#1cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Capitalizing on Natural Synergies; towards an EPA between Canada & Japan Presentation to Keidanren Committee on Canada Canadian Chamber of Commerce in Japan December 13th, 2011#2cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Agenda • . . • • Introductions CCCJ Overview CCCJ involvement in EPA discussions Current bilateral business conditions Bilateral opportunities in an EPA: Sector specific analysis EPA or TPP? Effective EPA cooperation between CCCJ & Keidanren • Discussion#3cccj Introductions CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON - - Wilf Wakely, President, Canadian Chamber of Commerce in Japan, Lawyer Shawn Lawlor, Vice-President, CCCJ, Chair, EPA Trade Policy Committee, Director, Japan Operations, Canada Wood Eric De Groot, Vice-President, CCCJ, Vice-Chair, EPA Trade Policy Committee, Country Manager, Forbo Flooring Joel Sievers, Senior Manager, Communications, Manulife Japan Toshiaki Haruna, Corporate Officer, Divisional Director of Corporate Division, Toys 'R' Us Japan Hiroshi Ando, Director, Sales & Marketing, Research in Motion Japan Hiroshi Fujita, Vice President & Country Head - Japan, Bank of Noval Scotia Brian Smith, Special Representative, CCCJ, Principal, Altavista Consulting International David Anderson, Executive Director, CCCJ#4ccci CCCJ Overview CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON - - Longest serving Canadian Chamber in Asia Voice of Canadian business community in Japan since 1975 Roughly 250 members including largest. Canadian corporations operating in Japan as well as numerous SMEs across 35 business sectors - On-the-ground expertise on bilateral business developments and trends#5cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCIE DU CANADA AU JAPON CCCJ Role Strengthen commercial relations between Canada and Japan through; - - Communication • Publications, Member updates, Guest Speakers Networking • . 30 events per year attracting roughly 2,000 guests. CCCJ works with like-mandated organizations including other foreign Chambers in Japan, CCC, CCCE, Keidanren, etc. - Advocacy · Voice of Canadian Business in Japan to Canadian and Japanese Government Officials EPA as well as other Social and Economic Policy initiatives#6cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON CCCJ involvement in trade discussions August 2004 January 2007 November 2010 December 2010 February 2011 July 2011 CCCJ meets with Keidanren Committee on Canada promoting the Canada- Japan Trade Framework Agreement CCCJ adopts promotion of an FTA as a guiding principle CCCJ EPA Trade Policy Committee submits Trade Policy Paper to Canadian and Japanese governments CCCJ presents to Canadian and Japanese government officials at Trade and Investment Dialogue CCCJ welcomes launch of Joint-Study, pledges active involvement CCCJ presents to Canadian and Japanese governments at Private Sector Roundtable December 2011 CCCJ presents to Keidanren Committee on Canada, promoting cooperation in EPA issues CCCJ will continue to collaborate with partners including the CCC, CCCE, Keidanren, Toronto Shokokai to bring the business communities strongest, unified voice forward.#7cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions 2010 Exports: $13.4B JDIC: $16B •Motor Vehicles, Machinery •ICT, Precision instruments • Rubber • Iron/Steel •Plastics •Mineral fuels, Oils, fruit, Grain •Wood, Wood pulp, Ores •Seafood, Meat •Aircrafts 2010 Exports: $9.2B CDIJ: $7.3B Stat Source: DFAIT, Office of the Chief Economist. Image Source: Embassy of Canada to Japan#8cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions - Canadian Presence in Japan Roughly 110 Canadian Companies with tangible presence in Japan representing C$7.3B of Capital stock 48 ICT 22 Retail, Travel and Other Service 20 Manufacturing 12 Agriculture, Forestry and Fishery Industries 5 Finance and Insurance 3 Bio & Life Sciences Agriculture, Forestry, Finance & Insurance Fishery. Manufacturing Bio & Life Sciences Retail, Travel & Other Services ICT Source: JETRO, Directory of Canadian Companies Operating in Japan#976 Compar cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions - Japanese Presence in Canada Roughly 327 Japanese Companies with tangible presence in Canada representing C$16B of Capital stock 17 F 2 Companies 216 Compete Food Processing Health Care Sales Office Mfg., Automotive, Machinery Services Trading/Trans Resources port/Storage ICT/Electic Machinery Sources: JETRO, 2009 Survey on Japanese Business Conditions in Canada; DFAIT, Office of the Chief Economist (C$16B figure is for 2010)#10• cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions - Canada-Japan Bilateral Trade & Investment CDN$ Millions CDN$ Millions Japanese FDI in Canada I Canadian FDI in Japan Canadian Exports to Japan Canadian Imports from Japan 18,000 18,000 16,000 14,000 16,000 14,000 12,000 10,000 8,000 6,000 12,000 10,000 8,000 6,000 4,000 2,000 4,000 2,000 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 In 2008, Japan represented Canada's 3rd largest trading partner, in 2010 - 5th In 2001, CDIJ represented 1.8% of CDIA, in 2010 - 1.2% • CDIJ in 2010 is roughly the same level as in 2001, while total CDIA has risen by 55% over the decade Source: DFAIT Office of the Chief Economist#11cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions Trends in bilateral Canada-Asia trade CDN$ Millions 70,000 60,000 50,000 40,000 30,000 20,000 10,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Impressive level of bilateral trade, however stagnant. Other Asian neighbours gaining. China India South Korea Japan Source: DFAIT Office of the Chief Economist#12• cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions - Trends in bilateral Canada-Asia Direct Investment CDN$Millions 25,000 20,000 15,000 10,000 5,000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Canada-Japan bilateral FDI remains strong, however others are catching up. China India Korea Japan Source: DFAIT Office of the Chief Economist#13cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Current Bilateral Business Conditions - Past decade Stagnant growth in bilateral trade No major issues of contention, however not much bilateral excitement Canadian business looking elsewhere in Asia CDIA moving to other Asian nations Japan still major investor in Canada, however other Asian nations are catching up - notably in resource sectors#14cccj Bilateral Economic Opportunities CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCIE DU CANADA AU JAPON . • ● Natural synergies • Japan has capital, technological leadership Canada has resources, technology Canada is making progress in diversifying trade. Opportunity is now to strengthen Canada-Japan economic relations. Current bilateral merchandise trade with Japan accounts for only 2.8% of Canada's global total. For trade with the world's 3rd largest economy, this should be higher 2008 bilateral service trade with Japan accounts for only 1.7% of Canada's global total. For trade with the world's 3rd largest economy, this should be higher An EPA is key to Revitalizing Mutual Economic Growth, Competitiveness & Prosperity DFAIT: Office of the Chief Economist#15cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Opportunities by Sector#16cccj Opportunities by Sector CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON - - Forest and Building Products: Canada is a long standing number one supplier of sustainable & legal forest products ($1 billion+ in Annual Exports) Supporting Housing Industry Innovation & Product Development: Cumulative 2 Million 2 x 4 Housing Starts Opportunities to Enhance Technical Innovation & Competitiveness of Building Industry 44 送圖螢北 Canadian Participation in Temporary Relief Housing in Kesennuma, Miyagi Prefecture#17cccj Opportunities by Sector CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Energy & Resources: Canada is a world leader in energy/mineral production and has what Japan needs World's 2nd largest reserves of crude oil, 3rd largest producer of natural gas and 2nd largest producer of uranium, rare earth metals development underway Canada is open to Japanese investment Canada can provide Japan with secure & stable long term energy supply - · Recent Shale Gas Investment a sign of things to come! Japan is currently being outpaced in FDI aggressiveness in Canada's energy sector by other Asian nations; China, South Korea EPA will attract more attention to Opportunities in Canada's Energy Sector - growth in FDI will also increase exports of heavy equipment from Japan to develop projects#18cccj Opportunities by Sector CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON ICT: - ICT contributes ~ $60B to the Canadian economy/year Nearly 50% of the CDN Companies in Japan are in the field of ICT. Research in Motion, OpenText, Celestica, QNX Software, etc Both Governments recognize ICT as a key growth industry moving forward An EPA will help enhance cooperation in ICT sector, bringing these two global leaders closer together#19cccj Opportunities by Sector CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Food & Agriculture: I Complementary strategic alignment Minimal Competitive Issues: Canada does not export rice to Japan Collaboration & Commitment to Food Safety Standards Enhanced access to stable supply source in a world of increasing shortages Canada is already a leading supplier of agricultural products to Japan Canada understands Japan's sensitivities in agricultural sector better than other potential free trade partners#20ccci CCCJ supports early conclusion of CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Canada-Japan EPA - CCCJ urges both governments to pursue EPA as matter of priority - Negotiations will help raise profile of bilateral trade relationship - - Others are pursuing EPAS or expanded trade – we can't afford to fall behind - Both government and private sector benefit when foundation exists for active dialogue#21cccj Benefits of EPA CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON - - - Healthy trade relationship depends on government policies that promote open markets, investment & innovation: key to revitalizing economic growth post 3.11 - Tariffs already low in most areas, but non- tariff barriers remain EPA allows governments to identify priorities of greatest interest to business communities in more timely manner#22cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON EPA Advantages • Japan/Canada EPA will: - Open new markets for goods and services - Promote innovation and competition - Enhance living standards - Secure access to resources, technology and investment - - Promote transparency - Increase flows of people#23cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Risk of Failure - - - - Many nations and regions looking to new trading arrangements Lack of Canada-Japan EPA risks compromising access to mutually beneficial flow of bilateral trade and investment May also result in diminished competitiveness Multiple failures damages credibility of bi-national engagement#24cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Government of Canada's Position on the TPP Canadian Government position on TPP: Canada has formally indicated its intent to enter into formal consultations to join the TPP negotiations. Government of Canada has reviewed outline for the TPP released Nov. 12, 2011 and is confident it can meet or exceed the level of ambition TPP Members are striving for. Canada has strong and growing ties in the Asia-Pacific region which is a priority for Canada. Canada is already pursuing a number of important bilateral trade initiatives in the Asia-Pacific region and the TPP will further broaden and deepen Canada's trading relationship to benefit Canadian workers and businesses.#25cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON EPA or TPP? Why not both? CCCJ supports the Canada-Japan EPA, as well as Canada joining discussions on TPP Bilateral EPA would be quicker & easier to implement than broader regional agreement TPP efforts will complement bilateral EPA between Canada & Japan#26cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Effective Cooperation of CCCJ - Keidanren CCCJ currently works in partnership with Canadian- based organizations including the Canadian Chamber of Commerce (CCC) & the Canadian Council of Chief Executives (CCCÉ) CCCJ is local partner for Keidanren Committee on Canada CCCJ & Keidanren Committee on Canada should hold periodic meetings to discuss issues and formulate strategy for liberalizing trade and investment initiatives leading to bilateral economic growth CCCJ & Keidanren Committee on Canada effectively advocate bilateral business initiatives to governments via joint-statements#27cccj CANADIAN CHAMBER OF COMMERCE IN JAPAN CHAMBRE DE COMMERCE DU CANADA AU JAPON Thank You Questions? Shawn Lawlor, Vice-President, CCCJ, Chair, EPA Trade Policy Committee Eric De Groot, Vice-President, CCCJ, Vice-Chair, EPA Trade Policy Committee For more information - contact: David Anderson, Executive Director, CCCJ David. [email protected] 03.5775.9500