OTTAWA (Reuters) - Seeking to reduce its reliance on the sluggish U.S. market, Canada has formally joined 10 other nations in talks on creating an Asia Pacific free trade agreement, the government said on Tuesday.
The Trans-Pacific Partnership (TPP) negotiations are designed to produce a free-trade zone with a combined population of 658 million people and a gross domestic product of C$20.5 trillion ($20.9 trillion), according to Canadian data.
“The region is a priority market for Canadian businesses, offering enormous opportunities to our exporters,” Heritage Minister James Moore said in a statement.
Canada, which sends around 75 percent of its exports to the United States, is looking to switch its focus to fast-growing emerging markets such as China.
U.S. agricultural groups say the TPP talks must target opening up Canada’s dairy and poultry markets, which are protected by quotas and high tariffs.
Canada’s Conservative government, which regularly promises to protect those markets, also says all areas of trade will be on the table during the TPP negotiations. This has prompted speculation Ottawa might relax its trade restrictions despite the political risk at home.
Four-fifths of Canada’s 13,200 dairy farmers live in Ontario and Quebec, populous provinces that are generally critical to election success.
Mexico also announced on Tuesday it has formally joined the TPP negotiating process. Mexico, Canada and the United States are already part of the North American Free Trade Agreement.
The United States, Australia, New Zealand, Chile, Peru, Singapore, Vietnam, Malaysia and Brunei have already been negotiating the TPP for more than 2-1/2 years.
A final deal is not expected until mid to late 2013.
Reporting by David Ljunggren; Editing by Peter Galloway