Address by Minister Van Loan to Argentine Canadian Chamber of Commerce

No. 2010/61 - Buenos Aires, Argentina - August 25, 2010

Check Against Delivery

Canada values its relationship with Argentina.

It’s groups like yours that help keep our partnership strong each and every year.

Since 1977, your organization has been at the forefront of Canada’s relationship with Argentina. Your members are significant players in our bilateral merchandise trade, which reached $876 million last year, as well as in most of the $3.3 billion in Canadian direct investment in this country.

Governments in both our countries will continue relying on your advice and support as they carry our partnership into the future.

Moving toward recovery

We believe that our partnership with Argentina can help both countries continue along the path to lasting economic recovery.

Like Canada, Argentina has taken advantage of its abundant natural resources and developed a diverse, market-oriented economy.

We’ve seen Argentina increase exports and business activity following its 2001 financial crisis. And we applaud Argentina’s continued economic-recovery efforts following the recent downturn.

Canada fared better than most in the recent economic downturn. Our banking system remained strong throughout the downturn, and did not require any government bailouts. And from the beginning, we understood the importance of smart, effective action to help bolster our economy.

In fact, our approach to economic recovery closely matches the goals set out by world leaders during the G-20 Summit held in Toronto in June.

At the Summit, leaders established firm debt-reduction targets in the coming years, something to which Canada and Argentina have long been committed.

Leaders also underscored their commitment to reforming international monetary institutions, something Canada knows a lot about, as demonstrated by the strength of our banking and financial systems.

The leaders also agreed that short-term stimulus as well as deficit-reduction measures are necessary.

Canada has been a leader in this regard.

Our economic action plan stimulated job creation, eased credit markets and helped workers get back on their feet.

Over the medium term, we’re continuing to make good progress toward balancing our budget well before any other G-7 country.

And we’re taking steps to ensure that Canada emerges from the downturn stronger and in better fiscal shape than nearly every other industrialized country.

Canada offers:

  • an open and attractive free-enterprise environment, ranked by the Economist Intelligence Unit as the best place to do business in the G-7 this year and over the next four years;
  • the strongest fiscal position in the G-7;
  • low corporate taxes—on track to being the lowest corporate income tax rate in the G-7;
  • the fastest economic growth in the G-7 in 2010, according to both the International Monetary Fund and the Organisation for Economic Co-operation and Development;
  • the first tariff-free zone in the G-20 for manufacturing imports;
  • 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 one of the most advantageous research and development tax incentive programs in the industrialized world;
  • a strong commitment to good governance and the rule of law; and
  • a high quality of life.

But another key to Canada’s economic success is our commitment to doing business beyond our borders. Inspired by our success with North American free trade, we’re moving forward on an ambitious agenda to open more doors for our businesses around the world.

Our new free trade agreements with Peru and the European Free Trade Association are now in force.

In May, I joined my Panamanian counterpart [Panama’s Minister of Commerce and Industry, Roberto Henríquez] to sign the Canada-Panama Free Trade Agreement.

In June, we received Royal Assent from Parliament to implement a free trade agreement with Colombia.

We’ve also introduced implementing legislation for a free trade agreement with Jordan.

We’re now engaged in free trade negotiations with the Caribbean Community, the Dominican Republic, the Republic of Korea and Ukraine, as well as the Central American Four: El Salvador, Guatemala, Honduras and Nicaragua.

We’ve been working closely with India to complete a joint study that will lead to a comprehensive economic partnership agreement.

And we recently concluded the fourth round of negotiations with the European Union toward the most significant Canadian trade initiative since the North American Free Trade Agreement.

And in the midst of these efforts, we continue to see our partnership with Argentina as an engine of opportunity in the years ahead.

Future directions

As your members well know, our bilateral trade numbers have seen their share of ups and downs. Canadian merchandise exports to Argentina, for example, declined by more than 34 percent last year over the previous year.

I’m taking every opportunity to remind our Argentine partners about what Canada can offer in key areas, such as the machinery, electronics, pharmaceuticals and services sectors.

Mining is another good example.

Argentina’s mining sector has enjoyed rapid growth over the last 15 years. And I understand that the Government of Argentina has established the country’s mining projections for the next 15 years.

One projection is that by 2025 mining will represent about US$26 billion-worth of Argentina’s gross domestic product, and employ 380,000 direct and 800,000 indirect employees.

The government is also forecasting US$23 billion annually in exports by 2025, and US$25 billion in foreign direct investment. 

We think that Canadian companies can play a role in making these projections reality.

There are already 62 Canadian exploration companies active here, with investments of up to $2 billion, and $4 billion in mine development has been announced.

Barrick Gold’s Pascua-Lama project is a good example. Straddling the Argentina-Chile border, it’s the first binational mine in the world. Once in production, it will be the largest mining project in Argentina.

All of this places Canadian companies among the largest investors in the industry.

But Canadian companies can offer a lot more than mining expertise and investment.

As Argentina continues to look for effective, reliable sources of power in the years ahead, it should look to what Canada can offer in this area.

Increasing exports isn’t the only way forward. We need to continue becoming part of each other’s supply chains.

Canadian equipment and service suppliers are becoming increasingly active in the Argentine market.

There is immense potential in making things together, sharing technology and research, and creating products and scientific breakthroughs that can be commercialized on a global basis.

To build success in these areas, our trade commissioners here in Buenos Aires are actively working to match Canadian expertise with Argentine demand in a number of sectors.

Strengthening investment ties with Argentina is another priority of Canada’s.

Canada is an important and well-diversified investor in Argentina, thanks to companies like yours.

But making these commercial connections also requires an open, transparent approach to trade.

The global recession was a stark reminder of how interconnected and interdependent our economies are. Real, lasting economic success—and the jobs and prosperity that come with it—depends on free trade, not protectionism.

Canada believes that our relationship with Argentina holds great potential to help both countries farther along the path to lasting, sustainable economic recovery.

Unlocking this potential means tackling a number of barriers to trade. This includes Argentina’s import restrictions on food products, which run counter to global commitments at the G-20 and World Trade Organization to resist protectionist measures.

I encourage you, as leaders in the business community, to take every opportunity to be advocates to your counterparts in both government and business for continued lowering trade barriers and building of closer trade ties between our nations in the years to come.

Conclusion

Over the years, our two countries have become close partners in a number of areas.

We’re close collaborators on the global stage at the United Nations and in places like Haiti.

We’re both very involved in our regional neighbourhood. Canada will be hosting the 2011 meeting of the Inter-American Development Bank in Calgary, just the latest example of our leadership in the Americas.

And our business communities are getting closer every year, finding new ways for our citizens to prosper and thrive in the global economy.

But keeping these ties strong depends on groups like yours.

It depends on close political engagement, as demonstrated by the many Canadian ministers who have visited Argentina in the last year, as well as by Argentine president [Cristina Fernández de] Kirchner, who was in Canada during the G-20 Summit.

Whether we’re from business or government, we all have a role to play in building closer ties. So let’s continue working together to tap into the potential that exists in our partnership. Let’s help our countries continue on the road to lasting economic recovery.

Thank you.