Thank you, Madam Chair, for the opportunity to appear today.
My main theme today will be that Canada-Japan trade relations are no longer best understood as a traditional export relationship. They're now shifting to a strategic economic partnership shaped by economic security, supply chain resilience and advanced industries.
This is a topic on which we at the Asia Pacific Foundation of Canada have increased our focus recently through our combination of in-house expertise, external research fellows and partner institutions, and convening events such as our annual Canada-in-Asia Conference in Singapore. Just yesterday on our website, we published a new research dispatch making the case for Japan-Canada co-operation on semiconductors and supply chains.
Japan matters for Canada not only because it is a major, sophisticated market—it has been that for a long time already—but today because it is a key Indo-Pacific partner at a time when reliable access to markets, trusted supply chains and rules-based trade are under unprecedented pressure. The opportunity is not simply to sell more to Japan. It's for Canadian businesses to become more deeply embedded in Japanese and allied value chains.
Accordingly, Japan should be understood as a partner in Canada's economic resilience. That means aligning our commercial relationship with sectors where both countries have strategic interests—critical minerals and batteries, artificial intelligence, quantum technologies, semiconductors, new materials, clean technologies and advanced manufacturing—all the while continuing in areas of strength, such as life sciences, aerospace, energy, agri-food and food security.
The most important point is that Canada should not be content to remain only a supplier of raw materials. In critical minerals and batteries, the greater opportunity lies in processing, refining, recycling, battery materials and related supply chain activity. In advanced technologies, the opportunity is not only research collaboration but commercialization, standard setting and industrial partnerships. Across these sectors, Canada should position itself as a trusted industrial and innovation partner, not only as an exporter.
The CPTPP gives Canada and Japan a strong, rules-based platform for this work, as you have been hearing. It has lowered tariff barriers and strengthened the framework within which Canadian firms can pursue opportunities in Japan, but formal access to a market is not the same thing as commercial success in that market.
Japan is open, but it's also very stringent. Canadian companies continue to face non-tariff and business barriers, including Japan-specific standards, certification requirements, language and labelling requirements, layered distribution networks, high consumer expectations and a relationship-based business culture. These are not reasons to avoid the market. They're reasons to approach it with patience, preparation, local partnerships and long-term commitment.
If we want our firms, especially small and medium-sized firms, to succeed in Japan, we must support them with market intelligence, help them to navigate standards and certification and help them with introductions to credible local partners.
Canada's Indo-Pacific strategy recognizes that trade, investment, innovation and security are now closely connected. In the Canada-Japan context of today, that means encouraging Japanese investment in Canadian critical minerals, energy, batteries, clean tech and advanced manufacturing. It also means supporting joint research and development, commercialization partnerships and stronger links among firms, universities, provinces, territories, indigenous partners and Japanese industrial actors.
The recently signed joint statement on Canada-Japan Comprehensive Strategic Partnership, with its practically focused road map, is an important step in this direction.
Subnational and indigenous partnerships deserve particular attention. Many assets relevant to Japan's economic security are rooted in specific regions and communities. Building durable Canada-Japan value chains will require federal policy, provincial capacity, indigenous partnership and private capital to work together. CPTPP has opened doors at a time when Japan itself is actively looking to diversify its relationships. The task now is to help Canadian firms to walk through these doors and to find a place inside.
In practical terms, that means focusing on three things. First is targeting co-operation in sectors where Japan's strategic priorities and Canada's comparative advantages overlap. Second is making Canada a more attractive destination for trusted Japanese investment and coinvestment. Third is ensuring that Canadian businesses receive practical support to navigate Japan's demanding but rewarding market.
If we get this right, Canada will capture more value, strengthen our supply chains and our overall resilience, support Canadian firms and workers, and deepen one of our most important Indo-Pacific partnerships.
Thank you for the opportunity to contribute to the committee's deliberations.
I look forward to answering your questions in either official language.