Now I am going to link that to trade in services, because our share of trade that is services is actually in decline while the rest of the world is seeing services grow. There's a huge irony there. Services are 70% of our domestic economy. They're only about twelve and a half percent of our exports. Part of that is because resources are so important, but we believe part of it is because we haven't really focused on services in a strategic way. It flows back to the balkanized domestic economy. We have insufficient scale. We have too much protection, and if you protect too much at home, your firms are not positioned to go out into the world and be able to compete internationally. It's no surprise there that the services aren't doing better, and really there's very little national debate or discussion around trade in services, and yet that's what most of us do. Seventy percent of our workforce is in services.
That flows to the third point, embracing integrative trade. We have to now understand that you can't treat exports and imports as separate pieces. You can't separate inward investment from outward investment. You can't separate sales from foreign affiliates from exports. They're all really part of the package, and when our business community thinks about international business, they're trying to make themselves as competitive and as efficient as possible, and government policy has to align around that. We have to ensure that all the instruments of government policy are supporting integrative trade rather than the traditional model where exports were good but we really didn't want to import too much because that was then competing against domestic industry.
The fact of the matter is imports are critical to exports and critical to the operation of our domestic economy. So if we put up artificial barriers to imports, all it does is raise costs and make us less competitive.
Fourth, and perhaps more importantly, we've got to reposition Canada as a leader in multilateral negotiations. Our strong view is that we've been pushed out of the inner circle of the trade negotiations. We're not part of what was called the “quad”, the quadrilateral. We've been pushed aside by Australia, and the frank reality is that our inability to address some of the sacred cows in our economy, things like supply management—and Gilles can talk more about that than I canvand even sectors like shipbuilding—If you can't offer something up in a trade negotiation, you can't expect to win something back in terms of improved market access, and that's where Canada is now. We're really not seen today as a serious player in trade negotiations because we have not been as forthcoming in our willingness to open up our national economy to others. If you can't open up, you're not going to be part of the story.
We also think that if Doha does not succeed, we have to have an alternative strategy. Think about deepening the NAFTA relationship, expanding it to more sectors, looking at things like non-tariff barriers and our alignment on regulations with the United States, and again, regulation is a very insidious and clever way of keeping goods out of markets. And we should also be thinking about other priority markets, liberalizing with other markets in the world, because the United States under George W. Bush has actually signed 13 bilateral free trade agreements and we haven't signed any. We've signed three since NAFTA.
So we're not really part of the game right now. Countries like Australia, and the EU, and China are busy pursuing bilateral regional free trade. Canada has to get back in the game.
Fifth, foreign policy has to support that. Our thinking on this is that clearly the U.S. is job one. That's the most critical relationship. We have to think about our relationship with the United States every day, but we also have to develop a parallel track around China and emerging markets, because they are the new centre of economic growth, without forgetting Japan and the EU, which are traditional relationships. We think it's critically important that Canada now think through all the aspects of its foreign policy with China, with India, with Brazil, and other major emerging markets.
Then in terms of our advice on where to start, we think option two is the best way, which is harder. We understand entirely that for you elected officials it's much harder to go to the public and suggest dealing with the sacred cows and areas of resistance, but that's where the greatest payback is, creating a single market within Canada, making our national economy more efficient, defining a trade and investment policy for the long term, and also the issue of the aging labour force.
Now at this point, Gilles, I think I should turn it over to you briefly to talk about volume two.