Photo:
www.cbc.ca
A new agreement between Canada and the U.S. is supposed to ease border congestion. Trucks line up after arriving at the United States border in Surrey.
how many years. Businesses that believe their goods have wrongly been deemed unqualified can go through an appeals process. Each of the three countries has a different procedure for NAFTA claims, and businesses that violate the laws or customs procedures of any country are subject to administrative, civil or criminal penalties. In other words, even without tariffs, there are still plenty of government-imposed bar- riers to trade.
Is it good for Canada? Arguably, free trade with the
U.S. has worked too well. The U.S. downturn that followed the financial crisis has taken a toll on Canadian exporters because so much of their business relies on consumers and businesses in that country. What’s clear now is that Canadian compa- nies need to diversify outside North America. This is where the latest new FTA comes into play. The Com- prehensive Economic and Trade Agreement (CETA) with the Euro- pean Union. The agreement, which Prime Minister Stephen Harper said should be in effect before the 2015
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federal election, would eliminate import taxes for the vast majority of goods on both sides. That means Canadian automobile manufac- turers, beef, pork and seafood producers, and mining, forestry and telecommunications companies, would suddenly have much easier access to the EU’s 500 million con- sumers. The agricultural industry alone
estimates it will send an extra $1.5 billion in exports to the EU each year, which would represent a huge boost over the $3 billion currently sold to the bloc. Canadian consum- ers can similarly expect to see both an influx of European goods and cheaper prices on products already available, including wine and beer, Volkswagen and Mercedes-Benz automobiles, and cheese. Adding to this is a plan to harmonize regu- lations so that when a product is approved in Canada it doesn’t need to go through the same hoops in the European Union, and vice versa. Overall, the government estimates two-way trade could increase by 20 per cent, to more than $100 bil- lion per year, in the process both
creating jobs and lowering prices. The government is also hoping the deal will encourage more foreign investment – which would also lead to more jobs for Canadians – as for- eign companies try to use Canada as a springboard into the world’s two largest markets, the EU and the U.S., through the North American Free Trade Agreement. The agreement would also allow
help Canadian companies to com- pete for government contracts in the EU, and see architects, engi- neers – and perhaps one day even doctors – licensed to work on both sides of the Atlantic. There could potentially be some
losers to this deal as well. Dairy farm- ers have been sounding the alarm that the deal will hurt them allowing for an influx of European cheese. Dairy is one of three agricultural sectors, alongside eggs and poultry that have long been protected from outside competition by the federal government. Joy Nott, president and CEO of the Canadian Associa- tion of Importers and Exporters, is strongly in favor of the deal, but also acknowledged that success
April 2014
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