The Canada-Colombia Free Trade Agreement came into force on August 15, 2011—a key boost for Canadian companies in five important sectors: agriculture, information and communications technologies, mining, oil and gas, and services.
The agreement gives Canadians access to new markets, customers and partnerships, creating stronger supply and production chains. The FTA will:
- Improve market access
- Remove or reduce trade barriers
- Make Canadian goods more competitive
- Reduce or eliminate tariffs on Canadian exports
- Allow free transfer of investment capital
- Provide investor protection and assurances
- Protect against unlawful expropriation
- Assure access to binding international arbitration
The Canadian pork industry, for instance, will likely see its exports double to around $12 million within the next three years, starting immediately, says Jacques Pomerleau, President of Canada Pork International, the industry association that represents Canada’s pork producers.
“We really needed to level the playing field,” says Pomerleau. According to Pomerleau, Canadian pork exporters had to contend with difficult market conditions before this FTA was negotiated. “It used to be very difficult to calculate import tariffs,” he says. “Tariffs would vary constantly. One day we would pay a 25% tariff, the next it would be 5% and you never really knew why. Now, we have transparent and stable access to a very important market and that is great news for Canadian companies.”
Canada’s interest in Colombia is growing strongly, and the market is attracting Canadian businesses—oil and gas, mining and manufacturing in particular. The country has undergone important economic and legal reforms, spurring democracy and global direct investment. The business climate is now stable and predictable, making Colombia a secure business partner and a solid investment destination. Colombia also offers attractive investment incentives. There are more than 40 free trade zones where the corporate tax rate is 15 percent. Also, imported materials are exempt from customs duties and VAT.
For more information, visit The Canadian Trade Commissioner Service.
Opportunities in Colombia
- Exports: Reduced tariffs will offer greater opportunities for Canadian agricultural and food producers. Consumer demand for processed foods and high-value food products is rising steadily.
- Investment: Colombia has 34.5 million hectares available for agricultural land development and a climate that supports efficient production.
- Exports: Colombia needs computer hardware and software, along with networking solutions and telecommunications equipment from foreign sources. The government procurement market is well worth exploring. Specialized software and e-services solutions are also in demand.
- Investment: Opportunities exist for mobile telecommunications, broadband and Internet service providers.
- Exports: Demand for transportation, early prospecting and drilling equipment is strong. Exploration companies also need geophysical, land surveying, mapping, engineering and environmental planning services.
- Investment: Investors are needed to expand coal and nickel mining production. International firms are also securing rights to explore Colombia’s gold and copper deposits.
- Exports: Colombia needs equipment and services for all stages of oil and gas production.
- Investment: Opportunities to build and expand petrochemical production and ethanol-producing plants are promising.
- Exports: Transportation infrastructure is needed, including urban transit, roads, ports and airports. Engineering and construction firms stand to benefit from opportunities in the power generation and transmission sector. Environmental services are also in high demand. The government is investing in waste management and water treatment services.
- Opportunities: There are excellent prospects in engineering, forestry, mining, oil and gas financial services, and education.