ADDRESS BY PRIME MINISTER JEAN CHRÉTIEN ON THE OCCASION OF THE APEC 2002 CEO SUMMIT

October 26, 2002
Los Cabos, Mexico

Distinguished guests. Ladies and gentlemen.

I would like to thank you for inviting me to address the 2002 meeting of the APEC CEO Summit. This is a captive audience, of some of the best of the best. Not only from the Asia Pacific...but also from La Gran Familia of the Americas.

And while I have your undivided attention, I would like to indulge in one of my great pleasures as Prime Minister of Canada. I would like to praise what Canadians have accomplished in recent times. The enduring strength and dynamism of the Canadian economy. Our confidence in the face of global uncertainty. And the rock solid foundation for long term prosperity and growth that we have established. A foundation that is allowing Canadian entrepreneurs to shine, as never before, in the global knowledge based economy. And that is fueling our resolve to brand Canada as the business partner of choice in the 21st century.

We have just passed the first anniversary of 9/11. We all felt the impact of that terrible event. It threatened our values of openness and freedom. Our sense of security and our economies. But it also brought us together in our grief, and in our resolve to heal and move forward.

Just a few weeks ago, in Bali, Indonesia, more innocent life was lost in another act of terror. Including one Canadian. And another is missing. On behalf of the people of Canada, I extend our deepest condolences to the families of the victims. It is our fervent hope that those responsible for this deplorable crime, will be brought to justice.

For Canadians, September 11th struck very close to home. It struck not only our closest ally and friend. It also posed a threat to the largest trading relationship in the world. And it threatened to accelerate the global economic slowdown that had been apparent even before 9/11.

9/11 was, in short, a comprehensive test of our people, and our spirit. A test that we have rallied to meet with energy, new resources, and close cooperation with the United States, and other nations.

Canada, has been a strong partner in meeting the global threat that terror poses to our values and our security. We have fought side by side with our Allies in Afghanistan. Our brave soldiers have given their lives. We have passed tough new anti-terrorism laws. And, we have implemented a Smart Border agreement to ensure both security and trade flows.

Ladies and gentlemen, when I last addressed the CEO Summit in 1997, I spoke of the progress that our government had made to restore our fiscal and economic strength. A strength sapped by years of deficits and skyrocketing public debt. We have taken major steps forward since then, enabling the Canadian economy to withstand the shock of 9/11 with extraordinary resilience.

Contrary to the expectations of most economists, we did not fall into a recession. In fact, in the first 8 months of this year, we set a new record for job creation. And the International Monetary Fund, and the Organization for Economic Co-operation and Development. Have forecast that Canada will post the strongest growth among G7 countries this year.

All of this is possible because of the sound fiscal and economic framework that our government, with the support of Canadians, has put in place. Because of our unwavering commitment over the years to fiscal discipline. To balanced budgets. To debt-reduction. To lower taxes. And to strategic investments that will build long term economic growth and vibrance. And strengthen the social fabric of our country.

Canadian governments, federal and provincial, have worked tirelessly to clean up their balance sheets. Last December, our government tabled our fifth straight surplus budget. Making Canada the only G7 nation expected to balance its books this year. We have paid down over $47 billion of our public debt. Almost $9 billion last year alone. More significantly, our debt-to-GDP ratio has fallen faster than that of any other major industrialized nation. We have implemented the largest tax cut in Canadian history.

Our corporate tax rates are now on track to fall 5 percentage points below average U.S. rates. Our capital gains taxes have been cut steeply. In fact, the Canadian top rate on capital gains is now lower than in the U.S.

These numbers are impressive. And the world is taking notice.

Earlier this year, KPMG released a study naming Canada the most cost-effective country in which to do business. While Moody's Investors Services, and Standard and Poors have each restored a "Triple A" rating to Canada for our domestic and foreign currency debt. The highest rating possible.

Ladies and gentlemen, in the aftermath of 9/11, and working in partnership with the United States, Canada has also taken effective action to ensure that our economy will not be held hostage to the threat of terror.

We share the longest undefended border in the world. Which close to 200 million people cross each year. Which supports close to $1.3 billion in trade every day. Indeed, in the "just in time" reality of NAFTA, our border is a fast lane for North American prosperity.

Shortly after 9/11, I met with President Bush. With so much at stake, we knew we had to take strong action to make our border more secure and efficient for trade. That is why, we reached a comprehensive "Smart Border Accord." An innovative model in which state-of-the-art technologies are being used to keep our border open for business but closed to security threats.

Before I finish, I want to mention the final way in which Canada has met the test of 9/11. While we have done what was needed to address trade and security concerns, we have not been thrown off our agenda for long term Canadian prosperity. A comprehensive and balanced agenda that invests in people, and in making Canada a magnet for the best ideas and minds. For new investment and new ventures. And for those who want to live, work and raise their families, in a nation with an unmatched quality of life. And that means dealing not only with the fiscal deficits, but also with social and environmental deficits. That is why in our next budget, we will be making major investments in health care, in reducing child poverty, and in the environment.

A key priority for investment will remain research and development and the skills of Canadians. The lifeblood of innovation and prosperity in the new economy. We have already taken enormous strides to promote advanced education and to create a state-of-the-art research and development infrastructure in our colleges and universities. We have taken steps to help parents save for their children's education. And to broaden access to advanced education through new scholarships and study grants.

To enhance the infrastructure of our universities and research institutions, we created the multi-billion dollar Canada Foundation for Innovation. The Networks of Centres of Excellence. The Canadian Institutes of Health Research. Genome Canada. And we are creating 2000 advanced research chairs at our universities, to attract, and retain the best talent in the world.

We established the most generous research and development tax regime in the world. And we are continuing to challenge ourselves, with ambitious new targets to encourage the commercialization of new ideas and innovation.

We are committed to doubling the amount we as a country will invest in R&D in the coming period. Our goal -- to place Canada among the top five countries in R&D performance by 2010.

And through our Innovation and Skills and Learning Strategy, we are engaging all Canadians on the next steps we need to take to ensure that Canada can continue to win in the new economy.

Ladies and gentlemen, the message I bring is simple, Canada remains on the cutting edge of new opportunities. We are making the Maple Leaf a 21st century trademark for excellence and prosperity. And, we offer cohesive, dynamic communities. Open for business, and ready to welcome your investment.

And I would now be delighted to take your questions.

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