June 5, 2009
Whistler, British Columbia
2009/38

Based on a Transcript

Address by the Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, at the 72nd Annual Conference and Municipal Expo of the Federation of Canadian Municipalities (FCM)

It’s such a delight to welcome each and every one of you to British Columbia. You’re going to hear some great speakers. I want to make my remarks brief because you’ve got people like Becky Scott, who has been a hero of mine, an Olympic champion, and she’s waiting in the wings here. I understand you’ll be in for some good discussions. There are some resolutions coming up, and I want to address that in a minute.

The Prime Minister cannot be here. He is in Normandy with President [Barack] Obama and other world leaders as they celebrate the 65th anniversary of D-Day. I’m sure you can understand the necessity for him to be present there. But he has a message that he wanted me to bring to you. He wanted me to read this to you, to help you understand his sentiments:

“I want to extend my greetings and best wishes to everyone participating in this year’s conference of the Federation of Canadian Municipalities [FCM]. I know that a major subject of conversation this year will be the economy, what approaches different municipalities are taking to dealing with the global recession, as well as next steps for the months ahead. Now, more than ever, it is important that all levels of government work together in a coordinated response to the challenges posed by the global recession. We all share a mandate from the same voters. These citizens are right to expect their representatives to cooperate in delivering tangible and timely results.

“I want you to know that whatever the issues of the day, our government will continue to look for more ways to cooperate and collaborate with Canadian municipalities. Our Economic Action Plan is filled with important job-creating projects and other stimulus measures that are already making a difference in communities throughout Canada. In particular, our action plan focuses on support for workers and taxpayers, support for the housing sector, infrastructure to create jobs, support for businesses and communities and improved access to financing. This common challenge we now face is ensuring that the money in Canada’s Economic Action Plan flows as quickly as possible in order to help the people who need it most. We are already taking unprecedented action to accelerate the federal approval process, and we look forward to working with you to further accelerate this process and maximize the value of these investments. By rededicating ourselves to a spirit of cooperation at all levels of government, we can help Canadians thrive during and beyond these trying economic times. Our government will continue to work with provinces, territories and communities to build an economically competitive Canada.

“I want to thank you for your leadership and partnership. Our government values your commitment not only to building stronger municipalities but also to building a stronger Canada. Sincerely, the Right Honourable Stephen Harper, Prime Minister of Canada.”

I don’t think the Prime Minister would mind if I added, on a personal note, that in our caucus meetings and in our Cabinet meetings, he is the first one to be asking the question to us as members of Parliament, “Are you talking to your mayors, are you in touch with the councillors in your areas?” He’s constantly reminding us of that.

It’s clear that when things are not going well or when challenges arise, and especially when workers feel insecurity related to their jobs, they start knocking on all doors. And as important as federal, provincial and municipal areas of jurisdiction are, when people are hurting and people are worried and people are anxious, they really don’t care a lot about jurisdiction. They just want to know that they’re being heard and that we’re taking action and we’re working together. And I wanted to thank you for being a part of that.

John Baird is our Minister of Transport, Infrastructure and Communities, and I understand you’ve also succeeded in having him here. He’s going to be speaking to you, so a lot of the details and the questions related to infrastructure and projects and the flow of dollars I’m going to leave to him to address.

We have agreed on many things, but one thing’s been predominant. In this time of global economic downturn, there are, you know, silver linings in some of the dark clouds. One is that the downturn has forced us to work at levels of cooperation and to look at removing levels of redundancy as never before, and that part has been positive.

We’ve said to the provinces, for instance, when it comes to a lot of the environmental assessments, we’ve said, listen, if our two processes are virtually identical and we know we’re meeting each other’s standards and meeting the expectations of our citizens regarding environmental protection, we don’t need to do two redundant processes when we’re looking at these assessments, especially on large projects. Let’s agree on one and get it moving.

So working at that level and working with you, we’ve been able to streamline things in such a way that [the benefits will continue] even when this economic downturn is over. By the way, what goes down comes up again; this is not the end of civilization as we know it. These are tough times, which we will work through as Canadians always have. We will move up again. And the things that we will have learned in government, in administration and in business will benefit us in many ways.

I’d like to let you know that we are doing a number of things to enhance our position in this time of global downturn, and so I’m going to speak briefly on international trade. We have put policies in place, and the whole of government has put policies in place, that have been recognized around the world.

As I attend meetings in different places in the world on our trade agenda, I meet with government officials and those in the business community in other countries, and there is a message that has been getting through to them. And it is evaluations by outside, independent evaluators. (You’ve heard this, and this is resonating around the world.) People will often open our meetings by saying, “We understand that Canada has the most stable banking system in the entire world.” That’s a fact. We are not bailing out banks. We are not bailing out financial institutions.

The other thing I hear is that we don’t have a big problem with sub-prime mortgages because of pre-emptive action we took to prevent these type of things happening. As the world looks at how they regulate the financial sector, they’re looking more and more at Canada. They used to call our banking system boring because we require certain levels of assets to be in place before a bank can even lend at certain levels. Isn’t it good to know that boring is the new exciting? This is where we are on the banking side.

On the competitive side, and this is our policy position, it is hard-working, entrepreneurial, risk-taking workers and investors and individuals who do all the trading of goods and services from Canada into other countries. It’s not the government. But it is our responsibility to make sure that our workers, producers, investors and innovators are encumbered as minimally as possible by government, so that they can be as nimble as possible when marketing their products and services on the international stage.

We all know there is some level of taxation that is necessary, but it can be burdensome. We all know there is some level of regulation that is necessary, but it must be efficient and it must be meaningful. And that’s why it’s our goal to make the tax load and the regulatory load as light as possible for those who are doing the business of selling and producing and innovating and bringing the revenues into Canada to keep us as prosperous as we are. That’s our goal. So we’ve done that on the regulatory side when it comes to banking.

The other message that we’re sending abroad and that we’re hearing—and it’s other evaluators, like the World Economic Forum, the World Bank and the International Monetary Fund who have said this, as they do their evaluations for the next few years, moving toward 2012—is that Canada has and will have the most competitive tax structure of all the G7 countries. That’s a great position to be in.

Along with that, with our solid banking system, a very competitive tax structure and a common-sense regulatory regime, we’re also doing what we can through Export Development Canada to make sure that as much as possible when banks contract—and even banks that have a solid base are in a time of some contraction right now—that as far as possible and following business practices, we are making credit available where perhaps banks aren’t able to do that. We’ve considerably expanded the credit base and the capabilities of EDC to help our businesses and our organizations doing business around the world.

These are the messages that we are taking out there. These are the messages that will continue to carry us ahead.

The other thing we’re doing very aggressively is promoting free trade agreements around the world—and not just promoting them, we’re getting them signed, sealed and delivered.

Before Parliament broke in mid-December, we introduced a bill concerning a free trade agreement that we concluded with four European countries [Iceland, Liechtenstein, Norway and Switzerland]. That bill was then the lever we were able to use—because those four countries now have a great advantage, and we have an advantage back and forth with them—that was the lever we were able to use to allow for the Prime Minister to be in Prague a little over four weeks ago to sign, for the first time ever, an agreement with the European Union. That’s 27 other countries. We will immediately proceed with formal negotiations to have a free trade agreement with the EU. That was a great step forward.

We just passed this week in the House of Commons our free trade agreement with Peru. We also have on the table a free trade agreement with Colombia that we’re working toward taking through the parliamentary process. We are very close to signing a free trade agreement with Panama. By the end of the month, I hope I’ll be signing the final free trade agreement with Jordan. I have been in China just recently, as has the Minister of Foreign Affairs [Lawrence Cannon], to look at the specific sectoral areas where we could sign agreements. We signed agreements and memorandums of understanding in a number of different areas. The same with India. (I could go on for quite a while. I’ve been saying to my officials with International Trade that “free trade deals are us.”) We have to open up the doors of opportunity for our workers and for our innovators and producers to be efficient all around the world.

We have run into a situation in the United States relative to what’s called the “Buy America” provisions. When the “Buy America” legislation first came out, it was our Prime Minister who took the lead on the world stage and said to the United States that it must live up to its international trade obligations. He said that very clearly. It was only about four days after that, that President Obama came forward and said the United States would live up to its free trade obligations. It would insert into the “Buy America” provisions a clause to that effect. And they did, and we applaud them for that.

However, since then, we have seen the working out, the flowing through of the funds as they’ve moved through the various committees, especially the Ways and Means Committee. They have had attached to the funds unfortunate provisions that are shutting out Canadian suppliers. And we say that needs to change.

We have been working at a number of levels for a number of weeks on this very issue, including through the Canadian embassy with our ambassador at the diplomatic level. I have been meeting and talking with the U.S. Trade Representative [Ambassador Ron Kirk] and the Secretary of Commerce [Gary Locke]. I met with the Chairman of the Ways and Mean Committee [Charles Rangel] and some of the members. As a matter of fact, I just talked to him again this morning. We are working across the border with international and national business organizations, chambers of commerce, and manufacturers and exporters associations. We are working across the border with governors and engaging people at the local level to get this message out: that especially in a time of economic downturn, if you want to protect workers, if you want to protect jobs, if you want to protect an industry, you open the doors of opportunity, you don’t close them.

The economic history books are filled with the results of retaliatory protectionist activity. We saw it in 1930. As the world was moving into the recession, the U.S. came out with the Smoot-Hawley Act, which was a very protectionist piece of legislation. It caused other countries around the world to retaliate, and the world plunged into a longer-term depression.

We need to push back with our American friends in terms of the direction that some of the stimulus packages are going in the United States. We have a great trade relationship that is the envy of the world. But it can get hurt and it can get strained by some of the provisions that are taking place.

I’ve been working also with the provinces. My officials have been working at the provincial level. Yesterday the Prime Minister had a full discussion with provincial premiers on this very subject, to make sure that we engage with them. This morning, in the meetings with Mr. Perrault [Jean Perrault, Mayor of Sherbrooke and President of the FCM] and the other members of the FCM executive, we agreed to link with municipalities to make sure that through my department and my officials we are tied into what you are doing, making sure you’re getting the information flows back and forth.

This is a time for us... Look, we’re all elected people. We know partisanship kicks in at times. But you know what? This is a time for us to really work together on this issue for the good of all our constituents.

There is a resolution that is coming before you. I understand it is from the Municipality of Halton Hills, and others are supporting it. Clearly, I’m not here to intervene or meddle in your resolutions. That’s for you to move ahead with. You know my position. Mine is that we want to head this thing off at the pass. We have been effective in the past on major issues with the United States. Many of us have been doing this. The movement is rolling. The pressure is coming to the White House and to Congress even now from U.S. business associations. They’re hearing from their own constituents who will lose jobs if trade with Canada is hurt. In the 35 states that depend on Canada, over seven million U.S. jobs are dependent on good trade flows.

So I want you to know that we are being very aggressive in the methods that we are taking to them, as in the past they have been leaders in the free world in talking about freedom of trade. They need to continue to set that example, continue to realize that you don’t build an economy up by building up a trade wall. Trade walls go up: economies come down.

We are going to work with you at your level and at these other levels to surmount this present difficulty. This is going to take some time. We are very pleased that they have a large stimulus package of US$787 billion, and that about US$287 billion of that is directed toward the municipalities and states, but we don’t want Canadians being shut out of that process. We’re here to work together so that the United States knows very clearly what our position is. And we are not backing down on this.

Thank you for working together with us, as we move to conquer this particular area and continue to see prosperity here in Canada and in your municipalities.

Thank you so much for being here today.