Canada Forges Strategic Partnership with ASEAN, Signifying Trade Advancements

05 Sep, 2023

Canada Forges Strategic Partnership with ASEAN, Signifying Trade Advancements

Canada is poised to strengthen its presence in the Indo-Pacific region through a significant development. The Association of Southeast Asian Nations (ASEAN) is preparing to establish Canada as its latest strategic partner during Prime Minister Justin Trudeau's visit to Indonesia.

This move by ASEAN symbolizes the recognition of Canada's growing influence in the region and underscores the substantial progress being made in the negotiations for a Canada-ASEAN free-trade agreement. The official ratification of this strategic partnership is scheduled to take place during Trudeau's visit to Jakarta, accompanied by Trade Minister Mary Ng.

Trudeau embarked on his journey from Ottawa on Sunday evening, accompanied by his son Xavier. During his visit to Indonesia, he is set to engage in discussions with Indonesian President Joko Widodo, focusing on critical issues such as combatting climate change, enhancing food security, and advancing economic ties, particularly in the realm of energy production and trade.

The launch of the ASEAN-Canada strategic partnership is scheduled for Wednesday, with Prime Minister Trudeau expected to deliver key remarks on this momentous occasion. Wayne Farmer, the President of the Canada-ASEAN Business Council, highlighted the deepening engagement between ASEAN and Canada, emphasizing that it marks a positive progression in their relationship.

The ASEAN bloc, comprising nations like Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam, has been working towards building stronger ties with Canada over the years. While Canada had not held the status of a strategic partner until this visit, negotiations for a free trade agreement with ASEAN commenced in 2021, and Wayne Farmer, actively involved in these discussions, expressed satisfaction with their progress. Another round of negotiations is scheduled for later this month, with both parties aiming to finalize the deal by 2025.

This achievement is particularly notable as Canada secured this trading opportunity despite strong lobbying efforts by the United States and the European Union, both of which already have strategic partnerships with ASEAN. Farmer described it as a significant accomplishment for Canada.

The Indo-Pacific region holds great significance for Canada, serving as its second-largest merchandise export market after the United States, with a substantial annual two-way trade valued at $270 billion last year. However, reducing trade barriers within the region remains a top priority for local businesses, as noted by Gaphel Kongtsa, the Director of International Policy at the Canadian Chamber of Commerce.

Canada's merchandise trade with ASEAN witnessed robust growth of nearly 29 percent in 2022, with agribusiness emerging as one of the major economic sectors in this relationship. Kongtsa highlighted the pressing need for Canadian expertise and goods in the region.

This need has intensified due to the economic disruptions caused by the COVID-19 pandemic and Russia's invasion of Ukraine. These challenges have amplified calls in the Indo-Pacific region for an accelerated transition towards clean energy solutions. Goldy Hyder, the CEO of the Business Council of Canada, emphasized the importance of transitioning countries that rely heavily on coal for energy generation to adopt more sustainable energy sources, which, he believes, is a crucial step in reducing global emissions.

ASEAN views Canada and its companies as valuable allies in providing technology, services, and products necessary to address issues such as food insecurity, the transition to green energy, and the development of smart cities. Wayne Farmer emphasized the need for a balanced approach, particularly in developing nations, where economic growth, elevation of living standards, and environmental protection must go hand in hand.

Government officials have highlighted that driving climate action while fostering economic growth will be a central theme of Prime Minister Trudeau's discussions during his visit to Jakarta. This strategic partnership signifies Canada's commitment to contributing to the region's prosperity and sustainability while strengthening its ties with ASEAN.