moved that Bill C-41, An Act to implement the Free Trade Agreement between Canada and the Republic of Korea, be read the second time and referred to a committee.
Mr. Speaker, I am pleased to have the opportunity to speak today about the landmark Canada-Korea free trade agreement and to outline clearly why it should be implemented without delay.
Both the 2013 budget and Speech from the Throne are clear that this government's top priority remains the creation of jobs, economic growth, and long-term prosperity.
As an export-driven economy, Canada requires an aggressive international trade strategy that continues to open up new markets for Canadian businesses.
One in every five Canadian jobs is dependent on exports, and over 40,000 Canadian companies are active exporters around the globe. They include global leaders in a diverse range of sectors, from aerospace to ice wine and everything in-between.
In a competitive globalized economy, hard-working Canadians depend on freer and more open markets for their economic security. That is a reality that this government understands. We know that our Canadian companies can compete with the very best in the world and win anywhere in the world, and our Conservative government is committed to supporting them as they grow and succeed.
The global economy is rapidly evolving, and emerging markets in Asia and elsewhere represent significant untapped trade and investment opportunities. It is imperative that we keep up with the times.
That is why this Conservative government has embarked upon the most ambitious pro-trade plan in our nation's history. Increased trade means greater employment prospects, more prosperity, and more food on the table for Canadians and their families. It also means more choice and better value for consumers. It means better priced and higher quality input, which would allow our Canadian manufacturers to remain competitive in a fiercely competitive global marketplace.
Let me provide some historical context. Members may recall that a previous Conservative government had the vision to negotiate the Canada-U.S. Free Trade Agreement, followed by the North American Free Trade Agreement, which, of course, included Mexico. Members may also remember that it was both the NDP and the Liberals who loudly opposed both of those agreements, claiming that they would cause Canada to lose its culture, its health care system, its sovereignty over water resources, and that we would see our economy hollowed out and lose millions of Canadian jobs. In fact, the Liberal Party of the day even threatened to tear up NAFTA.
Of course, none of those dire predictions came true. Over the last 25 years, Canada's economy has added millions of jobs and attracted hundreds of billions of dollars of foreign investment. Our trade with the U.S. has tripled, and our bilateral trade with Mexico has increased more than sevenfold. The last time I looked, our health care system was intact, we still had full control over our water resources, and Canadian culture is alive and well.
My point today is that many of those same naysayers and anti-trade activists are trotting out the same old tired arguments against every new trade agreement that Canada negotiates. I want to assure the members that their dire predictions were wrong 25 years ago, and they are just as wrong today.
Prior to 2006, the previous Liberal government largely neglected trade as an engine of economic growth. In fact, during 13 long, dark years in power, the Liberals were only able to sign three small trade agreements, putting Canadian workers and businesses at severe risk of falling behind in the global marketplace.
However, there is good news. We have delivered on our commitment to dramatically expand economic opportunities for Canadians through trade and investment. Over the eight short years since our Conservative government was elected, we have successfully concluded free trade agreements with no less than 38 different countries. That number includes the most comprehensive and ambitious trade initiative in Canada's history, the Canada-European Union free trade agreement. This past summer, we announced that we had completed the text of that treaty, and later this week we will be celebrating that achievement.
However, make no mistake about it, our efforts on the trade file are far from over. The cornerstone of our pro-trade plan going forward is the global markets action plan, which we call GMAP. We released it last fall. The GMAP guides our government's activities on trade and investment. It is our blueprint for increasing exports and supporting Canadian companies in markets all around the world. The GMAP outlines a broad array of trade initiatives, from negotiations of trade and investment agreements, to extensive stakeholder consultations and revamped market access plans. Crucially, we have identified priority foreign markets and priority sectors of our economy that are most important to Canadian exporters, and we are focusing our energies and resources on those priorities.
Not surprisingly, countries in the Asia-Pacific region figure prominently in GMAP because of the growing importance of that region of the world. That brings me to the legislation before us today. This past Monday, I was pleased to sign Canada's first free trade agreement with an Asian country, namely the Canada-Korea free trade agreement. South Korea is a modern economic miracle. That country's economic growth over the last 30 years has been remarkable. Since 1980, South Korea's GDP has grown more than six-fold and its economy has experienced an average annual growth rate of 6.5%. Korea has become a technological powerhouse and its global conglomerates, many now household names within our own country, anchor key regional and global value chains.
Given the size and dynamism of South Korea and our long history as friends and allies, implementing this historic agreement should be a no-brainer. As I noted, the Canada-Korea free trade agreement marks Canada's first bilateral trade agreement in Asia and will strengthen our economic ties with an increasingly important country that is both a priority market and a natural and complementary partner for us.
This agreement truly represents Canada's gateway to Asia. Commercial engagement between Canada and South Korea is already significant. Last year, two-way bilateral merchandise trade between our countries was roughly $11 billion and two-way investment is approaching $6 billion. But there remains great potential to expand this important partnership and this agreement will help unlock that potential. Indeed, the Canada-Korea free trade agreement will, in a very positive way, forever transform the way we do business with each other.
All told, this agreement is projected to boost Canada's economy by nearly $2 billion a year and increase Canadian exports to South Korea by 32%, creating thousands of new jobs in every region of our country and across every sector of our economy. As significant as those numbers are, there is another equally compelling reason to get this agreement implemented as quickly as possible. The Canada-Korea free trade agreement will restore a level playing field for Canadian companies in the South Korean market, where our fiercest competitors, including the United States and the European Union, are already benefiting from their own preferential access due to their own free trade agreements with South Korea.
Canada cannot continue to idly stand by as our competitors' goods maintain an advantage over Canadian ones. Implementing this trade agreement without delay is the best way to support Canadian businesses and the hardworking Canadians they employ. But one does not have to take my word for it. Stakeholders representing every sector and every region of the country have been calling on our government to move with dispatch to get this agreement in place.
On March 11 of this year, in Seoul, Korea, I was delighted to witness our Prime Minister and South Korean President Park announce the conclusion of negotiations. In the days that followed, many different companies and business associations publicly congratulated our government on that achievement. During the latest milestone in the implementation process, the tabling of the text of the treaty in the House this past June, we again heard from Canadians. Their message to us was loud and clear, that this agreement needed to be brought into force as quickly as possible.
Canadians overwhelmingly support this deal and when we look at the agreement, that should be no surprise. Our Conservative government is firmly committed to only signing trade agreements that are in the best interest of Canadians.
Let us look at some of the details of this agreement.
This is a 21st century, state-of-the-art free trade agreement that is ambitious in reach and comprehensive in its scope. It covers virtually every facet of modern commerce, including trade in goods and services, business mobility, investment, government procurement, intellectual property, technical barriers to trade, the environment and labour rights.
The centrepiece of the agreement is, of course, the elimination of tariffs on virtually all trade between Canada and South Korea. In numerical terms, nearly 90% of Canada's exports will be duty free upon entry into force of the agreement, and over 99% will be duty free once the agreement is fully implemented. These numbers translate into concrete benefits and opportunities for Canadian exporters, importers, investors, manufacturers and consumers all across our country and across all sectors of our economy.
Canada is a nation endowed with a wealth of both natural resources and human resources. We have people with the creativity and skill to turn the natural resources into a wide range of industrial goods, including in the aerospace, rail, information technology, chemical and pharmaceutical sectors, to name just a few.
I am pleased to say that over 95% of Canadian industrial exports to South Korea will be duty free immediately with the remainder being phased out over a number of years. This agreement will also result in the immediate elimination of South Korea's tariffs on liquefied natural gas, which is a commodity that has great potential to become a key driver of Canadian exports to South Korea in the future, especially from the provinces of British Columbia, Alberta and Saskatchewan.
Then there is Canada's forestry sector. This sector is another key contributor to the Canadian economy. In 2012, the sector contributed over $20 billion to Canada's GDP and employed close to 250,000 Canadians, many in well-paying, high-skilled jobs. This agreement will benefit Canadian forestry workers by eliminating tariffs on forestry and value-added wood products, while further diversifying our exports into Asian markets and reducing the sector's dependence on the United States.
I will speak for a moment about Canada's high-quality, premium fish and seafood products.
Canada's proximity to the Arctic, Atlantic and Pacific Oceans, the Great Lakes and other resources has allowed Canadians to develop one of the world's most valuable commercial fishing industries. This sector contributes more than $2 billion to Canada's GDP and provides over 40,000 jobs for Canadians in everything from fishing to aquaculture to fish processing. It is the economic mainstay of approximately 1,500 communities in rural and coastal Canada. We know the quality of Canada's fish and seafood products is second to none, and South Koreans are already showing a great appetite for our products.
In fact, shortly after the announcement of the conclusion of negotiations for this trade agreement, Korean Air Cargo launched weekly service to South Korea from Halifax and expected to transport a minimum of 40,000 kilograms of live lobster over the course of the last summer. Not only have these shipments helped to develop the South Korean market for fresh Canadian lobster, they have positioned South Korea as Canada's gateway for fish and seafood exports to other Asian markets, most notably Japan and China.
It goes without saying that in this free trade agreement, we have obtained a very favourable outcome for fish and seafood, one which eliminates 100% of South Korean tariffs, many immediately.
I do not have to remind my colleagues on the other side of the House, especially those from Atlantic Canada and the Pacific coast, that a vote against the speedy implementation of this trade agreement is a vote against Canadian jobs.
I want to also mention how this trade agreement will benefit our hard-working Canadian farmers and the more than two million people employed in the agriculture and agri-food industry.
In addition to Canadian beef and pork, Canadian icewine is becoming a hit with South Korea and throughout Asia. We want to promote those products. This trade agreement supports Canadian vintners and Canadian beef and pork producers to further expand their market share.
The tariff elimination package contained in this trade agreement represents a tremendous outcome for Canada, particularly given that South Korea's current tariffs are, on average, three times higher than ours. Beyond tariffs, the agreement also contains a wide range of commitments pertaining to non-tariff measures, which is an area that has been identified as a priority for our stakeholders.
The agreement includes ambitious outcomes on services and investment. This trade agreement includes a framework of reasonable protections that would result in a more secure and stable environment for investors in both countries. This will contribute to increased bilateral investment flows between our countries, creating more jobs, spurring creativity and technology, and linking Canada to global value chains.
Canadian investors are already recognizing the significant investment opportunities in South Korea, as well as its ability to be a potential test market for the larger Asian region. Just this past May, Canadian clothing brand Joe Fresh announced that it would open its first store outside of North America in Seoul, Korea. The flagship store in Seoul is only the start of its investment in South Korea, as the company plans to open nine more retail outlets in the capital by the end of the year.
The sooner this agreement is implemented, the sooner Canadians will start benefiting from the outcomes I have just mentioned, and the sooner Canadian companies can leverage the new-found market access into economic success. Our Conservative government will be there to support them every step of the way.
In addition to securing unprecedented market access for our companies, we are also supporting Canadian companies through our suite of trade promotion tools, tools such as Canada's trade commissioner service and the export financing and insurance products delivered by Export Development Canada. They are tools such as the government to government contracting support provided by the Canadian Commercial Corporation. There are many other tools that we are providing, including trade missions, which our government and ministers lead all around the world.
In short, we will be there to support our small and medium-sized businesses as they explore new opportunities in South Korea.
This trade agreement is comprehensive. It is high quality. It will create new opportunities for Canadian companies and contribute to our long-term prosperity.
I would remind my hon. colleagues of the robust outcomes across the board that this agreement would deliver. We owe it to our companies and we owe it to Canadians to ratify this agreement as quickly as possible. Early implementation of this free trade agreement will ensure that Canadians can quickly begin to reap its economic benefits, providing more choice for Canadian consumers and more prosperity for our nation as a whole.
