Free trade with China to be de­cided this fall

Move would tell U.S. Canada has choices: ex­perts

National Post (National Edition) - - CANADA - MARIE-DANIELLE SMITH National Post Email: md­smith @post­media.com Twit­ter: mariedanie­lles

OT­TAWA • While all eyes are on NAFTA, Canada is try­ing to move quickly on trade in the Asia-Pa­cific re­gion, with de­ci­sions on a China free trade agree­ment and an up­dated TPP com­ing this fall.

Di­ver­si­fy­ing trade with mar­ket ac­cess in Asia would of­fer ma­jor op­por­tu­ni­ties to Cana­dian busi­ness, say ex­perts, and send a sig­nal to the United States that while the North Amer­i­can Free Trade Agree­ment is im­por­tant, Cana­dian ex­ports can go else­where.

“The world is rush­ing and has been rush­ing to China’s door since China’s own eco­nomic mir­a­cle be­gan about 15 years ago, and we need to have a foot clearly in that door,” for­mer Con­ser­va­tive trade min­is­ter Stock­well Day told the Post. “To not be deal­ing with the fastest-grow­ing econ­omy in the world, in terms of sheer vol­ume, would just be folly.”

Day added deal­ing with China sends a sig­nal to the U.S. that Canada is not “cap­tive” to its mar­ket.

“It re­in­forces in their minds the fact that Canada has al­ter­na­tives.”

“The re­al­ity of the world is China is un­avoid­able. China’s part of our life whether we like it or not,” said for­mer Que­bec pre­mier Jean Charest, who helped get the Euro­pean Union on board with trade ne­go­ti­a­tions. He noted the pres­i­dent of Mex­ico also re­cently ex­pressed in­ter­est in a trade deal with China.

“I think the Chi­nese are prob­a­bly more in­ter­ested in Canada than they were be­fore the elec­tion of the Trump ad­min­is­tra­tion, be­cause we are a coun­ter­point to the Trump ad­min­is­tra­tion,” Charest told the Post.

“We make the point to them, and to the world, that China has the abil­ity to get along and work with de­vel­oped coun­tries.”

Charest said he thinks the re­la­tion­ship should be in­ten­si­fied but Canada might not be quite ready for a fullfledge­d free trade agree­ment. “I think (the gov­ern­ment is) right to be cau­tious. They ob­vi­ously are sen­si­tive to pub­lic opin­ion in Canada, and pub­lic opin­ion is fickle on this is­sue,” he said.

Not ev­ery­one is keen on China. Con­ser­va­tive Party leader An­drew Scheer has pub­licly nixed the idea, and polling shows Cana­di­ans have mixed views.

An Asia Pa­cific Foun­da­tion poll in late March found 55 per cent of Cana­di­ans sup­port a deal, 36 per cent op­pose and nine per cent don’t know. By con­trast, an An­gus Reid In­sti­tute poll re­leased Thurs­day finds 29 per cent sup­port, 31 per cent op­pose and a full 40 per cent don’t know. The polls were both taken on­line, with mar­gins of er­ror of 2.4 and 2.5 per cent re­spec­tively.

If Canada launched trade ne­go­ti­a­tions with China it would be the first G7 coun­try to do so. This might give Cana­di­ans a bet­ter deal, said Yves Tiberghien, di­rec­tor emer­i­tus of the Uni­ver­sity of Bri­tish Columbia’s In­sti­tute of Asian Re­search and a se­nior fel­low with the Asia Pa­cific Foun­da­tion.

“The worst sit­u­a­tion is to be a late mover,” he said. “We lose out even­tu­ally.”

Tiberghien pre­dicted oth­ers may soon line up: the United King­dom, for ex­am­ple, will be look­ing for big trade part­ners af­ter its exit from the Euro­pean Union.

Ac­cord­ing to a Cana­dian gov­ern­ment of­fi­cial fa­mil­iar with the mat­ter, for­mal ex­ploratory talks with China wrapped up in July. Of­fi­cials are crunch­ing num­bers and are ex­pected pro­vide anal­y­sis to trade min­is­ter François-Philippe Cham­pagne be­fore the end of the month.

Cabi­net could be dis­cussing a de­ci­sion by Oc­to­ber, and Cham­pagne could be on his way to China in De­cem­ber if there’s a green light, the of­fi­cial said.

A trade deal with China is not the only iron in the fire.

A trans-Pa­cific Part­ner­ship sans Trump is shap­ing up in earnest, spear­headed by Japan and Canada. Of­fi­cials are ex­pect­ing a road map for an agree­ment will come along­side an Asi­aPa­cific Eco­nomic Co­op­er­a­tion sum­mit in Novem­ber. The ex­pec­ta­tion is this would take months, not years, said the of­fi­cial.

Canada is also near­ing the con­clu­sion of a for­eign in­vest­ment pro­tec­tion agree­ment with In­dia.

WE NEED TO HAVE A FOOT CLEARLY IN (CHINA’S) DOOR.

ADRIAN WYLD / THE CANA­DIAN PRESS FILES

Prime Min­is­ter Justin Trudeau is greeted by Chi­nese Pres­i­dent Xi Jin­ping at the G20 sum­mit in 2016.

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