2 Canada

(1) Situation in Canada

In September 2021, a general election was held following the dissolution of the House of Commons of the Parliament of Canada. It resulted in the continuation of the administration of Prime Minister Trudeau with almost no change in the number of seats held by any party, including the ruling Liberal Party led by Prime Minister Trudeau and the largest opposition party, the Conservative Party. The new Trudeau cabinet was established in October, with 38 ministers excluding the Prime Minister and consisting of an equal number of male and female cabinet members). Former Minister of Economic Development and Official Languages Mélanie Joly was newly appointed as Minister of Foreign Affairs. Prime Minister Trudeau's priorities include the full containment of the pandemic, a strong economic recovery, combating the issue of steeply rising housing prices, issues revolving around climate change, and reconciliation with indigenous peoples.

The Trudeau administration positions COVID-19 countermeasures as a top priority, and has strongly promoted vaccinations while continuing to provide benefits, wage subsidies, and cash flow support to companies in 2021. The GDP growth rate slowed again to -0.8% (annual rate of -3.2%) in the quarter from April to June 2021 due to the resurgence of COVID-19 infections, but recovered to 1.3% (annual rate of 5.4%) in the quarter from July to September due to the gradual removal of various restrictions (real GDP growth rate of 4.6%). The unemployment rate has remained generally flat at the 6% level (from 6.0% in December to 6.5% in January 2022), but there are concerns about rising inflation and other issues due to supply chain disruptions and rising oil prices.

Prime Minister Trudeau also focuses efforts on climate change policy. At the Leaders Summit on Climate in April, he announced a greenhouse gas emissions reduction target of 40-45% below 2005 levels by 2030. In September, during the general election for the House of Commons, Prime Minister Trudeau pledged to make zero-emission vehicles (ZEVs) account for the majority of new car sales by 2035, decarbonize the electricity grid, impose restrictions on total emissions in the oil and gas sector, consider border carbon adjustments, and utilize Carbon dioxide Capture and Storage (CCUS) as well as hydrogen.

On the diplomatic front, the Trudeau administration has been strengthening engagement in the Indo-Pacific region, in addition to the relationships 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 illegal ship-to-ship transfers by North Korean-flagged vessels as prohibited by the UN Security Council resolutions. Canada dispatched Royal Canadian Air Force aircraft in October, and Navy vessels conducted monitoring and surveillance activities from October to November. As for Canada-China diplomatic relations, the arrest of Huawei Chief Financial Officer (CFO) Meng Wanzhou by the Government of Canada in late 2018, and the subsequent detention of two Canadian citizens by the Government of China afterward, had remained an unresolved issue. However, in 2021, a plea deal with the U.S. resulted in the release of CFO Meng in September, followed by the release of the two Canadians by China. Canadian public opinion toward China continues to be dour, not only due to this case, but also from distrust of China's COVID-19 response as well as human rights issues in Hong Kong and the Xinjiang Uyghur Autonomous Region. Future relations with China will be the focus of attention.

On the economic front, the Canada-UK Trade Continuity Agreement entered into force in April. In addition, July marked one year since the entry into force of the United States-Mexico-Canada Agreement (USMCA). Canada also announced the start of CEPA negotiations with Indonesia in June and the start of FTA negotiations with ASEAN in November.

(2) Japan-Canada Relations

In 2021, two summit meetings (including one teleconference meeting) and four foreign ministers' meetings (including one telephone call and one teleconference meeting) were held between Japan and Canada. On February 9, 2022, a summit telephone call was also held.

The Japan-Canada Foreign Ministers' Meeting in May 2021 marked the unveiling of the “Shared Japan-Canada Priorities Contributing to a Free and Open Indo-Pacific”¹, which works toward realizing FOIP that Japan and Canada share. At the Japan-Canada Summit Meeting during the G7 Cornwall Summit in June, the leaders shared the view to further promote concrete and robust cooperation and coordination in the six priority areas of cooperation between the two countries.

In more recent events, Foreign Minister Hayashi, who was visiting the UK to attend the G7 Foreign Ministers' Meeting, held a meeting with Foreign Minister Joly on December 11th. The two ministers concurred to advance further cooperation on the concrete aspects of the six priority areas of cooperation. They also exchanged views on regional issues, including China and North Korea. Furthermore, they exchanged views on nuclear disarmament and non-proliferation, and shared the view to cooperate for a meaningful outcome at the NPT Review Conference in 2022. They also held strategic discussions on the international order in the Indo-Pacific region, including the CPTPP Agreement, and shared the view on the importance of maintaining the high standard of the CPTPP Agreement.

Although trade between Japan and Canada declined in 2020 due to the effects of COVID-19, there has been a steady recovery throughout 2021. Trade and investment relations have further deepened, with the two countries marking three years since the entry into force of the CPTPP Agreement, the first economic partnership agreement between Canada and Japan. In December, the 31st Meeting of the Japan-Canada Joint Economic Committee (JEC) was held in an online format. In addition to exchanges of views on recent international economic developments, such as the CPTPP and the WTO, and the realization of FOIP, among other areas of Japan-Canada cooperation, there were discussions on five priority areas of cooperation: (1) Energy; (2) Infrastructure; (3) Science and technology cooperation and innovation; (4) Tourism and youth exchange; and (5) Improving the business environment and promoting Investment.

• 1 Six Priority Areas of Cooperation: (1) The Rule of Law; (2) Peacekeeping Operations, Peacebuilding, and Humanitarian Assistance and Disaster Relief; (3) Health Security and Responding to COVID-19; (4) Energy Security; (5) Free Trade Promotion and Trade Agreement Implementation; (6) Environment and Climate Change