Canada and Malaysia sign deal to improve cooperation on security issues

Bruce Cheadle, The Canadian Press
Prime Minister Stephen Harper takes part in a business round table in Kuala Lumpur, Malaysia, on Saturday, October 5, 2013. Harper will travel to the APEC Leaders' Meeting in Bali, Indonesia, following his state visit to Malaysia. THE CANADIAN PRESS/Sean Kilpatrick

KUALA LUMPUR, Malaysia - Canada and Malaysia have signed an agreement that Prime Minister Stephen Harper says will enhance security co-operation between the two countries.

Harper announced the agreement in Malaysia on Sunday when he was formally welcomed to the Asian country by his counterpart, Prime Minister Mohd Najib.

A news release from Harper's office says the deal will help combat the threats of terrorism, human smuggling and organized crime.

Harper also announced amendments to the Canada-Malaysia air transport agreement.

A statement says the amendments will allow greater flexibility for airlines to offer air services using the flights of other airlines.

Harper is the first sitting Canadian prime minister to visit Malaysia in 17 years, but he received scant attention on Saturday as he was eclipsed by a state visit by Chinese president Xi Jinping.

Harper simply couldn't compete with the attention the Chinese leader was attracting and chose to spend a low-key day touring a mosque and a maritime air base and speaking to Canadian business leaders.

That's not to say Canadians aren't competing in Southeast Asia.

The emerging economies have been a bright spot in global economic growth and a number of Canadian firms have capitalized.

Marc Parent, the chief executive officer of Montreal-based CAE, says Canada punches "way above our weight" in the aerospace sector, and CAE's flight simulators and pilot training are part of that success.

A growing Southeast Asian middle class is a key driver, said Parent. And having a stream of top Canadian officials — from ministers to the Governor General and now the prime minister — visit the region in recent years has helped as well.

"I can tell you it's translated into increased business for us in Brunei, in the Philippines and other (regional) nations," Parent told reporters.

He was part of the round table group that met Harper on Saturday in a downtown hotel. Talisman Energy, Bombardier Rail, Teknion Furniture and several major financial institutions are among the Canadian firms already cashing in on regional growth.

CAE Inc., does all the pilot training for Air Asia, a discount airline that's the fastest growing in the region.

Canadian business presence in Malaysia may be growing, but the Chinese regional colossus puts Canada-Malaysian two-way trade in sharp perspective — and explains the fawning media coverage accorded President Xi's visit.

Canada-Malaysia commercial trade tops out at about $3 billion annually, while China is doing almost $100 billion dollars a year in trade with Malaysia. On Saturday, President Xi said he'd like to see that total hit $160 billion a year by 2017.

Small wonder then that Harper is keying in on trade talks with Pacific Rim countries — Malaysia included — as part of the Trans-Pacific Partnership negotiations. Those talks will be a subtext of the leaders' summit that begins Monday on the Indonesian island of Bali, where Harper heads later Sunday.

Canada and Malaysia also signed a declaration of intent to conclude a new tax agreement that Canadian officials say will reduce tax barriers between the two countries, but a statement from the Prime Minister's Office contained no details.

Note to readers: This is a corrected story. An earlier version mistakenly said China does almost a billion a year in trade with Malaysia.