44th Parl. 1st Sess.
December 1, 2021 02:00PM
- Dec/1/21 7:49:51 p.m.
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Mr. Speaker, I rise on a point of order. The interpreter just indicated that the sound quality is very poor. That needs to be corrected to allow the interpreters to do their job properly.
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- Dec/1/21 8:03:49 p.m.
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Mr. Speaker, since I just returned yesterday from an observation mission in Colombia, this is my first speech in the House since the last election—not counting the small point of order that I made earlier, of course.
I would like to take this opportunity to warmly thank the electors of Saint-Hyacinthe—Bagot for their renewed trust. I will do everything in my power to live up to this second term that I had the honour of being entrusted with.
Rather than engage in petty games by passing the buck and throwing accusations at either the Liberals or the Conservatives, I will try to bring the debate to another level, even if I do think that both are to blame. Focusing the debate on something else will only elevate the discussion.
First, let us quickly review the facts. Last week the U.S. administration announced that, starting in 2022, countervailing duties on Canadian softwood lumber will double from 9% to 18%, on average. Of all the companies affected, the primary victim is Quebec’s Resolute Forest Products, which will be slapped with a combined tax of 29.66%. That is why the Bloc Québécois wanted to have this take-note debate tonight, in which I am participating as my party’s international trade critic.
The trade war over softwood lumber is an old and never-ending issue. It has been said before, and it needs to be said again: There have been countless missed opportunities to resolve this problem.
The forestry industry accounts for 11% of Quebec’s exports. Our forests are a source of economic development, jobs, and tax revenue, and they have great ecological value. That must also be said. The forestry industry presents immense carbon sequestration and storage capacity, and it inspires many innovative Quebec SMEs to produce bioenergy and bioproducts. Some issues require international co-operation. The environment, the fight against climate change, and green trade are among them, and our wood can play a key role.
The new tariff war will hurt almost everyone. It will certainly hurt us because it could result in a large increase in the price of lumber and serious consequences for our businesses and the 25,000 direct Canadian jobs tied to the sale of softwood lumber to the United States. Things will not necessarily be any better in the United States either. The cost of housing will increase, which will further restrict Americans' access to housing, even though the Biden administration is claiming that access to housing is one of its priorities. Who will win in the end? The U.S. lumber lobby and a few politicians who see that the mid-term elections are quickly approaching.
Let us review the facts of this matter. Year after year, the United States accuses the Canadian forestry industry of benefiting from public subsidies that hurt the American sector. The American decision is based on what could be called a structural dynamic. This happens a lot. This is not the first softwood lumber crisis. There have been four rounds of trade conflicts: in 1982-83, in 1986, from 1991 to 1996 and from 2001 to 2006. We are now at the start of a fifth conflict.
It makes no sense. Canada has turned to the World Trade Organization and North American Free Trade Agreement dispute resolution bodies for help several times.
Canada has won all of its cases. In May 2020, the WTO even said that Washington had not been objective or fair and that its tariffs were unlawful.
Free trade agreements generally set time limits on disputes to prevent them from dragging on. The Americans knew that they would lose their case, though, so they did what they always do. They used every trick in the book to stall the arbitration tribunal, for example, by filing petitions to take up the tribunal's time or by blocking the appointment of arbitrators. The longer this goes on, the worse things get for our forestry industry.
The Americans’ strategy is therefore clear: Set tariffs that they know will be found to be wrong and take advantage of the years they are in effect to bankrupt, or at least undermine, the Canadian industry. This will allow the United States to further develop their industry in the meantime, modernize it, improve its competitiveness, and therefore get a head start.
That is what is behind the push for a trade war. Is this not precisely what can easily be described as unfair competition? It seems to me that it is. Still, there have been many missed opportunities to address this.
The Canada-United States-Mexico agreement, or CUSMA, passed in the House in March 2020, represents a very large missed opportunity in this regard. CUSMA needs to be amended. The government could have taken the opportunity to close these loopholes when renegotiating North American free trade over the past few years to ensure that the litigation process is much better regulated so that we could avoid overly long delays when time is not on our side.
There is also another item that needs to be amended in CUSMA. It should provide for a permanent softwood lumber advisory board. I tried to introduce a similar amendment in the House in March 2020, but unfortunately it was rejected by the Chair.
This brings me to another urgent matter, that of getting the Quebec system recognized.
Since 2013, Quebec's forestry regime has been fully compliant with the free trade framework and requirements, which should save it from vagaries like the ones we are experiencing right now. The regime is simple to explain. One quarter of the timber from the public forest is sold at auction, where anyone can bid. The price obtained is then applied to all the timber from public forests. This system is very similar to the one used in the United States. The price of timber is set by the market, not by the government. It is not subsidized, which passes the free trade test 100%. It was actually designed specifically for that purpose.
In contrast, that is not how B.C.'s stumpage system works. In that case, it is set by the government. Recognizing the specificity of the Quebec system would save us a lot of trouble.
I will make an aside to talk about one of the reasons I am in politics. When people ask me why I am a sovereignist, I tell them that it is so we can have the power to sign our own agreements and treaties, which sounds a bit abstract and seems quite theoretical. However, here we have the perfect example, and it is a fairly typical case: we want to be able to negotiate on our own behalf, in our own interests, instead of letting a government that does not see us as a priority do it for us.
Of course, in the short term, the government urgently needs to support the industry with a loan and loan guarantee program, to match the amounts being withheld by Washington. It is the only way to get through the crisis.
Ottawa could also argue for an exemption for timber from private forests. Although the vast majority, or 90%, of the timber harvest in Quebec comes from public forests, certain private forests are quite large and have real value in some regions, and therefore deserve our attention. The point to be made is quite simple. The Americans wag their finger at public forests, saying they do not respect the free market system and they benefit from hidden subsidies. Why, then, is timber from private forests, which I would point out is not subject to the Quebec regime, also subject to these new tariffs? This should be a very simple argument for our friends in government. It seems to me that it should be pretty easy to argue that.
Since the new duties do not apply to processed products, as my colleague from Jonquière mentioned earlier, this is a great opportunity to develop a value chain to promote the processing of forestry products. I think this presents a great opportunity for secondary and tertiary processing.
What does the government do? It tells us it is working very hard for all Canadians and that softwood lumber is a priority that it is, and I quote, “vigorously” defending.
Two weeks ago, the Prime Minister took part in the first three amigos trilateral summit in many, many years. Barely one week later, new softwood lumber tariffs were announced. Make of that what you will, but there is still a problem here. Tomorrow, the Minister of International Trade will be in Washington. Let us hope for better results.
Will the government take a firmer tone? Will it retaliate with measures on U.S. goods?
We will have to wait and see. We have yet to hear any real announcements. Empty buzzwords like “priority” and “vigour” have run their course. Now, a major industry—
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- Dec/1/21 8:15:22 p.m.
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Mr. Chair, we are hearing a lot of empty words like “priority” and “vigour” while workers and industries are struggling.
We have had enough of these empty words. They are like buzzwords. They need to be tweaked to say that it is important to the rest of us. Enough buzzwords. People are waiting.
This should indeed be a key priority. However, I am curious, and I have to wonder. President Biden holds the first three amigos summit in several years, bringing together the three North American heads of state, and a week later, new tariffs are announced. If that is not a diplomatic triumph, I do not know what is. I hope my colleagues caught my sarcasm.
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- Dec/1/21 8:17:00 p.m.
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Mr. Chair, first I would like to know what to think. I have not heard any intentions. What I mean is that I have heard the intention, but I have not seen anything of substance.
I would really like to be the first to say that I have seen the proposed policy and that it makes sense, or that this or that element should be improved. However, right now, there is nothing. There is absolutely nothing, just wind. Once again, there are just empty words.
My colleague asked me if I support processing and market diversification. I have spoken about that. Now, when are they going to put their money where their mouth is?
We are not in government. It is up to the Liberals to answer that question.
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- Dec/1/21 8:18:23 p.m.
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Mr. Chair, I thank my colleague for his question, but I have no answer for him.
My colleague asked where the plan is. Had I seen it, I could have definitely answered him. Unfortunately, I am very saddened to come to the conclusion that it does not exist.
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- Dec/1/21 8:19:44 p.m.
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Mr. Chair, my heart goes out to the workers in my colleague’s region who have been affected by these various shocks and who may still be affected in 2022, if this continues.
My colleague mentioned the 2006 agreement. When it expired in 2015, there was some lofty rhetoric, but there was no new agreement afterwards. Nothing concrete was announced. To answer his question about how to prevent this from happening, I would say that Ottawa needs to acknowledge that Quebec has a genuine system. The real solution is obviously for Quebec to negotiate its own agreements directly as a free and independent republic.
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- Dec/1/21 8:21:07 p.m.
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Mr. Chair, I commend my colleague and former peer from the Standing Committee on International Trade. We had a lot of fun working together. We had a very good rapport.
Usually a visit from the Minister of Trade is spent with her eating up the time for questions. When we ask a solid question that calls for a short and solid answer, we get a response that begins with a long preamble involving thank yous, kowtowing and that sort of thing just to eat up time. Then we are told that they are working hard for Canadians, that this is a priority, that they are working vigorously on this and so on, yet we never get an answer from the minister. In fact, we have never gotten one from most of the ministers in this government.
I do not feel reassured. Even if I did, I would be wrong to feel that way. It would be naive of me. We got the answer a week ago.
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- Dec/1/21 8:22:49 p.m.
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Mr. Chair, I thank my colleague for his question and the opportunity to provide some details.
With respect to the benefits of forestry, we have seen some extremely innovative businesses. They are developing derivatives, wood-based bioproducts, rather than relying on yesterday's energy sources. I think that is one way forward along with other energy sources of the future.
We are a nationalist party. We are not against economic nationalism. There are issues we have to deal with on a continental and global basis, and the environment is one of them.
It took centuries for trees to develop. It is almost miraculous. All kinds of studies on trees show that their benefits are legion, ranging from oxygen to well-being. Some studies show that they improve well-being and create cool islands. Trees are all pro, no con. They supply us with extremely high-quality wood.
There is no doubt that the forestry industry has not always been up to snuff. I recall a film that made an impression in Quebec. It was called Forest Alert and was produced by Richard Desjardins, a great Quebec artist who is popular with all my Bloc Québécois colleagues.
Fortunately, things have changed, and this is a sign that social movements must continue to mobilize. Today, we have a great industry. We have a great sector that can always do better, of course, as long as it has the support of the public and a strategy, and political priorities are put in place.
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- Dec/1/21 9:24:11 p.m.
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Madam Chair, several factors are playing into this. One is definitely the diplomatic fiasco I talked about earlier, and another is a kind of bad faith on the Americans' part. That is undeniable.
Generally speaking, Quebec did its part to implement a system that complies with the free trade rules. Unfortunately, the system is undermined by other provinces' stumpage fees. That is the conclusion we came to.
Does my colleague think Quebec's unique system should be recognized as such during future negotiations?
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- Dec/1/21 9:43:29 p.m.
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Madam Chair, since my colleague is from British Columbia, if I am not mistaken, I would like to hear what he has to say about the stumpage system in his province. The stumpage system in British Columbia is set by the government, as opposed to the Quebec system, where prices are set by the market. That seems to be the sticking point for the U.S. How would my colleague defend British Columbia's system under free trade rules?
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- Dec/1/21 9:54:18 p.m.
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Madam Chair, my colleague spoke of great missed opportunities. The Bloc would support two amendments to CUSMA.
The first would be to regulate these infamous disputes, which are dragging on while our industry is going bankrupt. The Americans are using all kinds of smoke and mirrors to slow down the processes.
The other would be to create a standing advisory committee on softwood lumber through CUSMA. I introduced an amendment to that effect in the House in March 2020.
Could we count on the Conservatives to work with us on this issue?
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- Dec/1/21 10:04:03 p.m.
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Madam Chair, I wonder if my colleague shares my reading of the situation. I find one thing fascinating. We are in a take-note debate, and yet the government has very few solutions to offer. We have an industry and workers who are suffering, and all we are getting is a mishmash of empty rhetoric. No concrete action is being taken.
In concrete terms, what measures, what policies does my colleague have to propose given that the government clearly does not have any?
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- Dec/1/21 10:27:47 p.m.
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Madam Chair, again, I have a question for my colleague across the way.
Would the government, the Liberal Party, be prepared to consider an amendment to CUSMA? She gave some examples from CUSMA regarding recourse, potential dispute settlement mechanisms, but would the government be prepared to improve the issue of disputes so as not to unduly drag out these disputes when time is against us, and also to include a permanent advisory committee on the softwood lumber issue?
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- Dec/1/21 10:39:44 p.m.
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Madam Chair, my colleague mentioned that he ran for the position of Speaker of the House. I thank him for taking the time to call me about that. I do, however, sense a bit of relief on his part that he is not in the Speaker's chair, so he can continue to defend his constituents.
I get the impression that he wants us to show some backbone. Now how do we do that? What actions should we take? My colleague and I want the same thing, we are looking for the same results, but how should we proceed at this point?
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