TORONTO (Reuters) - Canadian exporters and investors have a brief opportunity to take advantage of preferred access to the fast-growing Colombian market, trade officials said on Monday, as pressure mounts for U.S. Congress to ratify a U.S. trade agreement with the Andean nation.
The Canada-Colombia Free Trade Agreement took effect on Monday, becoming Canada’s fourth bilateral trade deal with a Latin American country. It eliminates tariffs on a range of goods and services in an effort to facilitate trade and investment.
U.S. Republican lawmakers fumed over the potential for lost American exports as a result of the Canadian deal, which took force before President Barack Obama sent the five-year-old U.S.-Colombia agreement to Congress for a vote.
“There’s a definite advantage,” Stephen Benoit, chief representative for the Andean Region at the federal government’s Export Development branch.
“We look at some exporters having their tariffs dropped from 15 percent to zero right away.”
Producers of wheat, Canada’s largest export to Colombia, are seen as winners as they will now compete on the same terms as regional suppliers such as Argentina. The United States is now the world’s only major wheat provider without duty-free access to Colombia.
“It’s great for farmers,” said Jacques Marcoux, communications consultant at the Canadian Wheat Board, which sells wheat and barley around on behalf of Canadian farmers.
Exports of agricultural products such as lentils, beans and other pulse crops may also likely rise as a 16 percent tariff disappears.
An 11.8 percent duty on industrial goods will also disappear.
Two-way trade between Canada and Colombia totaled C$1.4 billion ($1.43 billion) in 2010, which is up significantly since the two countries first signed their free trade pact in 2008.
“A lot of Canadian companies will see more business opportunities,” said Jayson Meyers, president and chief executive at the Canadian Manufacturers and Exporters association. “(The agreement) provides a framework and a dispute resolution system that create a better investment environment.”
Reporting by Trish Nixon; editing by Peter Galloway