Canadian exporters and policy makers search for lessons from Australia’s success in the booming Asia-Pacific region
By Alan M. Field
At a time when most Western economies, including Canada, are growing slowly and painfully, Australia has continued to enjoy robust growth – an estimated 4.3 per cent for 2012 – buoyed by strong consumer spending and booming investment. The latest numbers announced by the Australian government, revised upward for the quarter ending in March 2012, painted “an extraordinary picture of exceptional growth,” said Australia’s Treasurer Wayne Swan, “putting the Australian economy in a league of its own, despite ongoing global turbulence.” The data, he added, provided “stunning proof” of the outstanding performance of Australia, which grew at its fastest pace since the global financial crisis erupted four years ago.
Both Australia and Canada have weathered the impact of global crisis of 2008-9 well, according to a recent report from the Canadian Council of Chief Executives. “Neither economy experienced a financial crisis, despite the fact that both had witnessed significant run-ups in housing prices in the mid-2000s boom. Canada, with its deep exposure to the United States, which was the epicenter of the crisis, experienced a large contraction in output, but rebounded strongly as the global economy stabilized.” However, Australia has done even better, according to the report, escaping “even a technical recession. Australia’s superior performance should not have come as a surprise.
That’s only the tip of the iceberg. Over the past two decades, Australia has been outperforming Canada, according to data from the International Monetary Fund and the World Economic Outlook Database. Between 2001 and 2010, Australia’s average annual GDP growth rate was 3.07 per cent compared with just 1.87 per cent for Canada. Australia’s employment growth rate was 2.27 per cent, compared with 1.45 per cent for Canada. And Australia’s aggregate productivity growth rate was 0.78 per cent, compared with 0.42 per cent in Canada. Looking forward, forecasts by those sources (IMF and WEOD) call for Australia to enjoy an average annual GDP growth rate of 3.25 per cent between 2011 and 2016, outpacing the consensus forecast of 2.33 per cent for Canada over that same period. The only major negative on Australia’s economic horizon in coming years is consumer price inflation, which is projected to grow by 2.81 per cent annually from 2011 to 2016, compared with Canada’s inflation rate forecast of just 2.03 per cent.
Despite the physical distance that separates them, Canada and Australia remain similar in their physical size, British cultural heritage, a vast wealth of natural resources, and even their per capita income. While Canada’s population of 35.08 million was about 53 per cent higher than that of Australia in 2011 – just 22.6 million – Australia’s per capita income was nearly the same as that of Canada when evaluated on a purchasing power parity (PPP) basis.
If anything, Canada’s geographic position would seem to provide it with a significant advantage over Australia. Unlike Australia, which sits in an otherwise remote corner of the Southern Hemisphere, Canada borders directly on the United States, the largest economy in the world, noted Michael Hart, a professor at the Norman Paterson School of International Affairs of Carleton University in Ottawa. “Canada is very lucky that way,” said Mr. Hart, a former Canadian government trade negotiator and trade policy analyst. “Australia is isolated from both the U.S. and the European Union” but Canada is positioned conveniently to trade not only with the rest of North America, but Europe and East Asia.
“Australia is twice as far from the rest of the world (than Canada is), measured by the ‘remoteness index,’ a tool used by demographers and economists, said Dan Ciuriak, an Ottawa-based trade consultant who was formerly Deputy Chief Economist at Foreign Affairs and International Trade, the government agency. “That’s because Canada is next door to the U.S. and not far from the European Union.” As if that weren’t enough, “Every Canadian city is closer to its U.S. neighbour city than to other major Canadian cities,” he added, citing such examples as Winnipeg’s proximity to Minneapolis, and Vancouver’s proximity to Seattle. In contrast, most of Australia’s sparse population is concentrated in the Southeastern and Southwestern fringes of the already remote continent. Darwin, Australia, in the country’s sparsely populated Northern Territory is the only city of any size (population: 127,000) that is closer to Asia than to another Australian city. Yet even Darwin is isolated by Canadian standards; 2,070 miles from Singapore, and 1,885 miles from Adelaide, the closest Australian city.
For all that, Australia is geographically closer to the booming economies of East Asia than it is to anywhere else on the globe, and that fact has gradually impelled Australia to focus much more of its energy on targeting that region than on addressing markets elsewhere around the world. “Australia is closer to the booming economies of Asia, while Canada is closer to the U.S., whose economy has been growing more slowly” in recent years, said Mr. Ciuriak. He said that Australia’s ability to escape even a technical recession during 2008-9 “is generally credited to the shift of its trade and investment linkages toward Asia, and in particular towards China, which has become the largest foreign investor in Australia.”
According to Wendy Dobson, professor and co-director of the Institute for International Business at the University of Toronto’s Rotman School of Management, “Australia has developed an influential role in the region far out of proportion to its economic size. More than twenty years ago, the Australian government initiated a major economic and political study of Northeast Asia’s economic prospects, which painted a clear picture of the region’s potential and made far-reaching policy recommendations that were taken up at the highest level and have been sustained by successive governments of both major parties. An explicit assumption in Australia’s strategy is that its relationships with the United States, with which it has a military alliance, and with the Asian economies are complementary. Australian governments also have invested heavily in maintaining personal relationships at the highest level, as Australian Prime Minister (Julia) Gillard demonstrated when she visited Japan’s Prime Minister following the devastating earthquake and tsunami (of 2011). Australia has also sought to improve its diplomatic, educational, and research capabilities with respect to the major Asian economies—one target is that, by 2020, 12 percent of Australian school leavers should be able to speak an Asian language. Australia has also completed, or is negotiating bilateral free trade agreements with ASEAN as a whole, with each of its more advanced members, and with Japan, South Korea, and China.” Dobson noted that it was former Australian Prime Minister Kevin Rudd who advanced the ‘Big Idea’ of an Asia-Pacific Community, which led to the United States joining the East Asian Summit.” Dobson is a former Associate Deputy Minister of Finance in the Canadian government and a former President of the C.D. Howe Institute.
Comparing the Australian and Canadian responses to Asia
As Ms. Dobson noted, the Australian example “provides a model for Canada to consider if it is serious about reviving its participation and visibility in Asia,” the fastest-growing region in the world. The good news for Canada is that during the past decade, Canada’s trade “has been diversifying beyond its historical focus on the United States and Europe and toward Asia.” That’s important for Canada’s long-term prosperity because China overtook Canada as the largest source of U.S. imports in 2006.
Meanwhile, Asia’s share of total Canadian merchandise exports rose by nearly three and a half percentage points between 2000 and 2010 – from only 4.36 per cent in 2000 to 7.81 per cent in 2010. Even more dramatically, Asia’s share of total Canadian imports rose from 10.3 per cent in 2000 to 16.81 per cent in 2010. Not surprisingly, China registered the strongest growth, both as a destination for Canadian merchandise exports and as a source of Canadian merchandise imports. China’s percentage share of Canada’s total merchandise imports rose from just 3.16 per cent in 2000 to 11.02 per cent in 2010. That is an annual growth rate of 13.31 per cent in China’s share of worldwide Canadian merchandise imports. Meanwhile, China’s share of Canadian merchandise exports grew from just 0.89 per cent in 2000 to 3.31 per cent, an annual growth rate of 14.04 per cent.
Over the past decade Canada’s trade with Japan has largely stagnated, and its trade with India has grown rapidly, from a very low base. In contrast, the United States’ share of Canada’s global trade dropped slightly, but from a very high base. Thus, the U.S. purchased 86.95 per cent of Canada’s exports in 2000, but only 74.89 per cent of Canada’s exports in 2010, largely because demand from Asia (especially China) was growing so rapidly during that period. The U.S. share of Canada’s merchandise imports also dropped over the same period, from 64.3 per cent (of all Canadian imports) in 2000 to just 50.37 per cent in 2010.
Lessons from Down Under
To what degree can Canada apply the lessons of Australia’s success in Asia? “The economic links Canada has constructed with the U.S. are broad as well as deep,” said Dominic Barton, global managing director of McKinsey & Co. and a former chairman of that firm’s Asian operations. “Asia, on the other hand, feels geographically and culturally distant” for most Canadians, “despite the fact that Canada is a Pacific nation. Links are sparse and Canadian businesses lag their rivals from other OECD (Organization for Economic Cooperation and Development) countries in terms of Asian penetration.” Mr. Barton noted that only half of the 20 largest Canadian companies even have operations in Asia, in comparison with 100 per cent of the top 20 American companies. “For the average Canadian executive, doing business in the U.S is a lower risk strategy because of the relative familiarity and ease of this modus operandum,” he added.
Australia “has far deeper links with Asia than Canada does,” said Barton. Only 12 per cent of Canada’s trade is with Asia – and only C$13 billion of Canada’s exports go to China, compared with nearly C$300 billion in Canadian exports that go to the U.S. On the other hand, Asia’s share of Australia’s merchandise exports grew from 19 per cent in 1990 to 50 per cent in 2012. As Mr. Ciuriak noted, “Australia has devoted far more of its resources to trade promotion with Asia” than has Canada, which has under-emphasized the positive impact of trade promotion initiatives. The United States, which spends about $1 billion annually on trade promotion efforts via various governmental agencies, has enjoyed a significant payoff from promotion efforts – an increase of 18 per cent to 20 per cent in export performance for those companies that have had assistance, said Mr. Ciuriak. In the case of Australia, those trade promotion dollars were increasingly focused on Asia. “While Australia has put its trade promotion eggs into East Asia, the fastest growing region in the world, Canada has put its eggs into the Americas,” said Mr. Ciuriak. “A legitimate case can be made,” he adds, that Australia’s stronger performance in economic growth and productivity are a direct result of its trade promotion focus on Asia.
Although such efforts aren’t readily characterized as ‘trade promotion’ initiatives, Australia also reaps significant benefits from its aggressive approach to promoting its universities as locations for the higher education of Asian scientists and other young scholars. “Australia’s market share of advanced education is much higher” than that of Canada, said Mr. Ciuriak. Recognizing that the overwhelming majority of urban Chinese parents wanted their children to acquire university degrees, Australia began in 2000 to take a much more aggressive position in forging links with Chinese academic world; inviting Chinese students to Australia, and making it easier for them to stay Down Under (in Australia), and pursue careers that are rooted in Australia and/or simultaneously in Asian nations. “This aggressive academic exchange program is much more open than that of Canada, and brings in a lot more Asians,” said Mr. Hart. According to Barton, education is Australia’s third largest export, contributing $18.6 billion to the economy and generating 125,000 jobs in 2009. In comparison, Canada’s global education exports were only $6.5 billion that year, “despite the fact that Canada is seen in Asia as one of the most desirable places to receive an education.”
Following the destruction of New York’s Twin Towers on September 11, 2001, Australia took further advantage of the fact that U.S. immigration authorities made it more difficult for non-U.S. students to enter and study for advanced degrees. Canada failed to follow suit. “Canada might have taken advantage of ‘9-11’ and the tightening by the U.S. that resulted,” said Mr. Ciuriak, but that was not the case. As rising numbers of Asian students took courses in Australia, the country also became an increasingly popular location for tourists from those Asian countries, said Mr. Ciuriak. In the contest for educational tourism, Australia will always enjoy a clear geographical advantage over Canada, he added. “Australia is in the same time zones as Asia, and it is easier for people from Asia to travel North to South, without suffering jet lag.” Students and their families from Northern Asian countries like Japan, South Korea and China can also take advantage of Australia’s opposite seasonality, enjoying a Southern Hemisphere summer that lasts from December through March annually. In 2010, Australia issued 159,000 visas to Asian students, compared with only 47,000 visas issued by Canada to those (Asian) students. These visas didn’t just educate those Asian students; they were an investment in personal links “that will pay off well into the future,” said McKinsey’s Barton.
How Australia became Asian
For much of its modern history, Australia was highly dependent on the British market for its agricultural exports. Australia’s recent focus on Asia is a relatively recent phenomenon, suggesting to some that Canada can make similar, substantial changes in its approach to Asia. For generations, Australia’s population was overwhelmingly white and European in origin – manifested in the country’s White Australia policy, which discriminated against immigrants from China and elsewhere in Asia. “When the U.K. joined the European Union in 1973, it was a body blow for Australia,” said Mr. Hart, because Australia lost its preferences in the British market – as did neighboring New Zealand. It took years for the Australians to find other foreign markets for its agricultural products, such as Japan and China.
Until the 1980s, when the Labour government of Prime Minister Bob Hawke (1983-91) took power in Canberra, Australia was “standoffish to its Asian neighbors,” said Mr. Hart. It was only then that Australia “began its aggressive campaign toward Asia, looking outward toward Asian markets.” Since then, Australia has taken a much more aggressive approach to pursuing markets in Asia, especially in China. Asian economies, then inward-looking, seemed distant not only culturally but physically, but in an age of long-distance jumbo jets, Australians increasingly view their nation as close enough to Asia to compete for its business against the rest of the world. As Mr. Barton pointed out, it takes 14 hours to fly from Sydney to Beijing, that is almost exactly the same time that it takes to fly to Beijing from Toronto. “It takes 16 days for a container ship to travel from Sydney to Shanghai, the exact same time as from Vancouver. And, of course, e-mail travels instantly from both countries,” Mr. Barton added. To stimulate imports from Asia, Australia has also made considerable progress in reforming its antiquated, inward-looking economy, formerly based on protectionist policies such as ‘import substitution’, by reducing import tariffs and opening its markets to competition from Asia and elsewhere.
Recommendations for Canadian policy
Mr. Barton believes that Canadian policy makers need to emulate Australia by taking seriously Canada’s opportunity to attract Asian students. “Increasing the number of Asian students studying in Canada has benefits beyond pure economics; it also raises the profile of our country in Asia and provides an avenue for future Asian leaders to experience Canada first-hand,” said Mr. Barton. “In addition to helping to attract Asian students to Canada, the government should encourage strong universities and technical schools (such as the British Columbia Institute of Technology) to build campuses in Asia.
One of the most promising aspects of Canada’s current relationship with Asia, said Ms. Dobson, is that Canada is already competitive in some major sectors, particularly natural resources. China and Canada are direct competitors in machinery and electrical equipment but neither is globally competitive in vehicles. Ms. Dobson added that the trend in Canada’s relative competitiveness in machinery is a positive one, although this is offset by static trends in Canada’s competitiveness in electrical equipment and vehicles. Canada needs to increase its competitiveness in electrical equipment, she said, and Canada’s lack of competitiveness in vehicles likely reflects the impact of low capacity utilization and the strengthening of the Canadian dollar in recent years.
Nevertheless, a number of Canadian industries are doing well in China, as a 2009 analysis by Canada’s Department of Foreign Affairs and International Trade confirmed. “Taking into account factors such as distance, language and formal trade agreements, the study found that Canada’s bilateral trade with China was double what would have been expected, even allowing for the high prices of Canadian commodities,” said Ms. Dobson.
Ms. Dobson added that Canada’s competitiveness in natural resources is relatively static, and while Canada’s position is worsening in pulp and paper and wood products, those Canadian industries remain competitive in China. “It is troubling, however, that Canada’s competitiveness in vehicles and aircraft appears to be declining,” she added. While trade between Canada and China is largely complementary, “Canada buys twice as much in manufactured goods from China as China buys in natural resources from us, and our trade deficit with China grew by nearly 50 percent between 2005 and 2010.” Dobson argued that Canada could close that gap by selling more natural resources to China. However, over the longer term, the best solution for Canada “should be to diversify bilateral trade, with Canada exporting more knowledge-based goods and services (to China) that China cannot produce, and by restoring Canada’s declining advantages in industries such as vehicles and aircraft.” With those goals in mind, this might be “an opportune time for the two countries to liberalize bilateral trade, since in the future, both countries would benefit from a framework that facilitates specialization and intra-industry trade,” concluded Ms. Dobson.
For his part, Mr. Hart cited a major barrier to expanding Canada’s competitiveness in China and elsewhere in Asia: Asia is still not a top priority for many Canadian companies “because the U.S. market has been reliable and so huge” for so many years. As a result, “We (Canadians) have to be more aggressive” toward Asia, added Mr. Hart, emulating the energy and concentrated focus displayed by Australian policy makers and corporate executives.
One area where Canada is clearly behind Australia, say Canadian business groups, is in its trade liberalization agreements. Currently Australia has six Free Trade Agreements in force – with ASEAN [the Association of Southeast Asian Nations] – as well as with Chile, New Zealand, Singapore, Thailand and the United States. Australia is also negotiating nine other free-trade agreements. According to DFAT, Australia’s foreign trade agency, the countries covered by Australia’s current FTAs account for 28 percent of Australia’s total foreign trade. Generally speaking, Australia’s tariffs are low, however, and these FTAs have led to only a “modest” amount of “trade diversion;” that is, a limited amount of trade diverted to other markets as a result of the preferences written into the FTAs. The Australian Productivity Commission said in 2010 that “utilization rates for Australia’s FTAs were low, reflecting undoubtedly the costs of documenting supply chains to meet rules of origin” stipulated in the FTAs.
In contrast, Canada has enacted free-trade agreements with 11 partners – Colombia, Peru, the European Free Trade Association (EFTA), Costa Rica, Chile, Israel; and Mexico and the United States (in the North American Free Trade Agreement). Not one of these FTA partners is located in the Asia-Pacific region, even if several have borders on the Pacific. According to Mr. Woo, Canada “has developed a reputation for not being able to close trade deals with Asian partners. Despite starting negotiations with Singapore, more than a decade ago, a deal with Singapore has yet to be reached. In the interim, Singapore concluded twelve agreements with other trading partners, including the United States, Australia, China, India, Japan and Korea. Likewise, the proposed Canada–Korea Free Trade Agreement is unfulfilled, even after six years of negotiations, in part, because of opposition from the Canadian automobile industry. The U.S. started its negotiations with Korea more than a year after Canada did, and came to an agreement in 2009 – overcoming the objections of its own, much larger, automobile sector.” Canada’s federal government recently announced negotiations with India on a Comprehensive Economic Partnership Agreement and raised the prospect of negotiation a free trade agreement with Japan. “If these negotiations end up languishing as the Singapore and Korea deals have, Canada’s image in Asia will be further tarnished,” warned Yuen Pau Woo, President and CEO of Vancouver-based non-profit Asia Pacific Foundation of Canada.
Beyond such arguments, Ms. Dobson argued that “since a major goal of the Asian economies is to move up the technology ladder, Canada has a strategic rationale for negotiating bilateral and regional trade agreements with (Asian economies) sooner, rather than later. In the absence of such arrangements, Canada’s relative lack of competitiveness in selling manufactured goods to South Korea could foreshadow the fate of our value-added exports to, say, India, as that country’s trade patterns increasingly resemble those of South Korea in Asia’s continuing economic transformation.”
For his part Mr. Woo added, “Our government should send a strong signal that Canada does not intend to be left out of the rapidly evolving trade and investment architecture of the Asia-Pacific region, including nascent groups such as the Trans-Pacific Partnership (TPP). If nothing else, putting agreements such as the new TPP on the domestic political agenda will force a reassessment of protectionism in Canada and focus attention on the very steep price that is paid for protectionist measures.” Mr. Woo and other members of the Canada-Asia trade community not only want to actively seek membership in the TPP, but to investigate trade and investment opportunities with other Asian partners on a bilateral or sub-regional basis. The government of Prime Minister Harper has expressed its interest in joining the Trans-Pacific Partnership.
The role of further economic reforms
Both the public and private sectors can play significant roles in emulating Australia’s policy successes. For decades, both Australia and Canada had similar systems for supply management in the dairy and poultry sectors, notes Mr. Hart. However, while Canada’s system continues to exist, Australia dismantled its supply management system during the 1990s, at about the same time that New Zealand did likewise. “We have not opened this issue yet; we are still protected,” laments Hart. U.S. trade negotiators have made it clear that they expect Canada to dismantle its supply management programs in dairy and poultry if Canada hopes to take part in the Trans-Pacific Partnership.
Australia’s dismantling of these antiquated practices came at a convenient time, when Asians were looking for new sources of food and Australia had the resources to deliver it. About 100 million more Chinese are slated to move out of the countryside and into urban centers in the next few decades, so demand for Canadian beef in that country, as well as Japan and Korea, could be strong for years to come. Mr. Hart calls for the removal of all Canadian government subsidies, not just in agriculture but in the aircraft sector. “The aircraft industry in Montreal is highly dependent on Canadian government programs,” he added.
Mr. Barton said that Canada’s prospects for emulating the Australian model in Asia will only succeed in those areas where there is the “highest level” of support from the Canadian federal government. U.S. policy makers have followed a similar model, for example, in their dealings with China, with apparently strong results. State Councilor Liu Yandong, the highest ranking woman in China, recently met with Hillary Clinton, the U.S. Secretary of State, to discuss educational ties with the United States, and then toured the campus of the Massachusetts Institute of Technology (MIT), accompanied by a delegation that included China’s Education Minister. The officials then signed an agreement through which China will provide 10,000 new scholarships for Chinese students to study in the United States. “Canada needs its senior leaders to promote educational partnerships with Asia just as strongly,” said Mr. Barton.
The role of private enterprise
Private enterprise also has an important role to play, noted Mr. Hart. “The private sector has to be prepared to take a longer-term view – with investments that facilitate the transportation of Canadian minerals and energy products to willing buyers in Asia.” For example, he added, the Canadian government has spent huge amounts of money on Prince Rupert coal facility, but it is “virtually unused” despite the ready availability of Alberta coal nearby. “We have to sell Canadian coal aggressively to Japan,” he noted.
Mr. Hart said that the Canadian private sector also needs to build the Enbridge Northern Gateway pipeline across the Rockies, which would make it easier to deliver oil and gas to markets in Asia. Construction of the pipeline has been held up by regulatory barriers and environmental groups. “There are far too many hearings,” allowing critics to voice their views repeatedly. He added that Canada needs to dismantle its protectionist policies regarding Canadian movies and recordings. “Already, the Internet has defeated the content restrictions on television and movies,” noted Mr. Hart, by making it quick and easy for foreign content – from Asia, the U.S. and elsewhere — to cross borders into Canada.
More fundamentally, to compete against Asian industry in the global economy, said Mr. Barton, “Canada must become more of an Asian-facing nation. In doing so, we must move beyond our current trading pattern with Asia: exporting natural resources and importing manufactured goods. There must be more value added to the relationship. Australia is also resource-rich but it is taking steps to avoid becoming merely a ‘quarrying nation’ for China. Canada must do the same. We have many assets to deploy: our long history as a trading nation, a multicultural population, vibrant cities, natural resources, our high quality of life, a successful education system and a strong business community.”
Mr. Woo suggested a series of steps that could set Canada on the right track toward enacting initiatives that may one day make Canada’s private and public sectors as fully engaged with Asia as their counterparts in Australia: First, the federal government should establish an Asia Advisory Council to provide advice on key opportunities and challenges. The new group could meet regularly with senior government officials, including the Prime Minister and Finance Minister. “A support system for the Council is critical to ensure that initiatives are pursued and delivered,” Mr. Woo argued. Thinking long-term, the Council must also establish a long-term body whose administrators are not changed at the end of each Canadian electoral cycle.
Second, said Mr. Woo, the federal government should strengthen its diplomatic links with Asian countries. The government should consider increasing the number of consulates in Asia; especially in some of the 100 or so Chinese cities that are expected to grow rapidly over the next 15 years. Other key measures might include increasing “the tempo and seniority” of official trips to Asia to demonstrate to Asians – as have Australian leaders – their commitment to the region. Similarly, the government could encourage prominent Asian government officials to visit Canada, and re-allocate Canada’s diplomatic budgets to put more emphasis on Asia.
Third, governments in Canada should pursue and strengthen various cultural and educational linkages with Asia’s public and private sector, Mr. Woo added. Economic ties are not constructed only by trade promotion and foreign investment, said Mr. Woo. “They rest on a broader base of social and cultural links.” Yet Canada currently “has no mechanism or institution to provide a centre of gravity for such efforts.” In that regard, the Asia Pacific Foundation’s National Centre on Contemporary Asia could play a role, Mr. Woo suggested. “Such a centre, with a sufficiently ambitious mandate and budget, could act as a prominent force for increasing the cultural and educational links between Canada and Asia.”
Although some Canadian industrial sectors place serious emphasis on Asian markets, noted Mr. Woo, “They are doing so at least ten years after their counterparts in comparable economies such as Australia, unfortunately.” And while the federal government may now “get it” when it comes to Asia, Ottawa “has come late to a party where most of the guests have already arrived,” he added.
How to make up for lost ground? Woo argued, “The challenge for (Canadian) government policy is not just to ‘get it’ but to ‘get ahead of it.’” If Canada is to catch up with Australia in Asia – even as Canada maintains its traditionally strong links with the U.S. and Europe – the federal government’s three-year program of ‘policy catch-up’ should be combined with “an ambitious longer-term program of policy leap-frog. The goal should be no less than for Canada to be the most Asia-engaged country in the Western world.”
Sounding a more cautious note, Mr. Ciuriak said that “establishing priorities is difficult” in Canadian federal bureaucracy because each country in Asia (and elsewhere) has its own country desk in Ottawa, and the people who work at each desk naturally view their own countries as a priority for Canadian foreign policy. Changing the mindset is essential. Unfortunately, few bureaucrats or businesspeople have been paying much attention to the lessons that Canada could have been learning all these years from Australia’s successes in Asia. Noted Mr. Ciuriak, “there are so many (positive) threads of connection between Canada and Australia that no one has felt the need to do an overview” of the ways in which Australia’s very different path in Asia can provide useful lessons for Canadians.