Taiwan and Canada sign investment arrangement, marking a major milestone in bilateral economic and trade relations

Office of Trade Negotiations, Executive Yuan

December 22, 2023

Taiwan and Canada sign investment arrangement, marking a major milestone in bilateral economic and trade relations

The Foreign Investment Promotion and Protection Arrangement, which Taiwan and Canada have been negotiating for more than two years, was officially signed today (December 22nd) by Harry Ho-jen Tseng, Taiwan’s representative to Canada, and Jim Nickel, Executive Director of the Canadian Trade Office in Taipei, at the Executive Yuan’s Office of Trade Negotiations. With negotiations completed in October, the Arrangement marks a significant milestone in the development of Taiwan and Canada’s economic and trade relations.

Also present at the signing ceremony to witness this historic moment were the Deputy Minister of the Ministry of Economic Affairs, the Director-General of the Ministry of Foreign Affairs, the Director of the Financial Supervisory Commission, the Deputy Director-General of the Ministry of Finance, as well as representatives from various Taiwanese and Canadian businesses, including Bora Pharmaceuticals, E-One Moli Energy Corp., Taiwan Smart Solutions Association, Taipei Importers and Exporters Association, NorthLand Energy, Air Canada, Lululemon, Taiwan Medicon, PharmEng Technology, and Stantec Consulting Services Inc.

In his remarks, Representative Tseng stated that the Taiwan-Canada Investment Arrangement is particularly important as it marks the first foreign investment arrangement to be signed by Canada after revising its model Foreign Investment Promotion and Protection Agreement (FIPA) in 2021, and that it should further strengthen supply chain connections and resilience, highlighting the importance of Taiwan in the global supply chain.

Agreeing with Representative Tseng, Executive Director Nickel said that it was a great honor to participate in the signing of this Arrangement after a decade of hard work, which he believes has been worthwhile. He also emphasized that Canada clearly made the right decision in choosing Taiwan to be the first partner to sign an arrangement based on the newest version of its model FIPA, and that Taiwan and Canada would now be in a better position to work together to create prosperity for both sides.

According to James Kuo-Ann Chiao, Chairman of Taiwan Smart Solutions Association, both Taiwan and Canada have developed high-tech AI capabilities supplemented by Taiwan’s world-leading smart chip solutions. The two sides are also deeply complementary and enjoy numerous business cooperation opportunities, making Canada an indispensable and important partner for the promotion of Taiwan’s energy transformation as well as its net-zero emissions policy goals. He further noted that the Arrangement has the support of Canadian businesses, which consider Taiwan to be a market worth exploring and plan to continue to expand their Taiwanese investments once it is signed.

A representative from the Office of Trade Negotiations then pointed out that Canada’s status as a member of the USMCA makes it an important link for Taiwan’s presence in North America, and expressed confidence that the signing of this Arrangement, coupled with the Arrangement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income in 2016, will further improve the investment environment between the two sides. She also indicated that Taiwan is currently in the process of finalizing a trade agreement with the United States, and that deepening economic and trade ties with both the U.S. and Canada should help businesses break into the North American market, with its population of more than 500 million.

As an important member of both the G7 and the CPTPP, Canada has been leading discussions on international economic and trade rules, including by working together with the U.S., the U.K., Japan, Australia and New Zealand to issue a joint declaration against economic coercion in June of this year. Relations between Taiwan and Canada have also significantly improved in recent years, with trade and investment ties growing increasingly closer and Canadian Prime Minister Justin Trudeau publicly supporting Taiwan’s meaningful participation in international organizations. In fact, earlier this month, the completion of negotiations over this Arrangement was cited by the Asia-Pacific Foundation of Canada, an important Canadian think tank, as one of the major achievements of Canada’s Indo-Pacific Strategy, highlighting the importance attached to Canada’s emerging partnership with Taiwan.

By incorporating such high-standard trade regulations as social responsibility, environmental protection, and governance goals, the Foreign Investment Promotion and Protection Arrangement reflects Taiwan and Canada’s shared values. It will also help build an economic and trade system characterized by inclusiveness, sustainability, and accountability which will foster greater recognition among CPTPP countries of Taiwan’s ability to comply with high-standard trade rules.