The Canada-Korea Free Trade Agreement:

Benefits for Agri-food and Seafood Sectors

November 13, 2014 Monica Gervais, Senior Manager, Trade Policy and Negotiations Branch

Ministry of International Trade

• Linking BC businesses with buyers, investors, and other key partners

in global markets

• Facilitating BC companies’ participation at major trade events

• Supporting outbound and inbound trade missions

• Opening markets and addressing protectionism

• Representing the Province’s and stakeholders’ interests in domestic

and international trade negotiations

OUR SERVICES FOR BC EXPORTERS

BC Trade and Investment Representatives

3

Keun-Saeng

PARK

Managing

Director

Transportation,

Intentional

Financing

Sang-Hun (Spencer)

PARK

>Senior Manager

Mining & Energy,

Natural Gas

Yun Ju JUNG

>Manager

International

Education

Jae Jung HUH

>Manager

Life Sciences,

Green Economy/

Clean Tech,

Forestry, New

Media

Gyeonggi Province

Jae-Hyun CHOI

> Junior Project

Officer

Juran JUNG

> Junior Project

Officer

Nahyun LIM

>Program

Assistant

Seoul Capital of South Korea

> Investment attraction

> Trade Promotion

> Strategic Partnerships

> Education Deals

Canada has implemented FTAs with these countries

Canada’s FTAs

Canada is in negotiation or exploration talks with these countries

CKFTA: Overview and Impacts

5

• On March 11, 2014, Canada and the Republic of

Korea concluded negotiations of the Canada-Korea

Free Trade Agreement (CKFTA), which was signed

on September 22, 2014, by both Parties.

• South Korea is British Columbia’s fourth largest

export market with goods exports totalling $1.8 billion

in 2013.

• BC exporters were at a disadvantage as the EU, the

US, and Australia had concluded deals.

• Expected to improve market access, eliminate most

tariffs and reduce non-tariff barriers.

• According to the Government of Canada, expected

to increase Canadian exports to South Korea by

32 percent.

• The CKFTA also provides a gateway for Canadian

companies to become more competitive in the Asia

Pacific region, as South Korea offers strategic

access to regional and global markets.

CKFTA Benefits: Agri-foods

• BC’s agricultural and agri-food products sector employed over 52,000

people in 2012.

• BC’s agri-foods exports to South Korea were worth an annual average of

$74 million from 2010 to 2012, led by food preparations, animal and

vegetable fats, tallow, wheat flour and pork.

• Canadian agricultural exports to South Korea face high tariffs, which

averaged 52.7 percent in 2012.

• Additionally, BC agri-foods exporters often face non-tariff barriers such as

onerous certification, labelling and sanitary

and phytosanitary issues, such as

pest risk assessments.

CKFTA Benefits: Agri-foods

A key benefit to BC exporters is tariff

elimination, which makes BC products more

competitive in the South Korean market:

• Ice Wine, immediate elimination of a

15 per cent tariff.

• White and Red Wine, 3 year phase out of a

15 percent tariff.

• Most food preparations, up to 11 year phase

out of up to 30 percent tariffs.

• Mixed animal and vegetable fats/oils, up to 11

year phase outs of 8 percent tariff.

• Beef fats/tallow, immediate elimination of up

to 8 percent tariff.

• Dried and fresh/chilled cranberries, 10 year

phase out of up to 45 percent tariff.

CKFTA: Impacts for Seafood Sector

• The fish/seafood sector provides jobs for 7,200 British Columbians.

• Between 2010 and 2012, BC exported an annual average of $8.1 million of fish and

seafood world wide. Seafood tariffs in South Korea are up to 47 percent.

• The CKFTA will eliminate 70 percent of tariffs by 2019; all eliminated by 2026.

• BC exporters of Pacific and Atlantic salmon (fresh, chilled and smoked) will benefit from

the immediate elimination of current duties of 20 per cent.

• Other BC seafood products such as frozen sablefish (10 per cent tariff) and fresh chilled

halibut (20 per cent) will have tariffs eliminated over 5 years (which is the same or better

than the US and EU deals).

Other CKFTA benefits

• Canada and South Korea have agreed under the

CKFTA to build on their shared commitments under the

World Trade Organization.

• The CKFTA establishes a Sanitary and Phyto Sanitary

(SPS) Committee that enhances cooperation and

facilitates trade by discussing issues before they

become problems.

• This will help BC agri-foods and seafood exporters by

helping to ensure that market access gains are not

undermined by non-tariff barriers.

• The CKFTA will provide improved access for

professional services and improved access to South

Korea’s government procurement.

• It will also allow for temporary entry of business

persons and intra company transferees.

““Tariffs on exports of seafood to South

Korea are 20 percent or more. Clearly, a free

trade agreement with South Korea is good for

our industry and great for the West Coast.

Trade means jobs and a higher standard of

living for Canadians.”-- Christina Burridge,

Executive Director, BC Seafood Association

What Stakeholders are saying

“British Columbia is now the largest

high bush blueberry growing region in

the world, so it’s essential that we

source new markets for our berries.”

-- Debbie Etsell, Executive Director,

BC Blueberry Council

“The British Columbia wine industry is excited

about the potential for expansion in the key South

Korean market. With the growth of BC grape

acreage and our harvest levels back to normal, we

will be looking to new markets to promote our

quality BC VQA wines around the world. A

successful FTA with South Korea would certainly

create new opportunities for the ‘Wines of British

Columbia.” -- Miles Prodan, President and CEO,

British Columbia Wine Institute

Next Steps

To finalize and bring deal into effect:

• Legal review, translation and ratification by

Canada and South Korea

• Expect to be ratified in early 2015

• Conduct outreach and education of

companies to ensure they are aware of the

opportunities provided by the CKFTA

• Participate in bilateral committees

• Monitor impact

Thank You