need to build on what we have and to think about things with a bigger vision, because a lot of issues continue to be decided by U.S. politics. I'm arguing that now we have a lot more decisions that have been taken on the basis of the rule of law. In fact, the chapter 19 dispute resolution mechanism has actually reduced the penalties in some cases, in previous softwood lumber debates, for example.

I think we would be worse off in the absence of that mechanism, but we need to build on what we have. Clearly, the framework we have in place is not strong enough to deal with a number of the serious disputes that have been going on for a long time.

Mr. Sarkis Assadourian: How do you assess the WTO, then?

Ms. Danielle Goldfarb: As to Canada's interest in the WTO, I think that for the same reasons I've suggested with respect to the NAFTA, Canada has a strong interest in ensuring that the WTO functions effectively and that it is also a rules-based system. Then if they have disputes, their size is not what matters, but the law and the rules are what matter. Canada always can benefit from a rules-based framework.

Mr. Sarkis Assadourian: I have one final, short question. Do you think there is less political involvement in NAFTA than in the WTO or more in the WTO than in NAFTA? In which one are decisions made according to political interest?

Ms. Danielle Goldfarb: I confess I'm not quite sure how to answer that question. Within the North American community, yes, there are decisions made on the basis of politics, but it would be quite difficult to measure in some way how decisions were made more on politics than based on law. In the absence of those systems you'd have more decisions based on politics rather than on law, but I don't know about one organization versus the other.

Mr. Sarkis Assadourian: You'll have to come back.

Ms. Danielle Goldfarb: Okay.

The Chair: You have an open invitation. We're looking forward to further papers you will be doing, especially if you are going to be approaching some of the topics you more or less put out in your presentation to us.

Do keep engaged with us in this process, and we thank you for joining us today.

Ms. Danielle Goldfarb: Thank you very much. No problem.

The Chair: We'll just suspend for a few minutes.

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¹ (1516)

The Chair We'll continue then with Diane Richler, president-elect and secretary general of Inclusion International.

Thank you for waiting and for being so patient. You have about ten minutes to speak to us, and then we'll engage you with questions.

Thank you very much.

Ms. Diane Richler (President-Elect and Secretary General, Inclusion International): Thank you very much.

It really is an honour for me to appear before this committee. It is the first time for me to appear before the committee in my new role as president-elect of Inclusion International. I'll be assuming the presidency in September.

Inclusion International is a federation of about 200 national federations in about 115 countries. The cores of these organizations are the families of sons and daughters who have a disability. The Canadian member is the Canadian Association for Community Living, with whom I had worked previously and on whose behalf I had appeared before this committee previously.

Inclusion International is one of the seven disability organizations recognized by the United Nations. Our main purposes are to promote the rights of people with disabilities at the international level and to support our members to play that role more effectively both at a national and regional level.

I'm here today particularly to address our concerns regarding the upcoming G-8 meeting and the Africa and education initiatives in which Canada plays such important roles.

I'd like to give you a little bit of the international context facing people with a disability, and their families. The United Nations, from our point of view, uses quite conservative figures. They estimate there are approximately 600 million people with disabilities worldwide. They base it on estimates of between 6% and 10% of the population. We know in Canada, where we have more reliable data available, Statistics Canada places it at closer to 18% of the population. We would think the 600 million figure is quite low. Even with the data, the United Nations estimates over 300 million individuals with disabilities are living in countries in transition.

The UN also acknowledges that disability has increased in the past ten years as a result of famine, drought, malnutrition, war, and national disasters.

I was really appalled recently at a meeting in Costa Rica with the rector of the UN University for Peace. He pointed out that when they look at current developments in Africa and the impact particularly of malnutrition, compounded by all of the other factors, they're looking at the next generation overwhelmingly being a generation of people with intellectual disabilities. When we talk about people with disabilities, we're not talking about a sector of society separate from the mainstream. We're talking about almost every family in countries in transition being directly affected by having a family member with a disability.

The impacts and costs are paid for at a number of levels. Individuals who have a disability pay by being among the poorest of the poor, undereducated, marginalized, and more often victims of violence. Families pay the price by having a family member who has a disability and trying to figure out how to provide support for someone who is not pulling weight economically within the family. Communities pay with the social alienation and social unrest of undereducated and alienated populations. Nations pay the price of reduced productivity and increased dependency.

Some of the research we've done in the past indicates most current attempts to address the challenges facing people with disabilities have not been successful, primarily because they focus on providing specific services and rehabilitation that, alone, can't address the sources of inclusion. What is required is a human rights approach that “focuses on structural causes of problems, as well as manifestations...of problems”. In that, we are consistent with CIDA. The last words I read were in fact a quote from a CIDA document. However, in a recent press release on the new education action plan, CIDA cites only 2% of children with disabilities are currently receiving any educational service in countries in transition.

I come here today with some very specific requests. I need to keep remembering, in my everyday activities, I'm not only wearing a Canadian hat; I'm wearing an international hat. In Africa, we have member associations in virtually every country.

I've had the privilege of being at two seminars recently, one bringing together representatives from 40 countries, the other bringing together representatives from west Africa. They were unanimous in their pleas to those of us from donor countries on the impact the G-8 meeting can have in changing the lives of individuals with disabilities and their families on the continent. They've seen some positive signs, some of them very subtle.

The fact that Dr. Len Good, the president of CIDA, is also chairing the G-8 task force on education has, for the first time, opened up G-8 consultations around education to civil society organizations and given the organizations in Africa a chance to have their voices heard. But when the families we've met with went through the NEPAD document themselves--which they had highlighted and marked up and knew back to front--they could not see themselves in it; they could not see their sons and daughters in it; and they could not see what the focus on a primarily economic agenda was going to do to change the current status of people with a disability.

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They are calling on us. In fact, I've left with the clerk of the committee copies of some correspondence that our members have addressed to the presidents of all of the G-8 countries--I apologize on their behalf; they haven't caught on to the fact that we have a Prime Minister--the heads of state of the G-8 countries, calling for a recognition of the rights of persons with a disability, particularly in the area of education.

I'd like to draw your attention here to where some of the gaps still lie, despite the progress that's been made in Canada. When the minister responsible for CIDA launched the new basic education action plan last month, one of the backgrounders was very solid in terms of calling attention to children with disabilities and the figure of only 2% of those children receiving services as one of the major challenges.

But when one actually reads the action plan and looks at how we're intending to spend Canadian dollars, it's not clear that disability is in fact seen as an issue that cuts across many areas in terms of all of the investments we are going to make. If teacher training is done in ways that leaves teachers unprepared to include students with disabilities, then those families are going to have to wait another generation before their sons and daughters can actually ever get into a classroom.

If there is construction of new schools, but they are made inaccessible simply because a few stairs have been put at the front and students with disabilities can't get in, then again, we are going to be waiting another generation.

We would call on Canada to play a leadership role at the G-8 meetings in Kananaskis, both in terms of making it a requirement that the African countries respect the rights of children with disabilities in accordance with the UN Convention on the Rights of the Child and other international covenants, and in terms of following what we hope will be Canada's lead in showing donors that attention to the inclusion of disabilities needs to be a cross-cutting issue in all of the education activities.

UNESCO, in its coordination of “Education for All” initiatives, is being clear about this need to include students with a disability. In fact, it is in the process of creating a new flagship on disability and inclusion. Inclusion International is playing a role in that. But the words of multilateral institutions like UNESCO won't go very far if in fact the donors are investing their money in programs that continue to exclude students with a disability--not intentionally, but by not thinking about it up front.

The second request I have is that the statements coming from the G-8 leaders in Kananaskis--and again, particularly those coming from Africa--contain a clear statement that all efforts to reduce poverty and inequality must include persons who are vulnerable, marginalized, or have a disability.

I think the words I've just chosen are pretty close, although I just translated them from the French copy I had with me. They are from the Quebec City declaration. I think it's worth pointing out that the Quebec City declaration included this reference to including persons with a disability, together with other vulnerable and marginalized groups, in poverty and inequality reduction efforts. Sometimes we wonder if statements and declarations make a difference, but the impact of those words in the Quebec City declaration have had a tremendous impact particularly on the OAS and the Inter-American Development Bank, in making them accountable in their reporting on the implementation of the summit declaration and to show they are paying attention to the inclusion of persons with a disability.

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Given the lead role Canada has played--the Prime Minister received the Roosevelt Award in recognition of Canada's leadership in disability at the United Nations a few years ago and Canada was the first country to include equality rights for persons with disabilities in our Charter of Rights and Freedoms--we think Kananaskis provides a really positive opportunity for Canada to show leadership regarding the rights of persons with a disability, which would have a tremendous impact both on the other G-8 countries and as well, particularly, in Africa.

I would be happy to answer any questions you might have.

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The Chair: Thank you very much for this. It is an important issue and I think one that holds well with the values of Canadians.

I also want to compliment you on this booklet, The Journey to Inclusive Schools. It's very well done, and looking at it from the reader-friendly perspective, I must say it is attractive. Thank you.

Mr. Day.

Mr. Stockwell Day: Thanks, Madam Chair.

Thank you, Ms. Richler, for your presentation. One of the important steps realized in holding these meetings is that the elected members can be better informed, because we get exposed to a wider view than just our own narrower, parochial view or the one of the world to which we're accustomed. This is very important information for us.

What I've noticed with some interest as different groups present--and also from different points of view, and we're trying to glean some overall perspectives that can make life better in Canada and in the emerging nations we're engaged with--is that some are very focused on, as you said, the economic agenda and regard with suspicion, and I'm saying that in a positive way, those who don't seem to be focused on the economic agenda. Those who are a bit concerned about the focus on the economic agenda are concerned that there's not enough focus on the social agenda.

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What I'd like to suggest is that in focusing on the economic agenda without countries that have the ability to create wealth, and therefore to create individual family or corporate surpluses, there will be no help anywhere for the emerging nations other than benevolence from the heart, which is sympathizing with someone's pain, but not providing a way out of it. That's why I think properly the focus is on the economic side, but for the purpose of seeing the economic benefits in some nations and how people in those nations can most efficiently share some of the benefits with others. That's why that economic focus is there. Again, without economic strength, all other talk is kindness, but there's nothing to go with it.

If as we move in that direction one of the things.... I find myself in the interesting situation of speaking from time to time on behalf of the Prime Minister, as if he's done something good here, which for an opposition member doesn't come by nature, you see.

In fact I think it is a proper focus to be saying to nations--and we're pointing at Africa here--as they've said among themselves, you must develop constitutional democracies, you must develop respect for the rule of law, you must develop free markets and private property and human rights. Otherwise, number one, there will not be even within their own countries the beginnings of economic strength.

Other countries will, because of their taxpayers, resist giving money, not to help people, as taxpayers are always ready to do that, but if they sense the money going is in fact being diffused through either corrupt or ineffective regimes, the heartbreaking reality will be that flow of assistance won't be there. That's why, personally, I think the importance of NGOs is so very clear, because they can operate without inappropriate government regimes in other nations.

Knowing that, saying that, and understanding where we're coming from on these issues, can you tell me first of all, with regard to the numbers you quote, which are heartbreakingly huge in terms of persons with disabilities, in Africa does that include HIV-afflicted individuals? If that doesn't, then it's even more than that, isn't it?

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Ms. Diane Richler: The UN has been using these numbers since before AIDS became such a big issue in Africa. That's why we know they're grossly underestimating. So no, it does not.

Mr. Stockwell Day: I agree with you. It is underestimating the challenge. It is even bigger than we think.

We're looking to you for advice here, for insight. If it's CIDA-related funding--we always say government funding, but it still comes from hard-working people, from their taxes--for tax dollars to be transferred to the very needs to which you speak, and it has to be done, is that most effectively done through NGOs? How does a government such as Canada's determine how best that flow of funds should take place? And how far can we go in appropriately asking for accounting and results of the funds going, so we know they're having an effective use?

Ms. Diane Richler: You've asked a number of complex questions and raised a number of issues.

Our members certainly want to be in better economic circumstances. They want to have enough money to put food on the table for all of their children and not have to decide which one should eat and which one should not. I have visited places in Africa where older persons whose own children had died were excluded from their communities because their extended families couldn't economically afford to support them.

We are not saying we don't have an interest in the economic development of countries. I think this is the question. How do you develop that economic development? The research we've been drawn to first of all suggests that the traditional ways, the ways we've tried to do it over the last few years, have not worked, because in fact the disparities between rich and poor countries, and between rich and poor individuals in countries, have increased rather than decreased. What does seem to make a difference, though, is when you have communities that have social cohesion, when there is equality, and where there is a strong civil society and a respect overall for human rights.

I don't see my election as president of Inclusion International as a personal victory. It was very much a desire on the part of our members to learn more about the Canadian experience and the Canadian way of doing things. I've had a few observations made to me. Sometimes it's interesting for us to learn how other people see Canada, and what they think is different about how they do things. Some of the things people have said to me are that they're fascinated by the way the concept of human rights has developed in Canada, so that we can protect groups who were previously discriminated against, rather than the way human rights is defined in most of their countries, which is much more protection for civil rights. They think we have a lot to offer in terms of a broader definition of human rights.

They're fascinated by the cooperation between civil society and government. The fact that your committee would invite people like me, following the C.D. Howe Institute, to come and talk to you today is something that most countries simply have no experience with. So when we talk about democratization, the fact that organizations of people with disabilities in their families would be strengthened and then brought into those kinds of processes so they could actually help to shape their government policy is a way of promoting democratization and a way of addressing issues of corruption.

I think it's not an either/or situation. It's not a matter of do we think there needs to be economic development or do we think there needs to be a promotion of equality. We think that if there's not a promotion and a recognition of the need to bring previously marginalized groups into the overall development of the countries in Africa, it's not going to happen. It will continue to be a small elite who are making decisions and who are benefiting from development. What has to happen is a greater opening up of the system.

What we have found--this may sound self-serving, but it is for me, personally, one of the reasons I've decided to invest my energy in disability organizations--is that when systems hold as their standard the inclusion of people with disabilities, they'll include everybody. If you set another standard, if you say women or if you say a racial minority, you may still be leaving somebody else out. But when you focus on disability, that often provides you with the kind of ongoing challenge to make sure nobody gets excluded.

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Mr. Stockwell Day: I appreciate what you've said and the importance of that focus and your comment that your presentation would be juxtaposed to one from the C.D. Howe Institute. I am suggesting--and I'm sure you would agree because you were here when the woman made the presentation--that your interest in seeing the needs of persons with a disability being met are probably equally as strong as the interest of the other woman who was here talking about economic issues. Your concern that Canada is economically strong is probably every bit on par with hers, even though we all have different ways to reach out and see the standard of living increased for ourselves, our families, our country, and for others.

So we're not talking about mutually exclusive destinations. We all want to get there to see people's needs being met. In societies, however primitive, their ability to meet the needs of, say, persons with a disability is going to be impaired if, first of all, they have not been able to secure food for themselves, obviously--just looking at the hierarchy of need--then shelter and then security. And as that hierarchy of needs is addressed, they're then able to at least have the resources to meet the needs.

I agree with you that there should be an understanding, at the most basic level, of the need to include people. That's why I'm going to continue to do everything I can to put whatever appropriate pressures on nations and, let's say, the G-8--and the Prime Minister is going to focus on Africa, so that's fine--to make sure they democratize.

If people in power in those regimes--right now I'm thinking of Zimbabwe, and I think it's fair to use that since they're being sanctioned somewhat for their taking away of human rights--know that they have to appeal to voters to maintain their position, and if the numbers you've given us are accurate on persons with a disability, and I believe they are, and if they are able to vote, and I'm sounding mercenary right now, those people who want power in those regimes are going to have to meet their needs or they won't be able to continue in terms of their own elected office.

I want to assure you that I, for one, as a citizen in this country, believe I am joined with you in wanting to see those needs met in those other nations. We must keep a proper and strong focus on the pressure to democratize and the pressure to realize the importance of allowing the environment to exist in those countries so that people can create both their own opportunities and also receive investment from outside. All of these things go hand in hand.

Ms. Diane Richler: If I could give a brief response to that, I want to be clear that I'm not asking for special funding for any programs for people with a disability--

Mr. Stockwell Day: I'm aware, yes.

Ms. Diane Richler: So on the whole issue of democratization, one of the things that we have been very involved in that I didn't focus on today is the involvement of people with disabilities and their families in the whole electoral process. We've been working with the International Foundation for Electoral Systems, and we are starting to monitor elections around the world to see whether people with disabilities and their families are participating to train people to be part of monitoring teams of elections.

What I'm saying, though, is that Canada has experience because of our charter in considering disability as a cross-cutting issue. Again, using elections, I think Elections Canada is the most progressive electoral organization I've ever seen in the world in terms of making sure that the voting process is accessible to people with disabilities.

But we need to make sure that whatever the focus is coming out of the G-8, people with a disability aren't ignored and that we benefit from Canada's experience at treating disability as a cross-cutting issue. It's only if the Government of Canada makes that a strong point that this will happen. They did it in Quebec City. We need them to do it in Kananaskis, because if it doesn't happen there, no one else will do it.

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The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

I, too, would like to commend you on your work and your organization. I think it's a very noble cause, and I think most Canadians, if not all Canadians, will agree with me that's really one of the benefits we have as Canadians.

I have a couple of questions. First, I went through the book here, but I didn't find a definition of the word “disability”. How do you define the word? Is it a physical or mental disability? In some areas you talk about physical disability and in some areas you talk about mental disability. I want to know if it is inclusive or not inclusive. That's my first question.

Secondly, mostly you focus on children here in the book, but as you know, people become disabled with age, and with so many baby boomers coming up in the next few years, I think your problem will multiply by manyfold, because along with the disabilities of children there will be a great increase in disability among seniors.

You mentioned here 173 organizations in 109 countries. How many of them are geared for seniors as a disabled group and how many of them are geared for children as a disabled group? Could you elaborate on those?

Thank you.

Ms. Diane Richler: Sure. There is considerable variety among our member associations, but most of them were started by parents of sons and daughters with intellectual disabilities, with mental disabilities. In some smaller countries, and this is true in many countries in Africa as well as Latin America, because there's not such a strong civil society, families of children, regardless of disability, all came together. That's why our language sometimes focuses on mental disability and sometimes focuses more broadly.

We try to be very careful not to speak for any of the other disability organizations, who are very good at speaking for themselves, but our primary focus is intellectual disability. But, again, many of the people who have intellectual disabilities also have a physical disability. That's why, rather than focusing on the disability, we try to focus on the inclusion, and that's why we changed our name. We want to make sure we're creating environments that can be inclusive of everybody, regardless of disability, rather than saying we're trying to do something for people who have Down's syndrome or who have another particular kind of disability.

Our member organizations deal with issues affecting people with disability throughout life. We had chosen in this presentation today to focus specifically on education because we know that is going to be a major focus of the G-8 meetings, and particularly because Mr. Good is chairing the G-8 task force on education.

We could have chosen to focus on citizen participation and focused the presentation somewhere else, but our African members are the ones we're responding to on this, and they feel it is critical right now to include more and more children in school. In Burkina Faso, for example, 20% of their children are in school. Their government's goal is to bring that to 60% by 2010. So our members think it's absolutely imperative that their sons and daughters, and children with disabilities, form part of that new wave of children entering school.

They've asked us to make that our priority in dealing with government. They've written to the G-8 leaders on that, and we're trying to support that position. Certainly, if the G-8 decide to go off in another direction and make most of the investment somewhere else, our interests would cross those areas too, and we would be pleased to participate and work together.

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Mr. Sarkis Assadourian: Are you doing anything to face the reality of the nation's baby boomers growing older, and that there will be a whole bunch of disabled persons?

Ms. Diane Richler: It is a real concern. Also, a real concern of families is what is going to happen to their sons and daughters when they're no longer able to care for them. That's a huge issue for us right now. Most of our associations formed right after the Second World War, so many of the founding members are now in their seventies and eighties. They're the ones who are really asking that question very much.

As I was driving here, I was listening to a CBC call-in show on this topic of families of children with disabilities. The message the families who were calling in were delivering--and I would certainly support it--is that if people are part of their community, that's the only security they can have as they move into old age. When people don't have any connections to their communities, they end up being abandoned.

We think school is the place where people form networks with other members of their community. If non-disabled children view children with disabilities as their peers, as part of the community, as people with whom they share some kind of social relationship and sense of responsibility, we're more optimistic that as those children grow older, they will ensure that their communities don't continue to exclude people, as is happening right now.

Mr. Sarkis Assadourian: Thank you.

The Chair: Thank you, Ms. Richler. I think you've put before us the importance of the paper Mr. Good and his colleagues are working on--education for all--and “all” is the important word there. You've also reminded us that there are things that deter the full participation of everyone in society, whether it's our society or African society.

We will be making recommendations. Hopefully, this will be one of the recommendations we can make, flowing out of your paper. But we'll also be seeing the minister for CIDA, who I think is to appear before us on the estimates. We'll have another opportunity to bring that to the fore.

I'm sure you know there is a parliamentary subcommittee that deals with persons with disabilities, chaired by Carolyn Bennett. They have also done some good work, following on the work Andy Scott did.

Again, I think you can see that all my colleagues around the table understand the issues and are very supportive that everyone in society has the opportunity to be a contributing member of society.

We thank you for that, and for your patience in waiting today to present to us.

Ms. Diane Richler: Thank you all very much.

The Chair: Our final witnesses of the day are from Kairos. The researcher-educator for Asia is Ms. Salimah Valiani, and she will speak on the ecumenical justice initiative.

Ms. Salimah Valiani (Researcher-Educator (Asia), Kairos): I'm Salimah Valiani. Kairos is a coalition of various social justice and economic policy advocacy groups working on behalf of major churches in Canada. There used to be 10 separate coalitions working on different regions of the world as well as on Canadian issues around aboriginal rights, social development, poverty, and refugees. The 10 coalitions came together in June and that is now the large canopy called Kairos.

In Kairos there are the Anglican Church of Canada, the Canadian Conference of Catholic Bishops, Quakers, the Presbyterian Church...all the major churches are there.

We thank the honourable members of the standing committee for this opportunity to address our positions on global economic justice. That is the program at Kairos, where I work: global economic justice. But we also recognize that most people around the world, including many Canadians, have very little access to the decision-making that shapes their welfare.

I'd like to begin with some descriptive points on the global condition of the day as seen from our perspective as researchers, community organizers, and church activists.

What we see today are countries throughout Asia, Africa, and Latin America, also known as the global south, stretched and torn at the seams because of the servicing of illegitimate debts since the 1980s. Illegitimate debts are those we define as debts incurred by despotic regimes, debts contracted for fraudulent purposes, debts whose proceeds were stolen through corruption, and debts where the debtors became unable to pay because the lenders unilaterally raised interest rates.

Parallel to this, we see the willingness of international banks to take losses as well as make large financial contributions to sustain questionable business practices of large corporations and investors, for example, Global Crossing, Enron, Long-Term Capital Management, and other communications companies around the world.

Instead of the well-meaning United Nations millennium development goals, we see a 21st century world economy built around a structure of some countries producing high value-added goods and most producing raw materials and labour-intensive goods, capturing ever-depleting prices in the world market.

We hear the emphasis and re-emphasis on export-led growth for southern countries, yet the ratios of total exports and imports to GDP--that means the percentage of total economic activity--represented by trade in North America and Europe are a mere 13.2% and 12.8% respectively, while for Asia and Latin America they are 15.2% and 23.7% respectively. For Africa a looming 45.6% of total economic activity is made up of extraregional exports and imports.

Further on Africa, we see structural adjustment programs that have been applied 162 times in 32 African countries over the last 20 years, resulting in an increased integration into the global economy. However, this has been done without overcoming malnutrition, unemployment, or poverty, and in fact it has created economic stagnation by the dismantling of internal markets.

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In light of the global human condition of increasing insecurity and instability, we would like to offer the following concrete steps toward change with a 100% cancellation of all bilateral and multilateral debts owed by low-income countries and an end to structural adjustment programs. We remind the committee of a 1999 petition to the G-7, signed by 650,000 Canadians, as well as 24 million others around the world, to cancel debts and end structural adjustment programs.

We recommend mechanisms to assess and cancel the illegitimate debts I defined earlier of all developing countries. We recommend mechanisms such as sovereign processes of independent audits to verify whether debts are legitimate, as well as a fair and transparent illegitimate debt tribunal independent of the IMF, incorporating an automatic stay of debt servicing once a case is opened and protection for resources needed for essential services, with access for civil society to such proceedings.

We would like the G-8 and the IMF to recognize the use of capital controls that encourage socially beneficial development as a sovereign right for all nations. We call for an international currency transactions tax, whose revenues would be distributed by an independent body to fund the social and economic development that we see as intimately tied. We recommend periodic reviews of private financial institutions to ensure they follow socially responsible practices, both in Canada and abroad.

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We call for the replacement of the International Development Association, now under the World Bank, with an independent agency for the provision of grants to low-income countries for public investment and the provision of health, education, water, and sanitation services.

Finally, we ask for fresh and new approaches to economic planning that ensure social and ecological risks are accounted for and that the varying development demands of people around the world, communities around the world, are at the root of economic decision-making.

With regard to the new planned partnership for African development, NEPAD, we would like to highlight key messages of our partners in Africa.

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First of all, NEPAD is based on a failed economic program. The legacy of structural adjustment programs in Africa has increased hunger, poverty, and stagnation, not growth and prosperity. Today, Africa exports 30% more than in 1980, but the value of those exports have fallen by over 40%. The NEPAD must recognize the fundamental rights of Africans to produce, first and foremost, food for themselves.

Marginal debt relief is not enough; 100% of Africa's debt must be cancelled.

NEPAD purports to support democracy, but itself is not democratic. African citizens have not been consulted. “It is a partnership with African leaders without African people”, is what Dr. Molefe Tsele, general secretary of the South African Council of Churches has said of NEPAD. “Send it home” says Reverend John Patrick Ngoyi of Nigeria.

With all the alternatives out there--the African alternative framework to structural adjustment programs, the Arusha declaration, the Lagos plan of action--why has Canada and the G-8 latched on to this very flawed development program?

Finally, as one last message from our partners, we question the redeployment of aid primarily to countries that demonstrate “good governance” by deregulation and opening up to foreign investment. Rather, for us, they say, good government implies recognition of the will of the people, respect for human rights, and the facilitation of capacity-building at the grassroots to enhance the role of communities in ensuring good governance.

To close, I'd like to underline that we see the interrelatedness of global inequality and social crises, including various forms of violence. We urge our leaders--G-8 leaders, Canada, yourselves--to honestly and actively join us in realizing the link between global peace and social, economic, and ecological justice.

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The Chair: Thank you, Ms. Valiani.

We'll now go to questioning, starting with Mr. Day.

Mr. Stockwell Day: Thank you, Madam Chair.

Echoing remarks from our chair earlier today--and I thought they were well founded--I'll say, personally, I'm a bit at loose ends in terms of how to respond to comments we've heard related to NEPAD, because this was not something that was developed by Canada or the United States, or other G-8 nations; this is something that was brought to us by leaders.

As you say, and I agree, what process--

Ms. Salimah Valiani: Certain African leaders, yes.

Mr. Stockwell Day: Yes. What process they went through to glean those deliberations, I certainly have no idea. So it's a little bit disconcerting to me to try to ascertain, when these African leaders are telling us this, that they want to move to increased democratization, to written constitutions, to respect for the rule of law, and all these other items, which personally I feel are the foundations for economic strength and therefore help to people who need help--when they bring those to us, I don't see that as something I can question or throw back in their faces. So I can just encourage you to contact those leaders and put these questions to them, because we're here to--

Ms. Salimah Valiani: I have left with the clerk two statements that came from West Africa last week, where civil society groups from Africa, as well as solidarity organizations such as ours, gathered, discussed NEPAD, and presented their declaration, yes, to their own leaders, but we also presented to the leaders of the G-8, of which Canada is host for the present meeting, because there has been discussion between those leaders around NEPAD, and as you're opening up to civil society, for example, today, we are transferring to you messages from our civil society partners in Africa.

It's not really that far-fetched to say there has been quite a history of despotic regimes throughout the continent, unfortunately since independence.

Mr. Stockwell Day: I agree.

Ms. Salimah Valiani: We would expect G-8 leaders to consider that when they look at a plan coming from three or four African presidents and prime ministers who have very well-known histories.

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The Chair: Excuse me. It's not coming from three or four, if I may interject. There are a number of initiating states, heads of state, who have been involved with this. We know it goes all the way back to the millennium and further to Lagos and others, as you mentioned. We also know there were 15 African leaders who were involved in the implementation process. There is a secretariat set up.

So it's not just a few leaders who were part of this, but we take the point you're making that there were some people in Africa, in civil society, who have some things to say to their leaders. I think at this point in time, Mr. Day's point is that we're trying to support them in the enterprise.

Mr. Stockwell Day: Thanks, Madam Chair. I'm certainly not disputing anything you're saying. I'm just trying to share some of our pain--and I don't mean physical pain. I'm trying to come to grips with who is saying what and who is representing whom when it comes to the African people. We're honestly and sincerely trying to do that to the best of our ability. It's not unnatural that there would be a conflict of opinion. We have that in our own country. I happen to think our government doesn't represent the people all the time either, and that's why I'm in the opposition.

So I'm just sharing that reality with you. I, for one, and I'm sure my colleagues here, want to pass on and transmit all these messages through our committee to our colleagues, of whatever political stripe, in the House of Commons. We'll let them know there is some disparity, but we are not the ones to send something back to Africa. We could no more do that than request that NEPAD come out of Africa with a certain proposal. As partners in the global community, we're just saying that if we can be of help in some legitimate way, we want to be. That's to all the peoples of Africa.

I happen to agree with you in relation to debts. I think many of them have been incurred illegitimately by despotic regimes. I totally agree, and it's been heartbreaking because the people who really needed the benefit of those dollars never got them. It's tragic.

In terms of cancellation of debts, I'm happy to pass that message on to the international banks. There's not much of a history of banks themselves cancelling debts. I also couldn't agree with you more in terms of corporations. The banks have bailed out corporations that have been poor managers. I have never been in favour of that because then the rest of us, as hardworking people, pay for that through increased interest rates, increased service charges, all of that. So I'm on the same page with you on that.

I don't know that I have the answer of 100% cancellation of debts. I don't want that transferred unnecessarily onto responsible citizens because there have been bad actors, but I think some kind of restructuring should be in order. I think countries, and the banks themselves, which rushed into these arrangements, should have some kind of accountability there for a proper look at restructuring to alleviate that pressure on the people of these nations who have been afflicted.

I also agree with having a system of providing... I would do all I could. I can tell you as a former Minister of Finance that the process of audit is very important--sovereign processes of audit. I've had the honour of working with one African province in terms of sharing what little I knew about that from my own experience, and I saw their intentions in wanting to apply that.

You've brought forward some excellent suggestions here, and I will do my best to advance these and make sure our Prime Minister and representatives at G-8 understand and hear these concerns.

The Chair: Thank you.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

I share some of the ideas you expressed here. I take it you are not very happy with NEPAD.

Ms. Salimah Valiani: Right. We're not impressed with the NEPAD. There are alternatives, like the ones I mentioned.

Mr. Sarkis Assadourian: In your testimony, you said four or five leaders came together and prepared this report.

Ms. Salimah Valiani: In the initial stages, yes.

Mr. Sarkis Assadourian: The last time I counted, there were 54 countries in Africa. The other 49 or 50 didn't participate? I'm amazed they did not bring their own NEPAD report number two. Maybe those who are concerned with it will bring forward their own proposal rather than criticizing what we have on the table. These G-8 people have to work with something. I hate to see part of Africa demonstrating for NEPAD and the other part speaking against NEPAD. That doesn't do Africa, which needs our help, G-8 help, any good.

I would say that since the other 49 or 50, according to your estimate, weren't consulted or they don't approve of NEPAD, maybe they missed the boat, I am sorry to say. They should have prepared themselves to get their own report out there so that these people--us, governments--could see two reports and make an assessment of which one they'll go for. But for you to come and say this NEPAD is not a good report, that only four or five countries participated and the other 50 were left out, and ignore this report, I think is unrealistic. Correct me if I am wrong.

Ms. Salimah Valiani: That's not my message here. My message is that civil society, communities in various countries throughout the continent, have not participated in the development of this plan.

Mr. Sarkis Assadourian: Who's stopping them?

Ms. Salimah Valiani: Whether the 50 or so other prime ministers and presidents, leaders of state, have participated, I can't tell you, even if they had. Our message is that the people on the ground, the people who make economies, particularly in ecologically sensitive economies and societies like the ones in Africa, have not contributed. They have not been allowed to contribute.

Mr. Sarkis Assadourian: Are you telling me that the report prepared by five--

Ms. Salimah Valiani: The original drafts were done by particular presidents from Algeria, from South Africa, from Nigeria, who then went and consulted the Senegalese leader. From there it went to other people, other leaders in Africa. There are many drafts of the document. We're talking about the earliest.

Mr. Sarkis Assadourian: If that's the case, how come the civil society you referred to was not doing its own thing to counter what the Algerian, South African, Senegal presidents were doing in the back room, so to speak? They cooked this deal and then presented it to the G-8 as a document for Africa. On the other hand, you're telling me now that they weren't consulted. Who stopped you from doing your own report?

Ms. Salimah Valiani: Nobody, and those groups have--

Mr. Sarkis Assadourian: Let me finish.

In this G-8 meeting and the previous G-8 meeting, CIDA paid money to organize the people's summits, right? They could have done the same thing for your groups to have proposed a counter report, but obviously you missed the boat, I think.

Ms. Salimah Valiani: Pardon me. I mentioned the African alternative framework to structural adjustment programs, the Lagos plan of action, the Arusha charter--those are all development plans produced by civil society groups over the past 10 years or so. Yes, partly they were able to do it through CIDA funding. What we are highlighting to you today is the question of why the G-8 is going with NEPAD and none of those other alternatives.

Mr. Sarkis Assadourian: Do you have the answer? If you were to organize and put them all together in one effective report.... I have never heard about this work you're telling me of now.

Ms. Salimah Valiani: Please find them and read them.

Mr. Sarkis Assadourian: For the past two or three months we've been hearing about NEPAD only. Am I wrong, Madam Chair?

Anyway, thanks.

The Chair: We really don't want to take Ms. Valiani to task. She has conveyed to us the sentiments of the civil society community and their sense of their lack of involvement in the process because opportunities for their input were not sought. At the same time, I think the responding argument is that this is a work in progress and it has to be done by the Africans. Now that it's opened up and we as Canadians are trying to help build the critical mass of civil society with knowledge about NEPAD, they will convey that to their leaders in their various jurisdictions.

In terms of Canada and the G-8, we are in the process of coming up with an action plan and we are just asking for input and comments in that area. Bringing us a perspective of the various situations of Kairos and its partners and the expression that the partners want to have around the table is quite valid, I think, but you can understand our perspective that this is an opportunity, this is a window. Here are some leaders who have looked at their continent, looked at the decline in the continent, more so now than at any other time, and have said, “Here is some way in which we can make things better for our people”. Their people just need to get on board with them. They need to communicate with their people, and the communication has to be two-way within Africa.

We take the points you make. We heard that before. There was a speaker earlier in the day who made the same recommendations and comments you made. We appreciate that and we thank you for that opportunity. It's part of our documentation. It's part of the recommendations, the scripting of what we heard, and we greatly appreciate it.

Mr. Stockwell Day: Madam Chair, can I just add a comment?

Again, thank you. You have insights we didn't previously have, and that's important. I really think our ultimate desire, the end goal, is to see more and more people on this planet being able to have economic security, social security. I'm saying that in the true sense, not in terms of government programs. So I think we're working together, toward the same goal.

I do accept what you say, that there are large numbers who feel they have been left out of the process in Africa that was developed by the leaders. I'm not disputing that. Notwithstanding that, are there some things in the broad proposals of NEPAD that you would fundamentally differ with? For instance, it is the NEPAD presentation that says they recognize the need of any nation that wants to be healthy for constitutional democracy, the rule of law, the recognition of human rights, property rights, and the rights of freedom to trade with your neighbour or the person down the street or the person across the river. Those are some of the fundamentals of what the NEPAD group is saying. Are there any of those that your group would fundamentally disagree with or have a problem with?

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Ms. Salimah Valiani: The key problem we see with NEPAD is a lack of attention and calculation with regard to internal markets. Those have been destroyed through structural adjustment programs, which have been part of the conditions upon which countries have been lent further money, by the IMF and other institutions, to service the illegitimate debt we mentioned earlier.

Internal markets are basically the means of survival for the rich countries in the world. Sound internal economies provide for the basic needs of the population. If those do not exist in Africa today, given the roughly 20-year history, then what we are very concerned with in NEPAD is a call for more foreign investment and more exports as a means to economic growth.

As I mentioned to you, WTO statistics show 45.6% of Africa's economy in 1995 was made up of external trade, or exports and imports. If that is not providing for basic levels of nutrition--or health, education, and a sturdy workforce, which any economy needs--any capitalist will say how then is NEPAD going to solve it? We don't see the solutions there. From a hard economic point of view, we don't see the possibility of long-term growth in NEPAD.

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Mr. Stockwell Day: I would agree that many of the nations forced to implement certain IMF requirements have been hindered in their ability to develop a truly flourishing economy. That's why I think some of what the IMF requires should be seriously looked at, because it is anti-freedom of economy, and anti-freedom of enterprise at a local level.

You mentioned the ability to develop food and agriculture. Again, one of the most basic principles of a thriving economy is you must have provisions for private property. If you do not, the people will starve. The USSR or Union of Soviet Socialist Republics certainly proved that. It was ably and amply demonstrated. Large tracts of land collectively managed by the state failed spectacularly to feed the people. But the tiny percentage of a collective farm that allowed peasants to grow their own particular products produced many times over what the rest of the collective produced. Do you see what I'm saying?

There are some basic economic truths. We might not like them, philosophically--or from where a person's coming from--but if they're not attended to, then certain nations, jurisdictions, and provinces will never be economically healthy.

That's why I would certainly encourage--and I think we're saying the same things--taking a look at IMF areas that go against the grain of true economic freedom. Let's really push for freedom of enterprise to take place, for democracy, freedom to own property, the rule of law--and a follow-up of internal sanctions for those who don't follow the rule of law. That will present and develop internal strength in an economy. It will provide a platform for security, from which people can begin to develop ways to acquire wealth for themselves and their families, and maybe one day enough to share with others.

I hope these are basic principles. Is there anything in these basic principles where we're disagreeing?

Ms. Salimah Valiani: How long do I have to answer this?

The Chair: Less than a minute.

Mr. Stockwell Day: Well, with respect, you can just go down the list.

Do you have any problems with constitutional democracy, the rule of law, the respect for human rights--including property rights, intellectual rights, and democratic rights?

Is there anything in that list you fundamentally have a problem with?

Ms. Salimah Valiani: I hope that wasn't part of my minute.

Collective ownership is a reality for many of the local economies in Africa. How are these covered by your notion of property rights?

Mr. Stockwell Day: Let's leave Africa out of it. In any other jurisdiction in history--

Ms. Salimah Valiani: These systems are threatened by development plans in NEPAD, for example, around energy. These include hydroelectric energy around river basins, which have been used for all kinds of agricultural and fishing purposes to date in Africa, and as a means of survival. These are threatened by NEPAD. We are very concerned about this.

Mr. Stockwell Day: It's when land is owned collectively, especially with state collectivism, that you run into problems.

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Ms. Salimah Valiani: Pardon me, I didn't say state collectivism.

Large development projects, for example hydroelectric plants, are state development projects. We don't see how those are going to help those local systems. What they will do is to assist the transport of oil within the continent and out of the continent. So more oil exploration and more trade in oil as, again, a means to increase growth and welfare in Africa is something we question fundamentally.

Mr. Stockwell Day: It's fair to question all those things.

I do hope that all nations, including African nations, stick to these most basic fundamentals that history has shown eventually, over time, lead to more people having more access to the basics of life. Is it a perfect system? No. But it will lead to a road and a pathway out of mass poverty.

The Chair: Thank you, Mr. Day.

I note, as they say, the lateness of the hour.

Ms. Valiani, thank you so much.

Ms. Salimah Valiani: Thank you.

The Chair: As you work with your colleagues in Africa, I hope that part of our responsibility is to make sure that everybody focuses on the initiatives of NEPAD and that we try to make it better, because, as I said earlier this morning, it's a work in progress.

Thank you so much.

Ms. Salimah Valiani: Thank you all.

The Chair: I now close this meeting, to resume tomorrow at 7:45 a.m. Please note the change is simply made to try to accommodate all the witnesses for tomorrow. So 7:45 a.m. in this room tomorrow, Wednesday.

Thank you.