Posts Tagged ‘Free Trade’

How Will the Columbia Free Trade Agreement Affect You?

August 18th, 2011

On Aug 15, 2011 the Canada – Columbia Free Trade Agreement came into force. I took a quick look at the agreement and the possible impact for our customers and Canadian business in general.

Currently, total Canadian imports and exports are about $400 billion of goods each way, each year. That number is about $650 million (each way) between Canada and Columbia. Free trade agreements like this one, allow companies to buy and sell goods to each other duty free. My initial impression- this will be a significant factor to encourage increased trade between our countries – not so.

What Do Canadian Businesses Buy from Columbia

Petroleum and Coal $300 million
Coffee, fruits, vegetables and cut flowers $325 million
Other stuff $75 million

What Do Canadian Businesses Sell to Columbia

Wheat, Oats and Cereals $240 million
Machinery, vehicles, chemicals $210 million
Other stuff $150 million

Looking at the above list, petroleum, coal, coffee, fruits and vegetables were already duty free entering Canada…even without a free trade agreement. The bottom line? It’s no big deal unless you import cut flowers, then you can save an additional 6%.

Something to add? We welcome your comments!

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