Free Trade Zone in Saint John Bonaza at whose expense?
by John Murphy, Executive Secretary, With little fanfare the federal government has changed the law to allow any municipality in the country to set up a Free Trade Zone (FTZ) or, as they are commonly called, Export Processing Zones (EPZs). FTZs are special geographic areas where foreign companies can manufacture, process, store and export goods duty free. The legal changes by the federal government would reduce the costs of production for goods destined for export from Canada. The first FTZ in Canada is targeted for Saint John, New Brunswick. At the urging of the area’s business community the province of New Brunswick granted a Toronto-based developer, AMW Holdings, up to 1,000 acres of prime industrial land adjacent to Saint John’s Spruce Lake Industrial Park for the sum of $1.00. Preliminary plans call for the Saint John FTZ to focus on attracting a variety of manufacturing and processing firms from Southeast Asia and Europe. Predictably, promoters of the FTZ concept speak in glowing terms of the advantages for interested companies; preferred access to U.S. markets, the Harmonized Sales Tax and one-stop access to a variety of federal and provincial government economic development and immigrant investor programs. To these may be added the natural advantages of doing business in Saint John including the presence of skilled labour, a stable business environment, an accessible geographical location and a full transportation infrastructure. Draft documents for the FTZ project refer to a multiple partnership arrangement. Partners include AMW Holdings, the City of Saint John, Saint John Industrial Park Limited, Enterprise Saint John, the Province of New Brunswick, and the Government of Canada. Labour is not deemed to be a partner in the FTZ project. Upon learning of the FTZ project, Saint John labour activists immediately sounded the alarm bells. In other parts of the world, export processing zones typically mean misery for workers. Below-subsistence wage levels, poor working conditions, direct abuse of workers and aggressive attacks on efforts to organize workers are the global norm in FTZs. Indeed, the world’s FTZs exist primarily so that businesses can exploit pools of young female workers. Knowing this, Saint John labour activists raised a number of concerns in a letter to New Brunswick’s former Minister of Economic Development and Tourism, Camille Theriault. Among labour’s concerns are the absence of any details relating to public financing for the FTZ proposal, feasibility studies, legislative requirements, tax concessions and a lack of specification about the type of manufacturing initiatives envisaged. More importantly, the labour movement went on record as being opposed to any development that will nullify or override provincial or federal environmental regulations, employment standards and the social safety net. In the absence of any response from government the Saint John Labour Council began voicing concern about the FTZ project to the media. The Council of Canadians warned that the proposal could turn Atlantic Canada into the maquiladora of Canada. (The maquiladora is Mexico’s export processing area that runs along much of the U.S. border. It is famous for its abuse of workers). Maude Barlow, chair of the Council, issued a media statement denouncing the proposal. "Export processing zones are bad for the environment, for labour standards, and for our long term economic health," said Ms. Barlow. She noted that there are currently 500 such zones world-wide, most of them located in developing nations of Asia and Latin America, and the Saint John zone would have to compete against countries with "minimal" enforcement of labour and environmental standards. The fear, as the Council of Canadians has quite rightly expressed, is that there will be intense pressure to lower environmental and labour standards to make Saint John FTZ globally competitive. Will workers in the FTZ be protected by New Brunswick labour laws? Will the province’s environmental, health and safety standards be applied? Will our human rights laws be enforced? Is this a jobs-at-any-price development project? In an attempt to persuade labour that the FTZ proposal was a worthwhile economic development initiative, the project’s proponents began viewing labour as a potential partner and agreed to several undertakings. These included efforts to improve communication between labour and the FTZs proponents, the development of a code of conduct applicable to FTZs, and support for the application of all provincial labour laws to the Saint John FTZ in particular. The New Brunswick Federation of Labour has offered the following items for inclusion in the development of a code of conduct for FTZs:
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