Canada and China are creeping closer to signing an agreement that would set investment rules and guide dispute resolution for investors, International Trade Minister Ed Fast said Thursday.

Fast is in China on a trade visit, accompanied by representatives from companies like SNC Lavalin, Cameco and Bombardier.

In a teleconference from Qingdao, Fast said he and his Chinese counterpart agreed they want to get the foreign investment protection agreement done.

Fast addressed the issue amid news that Canada's trade deficit grew in August, with exports up 0.5 per cent but imports up 0.7 per cent for the month.

Fast says the agreement under negotiation would set out clear rules under which Canadians could invest in China and the Chinese could invest in Canada.

"It also sets out a very clear set of rules under which disputes relating to investments will be resolved. And if we can put that agreement to bed, and we’re making excellent progress in that regard... it will send a very clear message to Canadian companies that China is open for business," Fast said.

"It doesn’t change the fact that it’s still an unfamiliar business environment for many Canadians. It’s an unfamiliar regulatory and legal environment," he added, urging caution.

Fast admits China's intellectual property protection could be stronger, and said it's something Canada would like them to improve.

"Canada and China offer each other so much, it would be a mistake for us not to take advantage of those opportunities."

Fast also announced the government has set up an expert panel to advise the government on creating a strategy to attract more international students, a market he says is worth $6.5 billion a year to the Canadian economy.

Prime Minister Stephen Harper is expected to visit China later this fall. The Conservative government has sought to find new trading partners, especially since the 2008 recession hit the economy in the U.S., Canada's biggest export market.