Canada closes to EU free trade deal, minister says

Canada may be just months away from becoming the first country in the world to have a free trade agreement with both the United States and the European Union (EU), Peter Van loan, Canada's minister of international trade, said here Thursday.

Speaking at a private meeting of conservative policy experts, Van Loan said he hopes the Canada-EU trade deal can be completed by the end of next year. A fourth round of meetings between Canada and EU officials recently ended on a positive note, Van Loan told the Fraser Institute.

"These negotiations hold great potential to help create jobs and prosperity on both sides of the Atlantic," the minister said. "One study predicted that an agreement could boost Canada's trade with the European Union by 38 billion U.S. dollars within seven years of implementation."

Van Loan said Canada is "very encouraged" with the progress of the talks.

An agreement with the EU would give Canada its first major entry into European markets since 1960, when Britain dropped trade preferences for its former colonies in its first bid to join the European Economic Community.

"Once an agreement is in place, Canada will be the only country in the world to have a free trade deal with both the United States and the European Union, the world's two largest economies-an enormous competitive advantage," Van Loan said.

The EU agreement would be the culmination of a free trade strategy that has seen Canada strike out on its own to make arrangements with several developing countries in the western hemisphere.

Van Loan also introduced a bill in Canada's parliament to ratify a new free trade deal with Panama.

Since coming to power in 2006, the Conservative government has also concluded new free trade agreements with Colombia, Peru, Jordan, Panama and the European Free Trade Association states of Iceland, Liechtenstein, Norway and Switzerland.

It is still engaged in free trade negotiations with India, the Caribbean Community, the Dominican Republic, as well as El Salvador, Guatemala, Honduras and Nicaragua.

"History has shown, time and time again, that the path to prosperity is built through free trade and partnerships, not protectionism," Van Loan said.

The minister said he has noted a shift in global trade, "as developing countries increasingly trade not just with developed economies, but also with each other."

But, he added, the greatest success has come from Canada's trade deal with the United States and Mexico.

"Since the North American Free Trade Agreement came into force, Canada's merchandise trade with the United States has increased by 73 percent. Our two-way investment, even in the midst of the global economic downturn, is extraordinary, reaching 550 billion U.S. dollars in 2009.

"We've become integral parts of each other's supply chains. We 'make things together'," he said.

Last spring, the Canadian government declared Canada a free trade zone for manufacturers, inputs into the manufacturing process, equipment parts and machinery and materials.

"Our government implemented this policy to help Canadian manufacturers increase their productivity and to stimulate jobs and growth in our economy. We did this unilaterally, without expectation of reciprocity," Van Loan said.

"This decision will make Canada the first tariff-free zone for manufacturers in the G-20. More importantly, it will help our manufacturers become more competitive, by making it easier to get the inputs they need from around the world and at a better price," he added.
(Source:xinhua)