I didn't come fully prepared to discuss a Canada-China free trade agreement, but let me give you a brief response.
I've actually been very cautious about advocating free trade with China and have, in the past, promoted more of a sectoral approach that focuses on the specific areas where Canada has expertise, and where China has obstacles to Canadian exports. But I was very surprised to find recently, when the Prime Minister was in China, that his counterparts from the very top, the president and the premier, offered to let Canada enter into free trade negotiations with the People's Republic of China.
That, to me, is a very extraordinary offer. The Chinese, as far as I know, have never offered free trade agreement negotiations with a western country, and they seem to have dropped all preconditions for the beginning of such talks. This is really an extraordinary offer that Canada should look at very seriously.
On the face of it, if we are able to achieve the removal of barriers on both sides, Canada has more to gain than China, simply because there are more barriers in China than there are in Canada. What we import from China—manufactured goods, consumer items, machinery and equipment—generally enters either tariff free or under very low tariffs. So there is not much we can give the Chinese anyway.
On the other hand, in the areas where Canada has great expertise—advanced manufacturing, services, education, distribution, supply chain management—all of these areas are growing very fast in China, and all of them have various levels of protection, either protection at the border or protection through regulations and administrative requirements that make it hard for Canadian businesses to succeed.
As I say, if in fact the Chinese are sincere about opening up their market and negotiating with Canada, and we can get concessions in these areas that are now so tightly controlled, we stand to benefit a lot more I think than the Chinese do.