Embassy, November 14th, 2007
Trade Deal Would Be Reward for Jordan’s Moderate Stance
Nabil Ali Barto says free trade talks are a reward for his country’s moderation and peace efforts, but critics worry the government isn’t genuine in its trade relations.
By Lee Berthiaume
Jordanian Ambassador Nabil Ali Barto believes the Canadian government’s intention to launch trade talks with his country in the near future is a reward for the kingdom’s position as a moderate Arab nation pushing for peace in the volatile Middle East.
As a result, he added, the benefits to Canada won’t merely be the securing of a springboard for Canadian products into the many Arab countries that Jordan already has such agreements with, but also a visible incentive for other nations to embrace moderation.
"If countries like that are rewarded for what they are doing," he said in an interview yesterday, "other countries will follow that path."
This week, International Trade Minister David Emerson led a trade mission to the Middle East, with stops planned for Kuwait and the United Arab Emirates-both members of the six-state Gulf Co-operation Council-as well as Jordan.
In an email interview with Embassy this week, Mr. Emerson said that that "Canada and Jordan are exploring the feasibility of [a free trade agreement], with a view to launching negotiations in 2008.
"We also hope to engage with the countries of the Gulf Co-operation Council, building on the FIPA and air agreement we have already concluded with Kuwait," he added.
Jordan signed a free trade agreement with the United States in 2000, Mr. Barto said, but he was confident the Canadian decision to pursue talks was not prompted by that bilateral deal.
Instead, the ambassador said he has been trying to promote talks by selling a deal as a positive signal to Amman that its policies of contributing to stability and peace are appreciated.
"This is exactly what I have been trying to promote," he said. "Other countries will start thinking twice before going in a different direction."
The Canadian government has hinted that supporting progressive countries is one reason certain nations have been chosen for negotiations, Colombia being the most visible example.
However, Mr. Barto said just because Jordan is being rewarded, that doesn’t mean Canada will give up important concessions during the talks or that the deal is not economically viable.
"When we talk about the Middle East, it is a very important region and it has as big a market as the United States," he said.
"When you do this, you are not only sending the signal that you are supporting countries who are pursuing democracy. Jordan has free trade agreements with most of the Arab countries. So when you sign a free trade agreement with Jordan, you open all these markets to you."
While markets may open, Canada has historically had minimal trade and investment relations with the region, says Kuwaiti Ambassador Musaed Rashed Al-Haroun, in part because Canadian companies are hesitant to explore new markets.
"You always say Canadians are not aggressive enough to get into the market over there," he said. "And there are a lot of opportunities in the Gulf states."
He admits, however, that companies from the Persian Gulf region, especially Kuwait, often overlook Canada because of historical links to the United States and Western Europe.
The Gulf Co-operation Council is comprised of the six richest countries in the Middle East: Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Oman and Bahrain. According to the Department of Foreign Affairs and International Trade, the combined population is 35 million and the group’s economy has doubled in the last five years.
Oil, of course, has contributed to their success, though the six countries are trying to diversify. Bilateral trade in goods between the GCC and Canada increased 14.9 per cent between 2005-2006, reaching $3.64 billion. The government has signed an air agreement and Foreign Investment Promotion and Protection Agreement with Kuwait.
However, in a sign of the state of relations between Canada and the bloc, only three of the countries-Saudi Arabia, the UAE and Kuwait-maintain embassies in Ottawa, while Canada maintains the same presence in the GCC member countries.
Mr. Al-Haroun said there are major opportunities in the energy and construction sectors in the six Gulf states, especially with concerted efforts privatize many industries there.
Liberal Trade critic Navdeep Bains visited the Middle East in the spring with members of the Standing Committee on International Trade and said yesterday there are numerous opportunities in the region for Canadian companies.
However, he questioned whether DFAIT has the resources necessary to not only promote Canadian trade and investment abroad, but also to conduct free trade negotiations with a slew of countries.
"With limited funds, it seems this government is trying to accomplish a lot, which questions their true intentions," he said.
He added that he harbours concerns that the government is willing to give up potential economic benefits for political gain, pointing to the softwood lumber deal as an example.
"The devil is in the details, so I don’t know how genuine this government is in building true trade relations," he said. "We always have to look at the fine print, and I have very little faith in this government."
NDP Trade critic Peter Julian said Canada needs to diversify its markets by expanding trade and investment relations with democratic countries, and that some of the GCC countries continue to be "problematic with human rights."
"Without pinpointing any country particularly, the principle is if we’re looking to diversify, we should be looking to diversify with countries that have a democratic model or are showing significant progress on human rights," he said. "That is fundamental."
He also accused the government of negotiating "in retreat" by giving important concessions to countries with minimal return for Canada.