Canada is taking a leadership role in the logical and inevitable move toward freer trade. With protectionism and “Buy American” sentiment alive and well in the United States, today the government of Conservative Prime Minister of Canada Stephen Harper introduced legislation in Parliament to strike new trade deals with Colombia and Peru. These deals should be law before the end of June.
The Colombia free trade agreement was signed in November and the deal with Peru was signed last May. Both are part of an overall approach that recognizes protectionism does not work, especially within the current global economic crisis. Free trade agreements strengthen economies and they offer businesses the tools they need to create new jobs.
Last year Canada did $1.3 billion worth of two-way trade with Colombia and $2.5 billion with Peru. Canadian exports and investment in Peru are primarily focused in the areas of mining, energy, and financial services. Canadian exports to both countries include heavy equipment, paper products, and agricultural products such as wheat, barley, and lentils. Imports from these countries include staples Canada needs, such as vegetables, coffee, bananas and commodities like gold zinc, copper, and oil. The agreements will help create a more secure and predictable environment for Canadian investment and will open the doors of opportunity for entrepreneurs, investors, and working people in both our hemispheres.
The free trade agreement with Peru in particular means an elimination of tariffs on 95 percent of current Canadian exports with most remaining tariffs to be eliminated over a five- to ten-year period. In a practical sense, the Peruvian agreement will mean Canadian businesses and products like wheat, barley, lentils, peas, selected boneless beef cuts, paper products, machinery, and equipment will benefit from immediate duty-free access.
The Canadian government believes in the critical importance of these agreements at this juncture in part because Colombia and Peru have already negotiated free trade deals with a number of European countries. We should at least be getting our own free trade house in order on this side of the ocean. Unlike some of the free trade critics, Canada believes increased engagement in Latin America ensures more prosperity. That in turn means better security means better protection for human rights.
Senator Pamela Wallin, Canada
Advisor to AS/COA on Canadian-U.S. Affairs