Chairman and committee members, thank you for inviting me to today’s committee meeting. This is my first time attending a parliamentary committee meeting, and I am honoured to be representing Prince Edward Island as the Minister of Innovation and Advanced Learning.
In Prince Edward Island’s most recent Speech from the Throne, and again in our 2012-13 budget speech, our government voiced some concrete goals for growth in our private sector, our trade and exports, and our population. We will grow our GDP to $6 million by 2016, we will increase employment levels to 75,000 jobs by 2016, and we will reach a population of 150,000 by 2022.
For our province, strengthening and increasing trade with international economic powerhouses such as Japan is essential to achieving these goals. We are on a good track. Just last week the Atlantic Provinces Economic Council forecasted that Prince Edward Island will lead the Atlantic region in GDP growth in 2012. Our government is very serious in working with our provincial, territorial, and federal counterparts on any discussions to encourage trade opportunities.
Prince Edward Island has enjoyed a long relationship with Japan. Japan continues to be one of Prince Edward Island’s most important trading partners, ranking as our third largest trading partner. Total merchandising trade in 2011 was almost $15 million, accounting for 2% of total exports worldwide.
We also have a strong relationship culturally, driving nearly 29,000 Japanese tourists to Prince Edward Island over the last seven years. We are finding that our visitors from Japan tend to spend more than the average tourist, an average of $95 per visitor, per night. Japan is the only market where Prince Edward Island owns what is considered a Canadian icon, Anne of Green Gables, and this is still the number one motivator for visitation to P.E.I. from Japan. The fictional red-haired character has tremendous brand recognition in Japan.
Prince Edward Island is keen on expanding and growing their partnership with Japan through the Canada-Japan economic partnership agreement. We see opportunities in our traditional sectors, seafood and aquaculture, agriculture and agrifood, tourism, and manufacturing. Additionally, we have a keen interest in growing trade in services, bioscience, aerospace, and information technologies.
Currently, the bulk of trade between Japan and Prince Edward Island is in food products. Prince Edward Island exports various products to Japan, often very diverse and niche products. In 2011, top exports in our seafood and aquaculture products included lobster, at $3.5 million; mussels, at $1.2 million; and tuna, at $600,000. Other products emerging in this sector are herring roe and snow crab.
Unfortunately, because of the fact that many of our products are routed to nearby provinces or states before export, federal export statistics are not truly representative of the amount of Prince Edward Island product going to Japan. The Agriculture and Agri-food Canada statistics show Canadian seafood exports at $250 million in 2011 and $300 million in 2010. P.E.I. seafood exports to Japan were $6 million in 2011 and $10 million in 2010. In reality, the value of Prince Edward Island seafood exports to Japan in 2010 and 2011 exceeded $18 million to $20 million. Prince Edward Island seafood exports to Japan are: lobster, actually $12 million; tuna, $3 million; and mussels, $2 million.
These P.E.I. figures are compiled as a result of discussions we've had with P.E.I. seafood companies that are supplying product to the Japanese market. For example, we know that 99% of bluefin tuna caught in Prince Edward Island are sold to Japan, hence the discrepancy in the statistics: it's much closer to $3 million than the recorded $600,000.
We see huge opportunity for increasing our sales of lobsters and mussels as well as emerging products like herring roe and snow crab. As a province, we are looking at co-packing to alleviate transportation costs, and we are developing the export channels between P.E.I. and global markets. The government has dedicated resources looking into export channel development for a number of our industries.
In the agriculture and agrifood exports, the top food products are cheese, potato products, canola, and soybeans. Japan is our third-largest trading partner—it's actually our second-largest trading partner if you account for the discrepancies I've noted in the trade data.
We are excited by the business relationships we have been building by supplying canola to Japanese buyers. We are only just developing this, but we know there's a strong appetite in Japan for our high-quality, GMO-free canola. Prince Edward Island farmer Raymond Loo and regional company Atlantic Oil Seed Processing have been at the forefront of this relationship-building.
We are hoping to export more value-added canola oil rather than the unprocessed seed. Prince Edward Island currently has the facility to crush canola, and our government is looking into how we can help this sector develop the most efficient way to deliver this product while ensuring the high quality demanded by the Japanese market.
We also know that there's a desire for food products in Japan, especially high-quality, health food products. This has helped sell our food-grade soybean. Currently 8,000 acres of soybean production is going to Japan, and our buckwheat, which is used to make noodles, is a staple in the Japanese diet.
To continue our successes with exporting food products to Japan, Prince Edward Island would like to see the federal government consider the following in their negotiations: a tariff reduction on fish and seafood as well as agricultural and industrial goods; favourable outcomes on technical barriers to trade; and more liberalized rules for sanitary/phytosanitary measures.
Rules of origin would help improve the flow of goods into the Japanese market in our key sectors. As an example, to further facilitate trade in organic products, Prince Edward Island would be interested in an agreement with Japan concerning the equivalency of organic product standards. At present, Canadian organic products are at a serious disadvantage compared with American organic products, as the United States already has organic standards equivalency with Japan.
Beyond the trade relationships we have in the traditional sectors of food products and tourism, we would also like to widen our trade in service education and investment relationships. Prince Edward Island continues to develop a strong knowledge-based economy as well as a sophisticated and competitive services industry. The services sector employs nearly 54,000 Islanders, a key driver of the Prince Edward Island economy, accounting for 76% of the province's GDP in 2010. There are potential trade barriers that may exist on Canadian services, namely, citizenship or residency requirements, lack of temporary rules, and ownership and investment restrictions. Negotiating favourable rules in these areas would directly benefit businesses and workers in this vital Prince Edward Island sector.
The Government of Prince Edward Island is looking to expand the number of foreign students who study at our university and colleges. We think their presence strengthens our schools, and we expect that students who have a positive experience at our schools may consider future immigration to Prince Edward Island. Japan could contribute a great number of foreign students to the Island, and this is an area that we would watch with interest.
As well, we see an opportunity in inward investment. Negotiating predictable investment rules and guaranteeing access to Japanese markets will help create a level playing field for Prince Edward Island investors and businesses and reduce the risks associated with investing abroad. This would lead to a greater two-way investment that would help create jobs and long-term prosperity for hard-working Islanders.
On behalf of the Government of Prince Edward Island, I want to extend thanks to the committee members for inviting us into this discussion. We are encouraged to hear that these discussions are going forward with the Canada-Japan economic partnership agreement. Prince Edward Island looks forward to broadening trade between our two countries.