The auto industry in Canada and virtually all the sectors and stakeholders in the auto industry, including the North American producers and including Honda, Toyota, the auto parts manufacturers, and the CAW, are unanimous that a bilateral Canada-Korea trade agreement would be very negative for the Canadian industry.
As it stands, we have a terrible trade imbalance with Korea in manufactured goods and in auto in particular. The Korean market is a sizeable market. It has more people than Canada. It sells not as many vehicles as Canada, but a substantial number of vehicles. For every dollar of automotive product that we sell in the Korean market, they sell $177 worth of automotive products in Canada. That's not an accident, and I don't think it reflects the quality or competitiveness of the vehicles. It reflects deliberate proactive efforts by the Korean government, particularly after the 1997 financial crisis in east Asia, to kind of enhance the economic benefits of their exports while strictly limiting their imports. Our exports to Korea have actually declined by over 80% since 1997, even as the Korean economy grew and developed. That reflects the impact of non-tariff barriers of various kinds to limit imports and also the positive feature of government assistance for investment and technology in Korea. You know that the Korean automakers have come massively forward in terms of the quality and innovativeness of their product. That is all done with dramatic government help and support for exports.
That's the kind of imbalance that has undermined the strength of the North American industry, even before the current financial crisis hit. I don't think it makes any sense whatsoever for government to be proactively trying to help the North American industry survive with one hand, but then to be making life considerably more difficult by liberalizing trade even further with Korea, because it would clearly exacerbate that imbalance. I would be very much in favour of basically shelving those negotiations for the Korea trade agreement.