CANADA'S TRADE POTENTIAL: INDO-PACIFIC REGION

 The scale of U.S. economic ties, combined with retaliatory tariff threats, means Canada must pursue a mixed strategy: defending its U.S. trade interests while accelerating domestic reforms and knowledge-economy growth, while substantially increasing trade with other Countries to reduce long-term dependency.

A key part of this endeavor is the successful implementation of various trade agreements, successful implementation and beneficial outcomes.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) includes 11 original members (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam), with the United Kingdom joining as of December 15, 2024

 In 2024, the total merchandise trade between Canada and all CPTPP partners (without finalized 2024 statistics) is estimated to have been in the area of$150 billion. Canadian exports to CPTPP partners in 2024 were valued at $55.9 billion, representing an 18.5% increase from 2021.

Canada's merchandise trade with the AP7 (Australia, Brunei, Japan, Malaysia, New Zealand, Singapore, and Vietnam) also grew in 2024. The total two-way merchandise trade between Canada and the AP7 reached C$70.2 billion in 2024, representing an increase from C$66 billion in 2023.

Plus, Canada is navigating other trade agreements in the region. The Canada-Indonesia Comprehensive Economic Partnership Agreement (CEPA), with negotiations concluded in November 2024, is projected to increase Canadian exports to Indonesia by an additional C$446.5 million by 2040.  

While the projected export increase is not very large in the grand scheme of Canada's international trade, the CEPA represents a strategic move to strengthen economic ties with Indonesia and potentially open doors for further engagement in the rapidly growing Southeast Asian market.

 Negotiations for the Canada-India Comprehensive Economic Partnership Agreement and the Canada-ASEAN Free Trade Agreement are underway.; ASEAN countries are Canada's sixth-largest trading partner.

While the Canada-Indonesia CEPA, Canada-India CEPA, and Canada-ASEAN FTA are focused on specific bilateral or regional trade relationships, the CPTPP is a multilateral agreement that includes multiple countries in the Asia-Pacific region and covers a wider range of trade and investment issues
These agreements also enhanced Canadian firms' competitiveness by easing tariffs and non-tariff barriers, simplifying trade rules and opening government procurement opportunities.

The CPTPP has delivered a clear and direct economic boon to key Canadian industries. Agricultural and food exports have flourished. Manufacturers have seized new opportunities in Japan, Vietnam, and Malaysia.
Natural resource sectors, particularly Minerals, and service industries like trade and transportation have also thrived.

The CPTPP's science-based approach to Sanitary and Phytosanitary Measures (SPS), tariff reductions, improved market access, and other high standards have been instrumental in this success.

Canada's resolve to evolve its trading relationships in the Indo-Pacific region is a testament to its strategic vision to diversify and reinforce its economic resilience.
As the CPTPP and other pacts continue to bear fruit, it's clear that expanding trade ties with the Indo-Pacific region is one more approach worth pursuing.

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