China Approached Canada First on Free Trade

“China asked Canada to consider the feasibility of an FTA (Free Trade Agreement) as part of a study into the ways in which the Canadian and Chinese economies are complimentary…Canada accepted China’s proposal for an economic study and to consider an FTA thereafter”, the note reads.

Trade consultant Lawrence Herman said the fact China approached Canada is significant because it is selective in which countries it chooses to pursue free trade talks with.  China may want to use Canada as a testing ground before launching negotiations with larger and potentially more complicated trading partners such as the United States or European Union, Herman said.

Hungry for Canadian energy and natural resources, it may also want to establish a framework around which to expand its involvement in the oilsands and mining sectors.  China has emerged as Canada’s second-largest trading partner after the United States and a major source of foreign investment – including $10 billion into Alberta’s oilsands and B.C.’s shale gas deposits.

A joint study launched during Prime Minister Stephen Harper’s trip to China in February is aimed at determining ways to enhance trade and economic activity between the two countries.  The study was to be completed by the end of May, but it still hasn’t been released.

A recent Asia-Pacific Foundation of Canada survey of 465 individuals engaged in Asia through their professional, research or personal interests found nearly half felt the government should prioritize trade talks with China over other partners such as Japan, India and the European Union.

– Postmedia News