No. 2010/38 - Toronto, Ontario - May 28, 2010
Check Against Delivery
It’s a pleasure to be here with so many of the people who keep the ties between Canada and Spain strong, year in and year out.
Earlier this month, I was in Madrid, where I had the opportunity to meet with a number of government officials and business people to talk about future directions for our bilateral relationship.
I also spoke to the recently created Canada-Spain Chamber of Commerce there—a great reflection of the strides our relationship has taken over the years.
And I met with Spanish business leaders, decision makers and investors to highlight Canada’s business advantages.
In all of my meetings, one theme emerged loud and clear—as we work through the recession, we need to do so as partners.
These challenging economic times call for more partnerships, not fewer.
They call for more trade and investment, not less.
And they call for building more commercial ties with our partners across the Atlantic.
So as we continue expanding our business with Spain—and with Europe more broadly—I can tell you that groups like yours will have a critical role to play in advocating closer relations and keeping the doors of opportunity open.
You’ll be hearing a lot about this in the coming weeks, as Canada prepares to welcome the world to the G8 and G20 summits.
Our country has enjoyed great success with free enterprise and free trade over the years, and we think the world could benefit from a more open approach, too.
In fact, our relationship with Spain stands as a good example of a trade relationship that works. During my visit, I was deeply impressed by the depth of our commercial engagement in many key sectors.
In 2009, our bilateral merchandise trade reached $2.5 billion, while our two-way investment stood at $2.9 billion.
I also saw first-hand how our Canadian trade commissioners in Spain are working hard to make new connections in key sectors—in everything from natural resources to infrastructure, energy and high technology.
If they haven’t already, I urge Canadian businesses to get in touch with our trade commissioners around the world—and across Canada—because they can help tap into new and exciting opportunities across Spain and globally.
Already, over 45 Canadian companies have significant operations in Spain.
And Spanish firms like Repsol [YPF], Ferrovial, CEPSA, ACCIONA and Enerfin are active here in Canada.
In addition, the Spanish Exporters and Investors Club announced this week that Canada is the top foreign business destination outside of the European Union.
This represents a great endorsement for Canada.
Seeing these ties up close reminded me, once again, why Europe is such a crucial market for Canada—and why we need to continue moving forward on negotiations toward a new economic partnership agreement that will benefit us all.
Our businesses have long called for closer ties with Europe.
They’re excited about the European Union’s position as the world’s largest single common market and biggest investor in other countries, as home to some of the world’s largest and most important companies, and as an incubator of innovative ideas and technologies.
The many advantages I saw in Spain—its active business sector and commitment to innovation, for example—reinforced my belief that more Canadian companies should be doing business there.
Businesses in Canadian sectors like aerospace, financial services, renewable energy and many others can offer a lot to the European marketplace.
Our companies and workers can compete—and win—in Europe.
But our European partners have also told us that they’re excited about doing business here in Canada.
Between 2000 and 2009, European Union countries increased their investment levels in Canada by $68 billion, reaching over $163 billion in 2009.
They’re tapping into a number of Canadian advantages:
Our excellent financial system is also attracting attention.
Canada’s banking system is consistently ranked as one of the best in the world. Despite the global economic downturn, Canada did not experience any bank failures, and no bailouts were required.
In fact, many banks—including the Bank of Montreal and Royal Bank, for example—are growing at an impressive rate.
These kinds of confident expansions simply wouldn’t be possible without a strong, stable banking system. Canada has a well-regulated, free market economy with a private financial sector of substantial strength with demonstrated endurance. Thanks to more prudent regulations, Canada’s banks were in a stronger position to weather the storm than their foreign competitors.
Our banks did not require bailouts during the global financial crisis, and we do not believe that Canadian taxpayers should have to bear the costs of bailouts of financial institutions in other countries.
For this reason, Canada does not support imposing a systemic risk levy or tax. Canada will not go down the path of excessive, arbitrary or punitive regulation of its financial sector.
We do not want to see our financial institutions in Canada penalized because of their relative success and their stability during the course of the crisis.
That’s why Canada prefers to focus on the financial reforms agreed to by the G20 as a way to ensure high standards for capital, liquidity and leverage among global institutions.
I can tell you that this will be a core part of our message to the world, as Canada prepares to host the G20 summit here in Toronto. So negotiations toward a comprehensive economic and trade agreement between Canada and the European Union couldn’t come at a better time.
An agreement holds great potential for both sides.
A recent joint study shows that an agreement could lead to a potential $38-billion boost to our bilateral trade, and significant gains in gross domestic product for both sides.
In fact, it would make Canada the first developed country with which the European Union had such an agreement.
Obviously, this would give Canada a huge competitive advantage. And for the European Union, it would set an ambitious standard for their future trade agreements.
We’re looking at a range of issues, including:
The chief negotiators from both sides have remarked on the excellent working relationship they’ve developed. They’re also very impressed by the collaboration and creativity being shown on both sides as they work through challenging issues.
We just completed the third round of negotiations, and are preparing for the next round in July.
We’ve exchanged an ambitious tariff offer—with a second offer being prepared for the fall.
The European Union has told us that we’re a year ahead of where they expected to be by this point.
Let me tell you—trade negotiations aren’t done overnight!
So this is a good sign.
But as with any negotiation, we expect to face some challenges along the way—challenges that may cause some in Canada and in Europe to question our efforts.
And that’s where our business communities come in.
We need your help to build public support and face down critics who feel that increased business ties lead to an erosion of national sovereignty, or are somehow harmful to a country’s economy.
We need everyone who’s interested in seeing this agreement happen to step forward and make their views known.
This is a good time to do it.
Fighting protectionism and opening doors to cooperation will be a key theme during the upcoming G20 summit. Countries from around the world will be talking about the best ways to promote a lasting global economic recovery.
Through our actions, we’re proving that Canada is a free trade leader.
Look at how we unilaterally eliminated tariffs for manufacturing equipment imports—the first country in the G20 to do so—making it easier for Canadian manufacturers to remain competitive.
Look also at our ambitious free trade agenda, with partners around the world.
Two weeks ago, we signed a free trade agreement with Panama.
That’s just one example of many, all inspired by our enormous success with North American free trade.
Canada is on the “right side” of history when it comes to opening doors to commercial partnerships with other countries.
As the economic histories of both North America and Europe have proven, jobs, prosperity and opportunities are created only when we keep the doors open to trade.
We think that our negotiations with the European Union represent an important opportunity for people on both sides of the Atlantic to move through these uncertain times and work toward lasting economic recovery.
Let’s work together to convince Canadians and Europeans alike of the enormous benefits of opening new markets across the Atlantic.
And let’s get behind this partnership, which will help us create jobs and opportunity in the years to come.