EFTA-Canada Free Trade Agreement Becomes Operational

09.07.2009


The Free Trade Agreement between the Member States of the European Free Trade Association and Canada entered into force on July 1, 2009. The agreement, which focuses on trade in goods, has the potential to yield significant benefits for exporters in all five participating countries. It provides new links between European and North-American supply and value chains.

Two-way merchandise trade between the EFTA States (Iceland, Liechtenstein, Norway, Switzerland) and Canada amounted to USD9.8bn in 2008, with EFTA’s exports reaching USD6.1bn while imports represented USD3.7bn. This made Canada EFTA’s fifth largest trading partner, while EFTA represented Canada’s eighth largest export destination.

The EFTA States’ main exports to Canada are mineral fuels, pharmaceutical and chemical products, as well as machinery, while Canada primarily exports nickel, aircraft, pharmaceutical products, machinery and mechanical appliances.

Most industrial goods, including fish and other marine products, benefit from duty-free access to the respective markets as of the entry into force of the Agreement. Basic agricultural products – covered by agreements concluded between Canada and the individual EFTA States – form part of the instruments establishing a free trade area between the parties.

The Agreement also includes provisions relating to the elimination of other trade barriers and trade-related disciplines, including rules on competition. The parties are to review provisions regarding services, investment and government procurement within three years. A Joint Committee has been set up to supervise the agreement.

Currently, EFTA has 18 Free Trade Agreements with 27 countries and is in free trade negotiations with several further partners. Together with the EFTA Convention, and the EFTA States’ arrangements with the EU, EFTA’s Free Trade Agreements now provide for preferential conditions for 80% of its overall merchandise trade.

Quelle: Tax-News.com