44th Parl. 1st Sess.
November 6, 2023 11:00AM
Madam Speaker, I listened with interest to the member for Lethbridge's speech, and I am particularly interested in the example she gave about Hytera. For those who are watching and do not understand, the Chinese-based state-owned company that bought it does not make money; it actually loses money every year. These state-owned enterprises are not only acquiring Canadian companies but also winning contracts by being the lowest bidder for Canadian companies not making money.
Could the member please inform the House what she thinks the motivation might be of a state-owned enterprise if it is not making money in acquiring these businesses?
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Madam Speaker, the existing committee and the committee of industry before it actually took opportunity to study this issue extensively. In addition to that, there have been other investigations done. What has been found is that at times, there will be state actors that will make an investment in Canada or purchase a business that exists within Canada and do so for the sake of the state actor. It is in their interest, not in the interest of the Canadian people. It is not in the interest in the furtherance of our nation. It is not in the economic interest of Canada. Rather, in this case in particular, it is the Communist Party of China that ultimately will benefit from such a decision. Again, this is where proper review and consultation are so important when we look to allow these foreign investments in Canada.
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Uqaqtittiji, understanding that in deciding to invest in Canada, there has to be a balance between what will generate prosperity in Canada and protecting national security, I wonder whether the member can comment on whether she thinks this bill would balance more toward the prosperity of Canada or more toward national security.
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Madam Speaker, if I may, with the deepest respect, I think it is a dichotomy that maybe is not necessary. It is possible to do both. It is possible to look after the safety and security of Canadians, to make sure our nation is put first and foremost, and also to want to cultivate prosperity for the Canadian people. Both can be done, but it comes down to the review process.
For example, in the bill before us, one of the things is that a minister would be able to make a decision on their own, without having to bring it to cabinet. By doing that, the minister would actually be acting unilaterally, and I would say rejecting the collective wisdom cabinet would have to offer in many of these cases. Cabinet is an assortment of individuals from many different ways of life, many different backgrounds and different regions, so its ministers have access to information that could help a robust discussion to take place and an educated decision be made. When cabinet is kept out of that process and the minister makes the decision all by himself or herself, Canadian people are put at a disadvantage.
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Madam Speaker, on a point of order, I would like a quorum call.
And the count having been taken:
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There are 20 members, including me, without the ones who are coming in.
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Madam Speaker, in studying the bill before us, the Liberals had an opportunity to reflect what actually is going on in the world rather than just putting in a fairly basic bill that just focused on time rather than on national security. I am wondering whether the member could comment on the lost opportunities the government had in introducing the bill without any substance.
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Madam Speaker, there was an opportunity to look at the recommendations that came from a subsequent committee and really take them to heart. A tremendous amount of study, time and energy went into those recommendations.
Further to that, my hon. colleagues at the committee brought forward numerous amendments. I know for certain that 10 of them were excellent, but they were rejected. They could have strengthened the bill. All those amendments were based on substantiated evidence that was brought forward by experts. Why would the government reject them? Why would it not want to make the bill the best it can be?
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Madam Speaker, this is a great opportunity to talk about foreign direct investment in Canada, why it is important and why this legislation is before us.
Our viewers might ask why foreign investment is so important to Canada. There are many reasons that we should be looking to attract foreign investment into our country. Foreign investment provides Canada with the capital it needs to develop its full potential and, yes, that includes our abundant natural resources, such as oil and gas. Foreign investment in Canada is also a source of innovation, allowing Canada to benefit from evolving technologies. As one of the most educated countries in the world, we also use that foreign investment in innovation to build our own technological capacity.
Intellectual property will drive our future prosperity. We had better ensure that this advantage is not squandered by failing to properly review foreign investments.
It goes without saying that foreign investment creates many jobs across our country. Invariably, when a foreign investor makes its investment in Canada, this creates new job opportunities for Canadians. Related to that is the fact that jobs created by foreign investment generate higher wages. At a time when the worst affordability crisis of a generation is raging, when many families are struggling to make ends meet and pay for groceries, schooling, gas and rent, it is important that the jobs that Canadians have available to them also have decent paycheques attached. Foreign direct investment also drives increased productivity, leading to greater prosperity for our country. When foreign investors commit to building our economy, they also increase our tax base, which of course allows governments at all levels to deliver the services that Canadians expect.
Unfortunately, for quite a number of years now, especially since the current Liberal government came to power, Canada's foreign direct investment performance has lagged far behind that of many of its OECD competitors. What I mean by this is that there is more investment flowing out of Canada and being invested in foreign jurisdictions than there is foreign investment flowing into Canada. We actually have a very significant deficit. Why has this happened?
There are many reasons. I will not go into them all, but I will begin with this: Canada is suffering from regulatory gridlock. In other words, regulatory and approval processes at all levels of government are so complex and reflect such an overreach that nobody wants to invest in Canada anymore. We have labour force challenges, heightened uncertainty, deteriorating public finances and increasingly unmanageable debt loads.
By the way, our system is not tax competitive. For years, we have been talking about tax reform, yet over the last eight years, no reform has materialized under the current Liberal government. As a result, it has become too expensive to do business in Canada.
Most recently, the Liberal government decided that not only would it maintain a punishing carbon tax on everything, but it would also quadruple the carbon tax on the necessities of life, the things that Canadians need to survive, such as home heating, natural gas and groceries. Prices have skyrocketed as the Prime Minister ratchets up his carbon tax. Putting gas in the car is becoming prohibitively expensive for many families. He plans to quadruple the carbon tax on fuel for our cars as well.
To make matters worse, while the Prime Minister recently announced that he would temporarily suspend the carbon tax on home heating oil for 3% of Canadians, the remaining 97% of Canadians will receive absolutely no break from the carbon tax on their own home heating costs. I thought he once said, “A Canadian is a Canadian is a Canadian”. It is another vacuous promise from a failed Prime Minister who seeks to divide Canadians and pit them against one another.
The bottom line is this: The world no longer sees Canada as a great place to invest. It is the government's policies, grounded in an ideology that disregards the importance of making Canada a welcome place for foreigners to invest, that is the basis of these problems. We have to get foreign direct investment into Canada right, because it can raise our standard of living and give Canadians, especially young Canadians, the hope that they can live out the Canadian dream.
However, not all investments are necessarily in Canada's best interests. There are benevolent investments that benefit Canada's economy, and then there are investments that are being made by malevolent actors around the world who simply want to take advantage of Canada. As we consider which investments fall into each of these two categories, it is absolutely critical that we make the determination that we are going to focus on Canada's net benefit, on defending our sovereignty and protecting our national security. That is why we are discussing this legislation today.
Bill C-34 simply attempts to update the Investment Canada Act, an act that is quite a number of years old now, but it has not kept up with the changing conditions on the ground, in a rapidly evolving global environment. I would mention that, after eight years, the government has been unable to put in place the kinds of policies and regulations that would actually protect Canadians against their key industries and companies being bought out.
I will give an example. Hytera and its associated company Sinclair Technologies have been charged with 21 counts of espionage in the United States. In fact, President Biden has banned the company from doing business in the U.S. However, in 2017, the Liberal industry minister, Navdeep Bains, refused to conduct a full national security review on the sale of a B.C.-based telecoms company, Norsat International to China-based Hytera, which is banned from doing business in the United States. It was here in Canada buying up one of our companies.
The RCMP awarded a contract to Hytera to supply sensitive hardware for its communications systems. The Canada Border Services Agency has also been using communications technology from Hytera. Members may recall that a few years ago, the industry minister set up some rules about making sure that key Canadian companies, especially within the critical minerals space, would not be bought up by foreign hostile actors, yet that is exactly what happened.
In 2022, the Liberal government fast-tracked the takeover of Canadian lithium mining company Neo Lithium by Chinese state-owned Zijin Mining without a national security review. Every single citizen in China, every single company, whether a state-owned enterprise or otherwise, has a responsibility to report to the government any information it asks for with respect to the business that they carry on.
We want to make sure that this bill does what it is supposed to do. Briefly, this bill would streamline the minister's ability to investigate national security reviews of these foreign investments. It would strengthen penalties for failure to comply with the Investment Canada Act's review provisions. It would create a new power to generate a list of sensitive industries. It would improve coordination with our international partners. It would also vest power to the minister, rather than allowing cabinet to make these kinds of decisions in the first instance.
Would it not be better, instead of having two eyes on this kind of transaction, to have all the eyes of cabinet focusing on whether an investment is in Canada's net benefit or whether it represents a risk to our national security? The bottom line is we tried to get some amendments. To their credit, some members of the committee agreed with us and we actually got four critical amendments passed. However, there were seven other amendments we tried to make, some of which were contained in a unanimous report from the industry committee, and guess what? The Liberals on the committee voted them down.
We can do better, but this is a start.
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Madam Speaker, I heard the member reference that some countries are taking advantage of Canada. When he said that, I could not help but reflect on when I heard the member for Cumberland—Colchester suggest that Canada was taking advantage of Ukraine. Does the member believe that Canada is taking advantage of Ukraine?
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Madam Speaker, we are talking about the Investment Canada Act. We are not talking about the Canada-Ukraine free trade agreement.
I will say this, to complete my thoughts. The Investment Canada Act is there to protect Canadians against investments that are not in Canada's national interests. This act would be a small step forward—
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- Nov/6/23 6:41:55 p.m.
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We are going to other questions and comments.
The hon. member for South Shore—St. Margarets.
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Madam Speaker, I will do something unusual and ask a question about the bill, unlike the Liberal members, who seem to want to talk about everything but the bill.
The bill is about returning cabinet decision-making to the Investment Canada Act process. I know the hon. member is a former international trade minister and knows more than probably anyone on the government side in the House about cabinet decision-making and the role and importance of it. Without it, we have had poor decisions by the now VP for Rogers, former member Navdeep Bains of the government, who basically said that anything China wanted to buy China could have without a national security review.
I wonder if the member would enlighten the House as to the proper way a cabinet decision-making process should be when a hostile state like China is trying to acquire the assets of our country.
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Madam Speaker, that kind of decision takes a lot of thought. It takes a lot of due diligence. It is much better to have cabinet review, through a cabinet process, a national security-related matter or an investment when we are trying to determine what the net benefit to Canada is.
In cabinet, there may be 15, 20 or 25 people around the table. Everyone is asked to review all of the relevant documentation, and at the end of the day, they are able to discern whether something is in Canada's national interests. If we leave that decision with one minister, there is a huge risk that the minister will be co-opted by special interests within our country or outside of our country and a decision will be made that is contrary to our national interests.
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Madam Speaker, I want to go back a little to when the hon. member was a minister. The deal signed at that time was the Nexen deal. It was signed by selling off Nexen to a Chinese national offshore company for over $15 billion. The deal was signed in Russia in secret by former prime minister Stephen Harper. Does the member have any comments on that?
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Madam Speaker, at least this question relates, although obliquely, to the Investment Canada Act.
With respect to the Nexen transaction, prior to that point in time, Canada had absolutely no rules about how state-owned enterprises could invest in Canada or if they even should be investing in Canada. When that transaction came forward and cabinet had to review it, we said to hold it because with this transaction, there were no rules for us to be guided by. Therefore, Stephen Harper at that time articulated a clear set of rules for when countries like China or state-owned enterprises from countries like China, Russia and Iran, which are hostile actors, want to invest in Canada. We established the first set of rules for that, and of course, that—
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- Nov/6/23 6:45:42 p.m.
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The hon. member for Rivière-du-Nord.
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Madam Speaker, Bill C‑34 will increase oversight and improve our international reputation. I wonder how much that might help us with our main financial partner, the United States, if we pass Bill C‑34 in its current form.
What does my colleague think of that?
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Madam Speaker, as we know, this bill would not measurably impact investments coming from the United States, because we have special carve-outs for our free trade partners.
Having said that, it is important that we do have an act like that and that, from time to time, we review it—
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- Nov/6/23 6:46:37 p.m.
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Resuming debate, the hon. member for Selkirk—Interlake—Eastman.
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