Thank you.
Mr. Stanford, thank you for your testimony. I want to pick up on a few points you raised.
We had a presentation from the Canadian Manufacturers & Exporters association, who actually generally support a free trade agreement with Japan. Their material to us confirmed much of what you've said about the imbalance in raw resources that Canada exports versus the finished value-added goods we import.
They identified that the top five exports of Canada to Japan are coal, canola, copper, lumber, and pork. Those account for 58% of our exports to Japan, whereas autos, auto parts, heavy equipment such as bulldozers, printing equipment, tires, aerospace parts, and telecommunications equipment are Japan's top seven exports to Canada, and that accounts for 52% of our imports. They identified that we have an $8.2-billion trade deficit with Japan on manufactured goods, and I've noted that Canada's trade deficit in manufactured goods overall was about $17 billion in 2005 and it's approaching $80 billion today.
The manufacturers association also stated that they're concerned that an agreement could exacerbate our trade deficit on manufactured goods, but somewhat paradoxically they say it's therefore critical that an EPA with Japan provide a net benefit to manufacturers and exporters by providing open-ended reciprocal market access. They pointed out that some of the barriers to trade and investment are structural in nature, as I think you've pointed out. They said, “so one can question to what extent these issues can be effectively dealt with through a bilateral trade agreement”.
You pointed out, Mr. Stanford, that you can't divorce trade from an industrial policy. It's not just whether we trade, it's what we trade with other countries. You've stated that Canada needs to develop globally oriented companies, and you said that federal policy could be tied to that.
What federal policies would you like to see that would help Canada develop those kinds of domestic companies that could actually export value-added items, not just raw resources?