The positive qualitative and quantitative assessment of the above modelling, combined with the long history of cooperation between Canada and Japan, indicates the potential value of a bilateral free trade initiative. Although no agreement could be reached at this stage due to Japan`s concerns about the potential impact on agriculture, forestry and fisheries (in the context of the fact that these sectors account for such a large share of Canada`s imports), Canada and Japan have decided to reconsider the possibility of a free trade agreement in order to follow up on the report of the Joint Study on Appropriate Pathways. , such as the Joint Economic Committee (CME). The modelling of this chapter examines the potential benefits and costs of a Canada-Japan free trade agreement through the objective of economic modelling, and its results support the proposition that a Canada-Japan free trade agreement could bring economic benefits to both countries as a whole. Economic modelling, however, cannot definitively measure the impact of reform policies because it has limitations (. B, for example, there are several factors that cannot be measured in the market). Nevertheless, it serves as a useful indicator. Modelling shows benefits in terms of increased incomes and output, with GDP up 0.32% in Canada compared to 0.17% in Japan. Japan`s economic benefits would be close to $6.2 billion, compared to $3.8 billion for Canada. Japan`s total merchandise exports would increase by about $2.4 billion and Canada`s total merchandise exports by about $2.7 billion (double digits in 2001). Japanese exports would increase in most manufacturing sectors and Canadian exports would increase, in addition to wood products, textiles and clothing, as well as certain machinery and equipment, and cereals and meat. While agricultural scientific cooperation between Canada and Japan remains relatively modest at the institutional level, trade between AAFC and the Japanese private sector has been enhanced through a series of joint scientific and trade initiatives.
For example, AAFC and a large international Japanese commercial company have signed an agreement whereby a collaborative scientific cooperation project adds value to raw materials adapted to the Japanese market. In addition, in recent years, AAFC and the Canadian Embassy in Tokyo have worked closely together to establish a stronger relationship between Canada and Japan in the agri-food sector and to position Canada as a serious scientific and trade partner.