Legislators in both Canada and South Korea have ratified the two countries’ bilateral free trade deal to take effect next month.
Canada’s Trade Minister Ed Fast on Wednesday announced the Canada-Korea Economic Growth and Prosperity Act has received royal assent just as the South Korean National Assembly has passed its Canada-Korea Free Trade Agreement (CKFTA) ratification bill, wrapping up the ratification process in both countries.
“With this latest milestone, Canada and South Korea are on track to bring the agreement into force on Jan. 1, 2015, so that Canadian workers and businesses can access the full range of benefits and opportunities it will provide,” Fast said in a release.
A Jan. 1 implementation date was “a critical objective” for the Canadian beef sector, the Canadian Cattlemen’s Association said in a separate release. The effective date, the CCA said, “allows Canada to keep pace with its U.S. and Australian competitors from a tariff reduction perspective.”
The Canada/Korea deal calls for Korea’s 40 per cent tariff on fresh and frozen Canadian beef to be eliminated in 15 equal annual steps, while an 18 per cent tariff on offals will end over 11 equal annual steps, the CCA said.
Australia’s free trade deal with Korea also takes effect Jan. 1, while the U.S. has had a trade pact in place with Korea since 2012.
“Now that both parliaments have ratified the CKFTA, it can be implemented in time to avoid the U.S. gaining another year’s tariff reduction ahead of Canada,” CCA president Dave Solverson said.
“The absence of an FTA with Korea was causing substantial and growing prejudice to the Canadian pork industry due to tariff rate disadvantages arising from all of our key competitors — the U.S., the European Union and Chile — already having FTAs with South Korea in place,” Canadian Pork Council chairman Jean-Guy Vincent said in a separate release.
Given the value of pork cuts sold in Korea, such as shoulder cuts and bellies, a U.S. study has previously found the value of free trade in pork with Korea to be worth US$10 per hog, the pork council said. “The benefits for the Canadian pork industry of a free trade deal with South Korea should be similar as those in the U.S.”
Gary Stanford, president of Grain Growers of Canada, agreed in a separate release Wednesday that the planned implementation timeline “will allow the benefits of this trade agreement to be felt quickly across Canada’s agriculture and agri-food sector.”
Generally, the federal government reiterated Wednesday, almost 90 per cent of Canada’s current exports to Korea will be duty-free on the day the trade pact goes into force.
Fast said he plans to lead a trade mission to South Korea in February “to help Canadian businesses tap into the tremendous new opportunities the agreement will provide.” — AGCanada.com Network