Address by Minister Van Loan to Asia-Pacific Canadian Chambers of Commerce
No. 2010/40 - Shanghai, China - June 2, 2010
Check Against Delivery
It’s a great pleasure to be here tonight to help kick off this important event—the first-ever Asia-Pacific Canadian Chambers of Commerce Forum.
I’d like to thank our friends at the Canadian Chamber of Commerce in Shanghai for their efforts in organizing this event, and for bringing together so many of the groups that keep the ties across the Pacific strong.
I look forward to this forum becoming an annual event.
After all, Canada recognizes that these challenging, uncertain economic times call for more global partnerships, more trade and more investment.
Specifically, we think our Pacific partnerships hold a lot of potential to help spur the global economic recovery we all need. In fact, the Asia-Pacific region is leading this recovery.
Rapid and decisive action on the part of Asian countries to stimulate their economies played a big role in stabilizing global markets during these uncertain times.
But we also think that Canada’s businesses in the region have a role to play in boosting global trade and helping us all move toward a lasting recovery.
Canada as a Pacific nation
Canada is a Pacific nation—pacific in every sense, not just geographically.
Generations of immigrants from Asia-Pacific countries have settled in Canada, contributing to our rich cultural heritage. Cities like Vancouver, Calgary, Toronto and Montreal all boast strong cultural communities hailing from across the Asia Pacific.
But over the years, Canada’s businesses have developed a Pacific orientation, too.
Canada’s links to the Asia Pacific have expanded dramatically over the last quarter of a century.
We’ve seen steady, increased engagement with economic powerhouses like China, India, Japan and the Republic of Korea. Canadian companies, investors and researchers are becoming more and more active in these markets.
The results have been dramatic.
Today, Asia represents about 17 percent of Canada’s two-way merchandise trade, led by China, Japan and South Korea.
And our government has been very clear in our commitment to build on this.
Look at what we’re doing here in China—a great example of our dedication to forging stronger business links across the Asia Pacific.
Our two countries have long enjoyed a close relationship.
Canada’s first trade commissioner arrived here in Shanghai over 100 years ago. Since then, our commercial ties have expanded dramatically.
Two-way merchandise trade has grown an average of 8.5 percent annually since 2005, reaching nearly $51 billion last year.
China is now Canada’s third-largest merchandise export destination.
Even last year, in the midst of the global recession, the stock of Canadian direct investment in China reached an all-time record of $3.3 billion.
And China’s stocks of foreign direct investment in Canada has increased nearly 70 percent, making China our tenth-largest source of foreign direct investment.
This kind of investment growth is a driving force behind Canada’s commitment to enter into a foreign investment promotion and protection agreement with China in the near future.
We’re also very excited about China’s continued investments in infrastructure, its commitment to innovation and its development of a greener economy.
Canadian companies can help China reach its goals in all of these areas.
Yesterday, I had the chance to meet with members of the Canada-China Joint Science and Technology Committee to review progress in our vibrant science and technology relationship. This relationship includes a shared commitment to cooperating in the area of clean technology—already a focus of collaboration for our two countries.
I was also pleased to learn that civil aviation will be included as an area of focus for the committee’s future cooperation. We’ll work together to develop new cutting-edge technologies in this rapidly evolving market.
When it comes to transportation and clean technology, Canada has a lot to offer. We also have the resources and know-how to help China continue expanding and developing its economy in many other areas as well.
To help make these types of commercial connections, we expanded our network of trade commissioner offices across China to enable Canadian companies to broaden their presence here.
We’ve also increased the number of trade commissioners and trade offices in other key Asian markets, including India.
Our trade commissioners are great points of contact for Canadian businesses looking to deepen their presence around the world—and also for our partners looking to do business with Canada.
Look also at our Asia-Pacific Gateway and Corridor Initiative—a dramatic and unprecedented agreement aimed at bringing more Asian business to, and through, North America via Canada’s west coast.
Canadian government and industry partners have come together as never before to create a seamless cross-border supply chain involving seaports, airports, railways and roadways.
We’re taking advantage of Canada’s geography to create a fast, reliable and secure gateway for trade and travel. Vancouver, in particular, has become an important gateway for North American trade. Ports like Vancouver and Prince Rupert are now closer—by two or three days—than their U.S. competitors to key Asian ports like Shanghai.
So far, various levels of government have invested about $2.8 billion into this initiative.
The private sector has stepped up to the plate too, with over $13.3 billion in investments.
These kinds of efforts demonstrate Canada’s commitment to boost commercial ties across the Pacific.
Expanding markets across the Pacific
We’re also committed to diversifying our business in the region.
Much of our success in Asia has been due to the high price of—and high demand for—our commodities. We’re committed to telling our partners about everything we can offer in other sectors, too—including services, energy, transportation and infrastructure.
As economies throughout the Asia Pacific continue developing—and their middle classes keep growing—Canada will remain a strong and reliable partner in many areas.
As a country with a long history of success in free enterprise and free trade, Canada is committed to helping our businesses gain broader access to the Asian market. Our government’s ambitious free trade agenda is helping to support and bolster Canadian businesses on the world stage.
For example, Canada and India are engaged in a joint study exploring the parameters of a possible comprehensive economic partnership agreement.
I’m also engaged in an active dialogue with the eight members of the Trans-Pacific Partnership—an initiative that holds great potential for more integrated, rules-based trade in the Asia-Pacific region.
Another example is Japan—one of the world’s largest economies and Canada’s second-largest trading partner in Asia.
I see enormous potential in building closer ties with Japan in the years ahead.
We also think we can help our commercial relationship with Japan grow through an economic partnership agreement—or even a free trade agreement.
When Japan is ready to open new trade talks with other countries, we think Canada should be at the top of the list.
I’ll be heading to Japan in a few days to carry this message forward.
We also see South Korea as an important market, and we hope to resume our free trade negotiations with that country as soon as possible.
We’re very excited about deepening our commercial links to Southeast Asia—a group of nations comprising 592 million people whose economic star is rising.
And, as we’re doing with China, Canada is negotiating foreign investment promotion and protection agreements with Indonesia and Vietnam—two more opportunities to strengthen business ties across the Pacific.
Promoting Canada’s investment advantages
In all our efforts, we’re committed to reminding our Asian partners about Canada’s welcoming investment climate and many investment advantages:
- an open and attractive free-enterprise environment, ranked by the Economist Intelligence Unit as the best place to do business in the G-7 over the next five years;
- the strongest fiscal position in the G-7;
- a low corporate income tax rate—on track to being the lowest in the G-7 within two years;
- the fastest predicted economic growth in the G-7 between 2010 and 2012, according to the International Monetary Fund;
- a skilled workforce, with the highest proportion of post-secondary graduates among countries of the Organisation for Economic Co-operation and Development;
- a vibrant environment for innovation, with some of the most generous research-and-development tax incentives in the developed world, and the lowest research and development costs in the G-7;
- a strong commitment to good governance and the rule of law; and
- a high quality of life.
KPMG [LLP, the accounting and consulting firm] also confirmed last month that Canada is ahead of the pack of industrialized countries in terms of business-cost competitiveness. Quite simply, Canada is a great place for foreign businesses and investors looking for a foothold in the North American market.
Our excellent financial system is also attracting attention.
Despite the global economic downturn, Canada did not experience any bank failures, and no bailouts were required.
In fact, many Canadian banks are growing aggressively.
This wouldn’t be possible without Canada’s strong, stable banking system—governed by regulations that set out higher standards for investment and risk than we see in other countries.
Canada is also continuing to eliminate tariffs on imported equipment and machinery, positioning us as the first tariff-free zone for manufacturing imports in the G-20.
Throughout my visit to China this week, I’ll continue talking about investment advantages like these that Canada offers.
To help get the word out, I announced yesterday that, for one week in October , Canada will be hosting an “Invest in Canada” week at the World Expo here in Shanghai.
Each day, we’ll be focusing on key sectors in which Canada has proven experience and expertise: mining and resources, automotive, life sciences, clean technology and digital media.
All of these areas hold great potential for deepening our partnerships with countries across the Asia-Pacific region.
I invite all of you to join us in the Canada pavilion in October as we celebrate Canadian excellence in all of these areas, and take the next steps in strengthening our commercial ties across the Pacific.
Canada believes that the key to lasting economic recovery for the world is more trade and investment, not less.
The rise of the Asia-Pacific region as an increasingly integrated economic powerhouse stands as a model to the world of how individual nations can open doors to cooperation, and create new opportunities and jobs. Canada’s own economic history is another good example—as a successful partner in the North American free trade “family,” as an excellent business partner for nations around the world, and as a nation committed to an ambitious global free trade agenda.
This commitment to partnerships, and to opening doors to new opportunities, will be at the core of our message at the upcoming Asia-Pacific Economic Cooperation meeting in Sapporo [Japan].
And it will be a cornerstone of our message to the world as we prepare to welcome our friends from around the world for the upcoming G-8 and G-20 summits.
Global recovery depends on partnerships, and in that regard Canada views the Asia-Pacific region as crucial.
Let’s work together to build more success on both sides of the Pacific.
And let’s create the jobs, opportunity and prosperity our citizens are looking for in the years ahead.
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