Canada and China Sign Trade and Investment Agreement

Prime Minister Stephen Harper’s trade mission to China is beating expectations and may be setting the stage for free trade talks between the two countries.

Canada and China will wrap up a joint economic study by May, and are then expected to proceed to “exploratory discussions on deepening trade and economic relations.”

Seventeen specific government-to-government issues were dealt with over the past two days in areas such as energy co-operation, human rights and agriculture. And Harper highlighted 22 commercial agreements also concluded, saying they are worth $3 billion.

“Two-way investment between Canada and China has increased by 700 per cent … in seven years,” reported CBC senior correspondent Terry Milewski, who is travelling with the prime minister. “You can’t dismiss that as hype. That means that this is, as International Trade Minister Ed Fast put it today, a watershed moment in the enormous expansion of trade between Canada and China.”

Further diversifying trading relations can greatly expand Canadian growth and job creation, Harper said in a speech to the Canada-China business forum at the close of his stop in Beijing. ”We have seen remarkable growth in two-way investment, and trade, people-to-people ties, and bilateral co-operation during the last few years,” Harper said. “It is no accident, I think, that Canada and China came through the global recession avoiding the severity of the financial, economic and employment crises seen elsewhere.”

China remains a distant No. 2 to the U.S. in terms of trade volume with Canada, Milewski said. “But with the U.S. economy floundering and on the way down, you have to wonder when … China will become No. 1.” Still, it could be a while before the Canadian economy benefits from the government-level co-operation, as a number of announced plans are incremental steps forward in complex bilateral pacts. In addition to the end of the economic study, the two countries also announced the end of negotiations on a free trade investment deal and a promise to move forward on an export agreement for Canadian uranium.

They also agreed to increase their dialogue on human rights, as well as elevate education to be a strategic priority for both sides.

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