Its China complications aside, Canada has far more work to do now to cultivate its Indo-Asia-Pacific political and trade relationships.
Exploiting the region’s huge business opportunities demands a proactive and cohesive strategy that goes beyond increasing import-export velocity because those opportunities are threatened by what Macdonald-Laurier Institute senior fellow Jonathan Miller notes is a region that “plays host to some of the most significant challenges to rules-based international order.”
Canada remains in the middle-power weight class in global politics. Without assertive involvement in shaping the Indo-Asia-Pacific’s shift from an export to a consumption-focused economy while helping to ensure its political security, Canada’s interests in the region will be decided by countries in heavier weight classes.
There is also much work to do on the foreign direct investment (FDI) file, especially when it comes to digital technology, green energy development and other emerging areas of expertise in B.C.
The Asia-Pacific Foundation of Canada’s (APFC) recently released Investment Monitor 2021 report notes for example that 2020 was the second consecutive year of decreased Asia-Pacific FDI flow into Canada. According to the APFC, B.C. and Alberta receive 67% of that investment.
But it also pointed out that outbound FDI from Canadian companies into the Asia-Pacific rose to $16.8 billion, an increase of approximately $5.3 billion compared with 2019. As the APFC notes, the governments of South Korea, India, Australia and Singapore have focused post-pandemic economic recovery spending on green energy, digital and research and development industries.
That focus offers opportunities and challenges for B.C.’s development and export of those industries beyond its natural resources attraction for inbound Asia-Pacific FDI.
The opportunities parallel those driving the need for the country to be a player on the field rather than an observer on the sidelines in the political and economic development of the Indo-Asia-Pacific region.