2 Canada

(1) Situation of Canada

There has also been a large number of COVID-19 cases in Canada, mainly in metropolitan areas of such provinces as Quebec, Ontario, Alberta and British Columbia (as of the end of January 2021, the cumulative number of infected people in Canada was approximately 750,000, and the number of deaths was approximately 20,000).

In March, all provinces and territories declared states of emergency. The Federal Government implemented a series of measures one after another, including the issuance of travel advisories restricting Canadians from non-essential travel to anywhere in the world, the prohibition of entry into Canada in principle by foreign nationals, and temporary prohibition of non-essential travel between the U.S. and Canada (all these measures are still in effect as of the end of January 2021).

Although Canada's domestic economy was greatly affected by the spread of COVID-19, employment and GDP recovered relatively quickly due to factors including the Trudeau administration's successive activation of government spending to support people's lives, including benefits, wage subsidies and cash flow support, and the resumption of economic activity during the summer. On the other hand, growth is expected to slow down from September onward, as the number of infected people increases again as schools reopen and economic activity picks up (as of the end of October, the Bank of Canada's real GDP growth rate for 2020 was negative 5.7%).

On the diplomatic front, the Trudeau administration has been strengthening participation in the Indo-Pacific region, in addition to the areas that Canada placed importance on in the past such as the U.S.-Canada relations, the UN, the North Atlantic Treaty Organization (NATO), the G7, the G20 and the Organization of American States (OAS). In particular, Canada has been active in monitoring and surveillance activities against illicit maritime activities, including ship-to-ship transfers with North Korean-flagged vessels prohibited by the UN Security Council resolutions. Canada resumed dispatching Royal Canadian Navy vessels to waters surrounding Japan including the East China Sea in October, and also resumed monitoring and surveillance activities by aircraft from November to December. Meanwhile, Canada-China diplomatic relations, which marked its 50th anniversary in 2020, remained weak following on from 2019, posing a major challenge for Canada. Positive sentiment toward China in Canada has seen a major drop, due to the lack of progress in the case of the arrest of the Chief Financial Officer (CFO) of Huawei by the Government of Canada, and that of the detention of two Canadian citizens by the Government of China afterward, both of which occurred at the end of 2018; as well as factors such as distrust of China's COVID-19 response; and the deteriorating situation in Hong Kong.

On the economic front, the United States-Mexico-Canada Agreement (USMCA) entered into force in July. In addition, in November, Canada and the UK concluded an agreement under which the Canada-EU Comprehensive Economic and Trade Agreement (CETA) will continue to apply on an interim basis after the end of the transition period for the UK's withdrawal from the EU.

(2) Japan-Canada Relations

Between Japan and Canada, even though in-person high-level meetings were not held in 2020 due to the spread of COVID-19, four summit telephone calls and two foreign ministers' telephone calls were held. During the Japan-Canada Foreign Ministers' telephone call in February, Foreign Minister François-Philippe Champagne expressed his gratitude for Japan's response to the Canadian passengers on board the cruise ship “Diamond Princess.” Foreign Minister Champagne and Foreign Minister Motegi shared the view on continuing close communication and cooperation to respond to COVID-19. In the telephone call of Prime Minister Suga with Prime Minister Trudeau held immediately after his inauguration in September, the two leaders reaffirmed cooperation between the two countries and the two leaders.

On the economic front, two years have passed since the entry into force of the TPP11 Agreement, which is the first economic partnership agreement between Japan and Canada, and trade and investment relations are expected to deepen further. 2020 saw a major drop in exports to Canada in April and May due to the impact of COVID-19, but this has been on a recovery trend since the summer. In addition, the impact on Canada's exports to Japan, consisting mainly of primary commodities, remained small. International travel between Japan and Canada, however, has been severely affected due to COVID-19, and all airlines have reduced direct flights between the two countries. In December, Japan held the 30th Meeting of the Japan-Canada Joint Economic Committee online, during which there were discussions on international trade conditions, as well as bilateral economic cooperation toward FOIP and Priority Areas of Cooperation.