International Trade

The House of Commons Standing Committee on International Trade met to study Canada’s trade relationship with Japan, hearing from witnesses representing the Canadian Cattle Association, the Vancouver Fraser Port Authority, the Asia Pacific Foundation of Canada, the Canadian Chamber of Commerce, and the Forest Products Association of Canada.

Tyler Fulton, President of the Canadian Cattle Association, described Japan as a high-value, premium market where Canadian beef exports have grown 76% since 2018, largely due to tariff reductions under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). He stressed that trade diversification must be strategic and reciprocal, warning that the Mercosur negotiations offer no opportunity for Canadian beef and pose risks to biosecurity and Canada’s reputation, contrasting this with Japan’s reliable, science-based approach. He recommended that any CPTPP expansion should not dilute the agreement’s standards, citing disappointment with the United Kingdom’s accession due to remaining non-tariff barriers.

Alexa Young, Vice President of the Vancouver Fraser Port Authority, emphasized that the Port of Vancouver is Canada’s largest and most diversified port, handling $350 billion in goods annually, with Japan as its second-largest trading partner by volume. She called for investment in trade-enabling infrastructure, notably the Roberts Bank Terminal 2 project, which could unlock an additional $100 billion in annual trade capacity, and for expanding port authorities’ permitting powers to speed up project approvals. She noted that labour disruptions have tarnished Canada’s reputation for reliability and that optimizing existing infrastructure through digital tools and dredging under the Second Narrows bridge is critical to meeting the goal of doubling exports to non-U.S. markets.

Jeff Nankivell, President and CEO of the Asia Pacific Foundation of Canada, argued that Canada-Japan trade is shifting from a traditional export relationship to a strategic economic partnership focused on economic security, supply chain resilience, and advanced industries like critical minerals, semiconductors, and artificial intelligence. He recommended that Canada position itself as a trusted industrial and innovation partner rather than just a raw material supplier, and that subnational and Indigenous partnerships are key to building durable value chains. He also stressed the need for practical support to help Canadian firms navigate Japan’s demanding market, including market intelligence and introductions to local partners.

Matthew Holmes, Executive Vice President of the Canadian Chamber of Commerce, highlighted that Japan is Canada’s fourth-largest foreign direct investor and a key ally in the Indo-Pacific, with the new comprehensive strategic partnership providing a road map for collaboration on defence, energy, critical minerals, and technology. He recommended modernizing the Joint Economic Committee to reflect emerging priorities and noted that Japanese investors are confused by Canada’s internal trade barriers and jurisdictional chaos, which need to be addressed. He also pointed to energy security as a major opportunity, given Japan’s exposure to volatile energy sources, and emphasized the importance of Canada’s relationship with the United States for investor confidence.

Derek Nighbor, President and CEO of the Forest Products Association of Canada, reported that Canadian forest product shipments to Japan are around $1 billion annually, built over 100 years of trade, but face a shrinking Japanese market, growing domestic supply, and aggressive competition from European producers. He called for dedicated, multi-year funding for the Canada Wood Group and a doubling of NRCan’s global forest leadership program to support market development, noting that federal funding was cut to $4,000 in 2023-24, forcing staff layoffs and lost momentum. He disagreed with any suggestion that Japan can quickly replace the U.S. market, as softwood lumber shipments to the U.S. are about $8 billion annually compared to $800 million to Japan, and emphasized that a durable softwood lumber deal with the U.S. remains critical.

The committee heard questions from members on topics including port capacity, labour stability, the potential for crude oil exports to Japan, and the need for more trade representatives in Japan, with witnesses generally agreeing that sustained high-level engagement and domestic action on infrastructure and regulatory efficiency are essential. No procedural debate, motions, or votes were recorded during this meeting.