Japan-Canada Trade and Investment: Analyzing Economic Relationships

This report examines the economic relationship between Japan and Canada, focusing on trade and investment. It highlights the importance of open trade based on international rules, the shared values of both countries, and their collaborative efforts within organizations like the G20 and WTO. The report discusses the significance of Japanese investment in Canada, the key industries involved (manufacturing, wholesale trade, and natural resources), and the types of firms that invest. It references the declining commercial relationship between the two countries, and emphasizes the success of Japanese firms in Canada, while also mentioning that the firms are large, multinational, and diversified. The report also mentions the nature of Japanese investment in Canada and the major business of Japanese companies, and how the country attracts several types of firms from several industries. The report is based on two academic articles, Etzo et al. (2018) and Hong et al. (2020).

Running head: SOCIAL STUDYS
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Japanese Investment in Canada
Canada depends on open trade based on international rules and invests for the business to
grow and innovate, creating good jobs to people of Canada and maintain life of high quality.
Trade represents almost 60% to 70 % GDP of Canada. Japan and Canada share several common
values. Both Japan and Canada are the members of G20, G7 and Asian Development Bank.
Japan and Canada are quite strong allies to support multilateral system as well as are the key
partners for ongoing reform efforts of WTO (Etzo et al. 2472). Economic and trade relations
among Japan and Canada are steadily expanding. Japanese investment in Canada is quite
significant. Both these countries have long history for diplomatic relations. Regular exchanges
among Japanese and Canadian parliamentarians are other essential pillar for Japan-Canada
relationship.
However, commercial relationship of Canada with Japan significantly declined in last
few years. It is essential in improving characteristic of parent firms of Japan which made
decision for investing in Canada. Firms of Japan which make investment in Canada are
extremely huge, multinational and diversified corporations. Majority of Japanese firms which
invest in Canada stated their major business as manufacturing, wholesale trade ad natural
resources (Hong et al. 158). Major business of Japanese companies which invest in Canada is
commercial machinery and industrial sector. It is seen that Canada attracts several types of firms
which originate from several industries. Investment of Japan in Canada is formed around several
manufacturing activities which includes machinery and chemicals. Japanese firms which invest
in Canada are highly successful.

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References
Etzo, Ivan, and Sumiko Takaoka. "The impact of migration on the cross‐border M&A: Some
evidence for Japan." The World Economy 41.9 (2018): 2464-2490.
Hong, Paul, and Young Won Park. "The United States-Mexico-Canada Agreement (USMCA)
and Japanese Firms." Rising Asia and American Hegemony. Springer, Singapore, 2020.
153-163.