1. Creating Winning Conditions: Michael Holden | Canada West Foundation | May 2011 What governments can do to advance economic relations with China and India

2. Presentation Overview 1.Current State of Trade and Investment 2.Recent Policy Initiatives 3.Additional Policy Considerations Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

3. Canada’s trade relationship with China and India is expanding rapidly… Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011 Source: CWF calculations using Statistics Canada data

4. …as is Alberta’s. Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011 Source: CWF calculations using Statistics Canada data

5. China is a far more significant trading partner, both nationally… 17.5% of western Canada’s exports in 2009. 2010 Trade To China: Exports: $13.2 b Imports: $44.5 b To India: Exports: $2.1 b Imports: $2.1 b 2010 Trade To China: Exports: $13.2 b Imports: $44.5 b To India: Exports: $2.1 b Imports: $2.1 b Source: CWF calculations using Statistics Canada data as a % of total trade worldwide Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

6. …and provincially. Source: CWF calculations using Statistics Canada data $141 million Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

7. Even in China, however, Canada is running to stand still. Source: CWF calculations using data from the National Bureau of Statistics of China and the Indian Department of Commerce Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

8. Both China and India are emerging as major sources of FDI into Canada. FDI into Canada (2010): China: Total FDI: $14.1 billion 7 th -largest source of FDI into Canada India: Total FDI: $6.6 billion 11 th -largest source of FDI into Canada FDI into Canada (2010): China: Total FDI: $14.1 billion 7 th -largest source of FDI into Canada India: Total FDI: $6.6 billion 11 th -largest source of FDI into Canada Source: Statistics Canada Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

9. Presentation Overview 1.Current State of Trade and Investment 2.Recent Policy Initiatives 3.Additional Policy Considerations Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

10. Federal Government Initiatives: 1.Global Commerce Strategy  China and India identified as priority markets  DFAIT: China and India “present enormous business opportunities and…are key links to global value chains.”  India Engagement Strategy Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

11. Federal Government Initiatives: 2.Key initiatives/developments:  Free trade negotiations with India (November 2010)  Canada granted Approved Destination Status by China (2010)  Canada-China Science and Technology Agreement (2007)  BIT agreement with India (completed June 2007)  Canada-India Science and Technology Agreement (2005)  BIT negotiations with China (ongoing since 2004)  Asia-Pacific Gateway and Corridor Initiative Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

12. Provincial Government Initiatives: 1.Fewer policy tools available for provincial governments  Power to sign international treaties falls under federal jurisdiction 2. Key initiatives/developments:  Frequent government-led trade missions  Establishment of overseas offices  New West Partnership: AB, BC, SK to cooperate on trade and investment development Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

13. Presentation Overview 1.Current State of Trade and Investment 2.Recent Policy Initiatives 3.Additional Policy Considerations Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

14. Federal Government: 1.Sustained policy commitment and focus are required  Global Commerce Strategy: 13 “priority markets” include more than 90 countries  Consistent and adequate funding  Will a majority government improve policy efforts? 2. Domestic transportation issues need to be addressed  Are APGCI investments sufficient?  West coast pipeline issues and related energy policies Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

15. Federal Government: 3.Foreign direct investment rules need to be clarified  China and India are becoming major investors in energy and other “strategic” Canadian assets  Concerns over foreign (state-owned) control of Canadian resources  Recent high-profile rejections call into question the transparency and predictability of the investment review process Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

16. Federal/Provincial Governments: 1.Improve government engagement and visibility overseas  Commercial relations and government-to-government ties are closely connected in many Asia-Pacific markets  Frequent visits by government leaders send an important signal about their commitment to building commercial ties Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

17. Provincial Government: 1.Continue cooperative efforts through the New West Partnership  Helps to ensure consistency of messaging  Presents a united front overseas  Better use of available resources and market intelligence 2.Develop education- and tourism-specific strategies  Service sector opportunities should not be overlooked  Canada has lagged Australia and others in exploiting opportunities in education services  ADS could be a boon to Alberta Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

18. Final Thoughts: 1.China and India hold enormous market potential for Alberta and Canada 2. Many policy options for improving economic ties with China and India 3. Most important determinant of success is a sustained and concerted policy effort Creating Winning Conditions: What governments can do to advance economic relations with China and India | Michael Holden | May 2011

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