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Office workers walk to the train station during evening rush hour in the financial district of Singapore March 9, 2015. (Reuters photo)
SINGAPORE – Canada‘s trade finance agency is launching its first global branch in Singapore as the country steps up efforts to boost business ties with Asia following the withdrawal of the United States from the Trans-Pacific Partnership (TPP) trade deal.
Export Development Canada‘s branch will allow the agency to facilitate structured finance and corporate finance in local currencies, rather than Canadian dollars, while avoiding delays caused by the time difference, its regional vice-president Bill Brown told Reuters.
The TPP, which originally covered some 40% of global gross domestic product, was effectively torpedoed in its current form when President Donald Trump withdrew the US from the agreement in January. The deal included Australia, Brunei,
Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.
“Canada‘s largest trading partner is the US but the fastest growing economies are in this part of the word,” Brown said. “The base case for putting this branch here remains very strong regardless of whether there‘s a TPP or not.”
EDC aims to facilitate transactions between Canadian and Asian businesses worth 3.5-4 billion Canadian dollars (US$2.7-$3 billion) annually for the next four years. It sees opportunities in natural resources, clean energy, transportation and other sectors.
Annual two-way trade between Canadian and Asian businesses and consumers stands at around 170 billion Canadian dollars.
Brown said Canada was looking for other opportunities to expand its ties with the region in the absence of the TPP.
“There will be various forms of trade agreements in the region and Canada wants to be part of that,” he said. “There is still momentum with other countries that have signalled that they want some kind of trade agreements.”
Brown said EDC was looking to open at least four other global branches outside Asia, potentially next year.