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| Advancing Economic Ties with China: Three Priorities for Canadian Business | 
In a report released last week, the Canadian Chamber of Commerce argues that Canada-China ties are quickly becoming one of Canada's most important external relationships. Today, more than ever, what happens in China represents both a challenge and an opportunity for Canadian businesses.
"There is a clear need for more and better Canada-China trade," said Perrin Beatty, President and CEO of the Canadian Chamber of Commerce. "Of course, there are barriers in both countries that must be removed in order to open access to the tremendous opportunities ahead and build a partnership of shared growth and prosperity, but we cannot let these stop us from realizing the full benefits of the relationship."
In the report entitled: Advancing Our Economic Ties With China: Three priorities for Canadian business, the Chamber presents three elements to making Canada's relationship with China more profitable: implementing a strategy of political engagement with China; removing barriers and irritants to more trade and better trade with China; and, improving the investment relationship with China.
There are opportunities for Canadian businesses to provide China with the goods and services it requires to sustain its own development. These include energy, raw materials, food, financial and engineering services, aerospace and transportation, and higher education. There are also opportunities to plug into value chains - to provide expertise and business services to multinationals involved in trade and investment between China and the United States, China and India, China and Brazil, and so forth. Then, there are untapped opportunities to broaden Canada's investment relationship with China by loosening certain restrictions on capital flows.
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| Canada-EU Free Trade Deal Expected By Summer |  | |
Relatively few issues remain within the Canada-European free trade talks, and officials expect the deal to be completed by the summer, European representatives say.
Canada and the EU started talks for a Comprehensive Economic and Trade Agreement in 2009. The ninth round was completed on Oct. 21 in Ottawa. While that was the last formal round, negotiators will be meeting again next week.
"I'm not sure another comprehensive round is any longer needed. Now it's a question of solving a number of remaining issues and that can be done without any need for big rounds, which of course is an expression of how advanced things are," Mr. Dupla del Moral said.
Trade Minister Ed Fast said during a teleconference on Jan. 23 that he doesn't expect there will be any additional rounds.
"Now we're down to a set of very intense and focused negotiations on a sector-by-sector and industry-by-industry basis," Mr. Fast said. "These are obviously the last issues we have left to negotiate before we are able to finalize an agreement."
It is said that the deal will add $12-billion to the Canadian economy each year.
"Both on the Canadian side, and we sense on the EU side, there's still a high level of ambition and goodwill at the table," Mr. Fast said.
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Governments and Business Must Collaborate to Reduce Supply Chain Risk |  | |
The issue of supply chain risk took a high profile at the World Economic Forum (WEF) Annual Meeting in Davos, Switzerland.
At the meeting, senior government figures and industry leaders spoke of developing ways in which economic damage caused by disrupted supply chains could be mitigated.
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| GHY E-Newsletter #23 February 2012 |
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Beyond The Border: Harper, Obama Sign Deal to Bolster Security, Reduce Trade Barriers
On December 7, 2011, U.S. President Barack Obama and Canadian Prime Minister Stephen Harper announced two trade-enhancing partnerships to make it easier to conduct trade and travel between the two countries and remove unjustified regulations and paperwork that hamper cross-border commerce. Part of the restrictions in trade and travel were in response to the terrorist attacks against the U.S. in September of 2001, while many other regulations are leftover from a time when trade was less important and standards on both sides of the border were less uniform than now.
The U.S.-Canada Beyond the Borders program providing "a shared vision for perimeter security and economic competitiveness" was first announced in February of 2011 with the action plan recently presented. The areas of cooperation include: addressing threats early; trade facilitation; cross-border law enforcement; critical infrastructure and cyber security. Also announced in February was a Canada-U.S. Regulatory Cooperation Council to "better align our regulatory approaches to protect health, safety and the environment while supporting growth, investment, innovation and market openness." These two efforts will complement each other.
 The two sets of programs look long on bureaucracy, but that has become the new normal with heightened concerns about security. The programs do provide a framework for industries to work within to make the case for more rapid movement of products across the border and less multiple inspections of products. Agriculture and food are seen by the designers of these programs as major beneficiaries.
Under addressing threats early in the Beyond the Borders program, the two countries will conduct joint assessments and audits for plant, animals and food safety systems in third countries. For trade facilitation, a common framework for trusted trader programs will allow applicants to submit one application for multiple programs. Canada will develop a pilot program for processed foods to allow participants to submit transactions data for beyond the border and have expedited clearance processes and lanes at the border. Canada will also explore other product specific pilots for lower inspection rates for industries with good compliance histories. Agencies will develop a "single window" where importers can electronically submit all information for customs and other government regulations.
Under the Regulatory Cooperation Council (RCC) programs each country will maintain its own sovereign regulations and consumer protection, health, safety, security and the environment will not be compromised. New systems will be designed to achieve regulatory alignment to the extent feasible and appropriate. For agriculture and food an underlying fact is that both countries have robust food safety systems. Applying additional inspections or testing just because a product crosses the border should not be necessary.
Visit our website for more information about the Beyond the Border Perimeter Security and Regulatory Programs including: Downloads of the two Action Plans; Links to Resources; a breakdown of Key Benefits by Sector; and, a 2011-2016 Calendar of the dates and commitments that both countries have now put forward. |
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Protecting Your Business From Exchange Rate Volatility
There are practical steps firms can take to minimize the risks and exert a good level of control over foreign transactions.
Whilst the Government is encouraging businesses to boost cross border trade to help grow the economy, many SMEs are, understandably, lacking the confidence given the volatility of the currency exchange markets, in particular, in the Eurozone. However, there are practical steps businesses can take to minimize the risks and exert a good level of control over foreign transactions.
Protecting Your Business From Exchange Rate Volatility
First it is important to separate the two processes - Foreign Exchange (FX) and international payments. FX is the process of converting one country's currency into another country's currency in order to complete a transaction. International payments is the process by which the transaction takes place.
Ideally, SME's need to find a partner who will manage both processes cost-effectively and efficiently. Incoming and outgoing payments are the life-blood of organizations. Finding a provider who can do both FX and payments seamlessly at the right cost can have a significant impact on bottom line profitability. Read the complete article.
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Trans-Pacific Partnership Consultation
The Trans-Pacific Partnership (TPP) is a comprehensive free trade agreement under negotiation to liberalize trade in the Asia-Pacific region. Nine countries are currently participating in the negotiations: Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam and the United States.
At last November's APEC summit in Hawaii, Canada, Mexico and Japan also announced their intentions to begin consultations to join the TPP. Including the participation of all countries potentially involved in this new trade pact, the TPP would represent a market of more than 775 million people and a combined GDP of $25 trillion - a market significantly larger than the European Union (i.e., 493 million people with a GDP of $16 trillion).
With this in mind, at the beginning of the year, the Canadian Government embarked on a public consultation process to allow all interested stakeholders an early opportunity to provide comments, input and advice on possible free trade negotiations with TPP countries.
As outlined in Canada Gazette Vol. 145, No. 53, the government is presently asking Canadian stakeholders for advice and views on any priorities, objectives and concerns with respect to the following:
* Opinions on areas of goods export interest (identified by Harmonized System [HS]/Tariff codes, if possible), including products that would benefit from the early removal of tariffs
and other barriers by TPP countries.
* Views on market access liberalization for TPP countries products (identified by HS/Tariff codes, if possible) into the Canadian market, including input on those products for which the elimination of tariffs should be expedited or phased-in over time.
* Advice, views and experiences regarding measures affecting exports destined for TPP countries, including non-tariff barriers (such as import licensing), technical barriers to trade (including technical regulations, standards and/or conformity assessment procedures) and sanitary and phytosanitary measures.
* Views on general rules of origin and/or advice on appropriate rules of origin for specific products or sectors.
* Advice on "trade facilitation" issues (e.g. significant impediments related to import procedures).
* Advice, views and experiences with customs procedures and with commercial goods entering and/or leaving TPP countries.
Click here for the complete list of consultation items. Interested parties must submit their views by February 14, 2012.
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South Korea Lifts Canadian Beef Ban Paving the Way for Expanded Trade
The almost decade long beef trade dispute between Canada and South Korea appears close to its conclusion after Seoul announced it would immediately open its borders to Canadian beef from cattle under 30 months old. The 20 January announcement follows the temporary
suspension of a related WTO dispute in summer 2011 that had meant to facilitate a negotiated solution among the two countries.
This decision removes a major stumbling block to finalizing the long delayed Canada-Korea Free Trade Agreement.
Prime Minister Harper has correctly identified Korea as a priority market for Canada and is confident Korea's decision will also help create a favourable climate to lead to a deeper bilateral trade relationship.
South Korea is Canada's seventh largest merchandise trading partner and its third largest in Asia. In 2007, two-way merchandise trade was approximately $8.37 billion (Canada exported $3 billion and imported $5.37 billion), and in 2006 two-way direct investment was $1.1 billion (Canadian direct investment in Korea was $431 million and Korean direct investment in Canada was $655 million).
in a recent speech, Korean Ambassador to Canada, Nam Joo-hong, referred to the desire to expand two-way trade by $3 billion and to complete the stalled FTA negotiations.
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Going Global Innovation: Research and Development Funding for 2012 Open
Foreign Affairs and International Trade Canada (DFAIT) is accepting another round of applications for their Canadian government funding program called Going Global Innovation (GGI). Applicants who are accepted into the program will receive government funding towards
specific project expenditures. These expenditures must be related to  the creation of relationships with potential global partners and product developers.
The GGI program is intended on providing innovative SMEs in the science and technology fields with an opportunity to attract foreign direct investment and global R&D partnerships.
Applications require an 8-week review process so the funding will apply to projects occurring from March 2012 onwards.
Eligible expenses include travel and related costs such as: airfare; local transportation; accommodation; and meals. Other non-research expenses that will be covered by the program include: meeting costs (workshop or seminar expenses, hospitality), participation at targeted exhibitions and conferences; pursuit of large scale projects (such as EU Framework); development of legal documentation to solidify partnership; translation services; photocopies or printed material; and, pursuit of financial support.
Applicants must request a minimum of $5,000 from the GGI program in order for the proposal to be considered. The maximum payable to any organization for an approved project is $75,000.
Additional information can be obtained from the Going Global Innovation Handbook or by contacting:
Erika Mallett
Trade Commissioner - Going Global Administrator
innovation@international.gc.ca
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Finding time to follow the latest international trade developments and programs of Customs agencies on both sides of the border relevant to your business can be challenging, so we hope you find this issue of our Tradelines e-newsletter to be a helpful resource in this respect. As always, we'd greatly appreciate any opinions, comments and suggestions you may have to help us improve this information resource, so please don't hesitate to let us know what you think. If you haven't already, we'd like to take this opportunity to invite you to check out our Tradelines E-News weblog where you can find current stories updated daily about business events and developments that are important to Canadian importers and exporters.
If you would like to keep up to date on the latest developments in trade compliance and trade compliance strategies, please check out our Trade Compliance weblog.
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As well, you can follow any of the links below for the latest information, updates and links to articles of interest.     |
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