THE RISE OF ASIA AND CANADA S RELATIONS WITH ASIA

THE RISE OF ASIA AND CANADA S RELATIONS WITH ASIA 1

The Rise of Asia 2

Annual GDP Growth rates : Selected Countries, 2008-2012 Average GDP growth rate 10 8 6 4 2 0-2 Source: World Bank data base at h;p://data.worldbank.org/indicator/ny.gdp.mktp.kd.zg 3

Canada and Asia Current trade relamons with Asia is not dominant As Canada, and Alberta, looks to reduce its dependence on the US market and to increase its linkages to the fastest growing markets in the world, Asia has become a prime focus of Canadian businesses and policy makers. Asia s populamon size and rising incomes have impacted on Canada s primary sector directly and holds the promise of future market growth. Canada is an exporter of resources and primary products to Asia and a transit point for Asian imports into the North American market Canada s Northern Gateway Policy is intended to facilitate integramon with Asia and makes the West coast a logismcs hub for the Asian Trade. 4

Asia s Rising Influence in Canada Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next 5 genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Box 1, p.11.

Canada s Energy Outlook Source: Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Box 15, p.41 6

Asia Pacific Economic CooperaJon (APEC) and the Trans Pacific Partnership (TPP) 7

APEC APEC is a forum of 21 pacific rim countries established to promote growth and prosperity in the Asia Pacific region through economic cooperamon. Its annual leaders summit is an important venue for heads of state to discuss mutual concerns and collaboramon. Free trade associamons are found among its members such as ASEAN, NAFTA and other bilateral agreements. 8

APEC Membership Source: www.apec.org 9

The Trans- Pacific Partnership (TPP) Trade Talks Aside from bilateral free trade talks, TPP talks have become a key focus of Canada s Asia trade policy. The TPP agreement was inimated in 2005 by Brunei, Singapore, Chile, and New Zealand to create a trans- Pacific Free trade area. It has since expanded to include Australia, Canada, Japan, Malaysia, Peru, the United States, and Vietnam also. It is part of the trend to replace mulmlateral trade agreements with bilateral and regional agreements This is significant as it includes countries in the fastest growing economic region, save China. 10

Free Trade Area and Bilateral trade agreements among partnership countries Source: Ian Fergusson et.al., The Trans- Pacific Partnership NegoMaMons and Issues for Congress, CRS Report for Congress, August 21, 11 2013, Figure 2, p.6

Source: Christy Chen Trans- Pacific Partnership: Canada s Next Trade Agreement?, Focus, BMO Economic Research, May 17, 2013, Table 1, p.9 12

Canada s Exports to Top Five Trading Partners, 2012 (billions $CAD) Source: Dawson, Laura and Stefania Bartucci, Canada and the Trans- Pacific Partnership: Entering a New Era of Strategic Trade Policy, Fraser InsMtute, September 2013, Fig. 6, p.6. 13

Canada s Exports to Top TPP Countries, 2012 (billions of $CAD) Source: Dawson, Laura and Stefania Bartucci, Canada and the Trans- Pacific Partnership: Entering a New Era of Strategic Trade Policy, Fraser InsMtute, September 2013, Figure 7, p.7. 14

Per Capita GDP of TPP Countries, 2012 ($US) Source: Dawson, Laura and Stefania Bartucci, Canada and the Trans- Pacific Partnership: Entering a New Era of Strategic Trade Policy, Fraser InsMtute, September 2013, Fig. 1, p.2. 15

PopulaJon of TPP Countries, 2012 (millions) Source: Dawson, Laura and Stefania Bartucci, Canada and the Trans- Pacific Partnership: Entering a New Era of Strategic Trade Policy, Fraser InsMtute, September 2013, Fig. 2, p.3 16

Source: Dawson, Laura and Stefania Bartucci, Canada and the Trans- Pacific Partnership: Entering a New Era of Strategic Trade Policy, Fraser InsMtute, September 2013, Fig. 3, p.3 17

Source: Christy Chen Trans- Pacific Partnership: Canada s Next Trade Agreement?, Focus, BMO Economic Research, May 17, 2013, Chart 2, p.8. 18

Growth in Asian InternaJonal Investment, 2003 to 2011 Asia will be an important source of capital Source: Andrew Sleigh, et.al., Asian Growth Journeys, Accenture, 2013 p.3 19

Canada s Trade RelaJons with Asia 20

Canada s Trade with Asia 2014 Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 21

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 22

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 23

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 24

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 25

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 26

China s Preferred InternaJonal Tourism DesJnaJon Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Table 6, Table 2, p.33. 27

Source: The Asia Factor, Asia Pacific FoundaMon of Canada, 2015 28

How Canadians see the Importance Of Selected countries Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, 29 A Report of the Asian Competence Task Force, 2013, Graph 1, p.12

Canada s Merchandise Trade with Asia Pacific, 2012 Canadian Imports from Asia Pacific Canadian Exports to Asia Pacific Merchandise ClassificaJon % Merchandise ClassificaJon % 1 Electrical machinery and equipment 21.71 Mineral fuels, oils 12.34 2 Boilers, mechanical appliances, etc. 18.19 Oil seeds and misc. fruit, grain, etc. 10.85 3 Motor vehicles, trailers, bicycles, motorcycles 4 Iron or steel armcles 3.96 11.67 Ores, slag and ash 10.43 Woodpulp; paper or paperboard scraps 5 Furniture and stuffed furnishings 3.89 Wood and wood armcles, charcoal 6.17 6 Kni;ed or crocheted apparel 3.79 Cereals 4.55 7 Woven clothing and apparel armcles 3.59 Boilers, mechanical appliances, etc. 4.26 8 Toys, games, sports equipment 3.14 FerMlizers 3.91 9 Rubber and rubber armcles 2.63 Meat and edible meat offal 3.55 10 OpMcal, medical, scienmfic, technical instrumentamon 2.55 Fats, oils and waxes 3.46 Top 10 as % of total from Asia 75.11 Top 10 as % of total to Asia 68.17 Asian imports as % of Cdn total 20.01 Asian exports as % of Cdn total 10.46 Source: Trade Data Online. Industry Canada. 5 March 2013. h;p://www.ic.gc.ca/eic/site/tdo- dcd.nsf/eng/home 8.62 30

Canada s Market Share in Top 10 Asian Markets, 2012 (millions $Cdn) Total Imports Imports from Canada Proportions of Total Imports (%) Rank Australia 260,736 2,476 0.95 5 China 1,889,680 23,669 1.25 1 Hong Kong, SAR 524,939 1,801 0.34 7 India 510,030 2,924 0.57 4 Indonesia 199,359 1,883 0.94 6 Japan 921,454 13,206 1.43 2 Singapore 395,158 1,293 0.33 9 South Korea 540,367 5,457 1.01 3 Taiwan 281,292 1,689 0.60 8 Thailand 261,523 982 0.38 10 Asia Total 6,316,616 58,864 0.93 Source: Trade Data Online. Industry Canada., June 3, 2013. 31

Market Share of Top 10 Asian Exporters to Canada, 2011-2012 2011 Canadian Imports 2012 Canadian Imports 2012 Proportions of Total (%) Rank Australia 1,767 2,080 0.45 8 China 48,184 50,713 10.98 1 India 2,534 2,856 0.62 5 Japan 13,058 15,022 3.25 2 Malaysia 2,139 2,226 0.48 7 Singapore 1,555 1,425 0.31 10 South Korea 6,616 6,374 1.38 3 Taiwan 4,931 4,583 0.99 4 Thailand 2,675 2,633 0.57 6 Vietnam 1,332 1,618 0.35 9 Total 89,489 94,242 20.4 Source: Trade Data Online. Industry Canada., June 3, 2013. 32

Adapted from www.asiapaci fic.ca/ stamsmcs/ trade/market share 33

Canada- China Trade 34

Canada and China h;p://globalnews.ca/video/913818/canada- governor- general- engages- china- to- open- up- trade h;p://live.wsj.com/video/canada- growing- china- trade- connecmon/c5ec68e9-3404- 4344- A5B7- D94C4888D0D3.html#! C5EC68E9-3404- 4344- A5B7- D94C4888D0 h;p://www.cigionline.org/videos/china- canada- relamons- changing- global- contextd3 35

Canadian Bilateral Trade (2011) Brazil, Russia, India 2% Japan 3% United Kingdom 3% China 7% Others 23% USA 62% Source: World Trade Atlas 36

Bilateral Trade Flow: Canada - China Source: www.economonitor.com/analysts/files/2012/02/image003.png 37

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 38

Top Products in Sino Canadian Trade China s Top Exports to Canada PlasMc Kni;ed Clothing & Apparel Woven Clothing Toys, Games, spormng goods Computers & mechanical appliances Electrical or Electronic equipment Furniture, lamps & Illuminated signs Foot ware Iron and Steel OpMcal and medical equipment Canada s Top Exports to China Organic chemicals Computers & mechanical appliances FerMlizers Nickel & nickel products Fats, Oils & Waxes Ores, slag and ash Electrical and electronic equipment Fish, Crustaceans, molluscs Cereals Wood pulp & wastes & scraps Source: DFAIT Trade StaMsMcs 39

Billions of $ 18 16 14 12 10 8 6 4 2 Canadian Exports to China (2007 2011) $13.2 $11.2 $10.5 $9.5 $16.8 0 2007 2008 2009 2010 2011 Source: World Trade Atlas 40

Source: World Trade Atlas 41

Source: World Trade Atlas 42

Canada- China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 43

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 44

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 45

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 46

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 47

Canada China Trade Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 48

Adapted from www.asiapacific.ca/stamsmcs/trade/bilateral trade 49

Adapted from www.asiapacific.ca/stamsmcs/trade/bilateral trade 50

Exports to China by Province (%) - 2012 Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 51

Bilateral FDI Flows Source:www.parl.gc.ca/content/LOP/researchPublicaMons/2013-55- 55- e.htm 52

Note: FDI China into Canada in 2006 and 2007 are esmmates Source: Office of the Chief Economist of Canada 53

Future Trade ProjecJons Source: www.conferenceboard.ca/economics/hot_eco_topics/default/12-11- 12/as_Canada_s_trade_shiqs_the_world 54

China s Preferred InternaJonal Tourism DesJnaJon Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Table 6, Table 2, p.33. 55

Note: FDI China into Canada in 2006 and 2007 are esmmates Source: Office of the Chief Economist of Canada 56

China - Canada Bilateral Direct Investment 57

Sectoral distribujon of Chinese investment in Canada Chinese firms in Canada Seem to have invested according to najonal goals DistribuJon of Chinese FDI by Sector (2005-2012) Energy 74% Mining 23% Finance 0% Other 3% Green energy 2% Misc. 1% Source: Companies news releases 58

What is Canada s desjny in Asia? What is our role in the Asian Value Chain? Do we want to be part of this chain? Can we afford to ignore it? Discussions 59

Canada s PercepJon of Asia Canadian View of Asia 2010 Agree with Statement Canada I consider Canada to be part of the Asia Pacific region 29% Asian economies are vital to the well- being of Canada 62% The Government of Canada should aim to diversify its trade to be less dependent on the United States 76% The growing importance of China as an economic power is more of an opportunity than a threat Looking 10 years into the future, the influence of China in the world will surpass that if the United States 48% 60% Source: Asia Pacific FoundaJon of Canada, 2010 NaJonal Opinion Poll: Canadian Views of Asia, March 28, 2010. hhp://www.asiapacific.ca/sites/default/files/ filefield/najonal_opinion_poll_2010.pdf 60

Source: www.asiapacific.ca/pubicamons#editorials 61

Source: www.asiapacific.ca/pubicamons#editorials 62

Source: www.asiapacific.ca/pubicamons#editorials 63

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.8 64

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.9 65

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.42 66

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.47 67

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.38 68

Hesitant to move away from the US on Energy Mahers Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.37 69

Source: 2014 NaMonal Opinion Poll: Canadian Views on Asia, Asia Pacific FoundaMon of Canada, 2014, p.40 70

Views of Asian PracJJoners on Canada s Asian Competence Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Box 2, p.13 71

Canadian Support for Placing more Emphasis on Teaching about Asian Source: Asia- Pacific FoundaMon, Canada s Asia Challenge: Crea0ng Competence for the Next genera0on of Canadians, A Report of the Asian Competence Task Force, 2013, Graph 2, p.16 72