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, four additional rounds of negotiations
have been held: one in May 2005, one in April 2006, one in September
2006 and the most recent round in February 2007. Canada’s
objective in these negotiations is 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
purpose of a FIPA is to ensure greater protection to foreign investors
against discriminatory and arbitrary practices and to enhance predictability
of the policy framework affecting foreign investors and their investment.
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 2005 China received
US$72 billion). It will remain a key player in the Asia region and
at the top of the list in Canada’s Priority Markets. The United
Nations Conference on Trade and Development (UNCTAD) Inward FDI
Potential Index consistently ranks China as having a high potential
for future direct investment.
Statistics Canada estimates that the stock of China’s FDI
into Canada was CA$ 1.36 billion 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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