The Canada-Colombia Free Trade Agreement which took effect on Monday August 15 is Canada's fourth bilateral trade deal with a Latin American country and eliminates tariffs on a range of goods and services in an effort to facilitate trade and investment.
The FTA is expected to benefit Canadian workers and businesses across the country and many sectors of the Canadian economy, including agriculture (wheat, pulses and barley), paper products, heavy equipment, investment, mining, oil exploration, printing and education said Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway.
“With the agreement, Canada's producers and exporters will benefit from reduced or eliminated tariffs on nearly all of Canada's current exports to Colombia. The agreement will also provide a more predictable, transparent and rules-based trading environment for Canadian investors and businesses”, underlined Minister Fast.
Canadian Cattlemen's Association President Travis Toews who accompanied Canadian Prime Minister Harper visit last week to Bogotá applauded the Canada-Colombia FTA.
We are very pleased to see the Canada-Colombia Free Trade Agreement come into place with the new access it will create for Canadian beef. Exports are the lifeblood of the Canadian cattle and beef sector, and I commend Minister Fast and Agriculture and Agri-Food Minister Gerry Ritz for their efforts to open markets, said Mr. Toews.
The Mining Association of Canada (MAC) also applauded the Canada-Colombia FTA.
Latin America is the largest recipient of Canadian direct investment abroad in mining, which in 2008 was valued at 57 billion, stated Pierre Gratton, MAC President and CEO.
Free trade agreements, such as this week's agreement with Colombia, strengthen our ties with Latin America, which translates into jobs and opportunities for Canadian miners and mining service suppliers here in Canada. Prime Minister Harper's Latin American trade mission last week will pay dividends to Canadians for years to come added Gratton.
Producers of wheat, Canada's largest export to Colombia, are also seen as winners as they will now compete on the same terms as regional suppliers such as Argentina with the elimination of the 15% tariff. The United States is now the world's only major wheat provider without duty-free access to Colombia.
It's great for farmers, said Jacques Marcoux, communications consultant at the Canadian Wheat Board, which sells wheat and barley on behalf of Canadian farmers.
Exports of agricultural products such as lentils, beans and other pulse crops are also likely rise as a 16% tariff disappears. An 11.8% duty on industrial goods will also disappear.
Two-way trade between Canada and Colombia totalled 1.4 billion dollars in 2010, which is up significantly since the two countries first signed their free trade pact in 2008.
The implementation of the agreement was signed last week during Canadia PM Stephen Harper’s visit to Colombia where he met his counterpart Juan Manuel Santos.
A lot of Canadian companies will see more business opportunities, said Jayson Meyers, president and chief executive at the Canadian Manufacturers and Exporters association. ”(The agreement) provides a framework and a dispute resolution system that create a better investment environment.”
Under the FTA most tariffs on trade between the two countries are removed or reduced. The agreement was reached in 2008 and received royal assent in Canada in 2010.
Following are the top five Canadian imports from Colombia and the top five exports to Colombia, based on the average value for 2004-2006: Imports: coal, coffee, bananas, fuel oil, cut flowers (half the cut flowers that Canada imports come from Colombia).
Canadian exports include: wheat, newsprint and paper, machinery and equipment, off-highway dumpers, pulses (beans, peas and lentils). The top five exports account for 70% of the country’s exports to Colombia. Wheat alone represents 22% but 2.4% of exports world wide.