Regional and Bilateral Initiatives
Canada's Foreign Investment Protection and Promotion Agreements
(FIPAs)
Background on the Canada-China Foreign Investment Protection and
Promotion Agreement (FIPA)
Canada and China resumed FIPA negotiations in Beijing from September
21-23, 2004. Since then, three additional rounds of negotiations
have been held: one in May 2005, one in April 2006 and the most
recent round in September 2006. Canada’s objective in these
negotiations is to secure a high standard agreement with comprehensive
scope and coverage and substantive obligations pertaining to national
treatment, most-favoured-nation treatment, minimum standard of treatment,
transparency, transfers and expropriation. Additionally, this Agreement
should grant investors access to investor state dispute settlement
that is governed by detailed rules in the Agreement on standing,
procedural requirement and enforcement. While the existence of a
FIPA should be a positive and important factor in investors’
decisions on whether to invest in the territory of the other party,
it will be but one of many factors. The main effect of a FIPA is
likely to be greater protection for international investors of one
Contracting Party in the territory of the other. The FIPA will preserve
the right of both Canada and China to regulate in the public interest.
The stock of Canadian FDI in China for 2005 was CA$ 1.02 billion.
Though current Canadian investment in China is modest, the potential
for further investment is substantial. China ranks as one of the
world’s largest recipients of FDI (in 2003 China received
US$53.5 billion) . It will remain a key player in the Asia region
and at the top of the list in Canada’s New and Emerging Markets
Strategy. The United Nations Conference on Trade and Development
(UNCTAD) Inward FDI Potential Index consistently ranks China as
having a high potential for future direct investment.
Statistics Canada estimates that the stock of China’s FDI
into Canada was CA$ 1.36 billion in 2005. Chinese firms have expressed
interest in Canada's natural resources and energy sectors. Other
sectors in Canada which have received attention from China include
Information and Communication Technology, Biotech, Agri-food, Pharmaceutical
(mainly focussed on Traditional Chinese Medicine), and Manufacturing.
Contact Point
If you have questions or comments about this initiative, we would
like to hear from you. Please contact:
Investment Trade Policy Division (TBI)
Department of Foreign Affairs and International Trade
Lester B. Pearson Building
125 promenade Sussex Drive
Ottawa, Ontario, K1A 0G2
Fax: 613-944-0757
E-mail : consultations@international.gc.ca
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