FAIT Committee Meeting

STANDING COMMITTEE ON FOREIGN AFFAIRS AND INTERNATIONAL TRADE

COMITÉ PERMANENT DES AFFAIRES ÉTRANGÈRES ET DU COMMERCE INTERNATIONAL

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, December 11, 2001

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[English]

The Vice-Chair (Ms. Jean Augustine (Etobicoke—Lakeshore, Lib.)): Good morning.

I'd like to call to order, pursuant to Standing Order 108(2), a briefing on issues relating to the WTO ministerial conference in Doha, November 9 to 13, 2001.

• 0910

We welcome the witnesses. From the Canadian Council for International Cooperation, we have Mr. Gerry Barr, president and CEO; from the North-South Institute is Ann Weston, vice-president; and Mr. Fergus Watt is the executive director from the World Federalists of Canada.

We'll start with Gerry Barr, president and CEO of CCIC. Thank you.

Mr. Gerry Barr (President and Chief Executive Officer, Canadian Council for International Cooperation): Thank you very much, Madam Augustine.

First, I'd like to thank the committee for the opportunity to be here ahead of the Christmas break to discuss what happened at Doha. I think it's important for parliamentarians to hear diverse views on the Doha outcomes, and there's quite a bit of diversity on that score. In fact, there is very little consensus, in the broad international discussion of approaches to trade, on what is getting better, what is getting worse, and what are the best ways forward. This is true, of course, both north and south, but also within countries and amongst citizens. This non-consensus is important to remember as we try to grapple with how to ensure broad-based debate on the best role for Canada with respect to these international trade agreements.

CCIC was one of a small number of accredited NGOs observing trade talks at the recent Doha ministerial. In the ten minutes or so that I have to speak to you, I want to try to provide you some assessment of what happened there, as well as offer some views on what we see as key issues for the year ahead and the potential role for this committee.

On Thursday, you heard from the Department of Foreign Affairs. I share some of their conclusions about what was positive about Doha, but I do disagree with them on several of their key contentions.

First, to say that we have a development agenda coming out of Doha is, in my view, a misnomer. There were some important advances that the south and many NGOs struggled for. Chief among these is the political declaration on TRIPS, which calls for a pro-public health interpretation of TRIPS, particularly confirming flexibilities for countries to seek compulsory licences for generic medicines and to find savings via parallel importing of branded drugs available more cheaply on offshore markets.

The review of anti-dumping duties may help small countries that have been feeling subject to too much unilateralism and countervail actions taken by countries like the U.S.; however, I think one should say that anti-dumping may be in sight, but it is not yet in range for the developing world. The waiver of the Cotonou agreement on preferential EU tariffs for former colonies is certainly also a positive in development terms, and the strong, though contingent, language on phasing out export subsidies in agriculture is important as well for the developing world. For lack of time, I won't go into some of the other smaller issues that may also be of interest to development advocates.

Of course, many other core development concerns did not make it onto the agenda. These relate to biodiversity and patenting, market access for textiles, or special measures to protect small farmers in agriculture. With respect to medicines, the most critical gap at Doha was that countries too poor to have production capacity for generic drugs were not granted import rights, but instead were given a year of studying the issue. The opportunity for a true and proactive development round was, in our view, missed by global leaders.

For more details on the development agenda that might have been, I would direct your attention to a summary report of a round table on key development issues, which CCIC hosted with officials ahead of Doha, and which Mac Harb and Svend from this committee attended. I have copies of the report here, which I'd be happy to leave with the clerk.

The main point is that the south—fairly, in our view—had asked that significant headway be made, in advance of Doha, to address clear injustices and imbalances in existing agreements, including improvements in market access. They did not want to have to renegotiate the pledges of prior arrangements through trade-offs on new issues in a new round, but sadly, that is exactly what they ended up committing to.

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Ahead of Doha, the developing world had bitterly resisted the discussion of the new issues, particularly the Singapore issues of government procurement, trade facilitation, investment, and competition policy, arguing that they had neither the capacity nor the confidence to take on new issues with the north. That should have been respected, and in a consensus-based organization it ought to have been possible to respect it.

In the end, India and a handful of other countries did successfully hold out. They have the word of the chair, and implicitly of all countries who listened to this debate play out, that there is no agreement to move automatically to new negotiations after the next ministerial, but the pressure is of course on, with several new study groups that will exact demands on overworked and tiny delegations. Perhaps China will weigh in with India in future years on these questions, and that could tip the balance of negotiating power considerably on some of these questions.

So how did the new round and the new issues get launched? Was the process fair? Does Doha show us progress has been made toward ensuring effective participation of poorer countries? On Thursday you heard yes. You heard that the issues of developing countries were clearly reflected in the text—and, shockingly, you heard that the days of arm-twisting and backroom deals were pretty much over. Well, you should know that some of the most veteran NGO observers of trade and the WTO found Doha to be, in their judgment, the worst yet in this respect.

[Translation]

I remember the Summit of the Americas in Quebec City where exclusion was the order of the day. You only have to think back to the perimeter, the brutality and the tear gas. You will be surprised to learn that, compared to this fall's meeting in Doha, the Quebec Summit last spring was the height of democracy.

There were some 60,000 demonstrators in Quebec City, whereas in Doha, there were about 60, give or take a few. At the Doha summit there was visible brutality inside the security perimeter. Trade delegations from developing countries were lobbied and cajoled. Trade ministers were separated from their advisors. The much-talked-about green room process, where a small number of countries got together to make decisions on behalf of the remaining member-states waiting in the wings, was changed.

One observer remarked that the days of the green room were numbered, ushering in a new period of the green man. Those green men, who were friends of the chairman of the Doha meeting, had been given responsibility for special issues. These green men oversaw the bilateral talks. They recommended that new terminology be used with a view to obtaining the support of developed countries and the approval of the developing world.

In fact, Canada's Minister of International Trade, Pierre Pettigrew, became the green man for new issues, known as “Singapore issues”.

[English]

We think there's an important democratization agenda for the WTO, which Fergus will speak to in more detail.

Where to from here? What role for Canada? There are some core development issues that were not tackled at Doha that Canada must absolutely, in our view, support. I encourage you to ensure that it happens.

First, Canada should play a proactive role in the next one-year period to ensure that countries without production capacity for generic drugs have the right to import them. This is a basic rights issue—the right to health. Millions of human lives hang in the balance. It is imperative to note that the overwhelming majority of developing countries do not have generic production capacity.

What was achieved in Doha is good for Brazil and India. But think of the 48 least developed, largely African countries, who must rely on imports. They have been left high and dry.

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Canada must be clear on this issue, and to date Canada has not been supportive, although Mr. Pettigrew has indicated some sympathy here. If the committee could help seek clarification on Canada's intent regarding the study year on this issue of generic imports, that would be an important pressure.

In agriculture, the development box is an important southern proposal that would re-legalize key supports for small farmers—the majority of the world's poorest citizens—who are routinely being devastated by import surges resulting from dumping and liberalization measures. If this doesn't get on the agenda of the committee on agriculture this year, the prospects for millions of small farmers facing such pressures remains bleak indeed. Canada can play an important role, and must be called on to do so.

There are three years of heavy negotiations ahead in the coming round. If the bullying and pressure tactics continue, if the democratization process is not opened up, we could be in for some pretty sad outcomes by 2005.

MPs can help keep the windows open on a process that has an inherent inclination toward a closed-door approach. I think the committee also needs to help play a role in open consultations with Canadians, given the continuing non-consensus domestically about key issues in GATT's health and environment services—concerns about domestic regulation, capacity, and water exports, concerns about our excessive pressure on developing countries to open markets, and our lack of support for some of their key development proposals, such as those I mentioned earlier.

At our October 16 round table, the one I mentioned earlier, I suggested that Canada might consider an annual parliamentary tabling and debate of trade agenda and priorities akin to the budget process. I'd be keen to hear your reaction on that idea.

Thanks very much for your time.

[Translation]

Thank you, everybody.

[English]

The Vice-Chair (Ms. Jean Augustine): Thank you.

Dr. Weston.

Ms. Ann Weston (Vice-President, North-South Institute): Thank you, Madam Augustine.

I'm pleased to be able to be before the committee today to be able to present some of my thoughts on what happened at Doha.

[Translation]

First of all, I would like to make a few comments on the negotiation process at Doha. Then, I would like to talk about the outcome and, lastly, I would like to get into the next step.

[English]

First of all, talking about the process, I was pleased to have been part of the Canadian official delegation. In fact, I think I was one of the few from the development community who was able to take part in that official delegation.

With hindsight, there were some elements that really could have been improved. Partly as a result of the rush—many people didn't expect Doha to actually take place, and the delegation itself wasn't finalized until I was out of the country, about two weeks before the meetings took place—there were a number of questions about the role non-officials in that official delegation were to play and also about the issue of official resources that should have been made available to ensure their participation.

At Doha I was not asked to participate in the innermost meetings, the ones where the friends of the chair, for instance, discussed some of the Singapore issues and other issues behind closed doors. But really my role was to act as a go-between between the official delegates—the Canadian officials—and the NGOs that were outside.

The process was definitely more transparent in many respects than might have been expected, but there were also a number of elements that could have been improved. Gerry Barr has just mentioned some of those.

Many developing country delegates were very frustrated by the late-night meetings, the changes to the text that were introduced at the last minute and which excluded many of their demands. The friends-of-the-chair process—what we have now come to call “the green men process”—was also quite frustrating. Certainly there was a lot more extensive consultation than in the past, for instance, during the green-room meetings in Seattle, but the consultation was done in a very fragmented way and certainly with much less accountability than a more formal meeting process would normally allow.

People were also very concerned about the process of arm-twisting, the special bilateral deals with respect to promises of aid, promises of market access that were offered to persuade countries to sign on to the final declaration in order to achieve the much-lauded consensus, which was needed for the negotiations to proceed.

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I would say to their credit that many developing country delegations certainly displayed a far greater technical knowledge than they had in the past, so to some extent the results of the technical assistance and the capacity-building that has been offered to those countries has certainly begun to pay off. In many respects there was much more coordination in the presentation of draft proposals than has happened in the past, but in the end that coordination and coherence among those countries seemed to crumble in the face of tremendous pressure from the larger countries.

Finally, on the process, I would just like to note that it was quite important, although it was only a beginning, that the Canadian International Development Agency, CIDA, had two and a half delegates at those meetings in Doha. There were two people from Ottawa—the president of the aid agency and another person who works on trade policy—and then there was an official from Geneva who spent half of her time as financed by CIDA. That's why I say there were only two and a half people there. But this was a very important beginning for CIDA to play a larger role in the formulation of Canadian trade policy, although this is very much still at its early stages, and we have yet to see the capacity of the agency having many concrete results.

Turning then to the substance of what was agreed in Doha, as Gerry Barr has just mentioned, referring to the Doha development agenda for many development analysts is really a misnomer. This is not a development agenda. The results of the Doha discussions were not balanced in favour of developing countries, and certainly the agenda does not seem likely to address the imbalances that resulted from the Uruguay Round. In fact, many parts of the agenda appeared to disregard the demands that developing countries had been articulating so clearly in the days before Doha, particularly the need to deal with many of the implementation problems resulting from their Uruguay Round commitments—the need to study the impacts of those commitments on developing countries' economies and on their peoples before embarking on new issues or new areas, such as competition policy and trade facilitation, or before even going further on areas like investment and government procurement.

I think we should note that there are many ambiguities in the language that was agreed at Doha, and there are many questions about how that declaration will be interpreted. Some people, including our own officials, said that this was merely a political document. Perhaps in some sense they were trying to diminish the value of what had been agreed at Doha. So people are wondering whether this is a legally binding document and what value it will have as we begin to implement some of the areas that were actually discussed at Doha—for instance, the issues with respect to intellectual property rights and the commitments, albeit vague, to going further in helping open up markets to imports from least developed countries.

On the positive side, I would agree with Gerry Barr that there were some positive elements: the recognition of flexibility with respect to the production of medicines needed for dealing with pandemics; the commitment to end agriculture export subsidies; the agreement to review and tighten up the use of anti-dumping duties; the commitment to move on tariff peaks; the waiver for the European Union and the African, Caribbean, and Pacific countries so that the Cotonou agreement can be legally binding; the study groups on trade and debt, trade and the transfer of technology; the commitment to review special and differential treatment; and finally, of course, the commitment to give more technical assistance and support for capacity-building.

On the negative side, though, there is this pressure to continue full steam ahead on new issues on top of the already very heavy negotiating agenda with the negotiations, for instance, on agriculture and services. There is also the failure to deal with small countries that have to import drugs, the failure to move on textiles and clothing, the failure to deal with market access for least developed countries, and the failure to deal with the development box for agriculture. These are negatives that have to be taken into account, and they're not really sufficiently offset by the positives I mentioned earlier. Certainly throwing money at the problem is not going to make this a development round.

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I was particularly dismayed with Canada's continuing hardline position on market access for textiles and clothing and particularly for the least developed countries. I had just come to Doha from working in Bangladesh for a couple of weeks, and certainly in Bangladesh the clothing industry, which has typically employed a large number of young women, is facing a very desperate situation. Thousands of factories have closed and 300,000 young women are now out on the streets with very little alternative for employment. Many of them are forced either to go back to their villages or to just stay in the cities and turn to prostitution.

I think it was very disappointing that at Doha there was no commitment to further efforts for the least developed countries, whether in terms of further accelerating the removal of quotas on their clothing exports or, more importantly, I would argue, the removal of tariffs on all their exports to our markets.

What should happen next? I think it's very important that this committee continue to engage with the Canadian government on making sure that some of the promises at Doha are not empty promises and that we go beyond the commitments of cash to engaging in discussions about how we can actually make the World Trade Organization support development. We need to make sure that we recognize in the new rules that are going to be negotiated that one size does not fit all. We're not trying to create a level playing field for unequal players.

I would recommend that this committee make deliberate efforts to focus on development over the next three years, whether or not it would create a subgroup that would focus on making sure that this really is a development agenda, whether or not it would recommend to the government that, for instance, development expert be appointed to the International Trade Advisory Committee that works with Mr. Pettigrew. Mr. Pettigrew is very committed to developing countries, but what may not be so clear is how to make sure that those rules in the WTO really do work to support development rather than go against development in developing countries.

Also, in regard to some of the special advisory groups on international trade, whether it's the advisory group on agriculture or on some of the other issues, maybe it would be appropriate to make sure that there is somebody with strong development expertise who works within those committees to make sure that we have rules and concessions for developing countries that recognize their development needs.

I'd just like to end by quoting from Ambassador Erskine Griffith from Barbados, who said at Doha:

...the greatest threat to the survival of the multilateral trading system will not come from anti-globalization demonstrations or from the global economic slowdown, but from a failure to seriously address the growing imbalances in the existing system and their adverse effects on developing countries.

I hope you will take these appeals for consideration about developing countries' needs quite seriously.

Perhaps I will offer just one final comment. We should really be aware of what's happening in Washington, D.C., around the efforts to secure what's now called the trade promotion authority. What's happening in Washington really almost amounts to a backtracking on some of the commitments and some of the backroom deals that were made before and after Doha. This is of particular concern. Certainly there has been some rewriting of the special provisions for countries in the Caribbean in order to persuade one or two of the congressmen from the Carolinas to support the trade promotion authority. It's likely that when the trade promotion authority goes before the Senate there will be some pressure to go back on the commitments to reviewing anti-dumping rules as well.

We really need to make sure that what little was agreed to before and around Doha and at Doha is actually lived up to.

I would like to thank you again for this opportunity to be here and for the discussion this morning.

The Vice-Chair (Ms. Jean Augustine): Thank you, Dr. Weston.

Mr. Fergus Watt.

Mr. Fergus Watt (Executive Director, World Federalists of Canada): Thank you, Madam Chair, and I'd also like to thank the committee for this opportunity to reflect on what occurred in Doha.

I'm going to confine my remarks primarily to what is referred to as public participation issues, or the democratization of the WTO, if you will.

First of all, the fact that there continues to be a public participation agenda vis-à-vis the WTO arises primarily from the structure of the institution and its relationship with other parts of the international system of trade governance. The WTO, as we all know, is a powerful body, and its rules and tribunals have binding effect. They erode the authority of national governments. They infringe upon the jurisdiction of other international treaties and organizations. In short, they affect the public welfare on a wide and, by now, well-known range of non-trade issues. There's a broader public interest, and the public interest has scant means to be heard or represented at the WTO. What can be done about this?

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Practical remedies for this state of affairs have focused, as short-term goals, on two objectives. One is to improve the access privileges for civil society, non-governmental organizations, at the WTO, and the second initiative is to seek ways to bring parliamentarians more integrally into the work of the WTO through, for example, creating a WTO parliamentary assembly. That's something this committee has endorsed in the past.

I'm going to speak to those two initiatives, first of all, the NGO side. Comparisons of access privileges at various international organizations, UN bodies, the WTO, World Bank, etc., reflect the fact that the WTO is one of the world's least transparent international institutions. For NGOs, Doha must represent, however, some sort of low-water mark in terms of their capacity to influence outcomes and shape public expectations of the negotiations.

After Seattle, the WTO was determined to keep NGOs on the margins and it succeeded. Indeed, for most NGOs, the writing was on the wall long before the Qatar ministerial. For example, the WTO-sponsored symposium on the role of NGOs back in July featured boycotts by many of the international non-governmental organizations that usually participate in these sorts of events.

Canada, to its credit, tried to mitigate the damage at that particular meeting by subsidizing NGO participation and trying to encourage many to attend. I'd like to return to Canada's policy and perspectives on some of these public participation issues later as I conclude.

At Qatar, NGOs were frozen out through a variety of methods and strategies, starting with a bizarre and restrictive set of rules for accreditation that saw only 647 organizations authorized to participate. Half of these were industry associations. There was an awkward location for the NGO forum, ten minutes' walk away from the negotiations. The site of the meetings, Qatar, in a remote part of the world, was under stifling security arrangements. Also, there was restricted access to the negotiations per se, to government delegates, and to the meeting documents. All of these add up to a limiting of the ability of NGOs to gather information and try to influence outcomes at meetings such as this. It's really to the discredit of member governments.

There was probably a bit of a bunker mentality that pervaded after Seattle, but I think we really have to get over that now. There's still a lot of skepticism among the general public. Skepticism over what the WTO does and is about needs to be engaged, because I think as the shadow of Seattle recedes there's a maturing of the debate. There's no longer a widespread, sort of “WTO has got to go” mentality out there. I think a greater number of NGOs are willing to look at ways that trade rules can work for development and be structured in a way so as not to undermine environmental governance and rights and so on.

I think that if Canada could encourage NGO participation in organizations like the WTO, it would be in its interests to do so.

Turning to initiatives that would broaden a parliamentary dimension for the World Trade Organization, that situation was a little more positive at Doha. Over 90 parliamentarians from around the world—some of them are in the room here—met on November 11 and issued a declaration calling for a stronger parliamentary dimension in the work of the WTO. The meeting was organized and chaired jointly by the Inter-Parliamentary Union and the European Parliament.

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The co-sponsorship of the parliamentary conference reflects the fact that there are still two competing visions as to how a parliamentary forum alongside the WTO should be structured and implemented. The IPU members feel their organization should become the custodian of the WTO's parliamentary dimension, and WTO Director General Mike Moore also favours the IPU option. Another group, which first met in Seattle and is now led by the European Parliament, wants a more robust standing body of parliamentarians.

In any event, a resolution passed by this joint body that met in Doha called on governments to add language to the ministerial conference final declaration that would say “Transparency of the WTO should be strengthened by associating parliaments more closely with the activities of the WTO.”

Unfortunately, despite receiving support from Canadian representatives and European representatives, this text did not see the light of day when the conference final declaration was approved. However, there was elsewhere in the declaration, from the parliamentarians themselves, agreement to establish a joint IPU-European Parliament steering group that will hold further meetings and develop options for actually creating a parliamentary dimension for the WTO and bringing some of these proposals forward to the WTO council and a future ministerial meeting. So the debate on the role of parliamentarians and the WTO is put off for another day, but it's far from over.

In Doha, governments felt they needed a new round come hell or high water. Now that a new round has been agreed, the time may be a more propitious for the WTO to address its democratic deficit.

Greater attention should also be given to a wide range of what are referred to as coherence issues—the need to sort out the organization's relationship with other international treaties and agencies. This is particularly relevant in light of articles 31 to 33 of the final declaration, which call for the WTO to discuss its relationship with multilateral environmental agreements.

Canada has traditionally been more progressive on many of these public participation issues—the broader systemic question—than the majority of WTO member governments. But Canada could do more. Sometimes its activism on public participation issues has been a “back burner” priority for Canada—something we'll do in the future; something that's pushed when the costs are low, and often for domestic consumption rather than in the interests of actually making the organization function more effectively. As with so many other things, policy is often developed on the fly, in an ad hoc fashion.

A new round marks an opportunity for governments to renew and update policy. Canada could help lead the WTO to support initiatives to open up the WTO. I don't think those initiatives are going to come from the officials in Canada's or other trade ministries. I think leadership on some of these questions must come from parliamentarians. I would welcome serious consideration by this committee of ways in which Canada can help provide some of the continuing leadership on some of these important public participation questions.

Thank you.

The Vice-Chair (Ms. Jean Augustine): Thank you very much, Mr. Watt.

We'll now go to questioning. We'll start with you, Mr. Duncan.

Mr. John Duncan (Vancouver Island North, Canadian Alliance): Thank you very much.

I'm sorry, I missed your presentation, Gerry, so I can hardly talk intelligently about it.

As for Ann's presentation, you were talking about concerns related to dilution of WTO authority through the trade promotion authority discussions in the U.S. Congress. I think we all share your concerns.

• 0945

The positive in this is that, number one, we know about some of the trade-offs. I'm not sure that in the past we would've known what kind of horse-trading was going on, necessarily, in the U.S. Congress. Secondly, the ultimate disposition of some of this horse-trading presumably would be appealable under WTO rules. I think that's the irony of the situation. Do you read it that way? Do you read some positives into this as well?

Ms. Ann Weston: I think the problem with some of the trade-offs—some of the backroom deals that were agreed around, before, and after Doha—is that we don't actually know the details of some of those deals. I know we know the details on the floor of the House, because they were made very publicly. But the question is, to what extent are they leading to undermining some of the bilateral deals that were struck in the middle of the night in order to persuade countries to stop opposing the declaration at Doha?

We are concerned there might be some dilution around the language with respect to anti-dumping duties, which in itself is quite ambiguous in the final declaration. I think there's definitely a lot of pressure on the U.S. to review and control its use of anti-dumping duties, but it's quite possible what could happen over the next few days is the commitment could become even more problematic than it already was at Doha.

I'm not sure whether we have got the increased transparency. I would still think there needs to be a lot of pressure put on the U.S. by its bilateral partners, such as Canada, to make sure it really does live up to the commitments in Doha.

How far those commitments are legally binding I think is debatable. As I was saying earlier, some people say those are purely political commitments. Of course they're commitments by people with a lot of authority in determining how the WTO evolves. These are the trade ministers, after all, and it's their mandates that will then get reflected by the negotiators in Geneva, one would hope.

But the question really is whether or not even that political commitment will be diluted now by the U.S. as it's facing the pressure to pay off or buy off opposition to the trade promotion authority.

Mr. John Duncan: Yes, it's a difficult one.

I noticed somebody from the U.S. Department of Commerce very recently—I guess last week—wrote a public piece in one of the national Canadian newspapers basically to explain they were not captive of special interests but actually followed a legislated mandate. So they're obviously feeling more sensitized than they were in the past to some of the charges people such as myself and others have made—for example, that on the softwood file they're basically an agent of the special interest lumber lobby, and so on.

We're not going to get away from any of these political manoeuvrings in the short term. I guess we all have to ask, are we making progress or are we going backwards? I'd still like to think we're making progress, and I think I detected that in your comments.

• 0950

I have a quick question for Fergus. I was there, as you were, at the parliamentarian meeting. It's obvious that one of the problems is we have WTO member countries that don't have parliaments. Have you developed a model that would somehow address that, and maybe help expedite a parliamentary assembly?

Mr. Fergus Watt: I haven't personally, but there's quite a wide body of literature out there. Most recently, on behalf of my organization, John Bosley, a former speaker of the Canadian House of Commons, wrote an extensive paper on how you might go about structuring a parliamentary body and addressing some of those difficult questions of representation, and so on.

We're talking here about a consultative body, not a body with legislative powers. So the fact that not all parliaments are democratically elected is not a problem, in the first instance. Perhaps only years or decades down the road this consultative parliamentary assembly will evolve, for example, in the manner that the European Parliament has evolved, to now play an instrumental role in the governance of EU affairs. As it evolves, one might need to look more closely at questions of democracy and representation in a parliamentary assembly, as its powers evolve.

I should also point out that even though its role would be consultative, in the first instance, that would still entail quite a lot of influence. On just the capacity to hold hearings and engage the public debate in a political climate, such as the one we're living in, where there is so much public attention on matters of globalization and international trade, the fact that you would have a body of global parliamentarians sitting and taking a global perspective on what the WTO does would be a forum for engaging some of these public issues.

I think the meeting we attended in Doha had its problems. At the end of the day, a joint declaration was passed, as you know, but we're still a long way away from getting there. The fact that the text that was recommended to the ministerial declaration did not get in means we don't really have the recognition from governments that this process is underway and should go forward. So hundreds of parliamentarians from around the world who want to do more and feel they should do more at the WTO don't have a legitimate way in yet.

Mr. John Duncan: The spokesman, the member of Parliament from Thailand, probably described it best at that meeting. I understand, in the transition, the next chief executive for the World Trade Organization is from Thailand.

Mr. Fergus Watt: Yes, I believe so.

Mr. John Duncan: That sort of brings an optimistic note for the likelihood that this agenda may be moved forward, in my mind anyway.

The Vice-Chair (Ms. Jean Augustine): Thank you, Mr. Duncan.

[Translation]

Mr. Paquette.

Mr. Pierre Paquette (Joliette, BQ): Thank you, Madam Chair.

I would also like to come back to the issue of the democratic deficit. Several of us share your assessment of the WTO negotiation process. We feel the same way about the Free Trade Area of the Americas and also the free trade agreement negotiations with the four Central American countries.

• 0955

Could you perhaps give us some more concrete proposals to address the issue of the democratic deficit? Members of Parliament should be involved. I agree with you on that. For example, the Canadian Parliament does not have the opportunity to vote on international treaties. We are not setting a good example here. There are international assemblies which ratify agreements before they are signed by the executive. In Canada, at best, we vote on enabling legislation for these agreements, but we are never given the opportunity to have input into these agreements.

Therefore, how should members of Parliament be involved? How can we get civil society involved? Could you give us some examples here? I tabled a motion against the backdrop of the Free Trade Area of the Americas negotiations. My motion was designed to set up an on-going process whereby civil society and members of Parliament would be involved. My motion was supported by the whole House, including the government, but it failed to change the government's behaviour, because quite obviously, the government believes that both civil society and members of Parliament are already involved in the public debate.

Consequently, could you give us some fairly concrete suggestions on this? There is one other area which I feel it is important to clarify. Mr. Duncan alluded to it earlier. Many developing countries are not particularly democratic, and, at these fora, these countries speak against specific proposals, such as social clauses. Then the Canadian government comes along and it says that it was not against introducing clauses to defend workers's rights and the environment, but that it was in fact countries of the southern hemisphere which blocked them.

I would also like to hear what you have to say on that issue.

Thank you for your presentations.

[English]

The Vice-Chair (Ms. Jean Augustine): Mr. Watt.

Mr. Fergus Watt: I apologize. I have to answer in English.

Mr. Pierre Paquette: It's okay.

Mr. Fergus Watt: The initiative for a parliamentary assembly or parliamentary forum alongside the World Trade Organization is but one concrete way to address the democratic deficit. Complementary to that should be continuing and extended engagement in trade matters in the parliaments themselves.

Once you created a parliamentary body alongside the WTO, you would have a permanent standing body that could have a sort of organic relationship with the WTO. You'd get information flows, and parliamentary delegations and parliamentarians reporting back to national parliaments. There would be a sort of synergistic effect of strengthening national deliberations in parliaments, as well as those national deliberations calling for the World Trade Organization parliamentary assembly to do this or that. There would be a sort of self-reinforcing mechanism between the national parliamentary level and a higher supra-national body.

The second advantage of a parliamentary assembly is the forum it will provide for civil society. A parliamentary assembly is not going to meet for long periods of time, or year-round. They're going to be brief meetings, and they're going to need the particular expertise that civil society can help provide. Civil society, in turn, needs a legitimate forum to air its grievances—something other than the streets of Quebec City and Genoa. There's a shared interest there, in bringing public concerns to bear.

• 1000

Mr. Gerry Barr: Sorry, I'm trying to intervene and maybe I shouldn't. It's a sort of a governmental lesson, maybe.

I'd just like to say, on the points offered by Mr. Paquette, that in some respects he has really touched on the central agenda item here. It's so important that we get the process right. There are really three areas in which there are accountability issues and governance issues with respect to the WTO. One is on national governments reporting on and being accountable for their roles, in terms of their relationship with the WTO and other multilateral trade agreements, with which they're so importantly engaged.

Secondly, within the WTO itself, what is the process of decision-taking? How does it function as a consensus-based organization? Is that really true, or is it in need of repair? There's a large body of opinion going in the direction that there are serious needs for repair of the WTO's own governance of the relationship between the secretariat and the members. It is, after all, an organization of member states, yet many member states are marginalized and have their voices ignored.

Third is the question of broad and global accountability of the WTO to the global community.

So there are really sort of three terrains where this issue plays itself out, and I think parliamentarians have important things to say about all three areas. To the extent that people are in the street and distressed about what is going on, and to the extent there is a sense of being out of control of the global agenda in countries around the world, it connects to this failure of process and accountability. People really think they're not in a position to make discreet choices, either through their parliamentarians or based on their own role as activists. In both areas there are enormous deficiencies.

One doesn't have the sense that this is a process that is well in hand. On the contrary, one has the sense there are major macro-economic agreements, with consequences that are very discrete and local, where there is a real failure of accountability and an inability to get hold of this, either directly or through parliamentarians. How to address this matter of process is an absolutely urgent question, and I would encourage you to continue on the track.

The Vice-Chair (Ms. Jean Augustine): Dr. Weston.

[Translation]

Ms. Ann Weston: I shall answer the question concerning the social clause because I don't think that my colleagues commented on that.

First of all, I must say that in Doha, the Canadian government attempted to introduce stronger language in terms of the relationship between the WTO and the ILO, but at the end of the day, the language used in the declaration was not as strong as the government would have hoped.

However, I recognize that our government could do a lot more on this issue. Canada could set an example by conducting studies in Canada on the impact of trade rules, not only on our economy but also on our society as a whole. Canada could work with the ILO on this issue to establish a sort of template for assessing the social impact of these WTO rules, for example, on working conditions and the status of women in our society. I believe that we can always do more here in Canada, even if there are problems with the governments of developing countries in terms of their relationship with WTO rules.

[English]

The Vice-Chair (Ms. Jean Augustine): Thank you very much, Dr. Weston.

We'll now go to Mr. O'Brien.

Mr. Pat O'Brien (London—Fanshawe, Lib.): Thank you, Madam Chair. I have a number of questions.

The first thing I would note is I regret that the Council of Canadians is not here. I understand they were invited, and I'd just like to have that confirmed. Were they invited to participate, and declined? Is that correct, Madam Chair?

The Vice-Chair (Ms. Jean Augustine): Yes.

• 1005

Mr. Pat O'Brien: I think that is regrettable. There have been a number of exaggerations coming from that organization, ones I would have loved to have raised today—but maybe at another opportunity.

I think, however, that I should raise a couple of points. I read in the Globe and Mail Maude Barlow's characterization of Doha, then I read Mr. Dymond, a professor at Carleton, saying that Ms. Barlow and I must have been at different ministerial meetings. He has a far different perception of what took place. Here's the quote:

Ms. Barlow contended in these pages last week

—the Globe and Mail—

that the declaration's call for negotiations to reduce barriers to trade in environmental goods and services means that restrictions on the export of bulk water for commercial purposes will be illegal.

This is flatly untrue.

These are the kinds of things I would like to have had the chance to take up, and hopefully we will. It is regrettable they declined the invitation. We hear exaggerations about bulk water exports when we're talking about water filters. We hear exaggerations of bulk wind exports when we're talking about windmills or about bulk sunshine exports when we're talking about solar panels. Madam Chair, there is a bulk exaggeration coming from the Council of Canadians, and I hope to take it up with them at some point soon.

I would like to ask questions of Mr. Barr and of each witness. I thank you for your perspective on this, although I have some questions.

I think there is a characterization, perhaps mostly by Mr. Barr, that this is hardly a development agenda coming out of Doha. I would just like to quote the Indian Minister for Commerce and International Trade, Murasoli Maran, and get your response, Mr. Barr. He says:

The key concerns of Indian agriculture have been adequately safeguarded in the declaration. The ministers at Doha committed themselves to negotiations, aid, and substantial improvement in market access, substantial reduction in trade-distorting domestic support, and gradual phasing out of export subsidies.

He goes on to say:

There's a very clear commitment to review the provisions for the special and differential treatment for developing countries in various WTO agreements to see how these provisions can be strengthened, made more precise, effective, and operational. These are welcome features.

Now, these comments come from a minister of a developing country, yet you didn't seem to think there was much by the way of development in that agenda. I don't agree with you on that, and it doesn't sound as if the Indian minister agrees. Could you comment?

Mr. Gerry Barr: There are of course differences, not only in the north about approaches at the WTO but also in the south. I think one of the most marked differences you'll find is between those economies like Brazil, South Africa, and India, who are in their own right significant trade players, and others that are less competent or throw less weight in the trade arena. They will have different views, and they will have different interests. To some extent, those differences of interest surface in commentary like this.

The key question for the agriculture sector is actually, if you think about import surges and the difficulties associated with the agreement on agriculture.... One of the examples of import surges is the marginalization of onion and potato producers in Sri Lanka because of Indian exports to that country. Just as corn producers in Mexico may be jeopardized by import surges from the United States, in Sri Lanka they're looking at India. I think that's what you see in that kind of commentary.

If I might just go on to one other point, you were mentioning that the Council of Canadians wasn't here and that there had been some commentary about the impact on water bulk export, the implications for water bulk export in the agreement on the environment. I noticed in the transcript of the presentation that was made to the committee on Thursday that the discussion of goods and services in the agreement on negotiations on the environment was characterized by representatives from the Department of Foreign Affairs to the effect that there would be negotiations on trade of goods and services for environmentally friendly goods and services. I just want to say that there was no such distinction in the text. It was goods and services, period. Environmentally relevant goods and services....

• 1010

There was a question raised, not only by the Council of Canadians but also by other environmental groups who were present at Doha, about the implications of that negotiation around goods and services with respect to the regulation of public water supply. I don't recall that it was about the exportation of bulk water, but I do know that it was a matter of real concern and that it was raised by folks who spent a lot of time....

Mr. Pat O'Brien: Thank you.

The point I was trying to make in quoting Professor Dymond, who is a professor at Carleton, was that the interpretation of what we read in the Globe and Mail from Maude Barlow meant there would be bulk export of water, that the prohibition of that would be illegal. He said that's flatly untrue.

I want to leave that, because I have some other questions. I think it's best taken up when they show us the courtesy of attending.

Mr. Svend Robinson (Burnaby—Douglas, NDP): On a point of order, I wasn't going to interrupt, but since Mr. O'Brien has repeated the suggestion that the Council of Canadians was discourteous by not attending, I think it is important just to clarify the situation. I did check with the clerk, and I believe that Maude Barlow is just returning from Brussels and was not able to appear before the committee. I'm certain that she'd be quite pleased to appear before the committee in the future.

Mr. Pat O'Brien: I hope that doesn't come out of my time, Madam Chair.

The Vice-Chair (Ms. Jean Augustine): No. Go ahead, please, with your question.

Mr. Pat O'Brien: I think that's an interesting observation, but I would hope there are some other people capable of speaking for that organization besides Maude Barlow. That's the point I was trying to make.

I would like to note that Ann Weston very accurately characterized the fact that Minister Pettigrew is very committed to developing countries, as is the current government and, I think, the Canadian public. You then spoke about some ambiguity in the agreement. I can concede that there is some ambiguity, but are we not at the start of a rather long process in which, hopefully, that ambiguity will be clarified?

Ms. Ann Weston: I was particularly concerned about the ambiguity and the so-called naming of the declaration in the particular area with respect to least-developed countries described as being a political statement by one of our ministers. My concern is that least-developed countries are in a dire situation today and that they need urgent action.

We have had meeting after meeting at which we have said that we will try to do our best. The language there, for me, is too unclear, too vague, and too non-committal. That was one of my main areas of concern, that we were not even able at Doha to move ahead in that area. There are a number of other areas that are ambiguous too, but for me that was a particular area of concern.

On the issue of water, I'd like to....

Mr. Pat O'Brien: Thank you very much. I've got two or three other questions. I am sorry, but this chair is very good with the time. I assume I have two or three minutes left, and I'd like to pursue a couple of other points.

Two of you—I think everybody but Mr. Barr—conceded that the government has done a lot to try to involve NGOs in.... There was no recognition of the federally funded parallel summit at Quebec by anybody, so let's get that on the record, though I think at least two of you have acknowledged that.

Mr. Watt, you went on to say that you think there's skepticism among the general public. I wonder, that's based on what? Is that a feeling? Do you have factual data you can share with the committee about this skepticism? I don't hear this skepticism among the public about the need for international trade. I don't hear it from Kofi Annan, the Secretary General of the UN, who's quantified it and said that this liberalized, globalized trade with the reduction of tariffs and the elimination of unfair tariffs can put up to $150 billion a year into the economies of developing nations. I wonder if you could share your reaction to that. What is this skepticism you've mentioned based on? Can you quantify that in hard data?

• 1015

Mr. Fergus Watt: First of all, with regard to Kofi Annan and then later with public attitudes, I don't think anybody out there is disputing the fact that under the appropriate conditions, trade liberalization is and can be compatible with sustainable development. I think that's Kofi Annan's point. In terms of getting the process right, we're looking for—and this gets back to some of Gerry's points—the appropriate conditions.

Right now, we have a World Trade Organization with significant powers, with tribunals whose decisions stick, that are binding, and other international agencies whose decisions and activities just don't carry the same kind of clout in the international arena. That dysfuctionality is part of what has to be remedied. In terms of public attitudes, I don't have hard data right here—I'm not a pollster—but they're out there.

When people get up and protest or do whatever they do to express their concern at what their government is doing in terms of trade liberalization, when governments have to go to cloistered security areas like Qatar, where there's high security—

Mr. Pat O'Brien: I'm sorry to interject, but I want to ask one more question. I hate to do it, Mr. Watt, but you did answer my question when you said you didn't have hard data. I understand you're not a pollster, so that answers that directly. The reason I interjected is that my last question comes to you. It's from Mrs. Carroll, but she had to leave for other duties.

What's your view on the best model for parliamentary participation? I think we all share this interest, on both sides of the table here—the need to involve parliamentarians as much as possible. Which model do you think is best, of the two sort of competing models we heard about today—the IPU structure, or something different as proposed by the EU? I wonder if you could address that question.

Mr. Fergus Watt: I and my organization lean toward the model advocated by the EU—a stand-alone parliamentary assembly for the World Trade Organization itself. A lot of international organizations have a parliamentary assembly—the Commonwealth has its own assembly; NATO has its own parliamentary assembly; so does the Council of Europe. An organization like the WTO should have its own parliamentary assembly.

The idea of an IPU parliamentary dimension, as they call it, is really, in my view, an effort to keep parliamentary scrutiny at a distance. The IPU is a large, long-standing association of parliamentarians. It takes the parliamentary dimension for trade and puts it in one of the IPU's committees, and you get occasional reporting on trade matters through the IPU committee process, and eventually, to the floor of the WTO once a year. That's just not good enough. The WTO is too important for that.

There are more than two models out there. It's a continuing debate, and I hope it'll be something this committee addresses in the future. I would like to clarify that when I said I wasn't a pollster, I would have liked to have gone on to say the evidence is out there. There is still widespread public concern over where trade liberalization is going, and I think it's demonstrable. That's my view. I have read the polls; what I meant to say is I didn't bring them with me.

Mr. Pat O'Brien: That's fair enough. I would just share that as one parliamentarian, everything I've read suggests there's somewhere in the order of a good 70% of Canadians who support international trade. There are caveats on that, such as fair trade, and I share those caveats. But I think while we acknowledge the skepticism, it would be wrong to leave the impression that somehow the Canadian public does not support international trade, because no poll I've ever read suggests that.

Thank you very much, Madam Chair.

The Vice-Chair (Ms. Jean Augustine): Thank you.

Mr. Robinson, then we'll come back.

Mr. Svend Robinson: First of all, I want to apologize for not having been able to be here earlier. I was actually speaking over at the Pearson Building on some of the issues you're addressing this morning. I very much regret not having been able to be here, but I'll certainly be reviewing your evidence with great care.

• 1020

Because I wasn't here, I'm not going to ask any particular questions on issues that you may have already addressed. I just wanted to comment.

Mr. O'Brien has talked about the great groundswell of support for international trade and so on, but I think we have to also put this in context. While it's true that there may have been some increase in overall wealth, I'm sure you've made the point that the distribution of that new wealth, particularly within the poorest countries, has been profoundly skewed. In fact, there's been a growing gap between the rich and the poor.

I remember, for example, travelling to Chiapas and meeting with campesinos and campesinas there who had been driven off their land because of a flood of cheap imports from the United States. Certainly they didn't feel the great benefits of trade at all. I think there is concern around that. There's concern around the impact of chapter 11 of NAFTA. There has been another chapter 11 suit launched, as you may have seen, just in the last week or so, by an American pesticide manufacturer, a manufacturer of lindane.

There's a lot of concern out there. I think people are concerned about the impact not of trade but of trade deals that purport to deal with trade but really are dealing more with corporate power. I just want to put on the record that I think there is some real concern. Knowing the witnesses before the committee, I suspect that they may have touched on some of those concerns as well.

I really just wanted to ask Ann Weston if she wanted to follow up on the issue of water, since she was cut off in her attempt to do so earlier. Perhaps she might just care to elaborate on some of the issues around water.

Ms. Ann Weston: I just wanted to say I was at a meeting a week ago at which Maude Barlow was speaking. I'm sure there will be many opportunities over the next year or two when this subject will be addressed at a number of different international conferences. I'm sure she would be very pleased that the Government of Canada would join her in trying to get water taken out of international trade agreements. I think it is looking for an international agreement on water which would safeguard water. I'm sure that if this is the intent of this government then she'll be very pleased to work with it over the next year or two.

I'm not trying to speak on her behalf, but just to say that there are a number of meetings coming up at which this will no doubt be addressed, and this committee will probably have occasion to discuss the subject at length with her.

Mr. Svend Robinson: Certainly I wanted to strongly support Mr. O'Brien's suggestion that we do hear from Maude Barlow in this committee early in the new year, so that she'll have an opportunity to share her concerns with the committee.

Mr. Pat O'Brien: I didn't say that, Madam Chair. I decried the fact that they didn't show up today.

The Vice-Chair (Ms. Jean Augustine): Okay. We're not going to be debating this issue.

Mr. Pat O'Brien: Mr. Robinson was taking liberties with my words.

The Vice-Chair (Ms. Jean Augustine): We go next to Mr. Harvard.

Mr. John Harvard (Charleswood St. James—Assiniboia, Lib.): Thank you, Madam Chair.

I have a couple of questions. Perhaps I can just ask both of them and then members of the panel can respond.

I was one of the parliamentarians who was at Seattle a couple of years ago. While all of us abhorred the violence that took place in Seattle, I think there were some of us who thought that in some ways what happened out on the street was not totally unhelpful, that it was in some ways seen as a wake-up call for the WTO, which perhaps was not as sensitive to some of concerns or a lot of concerns as we had hoped.

I've already heard you and you've been on the record many times indicating your displeasure with the way the WTO is structured and with some of its behaviours. On a scale of one to ten, with ten representing significant change, where would you put the WTO on that scale, since Seattle? That would be my first question.

The second has to do with agriculture. I've been involved in agricultural issues for a number of years and we all know that there are some farmers in this country, particularly in grains and oilseeds, who are suffering, largely because of low prices and partly or largely because of subsidies by the Americans and by the Europeans. In our trade negotiations through the WTO and elsewhere we are looking for relief of one kind or another, especially the hoped-for diminution of subsidies. Then, of course, there is the plight of the farmers in the developing world. They're suffering too, and I suspect, on balance, more than ours.

• 1025

In our world trade discussions through the WTO and elsewhere, what kind of quid pro quo do we look for as a country? How do we help our own farmers and, perhaps at the same time through those discussions, provide some relief, whether it's to a producer in Sri Lanka or Latin America or wherever?

Those are the two areas I would like the witnesses to respond to.

The Vice-Chair (Ms. Jean Augustine): Mr. Barr.

Mr. Gerry Barr: Thank you, Mr. Harvard. To go to your second question first, one can see the agricultural economy of the world as having at least two very distinctive streams. There is the agro-export realm, and the agreement on agriculture in very large measure addresses agro-export and agro-industrial approaches to food production worldwide.

In addition, there are about two-thirds of those living in the world's least developed countries who depend, every single one of them, on small-farm production for their livelihoods. These are the farmers and producers who are put in jeopardy by the operations of the agreement on agriculture. In particular, I think the most vexing problem they face is the problem of import surges, which they're really quite unable to deal with.

This has enormous social consequences in terms of strategies to address global poverty. These are in fact the global poor, and what affects them in a way that takes their standard of living down exacerbates probably the most important problem—that is, if you look at the front end of the WTO it's supposed to be about sustainable development and it's supposed to be about raising the standard of living. With this very large constituency around the world, that is not happening.

I would argue that at the WTO we have to take different kinds of economies and different streams of the economy into account. Indeed, there are national economies with different needs, and those different needs must be taken into account in the negotiation of multilateral arrangements. That has not yet happened at the WTO. Instead, we get, as Ms. Weston said, a kind of one size fits all approach. It doesn't work and there are many dysfunctions that come out at the other end of it.

On the question of whether or not the WTO has changed since Seattle, I think it has changed, but unhappily the characterization I would be willing to offer is that it isn't that the WTO got better since Seattle, it's just that it got more ready.

At Seattle, I think the developing world was taken aback by the approach of the WTO. It was as if a kind of combination of errors resulted in the ditching of the agenda, so there was no new round emerging from it. This time there was absolute determination on the part of the secretariat that would not happen. There was a very tight management of process and a very specific sidelining of dissenting views on the way to Doha, with the objective in mind that, come hell or high water, a new round would emerge from this process.

I'm sorry to say that's the case, but it is, in my view and in the view of many others.

Mr. John Harvard: Would you say the same thing, Ms. Weston?

Ms. Ann Weston: I think it's very difficult with scorecards. You're forced to a single number and within that of course there are a lot of different measures. I would just make the point on the positive side that certainly we now have much more access to information about what individual countries and groups of countries think.

We're able to see, in fact, how wide the disparity is between the position of a country like India on certain issues and the position of a country like Canada or the United States. There is a lot more information available at that level. Whether or not having access to that information allows us to then influence the process, I think is another question. Certainly in many respects the process is still closed to people on the outside.

• 1030

Nonetheless, I think we're definitely moving in the right direction in terms of the transparency of the way in which the WTO works internally—in other words, how developing countries are able to engage, how they are able to see how things work internally. That's moving forward. And I think even in terms of external transparency, it's also moving forward. But we really have to be careful that we don't repeat Doha the next time around when we have a ministerial meeting, that it's not going to be something like Doha with all those security fences and the lack of participation, that we move to a more transparent and open process.

Mr. John Harvard: Thank you.

The Vice-Chair (Ms. Jean Augustine): Thank you.

[Translation]

Mr. Paquette, you have five minutes.

Mr. Pierre Paquette: On the issue of public opinion, we could use polls; I don't know whether the committee has the resources to do this, but I think it would be an interesting exercise. I recently saw polls which have been conducted in Quebec on the issue of globalization. These polls showed that the majority of people supported freer markets. However, this support has declined considerably since the events in Quebec City, but still continues to command the majority support. However when people are asked specifically whether they believe that freer markets would be good for jobs, they say no. When they are asked whether it would be good for culture, they also say no.

Overall, therefore, I have the impression that people are aware that there is a major unstoppable trend towards globalization, but when push comes to shove, they are concerned about current types of globalization, and they would like to see what I call globalization with a human face.

I was also struck in the poll by the fact that the most progressive-minded people are those who are most in favour of globalization, but, obviously, not the type that we currently are seeing. As a result, I believe that if we were able to look at these issues we could address many preconceived ideas which are currently being bandied about in all circles.

I would like to look at one issue with you. I sometimes wonder whether the World Trade Organization is the appropriate venue for discussing development, especially development in developing countries, because the rationale underlying the WTO is above all to liberalize trade and to protect investments. It goes without saying, however, that these issues cannot be completely decoupled from the development issue, but when the Bretton Woods Agreements were reached, a well-known economist at the time, Mr. Keynes, suggested a fourth pillar for international institutions. We had the World Bank, the International Monetary Fund, and the GATT which became the WTO. He suggested setting up another institution to stabilize international commodity prices. He based his suggestion on the argument that for as long as developed countries were not on a level playing field in terms of trade, there could be no development in countries in the southern hemisphere.

In light of that then, I don't know whether there is any discussion going on outside the World Trade Organization negotiations on ways of developing international institutions and strategies to promote development in third world countries.

The Vice-Chair (Ms. Jean Augustine): Point well taken.

[English]

Mr. Gerry Barr: Thank you very much for the question.

I think it's a preoccupation for almost all who look at the progress of multilateral trade agreements. Probably the most important observation that's generally made is that while these agreements may be the engine of growth, they're not in any way necessarily an engine of development. Development has a lot to do with social agreements, accountabilities, understandings between people about distribution of wealth, that sort of thing, and these trade arrangements are of course, some would say, shockingly empty in that respect. So you get some very powerful arrangements, ones that would have major economic impacts, and some of those economic impacts have negative consequences for groups and sectors within the community. Principally, of course, those who are marginalized may become even more precariously marginalized.

The issue you mentioned earlier, Mr. Paquette, about the social accountability of the process is germane here. At some level, in some way, I think a great deal of the debate is really about this. It's about how to fit into this process of negotiation of multilateral agreements some measure of social accountability, some answering for consequence, in terms of those who are particularly in need of development support.

• 1035

This is acknowledged in the agreements by parliamentarians and officials who craft the agreements, because you see at the front end, pretty inevitably, comments about sustainable development, about standards of living, and that sort of thing. But there is precious little to be found at the back end, as it were, or once you get into the shop door, about the instruments of that accountability. How are those agreements going to be measured against the criteria set up at the front end? It is indeed a very vexing but important problem.

The Vice-Chair (Ms. Jean Augustine): Thank you.

We'll go to Dr. Patry.

[Translation]

Mr. Bernard Patry (Pierrefonds—Dollard, Lib.): Thank you very much, Madam Chair.

[English]

I'll go to something totally different.

[Translation]

Mr. Paquette mentioned [Editor's Note: Inaudible]

[English]

However, my question is for Mr. Barr and Ms. Weston. Mr. Barr mentioned drug accessibility, and, Ms. Weston, you said that poor countries have to import drugs, because most of these underdeveloped countries cannot even produce any generic drugs. I think what you meant at the time was probably the importing of drugs mainly for pandemics. I think you were probably looking at AIDS.

I would like you to elaborate a little, if you could, on this issue of drug accessibility. I'd like to know, in your view—I have my view—what the problem is right now. Is it just an intellectual property problem? Is it just that the brand-name drugs cost, or the high cost also of generic drugs? I'm looking at just the cost side. If I'm looking at what's happening with malaria, malaria is still pandemic in Africa, and the cost of medication for malaria is very, very low. But it's still quite present there. Is this the problem there?

You mention also that Canada should be quite proactive, Mr. Barr. How do you see the role of Canada and what Canada should do? Do you have in mind any solution—quelques pistes de solution? What do you have in mind, exactly, regarding drug accessibility issues?

Mr. Gerry Barr: Perhaps I'll go first.

The issue that remains outstanding following the reversioning of the political declaration on essential and lifesaving medicines was the question of whether or not generic manufacturers could export under WTO rules to the least developed countries and other countries that did not have, themselves, the capacity to manufacture generics. Those in least developed countries would get under the political declaration—at least one would think—the capacity to go and search out branded drugs, which were available less cheaply abroad perhaps than in their own markets, and in that way effect some savings. But when it comes to generics, which are of course, in a sense, the gold standard of drug value, they would be unable to do that. This matters, of course, because relatively developed nations have the capacity to manufacture generics and produce for their own needs.

Price points and patents, in our view, really do have a great deal to do with the problem of supplying lifesaving medications, particularly in the case of HIV-AIDS, but also for malaria and tuberculosis. These illnesses are widely spread in the third world, but the third world amounts to only about 10% of the global pharmaceutical market. So all of this patent work and control really services the developed world more than the developing world. It's a measure of the exclusion, I think, arising out of high price points and patent protections that the developing world, which has two thirds of the world's population, really only takes up about 10% of the pharmaceutical market.

• 1040

Ms. Ann Weston: I think that nobody would argue that a good TRIPS agreement is going to solve HIV-AIDS. But what we're asking for in the area of health and efforts to help developing countries solve the HIV-AIDS problem is for a coherent international strategy. In other words, Canada is doing lots through the Canadian International Development Agency. Canada's working hard through the World Health Organization. But through the World Trade Organization, we have to make sure that the rules complement our efforts to support countries' efforts to fight HIV-AIDS.

So having a TRIPS agreement that allows the compulsory licensing and the export of cheaper medications will contribute to that fight against HIV-AIDS. Clearly it's not going to solve it on its own. There's a lot more that needs to be done. But the point is, if we try in other areas to assist developing countries, but we don't try to change the TRIPS agreement or make sure that it is flexibly interpreted, then we're not going to be doing all we can.

I think it's a generic point. The WTO needs to engage in development in a whole variety of areas, not just in the area of international health. But there's a whole variety of ways in which we need to make sure that the WTO rules support development, rather than undermining what's being attempted through other international organizations. That really is the problem at the moment.

The Vice-Chair (Ms. Jean Augustine): Mr. Graham, I think you have a copy of the agreement. Can you just go through the section that deals with TRIPS? Because it seems to me there is fuzzy wording and thinking. Maybe we can seek some clarification here.

Mr. Bill Graham (Toronto Centre—Rosedale, Lib.): Madam Chair, I cannot believe there is any trade agreement in which there is fuzzy wording or meaning.

Some hon. members: Oh, oh.

The Vice-Chair (Ms. Jean Augustine): Well, I've read it a number of times....

Mr. Bill Graham: After all, it must be drafted by lawyers somewhere, no?

I would like to ask a follow-up of Mr. Barr, because obviously a lot of us who were there at Doha were very pleased with the agreement on public health. So I would have thought reading in conjunction with paragraphs 4 and 5 of the agreement, particularly 5.b, which says that TRIPS “does not prevent members from taking measures to protect public health”, and particularly that each member “has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted”, wouldn't that enable countries to have access to imported drugs, particularly drugs for AIDS? I assumed when this came in that what this was making was the ability of these countries to import AIDS drugs from India and Brazil in particular, where they're manufactured at lower prices. Are you saying that this agreement does not permit that in any way?

Mr. Gerry Barr: Well, it does in some ways, but in other ways it does not permit it. It doesn't permit the export of generics to countries that do not have their own capacity to make generic drugs. No, it doesn't.

Mr. Bill Graham: So the compulsory licensing would be only if you had a plant to make it in your own country.

Mr. Gerry Barr: Yes.

Mr. Bill Graham: That's a very interesting point. I think we should ask that to be followed up. Thank you very much.

The Vice-Chair (Ms. Jean Augustine): I think it's a point we need to follow through, because if our thinking is that they had the ability to do some things and it's not in there, then we need some clarification.

Ms. Ann Weston: This is quite clear in article 6, actually, in that draft declaration or what was finally declared:

We recognize that WTO Members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing under the TRIPS Agreement. We instruct the Council for TRIPS to find an expeditious solution to this problem and to report to the General Council before the end of 2002.

So that issue has yet to be studied and addressed.

The Vice-Chair (Ms. Jean Augustine): Thank you.

Next on our list is.... Svend, do you have another question?

Mr. Svend Robinson: No.

The Vice-Chair (Ms. Jean Augustine): Mac Harb.

Mr. Mac Harb (Ottawa Centre, Lib.): I want to take this opportunity to thank our witnesses for appearing before the committee.

I had the distinct pleasure of attending one event, which was hosted by the Canadian Council for International Cooperation. I was most enlightened by the quality and the calibre of not only their membership, but those who also participated at that forum.

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Also, while we were at that meeting, one of the issues raised was the importance of participation—that is, for government to interact with the voluntary sector when it comes to issues affecting trade. I'm delighted to see the council members as well as World Federalists of Canada and the North-South Institute appearing before the committee, because I believe this is one of the most effective ways to communicate to government your views and those of your members.

I know Mr. Fergus Watt was at the WTO meeting. I don't know whether Mr. Graham mentioned to our guests his motion to establish a parliamentary assembly that goes hand in hand with the WTO, but in the event he did not I'm sure he will mention his attempt and the great work of Mr. Watt, along with many others, who were trying to make it happen at the WTO.

I look at trade as a maintenance of equilibrium around the world. When we talk about bulk trade, 99.9% of the time we talk about natural resources. I am struck, when I look a little deeper into it, that there is no natural resource that, if depleted, would not affect the sovereignty of the nation that is exporting it.

If we start with that assumption, then any country, whether developed or non-developed, could at any point in time declare that the export of their natural resources is going to affect the sovereignty of the nation. As a result of that, it would not take us very long to see crises erupting around the world. And it would not take us very long before we saw national security issues prevailing and wars being declared and chaos taking place everywhere.

When we talk about water in particular—and this is an issue that has been on my mind for a long, long time—I would say that if at some point we convince governments we should remove the export of bulk water completely, ban it totally, and we had an agreement all around the world that all member countries signed, and then suddenly we had a drought in a country where there's a desperate need for water, we would see the very same people who had been calling for the ban of export of water bashing government for not taking action to export water to support those countries faced with drought.

In a sense it's always a catch-22. One would say that at some point in time sanity will have to prevail and that to maintain this equilibrium around the world you have to have a system that is fair, where you say: “If this really affects your sovereignty, if you are trying to export water and you don't want to export it, then I'm giving you natural gas, or I'm giving you oil, or I'm giving you some other type of raw material that you need, and that affects my sovereignty too.” At what point will we say enough is enough—let's figure out a system that's fair?

I would like to hear a comment about whether or not you think in this whole debate about whether we should export bulk of anything we should bear in mind that at some point the pressure is going to be great by member countries of the WTO to have a system where you just can't tell me I can't have your water, because if you continue to tell me that, I'm going to turn around and tell you you can't have my gas.

The Vice-Chair (Ms. Jean Augustine): Mr. Harb, you're using up all your time on the question.

Mr. Mac Harb: No. I just have a statement.

The Vice-Chair (Ms. Jean Augustine): Oh, okay, we'll take this as a statement.

Mr. Mac Harb: I don't have a question. I just have a statement, just so we can reflect on it collectively—

The Vice-Chair (Ms. Jean Augustine): All right, let's have a one-sentence reaction to Mr. Harb's statement.

Dr. Weston.

Ms. Ann Weston: The question for me is really whether or not the World Trade Organization is the best place to talk about these issues of very key, essential resources. I think for many people the problem with bringing water into the World Trade Organization is that these values—the right of people to access water—really are not the values the World Trade Organization is promoting. The trade organization is about accessing markets, facilitating the flow of goods. There are all sorts of binding commitments that countries are required to live up to in return for market access.

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I think the problem with bringing water into the picture is there are more fundamental values to be addressed. I think that's why some people would argue we should be dealing with water somewhere else—presumably somewhere within the United Nations would be a far better place. I think we can distinguish between water, though, and other types of natural resources—resources like coal and other resources used in the production of a wide variety of goods.

The Vice-Chair (Ms. Jean Augustine): Mr. Graham, your question.

Mr. Bill Graham: I have three questions, one for each witness. I'll try to be very brief with each one.

Mr. Barr, you said you didn't feel this new round measured up to being a development round. It seemed to me, as I followed the continuum of these things going back to the Tokyo Round and the original GATT, that in the Uruguay Round we got rid of all those special deals for developing countries, basically because the economists all said they're bad for the developing countries.

It seems to me at least this round is once again asserting that different countries in different stages of development do require different treatment. In that sense I see it as a positive step. I'd just like you to reflect on that and on whether you would agree with me that the greatest problem I see, from the developing countries' point of view, is the failure of developed countries to live up to their market access promises.

When I go to the Caribbean countries, they say the Americans give us the CBI and then they insist we do certain things, but we don't really get access to their markets—textiles and agricultural products being the two of concern—in America.

We actually have aid programs where we've helped countries create a textile plant and then won't let them export the textiles to us. It seems to me it's our problem, largely—a failure of the developed countries to live up to the market access promises we made to the developing countries. I'd be interested in your reflection on that.

Fergus Watt, you mentioned the WTO PA—the parliamentary assembly. You were there, and several members were there. I just wondered, would you be doing some further work on the model? You mentioned the IPU, in your view, was perhaps focused on many other things and might be inappropriate as a forum. I'd be interested in some further comments on that.

Will the World Federalists be pushing, among other governments? You will recall that at Doha, only Canada and the EU pushed this at the ministerial conference. There was no other country pushing it. How do we get the other countries to push this idea so that we may get some success with it?

Ms. Weston, a very quick question for you would be, if we want a more transparent process, will the NGOs be cooperative? We don't want another Genoa either. We all want an open transparent process, but we don't want to run the risk of another Genoa either.

The Vice-Chair (Ms. Jean Augustine): Give brief answers, please.

Mr. Gerry Barr: I'm trading questions here, but I don't think I'm free to do that.

On your question with respect to whether or not there is improvement on the development side, I think this course of development is far more prevalent now than it was, and that maybe indicates a sensitivity to the broad issue in question.

I think the worry most of us who observed the scene have is whether or not countries like Canada, who could well be important champions for our developing country interests, would be willing to make the step from adjustment to liberalization through special and differential arrangements having to do with timelines for implementation or special sectoral support for groups that are particularly and specifically disadvantaged as a result of what Martin Khor would call big bang liberalization approaches.

Whether these shock absorber strategies are the limit and extent of Canada's willingness to accommodate developing country economies or whether, on the other hand, developing country economies could themselves be recognized as economies at a different stage with different needs, and whether you could see the WTO arrangement as one that would broker arrangements between different kinds of economies at different stages with different needs rather than attempt to ensure that the global economy is one kind of economy that is utterly—and, I would argue, non-accountably—liberalized, I think that's the key conceptual question. Is there room for different kinds of economies?

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We would argue urgently that Canada needs to make that next step. It is pretty good on the shock absorber side, good among developed world countries, excellent in a way, but it hasn't yet made that second step, and it appears to be very unwilling to do so. The consequences of that are quite severe.

Mr. Fergus Watt: Thanks, Bill. I don't know if you were here for all of my presentation—not to duck your question and throw it back at you—but I did make a pitch for this committee to continue to be engaged on the question of parliamentary involvement in the work of the WTO, and building on the recommendations it made in the 1999 report pre-Seattle and so forth. I think it should be a matter of continuing concern for the committee.

For our part, there will be a meeting in 2002. There is a joint planning group among European parliamentarians and the IPU, and that's going ahead. What can we do to support that is the question my organization and people like John Bosley have asked, and one initiative we're trying to move forward is to hold regional meetings for parliamentarians in Africa, Asia, and Latin America. This question has been a northern debate, partly because it's driven by this activist group out of the European Parliament. When the IPU organizes a meeting, it has a network of 140 or so member parliaments. A notable absence is the U.S., but that's another story.

The European vision of what this could become gets less air time in the south, and I think southern parliamentarians want to know, need to know, what a more robust parliamentary dimension can do for them. We've talked about the problems they have implementing WTO agreements, and whether a greater involvement of parliamentarians would help, in terms of moving legislation forward and so on.

So perhaps the idea that some of us are nursing is that we could have little meetings alongside regional meetings, like the African Parliamentary Union, and I'm having discussions with the Parliamentary Centre for Foreign Affairs here in terms of partnering with some of them. I'd welcome the support of members of this committee, should they be interested in trying to move that forward. Perhaps the FIPA could be a venue for something like this.

We need to broaden the constituency further. John Duncan mentioned earlier the problem of places where the national parliament isn't a fully democratic parliament. Engaging these parliamentarians in a supranational parliament would help in terms of giving these parliamentarians an opportunity to get out and see how the democratic world operates and so on.

So those are some of the ideas. Yes, I think we're going to still keep up the good fight, as the saying goes.

The Vice-Chair (Ms. Jean Augustine): Thank you, Mr. Watt.

Ms. Weston.

Ms. Ann Weston: On the question of the future of the relationship between NGOs and the WTO process, I think if the parliamentary consultative mechanism moves ahead, that will be one confidence-building measure for people outside government. But there clearly are a number of other measures that could be considered, and I would urge the committee to think about putting in place a discussion or having a round table to look at how civil society engages with the trade-policy-making process both within Canada and through the WTO, and begin to come up with a clearer understanding of what is needed to make sure that engagement really does happen in a constructive way, as opposed to the destructive way it happened in Seattle or Genoa.

Ultimately, there will probably always be some groups that choose to take to the streets. You're not going to be able to bring them all to the table to talk peacefully about these issues.

The Vice-Chair (Ms. Jean Augustine): Thank you.

Mr. Bill Graham: Well, maybe Quebec City, if I may just interject, Madam Chair, might be an example of where there was an attempt by many of the NGO community to actually engage within. There were obviously people outside as well. Some lost their trousers. Others did not, but they—

The Vice-Chair (Ms. Jean Augustine): Thank you very much.

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I think that also provokes one question for the panel as we talk about the transparency and the engagement of civil society, etc. There are some developing countries where the issue of having NGO involvement in the workings of processes, etc., is viewed with suspicion and is viewed in the light of too much disclosure to the population. Therefore, is the whole movement towards transparency and towards clarity and involvement something you as NGOs see all developing countries being receptive to?

Ms. Ann Weston: I was just going to say that from my observation of the Doha meetings it was quite encouraging that a number of developing country delegations actually included representatives of civil society. Now, as to how they were actually used I'm not sure, and as to the extent to which they were able to get into those innermost chambers for discussions, again, I'm not sure. But I think it really was a healthy sign that there were a number of delegations.... I think, for instance, the Kenyan delegation had a representative from civil society, and so did the Ugandan delegation. So as to the assumption that many developing country governments find that engagement difficult, perhaps we need to review that.

Mr. Gerry Barr: I generally agree with that characterization.

There are a couple of other features that might interest you. There are NGO groups who work in pretty close contact with developing world governments with respect to venues like the WTO summit at Seattle. It is uneven across the range of all developing country governments. Some are just like in the north, hesitant about letting NGOs into the discussion. Others are more enthusiastic and more interested. NGOs are bringing a lot of content sometimes to under-resourced negotiating teams in the global south, and there is a continuing kind of arrangement and relationship with numbers of governments from the global south. Presumably, that will continue.

I doubt that it will be universal, but it's a good thing. I'd encourage the north to take it up with greater vigour as well. The developed world governments are frequently not as open to NGO contributions as some of those in the south.

The Vice-Chair (Ms. Jean Augustine): Mr. Watt.

Mr. Fergus Watt: I would just add briefly that it's not only a good thing, it's probably an inevitable thing, given the way information technologies and so on are helping even small NGOs in the south to improve their analysis and engage in the issues.

Another problem that needs to be overcome is the alignment of NGOs with political parties, governments, and so on, becoming sort of captive NGOs, but even that is receding as a phenomenon. Within the NGO community there's a greater discipline in flushing out some of these non-bona-fide NGOs.

The Vice-Chair (Ms. Jean Augustine): Thank you very much for your presentations today. I think it brought another side to the story.

Thank you very much, committee members.

I'll call on the chair, who is sitting on the sideline. Is there anything you want the committee to address itself to before we adjourn?

Mr. Bill Graham: No, I think we're fine. Thank you very much.

The Vice-Chair (Ms. Jean Augustine): We're adjourned.