Thank you very much, Mr. Chairman and honourable members of the Standing Committee on International Trade. Thank you very much for allowing me the opportunity to give an opening statement from a Swiss perspective.
From the Swiss side, we are very pleased about the signing of the long-awaited EFTA-Canada free trade agreement. We are sure it will further strengthen the economic relations between our highly developed economies. For Switzerland, Canada is a very important trading partner, in fact the most important trading partner after the European Union, the U.S., Japan, China, and Hong Kong.
I'm sure that once the agreement is in force, Canada will become an even more important export market for Switzerland and the other EFTA states, and vice versa, the EFTA states for Canada. By the way, Canada will be the largest free trade partner of the EFTA states after the European Union.
The conclusion of the EFTA-Canada free trade agreement is a major achievement. Given that the world is evolving quickly and areas beyond trading goods are of increasing importance in international economic relations, we will be able to add more value to the package by further developing the agreement in due time, as foreseen by the various evolutionary clauses relating to services, investment, public procurement, and other second-generation issues.
For Switzerland, a country dependent on exports with diversified markets worldwide, the conclusion of free trade agreements with important partner countries, alongside membership in the WTO and the contractual relations with the European Union, is one of the three main pillars in its policy of market liberalization and of improving the general conditions for foreign trade.
Now I have some remarks regarding possibilities.
Switzerland and Canada can expect advantages specifically in those areas where tariffs are eliminated or reduced. Apart from a few exceptions, the tariffs on industrial goods will be eliminated in the trade between the EFTA states and Canada. In addition, both sides committed to important tariff reductions for processed agricultural products and for certain basic agricultural products.
Previous studies on the impact of existing free trade agreements for Switzerland show that trade with its free trade partners, exports and imports, grows on average significantly faster than trade with the rest of the world. We expect to see similar development in the case of the EFTA-Canada free trade agreement.
Now I have some remarks about the ratification process regarding Switzerland.
Domestic requirements allow Switzerland and Liechtenstein to apply trade agreements provisionally until the Swiss and Liechtenstein parliaments have approved them. This possibility is also foreseen in the EFTA-Canada free trade agreement; see article 41 of the agreement.
This device allows an agreement concluded by Switzerland to enter into force as soon as the partner countries have accomplished internal procedures in view of ratification. Otherwise the entry into force of such agreements would have to wait for the spring session, 2009, of the Swiss Parliament following the signing of an agreement, as the Swiss Parliament ratifies such agreements only once a year as part of the annual report on Swiss foreign economic policy submitted by the federal council to Parliament each January. In the case of the EFTA-Canada free trade agreement, this would mean that the agreements could only enter into force on June 1, 2009.
According to our information, the ratification process on the Canadian side is foreseen to be concluded by autumn this year; in Iceland, as the ambassador mentioned, it will be quite soon; and Norway will have concluded the ratification procedures by then as well. This would allow an entry into force of the EFTA-Canada free trade agreement and the bilateral agricultural agreements by January 1, 2009. Switzerland and Liechtenstein would apply the agreements provisionally from the day of the entry into force until the decision taken by Parliament in March 2009 and would notify accomplishment of their internal procedures immediately thereafter.
These are some remarks regarding the ratification process. I will finish with perhaps one remark.
I have read the transcript of the meeting of the standing committee on March 10. There was discussion or some kind of surprise that Switzerland would be the fifth largest investor from abroad, and I can confirm to you that is really the case. So Switzerland is, after the U.S., the U.K., France, and the Netherlands, the fifth largest investor in Canada, before Japan and Germany. That is just as confirmation, because on March 10 I think there was some surprise about this. I can confirm that it's true.
So thank you very much for your attention, and Mr. Chairman, I will end my comments here. Thank you for allowing me to provide a brief overview. I'm ready to respond to questions.