THE Canadian government wants the Philippines to be a preferred partner in the trade and investment arena even as it took note of the various economic and reform challenges that still needed to be overcome.
“We recognize that the Philippines has one of the fastest-growing economies in the region and represents tremendous opportunities for Canadians who are bold enough to recognize the opportunities that are here,” Canada Minister of International Trade Ed Fast said during his recent trip in the Philippines.
Fast’s trade mission to the Philippines promoted Canadian strengths in the agricultural, defense, mining, information and communications technologies, and sustainable technologies sectors.
He noted that there is still potential to grow the bilateral trade of the two countries valued at $1.7 billion last year, as well as investments being made by Canadian firms here.
Fast and his Philippine counterpart discussed matters of mutual interest including ways in which both can eliminate some of their tariff and non-tariff barriers. He and Trade and Industry Secretary Gregory Domingo both agreed that freer and more open trade could actually help drive prosperity in both countries.
Fast welcomed the interest from countries within the Asia-Pacific region to join the Trans-Pacific Partnership (TPP), a proposed regional free trade agreement currently being negotiated by 12 countries including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam.
“What we impose is that you share the same level of ambition in terms of trade liberalization that the current twelve member-countries have because we see transpacific partnership as a significant step forward in achieving a 21st century gold standard for trade and investment relationships among like-minded trade partners,” Fast said.
“Canada is a world leader in so many areas which is why I talk about trade relationships with the Philippines. Canada has some of the best technology and expertise in waste management systems, water and waste-water treatment, airports, railways, and green buildings.
Canada also has world-class expertise in renewable energy, information and technology, agriculture and agri-food, and even defense equipment,” he said.
“Canada is a strong supporter of the ambitious Philippine Defense Modernization Program, a program in which we believe Canadian defense and security companies will play a significant role in because we have world-leading technology in that area,” Fast said.
Both countries recently signed a $105 million contract for Canada to supply eight specialized helicopters manufactured by Bell Helicopter Canada.
“It is one of the outcomes of the memorandum of understanding that was signed two years ago between the Canadian Commercial Corporation and the Department of Defense of the Philippines. We’ve provided defense solutions that will serve the Philippines well for many years to come,” he added.
Given the country’s mineral resources, mining is an area where Canada sees investment opportunities.
“We would love to increase partnerships with Filipino companies in the mining sector,” Fast said.
“We also know that the Philippines has some of the best geology when it comes to mineralization—some of the best geologies in the world. What that means is that having some of the best opportunities for using some of the best extraction technologies for mining can open up opportunities in economic prosperity right here in the Philippines,” he said.
“One of the things that I’ve often shared is that when Canadian companies want to invest abroad, they are looking for certain things—they are looking for a welcoming investment environment, one that is fair and transparent and that recognizes the unique nature of things such as mining. Any mining investment regime has to make sure that that’s a great place to invest,” he added.
Canada is looking to double the number of foreign students that come to Canada to study over the next eight years. By 2022, the target is 450,000 foreign students studying in Canada.
“There are only 1,700 Philippine students studying in Canada. When you compare that to a country like Saudi Arabia which has 16,000 students in Canada, when you look at China, it’s close to 100,000.
We’d like to see more Filipino students in Canada. Let’s find a way to make that possible. Let’s find a way also to make Canadian students to seek an education abroad, for example here in the Philippines,” Fast said.
The Canadian government acknowledged that agriculture and agri-food are a very significant part of the country’s economy which is why it announced a new $10 million funding and support under the IFC’s Agribusiness Development Initiative that will support smallholder farmers in the Philippines to enhance their business management skills and financial literacy and access better farming practices and markets for their products.
“We’d like to be a partner with you in improving your ability to grow crops, to store crops, and to market those crops all over the world,” Fast said.
Asean-Canada trade and investment
Regarding its 37-year relationship with the Association of Southeast Asian Nations (ASEAN), Canada is a dialogue partner with bilateral trade of about $17 billion a year, of which $6 billion are Canadian investments and some of that are right here in the Philippines, according to Fast.
“It’s a region that Canada wants to be active in. We want to be engaged in a sustained way. Hopefully the Philippines and ASEAN more broadly speaking are taking note of Canada’s interest. We are here to stay,” the Canadian Trade Minister said.
“Last month I was very pleased to host an international trade delegation from ASEAN. ASEAN has had only two road shows in the past; one is to the United States and one to either China or EU. This is the third and we’re still pleased that they chose Canada,” Fast said.
In June, Canada announced a new air transport agreement with the Philippines to help further strengthen commercial and people-to-people ties.
The Philippines is currently the only ASEAN country that offers direct air transportation services to and from Canada. With close to 430,000 one-way trips in 2013, the Philippines is Canada’s 14th-largest air travel market, just behind Japan.
In the last three years, the Philippines has become the biggest immigrant source for Canada with 800,000 Filipinos. There are approximately 662,600 people of Philippine descent in Canada.
“On the economic side, we have a lot of Filipinos sending remittances back to the Philippines. About $2 billion a year goes back to the Philippines from Canada, supporting the Philippine economy as well.
This is a very significant contribution to your GDP (gross domestic product),” Fast noted.
Meanwhile, the trade official announced support for a project that will help farmers enhance their business management skills and access better farming practices, funding and markets for their products. This support reinforces Canada’s commitment to stimulate economic growth by leveraging private sector involvement and fostering good governance. The Philippines was recently added to Canada’s list of 25 development countries of focus.
“90 percent of Canada’s development assistance and aid abroad goes to the countries of focus and we recently added the Philippines to that list. That’s a clear signal that Canada wants to be engaged here in the Philippines, developing your prosperity and developing your capacity in many different areas,” he said
“We’ve also contributed to improved access to skills, technology, finance, and markets for more than 14,000 micro-entrepreneurs and farmers through our development assistance program,” he added.
Canada is also a playing an important role in reviving the animation sector in the Philippines by developing Filipino talent in animation and digital media such as Canadian-developed computer software by Toon Boom Animation of Montréal.
Bilateral merchandise trade between Canada and the Philippines totaled $1.7 billion in 2013, up 14.6 percent over the previous year.
Canadian exports to the Philippines reached $593 million in 2013, slightly up from $527.9 million in 2012.
Canada’s top exports to the Philippines were meat, wood and related products, and cereals. Top merchandise imports were electrical machinery and equipment, precision and technical instruments, and machinery.