It's great to be in your beautiful city. President Kennedy once described Washington as "a city of northern efficiency and southern charm." Well, this meeting has started on time and we have certainly enjoyed your generous hospitality, so you are living up to your reputation so far!

On my way over here today, I was thinking about the relationship between our two great countries and about some of the differences between us.

In America, it's "life, liberty and the pursuit of happiness." In Canada, it's "peace, order and good government." Someone has suggested that the advantage of pursuing happiness instead of good government is that at least with happiness, there is a possibility of achievement!

But, for all our differences, I know that few Canadians would want to live next to any other country, and I suspect that most Americans feel the same way about their northern neighbour.

We are friends, we are neighbours and, more than ever, we are each other's closest and largest economic partners.

This partnership manifests itself today in this room. It gives me great pleasure to address members of the U.S. Chamber of Commerce, the Canadian Chamber of Commerce and the Canadian-American Business Council. And we count on the advice, support and leadership of your organizations, on both sides of the border, as we move forward to build on our successes in North America.

In the brief time I have here today, I'd like to focus on two issues: first, Canada's healthy economic and investment climate at home; and second, Canada's commitment to the hemisphere, specifically to the Free Trade Area of the Americas [FTAA].

On January 12, 1995, The Wall Street Journal published an editorial entitled "Bankrupt Canada?". It warned of the debt burden Canada was carrying and talked about us "hitting the wall," much as Britain had done in the 1970s and New Zealand in the 1980s.

Well, I can report good news: not only did we avoid hitting the wall, we turned around and headed in the opposite direction! What has occurred in the three short years since that editorial is nothing short of an economic renaissance. Canada stands today stronger and more competitive than we have ever been.

The numbers speak for themselves: when our government took office in 1993, our annual budget deficit was $42 billion -- and rising.

Today, that $42 billion deficit has been virtually wiped out, and we expect it to be eliminated within the next year or two.

Interest rates are now below those in the United States and inflation is hovering at under 2 percent. In fact, Canadians are now enjoying the lowest sustained interest rates that we've had in 30 years.

While our unemployment rate remains unacceptably high, it too is falling. And the IMF [International Monetary Fund] predicts Canada will lead the G-7 nations in economic growth both this year and next.

What all of this means is that Canada now has an investment climate second to none. Recently, KPMG, an internationally recognized management consulting firm, conducted a comprehensive study.

It looked at the real costs involved in establishing and operating a company of 100 employees in eight different sectors of the economy. These were costs that almost every new business would have to consider -- things like labour costs, including wages and benefits; initial capital costs; and the costs of electricity, telecommunications and transportation.

The study compared seven countries: Canada, the United States, Germany, France, Italy, the United Kingdom and Sweden.

The study found that when you combine all of the elements I just listed, Canada ranks number one. In other words, it is cheaper to set up and run a business in Canada than anywhere else studied.

One of the most interesting findings of the study -- and maybe the most surprising for some of you -- is that Canada is tied with Sweden for the lowest overall corporate tax rates. I know that seems counter-intuitive to many of you who believe that Canada is a high-tax country, but it is the kind of myth about doing business in our country that has to be exposed.

It is the mark of a wise investor to seek out undiscovered gems. And I can tell you without hesitation that if Canada were a company, Warren Buffet would be buying!

Now, as International Trade Minister, you would expect me to point to our trade performance as the reason for our economic turnaround. Of course, trade isn't the whole story, but the figures do tell a good tale:

Trade now accounts for more than 40 percent of our GDP, and one out of every three jobs in Canada is dependent upon trade.

Our exports are up more than 45 percent in just four years. Two-way trade with the United States has doubled since 1989. In 1996, we traded an astounding $456 billion.

It is no coincidence that since 1993, almost a million new jobs have been created in Canada.

This good news trade story is understood in Canada. Recent studies show that 70 percent of Canadians support the concept of freer trade. This is up from a majority of 56 percent in 1993, when the NAFTA was signed. Six in ten (63 percent) Canadians support the NAFTA, up from 37 percent in 1993.

Each and every day, over $1 billion in goods and services are exchanged between our two countries -- this is the world's largest trading relationship. And even more impressive, over 95 percent of that trade crosses the border problem-free. It is therefore vital that we not allow trade irritants to define or discolour what is clearly a remarkable partnership between our two countries.

In this context, I'd like to thank the American business community for your support for the exemption of Canada from Section 110 of the U.S. Immigration Act. Free movement of people and goods across our shared border is essential if we are to continue our rapid growth in two-way trade.

We can also work together beyond our borders. More accessible trade and investment markets are a goal that Canada and the U.S. share. This is reflected in the NAFTA. But it's also why our two countries are among the strongest supporters of the World Trade Organization.

As you know, the WTO is the cornerstone for ongoing trade liberalization efforts, from the recently concluded agreements on telecommunications services and on information technology to the financial services negotiations, which are heading into the final stretch as we speak.

Both our countries are also committed to the resumption of negotiations in agriculture and in services, which are slated for the turn of the century. The WTO provides the foundation for bilateral and regional initiatives that deepen trade reform, including the FTAA.

In Canada, expanded rules-based trade has always meant jobs and growth. Along the way, Canada has changed not only how we trade with the world, but how we see ourselves in the world. Our roots are planted deeply in European soil. We have also enjoyed a long history of friendship with the United States. More recently, through the development of strong ties with the world of Asia Pacific, we have transformed and diversified our economic life. Now, this transformation is being enhanced through more engagement with the Americas as a whole, which brings me to the second topic.

Canada is unmistakably a nation of the Americas, and together we want to build a common destiny. Our commitment to this region is clear.

First, beyond our partnership with Mexico in the NAFTA, we have signed a free trade agreement with Chile. Designed to be a bridge to Chile's eventual accession to the NAFTA, this agreement is creating impressive opportunities for Canadian businesses, and we are very optimistic about our bilateral relationship.

Second, we are currently negotiating an arrangement on trade and investment co-operation with Mercosur. This is an important market for Canada -- our investments there total $6 billion -- and we will continue to build this relationship in the years ahead.

Third, Prime Minister Chrétien will lead a Team Canada trade mission to the region next January, visiting Mexico, Brazil, Argentina and Chile. We expect more than 400 business people to join the Prime Minister and provincial premiers in a combined effort to forge new commercial relationships and open doors to new markets.

Finally, nowhere is this commitment more clear than in Canada's unwavering support for a Free Trade Area of the Americas. And we welcome U.S. partnership in this endeavour.

In fact, despite the delay, we are hopeful that the President will succeed in coming up with a bi-partisan package on fast track that Congress will pass before next spring's Summit of the Americas in Santiago, Chile. This would send an important message to the world that the United States will play a leadership role in liberalizing trade. For our part, Canada does not intend to allow the delay in securing fast track to slow our own agenda to further liberalize trade in the hemisphere.

Why this push for hemispheric free trade? Why look to Latin America and the Caribbean? Because the growth is there. The opportunities and partnerships are there. By the year 2000, this region will have a population of nearly 500 million and a GDP of $2 trillion -- and that's U.S. dollars! But most importantly, there now exists a shared desire, and a unique opportunity, to build a true sense of community in the hemisphere.

So this really is a "ground floor" opportunity, and we must get in on it. This is the message I have heard repeatedly from the Canadian business community, which is extremely bullish on Latin America.

We also have to recognize that this region is demonstrating a strong commitment to continuing market reforms and to advancing democratic rights and good governance.

Argentina, Brazil, Paraguay and Uruguay have banded together in the Mercosur customs union, which has, in turn, signed free trade agreements with Bolivia and Chile.

Mexico, Colombia and Venezuela have entered into a free trade agreement, and the countries of Central America and the Commonwealth Caribbean are strengthening their respective customs unions.

These initiatives have not gone unnoticed: the European Union is already engaged in trade discussions with Mercosur. So we hesitate at our peril. The time for renewed commitment is now.

We simply must create the framework for a more open and predictable trading system in the region. For our part, Canada sees the FTAA as a comprehensive agreement, covering goods, services, investment and intellectual property. We see a hemisphere-wide partnership based on a single undertaking, containing a common set of rights and obligations for all members. The negotiations must start as a comprehensive package, with all cards on the table, including tariff and market access issues. Substantially all of these tariffs and trade barriers should be eliminated within 10 years of the agreement coming into force. At the same time, we must also recognize the special needs of the smaller members in these negotiations by adopting a phased-in approach for them that best serves their interests.

These are our goals and we are working hard, along with our FTAA partners, to ensure a smooth launch for the April meeting in Santiago. Detailed negotiations will have to begin immediately following Santiago so that we can meet our leaders' commitment to make real progress by 2000 and conclude negotiations by 2005. Given this timetable, it is important that the United States has fast-track authority to help move this process forward. We are under no illusion about the challenges that await us. But progress toward anything worthwhile is always difficult.

Canada understands the benefits of free trade because we are experiencing them. Having adjusted to the NAFTA, we are now confidently expanding our frontiers and our fortunes around the world. The global economy is becoming increasingly interconnected, and we do not intend to watch from the sidelines.

In the days that lie ahead, the United States and Canada must lead -- and lead decisively. Our vision must be outward, not inward. We must work together to extend the benefits of free trade throughout the Americas, and we must break down the barriers and attitudes that prevent us from realizing that goal. We must also highlight the social dividend -- such as new schools, hospitals, higher incomes and higher labour and environmental standards -- that flow from a well-administered, open economy.

If we do this, I believe we will usher in an era of hemispheric prosperity and stability. And the FTAA will take its place as a truly historic undertaking.

I began by quoting President Kennedy. In the interests of bipartisanship and fairness, let me close by quoting the words of President Reagan. When he addressed the Canadian Parliament in 1981, he reminded us that "our mission is more than simply making do . . . [it is to] lift the world's dreams beyond the short limits of our sights, to the far edges of our best hopes."

Let us take that wise counsel to heart and forge ahead as friends, advance as allies and proceed as partners. Because together, there is little we cannot do.

Thank you.

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Last Updated: 2006-10-30	Top of Page	Important Notices