Ottawa – Prime Minister Stephen Harper has announced the conclusion of a Free Trade Agreement between Canada and the Republic of Korea that will make it easier for the export-intensive Canadian aerospace industry to do business in South Korea.
The agreement, which will eliminate current tariffs of up to 8% on aerospace products including turbo propellers, turbo jet and propeller parts, and ground-flying training equipment, was applauded by the aerospace industry. Recent free trade agreements with the United States and the European Union have disadvantaged Canadian aerospace companies, which saw exports to Korea drop by over 80% from $180.3 billion in 2011 to only $35 billion in 2012.
“Our industry depends on exports and access to international markets to remain competitive and continue creating jobs and revenues here at home,” said Jim Quick, president and CEO of the Aerospace Industries Association of Canada (AIAC). “This agreement is imperative to restoring a level playing field for Canadian firms in the Korean market. We congratulate the government on this achievement, and thank them for their ongoing commitment to boosting Canadian competitiveness in international markets.”
The Canada-South Korea Free Trade Agreement also broadens a strategic opportunity for the industry into the Asia Pacific region, which is poised to be a major driver of international aerospace growth in coming years. Out of over $4.5 trillion of new work that is forecasted for the next twenty years, it is estimated that over 37% of the demand for new aircraft will come from the Asia Pacific region.
“Our free trade agreement with South Korea will create a gateway for Canadian companies to increase their presence not only in Korea but in the entire region,” Quick said.
Source: Aerospace Industries Association of Canada