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Economy Lab

Canada notably absent as Asia talks trade Add to ...

John Weekes, a senior business adviser at Bennett Jones LLP, was Canada's ambassador to the WTO and chief negotiator for the NAFTA



The Prime Minister's website boasts his government has "a strong and ambitious free trade agreement agenda." The reality, however, is somewhat different. The Harper government must urgently develop a bold new trade strategy to ensure that Canadian producers will have access to the high-growth markets of the Asia-Pacific region.

Canada's steadfast refusal to contemplate even minor changes to our protectionist policies in the dairy and poultry sectors resulted in its exclusion from the TransPacific Partnership (TPP) negotiations, the most recent round of which took place last month in New Zealand last month.

The host, along with the U.S., Australia, Brunei Darussalam, Chile, Malaysia, Peru, Singapore and Vietnam are negotiating "a high-standard, 21st century, Asia-Pacific regional trade agreement."

Even worse for Canada is the possibility that other countries may join in this negotiating effort: The U.S. has reportedly suggested that South Korea should participate.

Canada can, still safeguard its interests in the face of this setback with an ambitious program of negotiating comprehensive economic agreements with major Asia-Pacific countries that are not yet involved in the TPP talks. This would open major opportunities for Canadians in some of the world's most important markets and would allow Canadian negotiators to participate in establishing the 21st century trade architecture for the region.

Canada has started down this road with the launch of talks with India and ongoing negotiations with South Korea. Resuming stalled talks with Seoul must become an urgent priority, particularly now that the Obama administration has concluded its own FTA negotiations with South Korea. Canada cannot afford to let U.S. producers enjoy a preference over goods produced in Canada in this major market.

Canada should also press hard to initiate the negotiation of a broad free-trade agreement with Japan. This effort could build on the bilateral trade analysis completed in 2007.

Negotiating free trade with Japan seemed improbable just a few months ago, but timing is everything, and Japanese trade policy is now being re-engineered at the highest levels of the government. There is a growing recognition in Japan that protection in the agriculture sector is harming Japan's broader interests. Given that Canada is not a significant rice producer -- and that Japan is unlikely to want to export dairy products to Canada -- these two sensitive sectors should not impede a deal.

And then there is China. Canada should explore whether a free trade agreement with the People's Republic is possible. New Zealand, Chile and the ASEAN countries already have FTAs with China; Australia is negotiating one. Let's not wait until everyone else has a deal - let's get going now. There are enormous complementarities between our economies that we should be looking to realize. That door, at least, was opened last June in Ottawa with a commitment by Stephen Harper and Hu Jintao to establish a working group on deepening economic relations.

If we have no immediate prospect of joining in the TransPacific Partnership negotiations, Canada should ensure that Canadian producers enjoy terms of access to key markets in the Asia Pacific area that are at least as good as those enjoyed by its competitors.



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