Vancouver Sun | 7 June 2008
Free trade with Japan would be major boost for Canadian sales: ambassador
ASIA I Joseph Caron says Japan has recovered from a 1990s downturn, but Canadian companies are losing market share
Bruce Constantineau, Vancouver Sun
Japan sits in the "media shadow" of China but remains a hugely important customer of Canadian firms that are collectively losing market share to international competitors, Canadian Ambassador to Japan Joseph Caron said Friday.
"What we would really like is a [free trade agreement] and the government of Canada has called for one," he told a Vancouver Board of Trade meeting, noting the Japanese have not yet given an official positive response to possible free trade discussions.
Caron said Japan has largely recovered from a 1990s downturn, having experienced positive economic growth in 21 of the past 25 quarters, and stressed the Japanese economy is still the second largest in the world — trading about $1.6 trillion in goods and services annually.
"At least 3,000 Canadian companies provide goods and services to Japan but that’s not enough because we’re losing market share," he said.
Caron said Canada has fallen from being the 10th biggest source of imports to Japan in 1997, with 2.9 per cent of the total, to 13th place in 2006, with 1.7 per cent.
He said Canada should be proud of its resource-rich heritage, which allows it to be Japan’s top supplier of uranium and potash, and a major supplier of copper, iron ore and other minerals.
But Caron said many Canadians might not know Canada is Japan’s third most important source of imports in the aerospace sector, with about 50 Canadian companies selling aerospace products to Japan.
He said more than 100 Canadian firms export environmental technology products to Japan and Canadian companies also sell more than $100 million worth of high technology goods and services to Japan every month, with that figure rising by about 15 per cent annually.
Caron noted Canada and Japan have both increased their foreign direct investment in each other’s country in the past decade, with Japan’s investment in Canada rising to $13.5 billion from $8 billion and Canada’s investment in Japan increasing to $4.9 billion from $2.6 billion.
He said Japan, with 128 million people, has the most aging population among G8 countries — with 36 per cent of the total over the age of 55 — so products that target an aging population will likely have a greater chance of success.
Caron said Japan has public policy challenges that have to be sorted out, including a rising national debt. But he feels Japan today is showing "real transition and real transformation" as it works to deal with those challenges.
Caron said Japanese creativity, the country’s political evolution and its track record in adapting to changing circumstances will help it deal with any pressing issues over time.
He said two of the top Japanese-Canadian trade issues now are the need to reopen the Japanese market to Canadian beef from cows over 20 months old and the need to modernize trade relations with a new arrangement like a free trade deal.
Caron said the recent drop in the number of Japanese tourists visiting Canada has occurred because many Japanese like to travel within Asia, especially to China.
He noted the Canadian Tourism Commission is working hard to develop new products that will appeal to Japanese travelers who want to visit areas in Canada they haven’t already seen.