Mr. Speaker, I wish to inform you that I will be sharing my time with the member for Don Valley East.
Mr. Speaker, our Conservative government's top priority is jobs, growth, and long-term prosperity for all Canadians. That is why we are working hard to open new markets to increase Canadian exports and investments in the world's most dynamic and fast-growing economies. This includes South Korea, an increasingly important country that is both a priority market and a natural partner for Canada.
The Canada-Korea free trade agreement, Canada's first bilateral trade agreement with an Asian market, is projected to create thousands of jobs for Canadians by increasing Canada's GDP by $1.7 billion annually and our exports by about one-third over current levels.
The agreement is critical to re-establishing a level playing field for Canadian companies in the South Korean market, where major foreign competitors from the U.S. and the European Union currently benefit from preferential access because of their respective free trade agreements with South Korea.
The focus of my remarks today will be on the centrepiece of the agreement: the elimination of tariffs on virtually all trade between Canada and South Korea. Over 88% of Canada's exports would be duty free immediately and over 99% would be duty free once the agreement is fully implemented.
The potential benefits from such a huge amount of Canadian exports becoming duty free is why we need this agreement urgently. We need to restore our competitive position in the South Korean market, as I noted earlier.
The previous government ignored trade. While this Conservative government has been ambitious on behalf of Canadians, the Liberals offered only complacency. While the rest of the world moved forward, Liberals held Canadian enterprise back through their inattention, inaction, and incompetence.
Fortunately, Canadians have, for almost nine years now, chosen to have steadier, more visionary hands at the helm. We are, under this Prime Minister's leadership, repairing the damage from 13 years of neglect.
Over time, this agreement would result in the elimination of all South Korean tariffs on industrial goods, forestry and value-added wood products, and fish and seafood products. This is great news for workers in B.C., Quebec, Atlantic Canada, and my home province of Ontario, which needs every bit of good news on the economic front that it can find right now.
It would also eliminate the vast majority of South Korea's agricultural tariffs, including in priority areas for Canada, such as beef, pork, grains, pulses, oilseeds, vegetable oil, and processed foods. This would lead to substantial gains in these sectors, given that these are the areas most heavily protected in South Korea.
Allow me to go into detail on how tariff elimination would benefit Canadian exporters and workers in these industries and benefit the communities that depend upon them.
In 2012, 1.8 million Canadians were employed in the production and manufacture of industrial materials, which would include aerospace and rail goods, automobiles, information technology products, metals and minerals, chemicals, and pharmaceuticals. If there is something that can be manufactured, chances are a Canadian is either producing it or working on ways to improve it.
With this agreement, over 96% of Canadian exports of industrial goods would be duty free immediately, more than 99% within five years, and the rest within 10 years.
I want to note the excellent results of particular interest and importance to Canadian exporters in such diverse fields as information and communications technology, aerospace, and rail goods. These are sectors in which South Korean tariffs would be eliminated immediately, creating new opportunities for companies in these sectors to expand their international business while at the same time creating jobs here at home. In the case of aerospace, over 80% of the sector's output is exported. This sector provides direct and indirect employment to 170,000 Canadians.
As well, there are very positive outcomes in the industrial machinery, chemicals, plastics, metals and minerals, pharmaceuticals, and textiles and apparel sectors, where most South Korean tariffs would be eliminated immediately and the rest within five years.
This would mean reduced barriers for these products in South Korea and an improved competitive position for Canadian exports. This is critical to industries such as chemicals and plastics, which export over half of their production abroad.
I would also note that South Korea is one of the world's largest energy importers, and Canada, of course, is a large and stable supplier.
While Canada does not currently export liquefied natural gas to South Korea, this agreement will result in the immediate elimination of South Korea's 3% tariff on LNG, thereby enhancing the prospects for energy exports to Asia from Canada's west coast.
I will now move on to forestry and value-added wood products, another industry that contributes substantially to Canada's economy. Under the CKFTA, 85% of our exports to South Korea would be duty free immediately, including pulp, paper, and some lumber products. Within three years of implementation, 98% of our exports in this sector will be duty free, and the rest will be duty free within five to 10 years. This will help our industry to diversify into Asian markets and to reduce its dependence on the U.S. market. It will also allow value-added wood product exporters in Ontario and B.C. to compete on an even footing with our competitors in the South Korean market.
I saved the best for last. From primary agriculture and processing to retail and food service, the agriculture and agri-food industry accounts for one in eight jobs in Canada and for 6.7% of Canada's GDP. The Canada-Korea free trade agreement will result in significant benefits for Canadian producers and exporters through the elimination of South Korean tariffs on around 70% of our exports in the agricultural sector within five years and on 97% of our exports once the agreement is fully implemented.
This is particularly important for my area in southern Ontario, the Region of Waterloo, and in particular the riding of Kitchener—Conestoga, which I am privileged to have been elected to serve three times now. We are blessed to live in a community where the 100-mile diet is a privilege, not a chore. We are home to Canada's largest year-round farmers' market.
Food processing is one of the largest employment sectors in my area. The farmers I represent will be pleased to know that for beef and pork, we have achieved tariff elimination over periods ranging from five to 15 years. This is the same tariff outcome for beef that the U.S. and Australia obtained in their respective FTAs with South Korea, and it will level the playing field among Canadian, U.S., and European exporters for Canada's top-traded pork lines.
This means that producers and exporters like Conestoga Meat Packers, a co-operative of 160 southern Ontario family farmers, can compete on an equal footing to provide the large and growing market in South Korea with high-quality Canadian meat products. In fact, when I learned that I would have the privilege of speaking to this topic today, I contacted Conestoga Meats directly to get a first-hand perspective on this trade agreement. Conestoga's president, Arnold Drung, states that this agreement will solidify more than 50 jobs at his plant alone. In fact, it is already investing in new equipment and technology that will enable it to ship fresh product to the Korean market. He concluded by saying, “Our congratulations to the Government of Canada on concluding this important agreement.”
This agreement is important to all Canadians farmers, not just pork producers. For other agricultural products, we will receive immediate duty-free access for key Canadian export interests such as wheat, frozen french fries, and fur skins. This agreement will also provide for tariff elimination over time or for duty-free within-quota volumes for a variety of other agricultural products, such as barley, malt, wheat flour, soybeans, canola oil, forages, pulses, blueberries, and many processed foods.
Overall, the tariff elimination package represents a very strong outcome for Canada, particularly given that South Korea's current tariffs are, on average, three times higher than ours. This agreement compares very favourably to what our competitors obtained in their agreements with South Korea.
Despite all the evidence that trade creates jobs, economic growth, and economic security for hard-working Canadian families, there do remain special interests who told us free trade with the U.S. would put an end to our sovereignty, who then told us that NAFTA would bring economic ruin, and who made similar fearmongering statements about free trade with Europe.
The Liberals completely neglected trade and took Canada virtually out of the game of trade negotiations, putting Canadian workers and businesses at severe risk of falling behind in this era of global markets. The last time the Liberals talked about free trade was when they campaigned to rip up the North American Free Trade Agreement. Of course that promise was ignored, as were their promises on child care, reducing greenhouse gas emissions, eliminating the GST, and protecting health care.
Stakeholders from across Canada, in all sectors, have called for this CKFTA to enter into force without delay to secure Canada's competitive position in the South Korean market.
We must pass this legislation quickly so Canadians can access the benefits and opportunities of the Canada-Korea free trade agreement as soon as possible.
