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Trade ruling could hurt green jobs

Written by Angelo DiCaron and Stuart Trew for The Windsor Star, October 15, 2012.

The embattled Green Energy Act is about to be pummelled once more, this time by the World Trade Organization. The big loser will not be the McGuinty government, but the thousands of workers who have found jobs in Ontario’s newest industry, and the very concept of sustainable development.

How the Ontario and federal governments respond to this WTO loss will be a key test of their seriousness about creating good Canadian green jobs for the future.

A preliminary WTO panel ruling in the challenge by Japan and the European Union against local content rules (“buy local” provisions) in Ontario’s landmark renewable energy policy has leaked out a month before anyone expected it. According to reports, the WTO has ruled these buy-local requirements in violation of global trade laws that forbid governments from treating imported goods less favourably than domestic goods.

Local content policies are key economic drivers the world over, including in the United States for steel, infrastructure and shipbuilding. “Buy local” is embraced in China, Korea and within the European Union. Ontario has a well-established Buy-Canadian policy for transit vehicles, as does the province of Quebec for subway cars.

In practice, even the Harper government has thrown its support behind these measures, with strictly Buy Canadian requirements for recent military procurements, despite its heated rhetoric against “protectionism.”

For its young life, the Green Energy Act has created 20,000 jobs and 30 new companies on the solar side alone. These jobs literally hang in the balance of this WTO decision and how Ontario responds.

In late spring, our two organizations, along with Blue Green Canada, the Canadian Federation of Students, the Canadian Union of Public Employees, the Communications, Energy and Paperwork-ers Union of Canada, and the Ontario Public Service Employees Union, submitted an amicus brief to the WTO panel hearing this case. In our submission, we urged the panel to consider Ontario’s, and Canada’s, obligations to reduce greenhouse gas emissions under the Framework Agreement on Climate Change and Kyoto Protocol.

The WTO has recognized that climate change “is not a problem that can afford to wait.” The organization called it “a threat to future development, peace and prosperity that must be tackled with the greatest sense of urgency by the entire community of nations.”

Even though the Harper government has taken steps to repudiate its Kyoto commitments and is the only country to do so, Ontario’s Green Energy Act was adopted while Canada’s climate obligations were in effect, and the province is mandated by the Framework Convention to which Canada is still a signatory. Article 3 of the Framework Convention says that Canada, or in this case Ontario, is required to integrate environmental and economic policies and goals, which is exactly what it has done in the Green Energy Act and precisely the definition of “sustainable development.”

Of course, the Green Energy Act isn’t perfect. It doesn’t provide incentive to the public sector to innovate and produce green energy (although it could have). Still, it has cultivated new industries in the province as well as new worker skills and competencies in a job market that’s been devastated.

Should this leaked interim report reflect the WTO tribunal’s final decision, expected in November, it offers further proof that the system of global free trade, and the tribunals that police it, are impediments the promotion of sustainable development.

We are heartened by the initial response issued by the Ontario Ministry of Energy and Infrastructure, indicating that a formal appeal could be launched, if necessary. Our organizations fully support that action.

More importantly, this impending WTO ruling will test the mettle of the Ontario government in ongoing trade negotiations being led by the Harper government, including a comprehensive pact with the European Union.

This deal includes unprecedented restrictions on provincial and local governments’ use of buy-local policies, which, like the Green Energy Act, are intended to foster more sustainable communities.

We hope Premier McGuinty can muster the political courage to face down WTO and CETA threats to kill sound job-creation and renewable energy policy. However, in the case of WTO disputes, the ball falls mainly in Prime Minister Stephen Harper’s court.

If the federal Conservatives resign themselves to the logic of our global free trade system that boasts too much rhetoric, and not enough action on the green economy, then it is they who must wear the albatross for putting thousands out of work and signing the death certificate of sustainable development in this country.

Angelo DiCaro is a national representative with the Canadian Auto Workers union. Stuart Trew is the Council of Canadians’ trade campaigner. Both are members of the Trade Justice Network Steering Committee.