The Government of Canada is seeking the views of Canadians on the exploratory discussions to enhance Canada’s trade relationship with the MERCOSUR countries (Argentina, Brazil, Paraguay and Uruguay).
On June 24, 2011, The Honourable Ed Fast, Minister of International Trade, announced that Canada and MERCOSUR were moving forward with exploratory discussions to enhance their trade relationship. Through the Global Commerce Strategy, the Government has pledged to improve Canada’s competitiveness and to support Canadian firms as they pursue opportunities in the global marketplace.
MERCOSUR, also known as the Southern Cone Common Market, is a customs union established by Argentina, Brazil, Paraguay and Uruguay in 1991. This regional bloc represents a significant economic presence in Latin America. In 2010, the four members of MERCOSUR had a combined GDP of $2.6 trillion and a population of about 243.5 million.
In 2010, bilateral merchandise trade between Canada and MERCOSUR reached over $8.0 billion, representing an increase of 157.0% over the last decade. Canadian merchandise exports totalled close to $3.0 billion in 2010, with nearly 96% accounted for by exports to Brazil and Argentina (86.1% and 9.5%, respectively). Leading exports included fertilizers, mineral fuels and oils, machinery, pharmaceuticals, and paper and paperboard. Canada’s merchandise imports from MERCOSUR totalled almost $5.1 billion in 2010. Close to 99% of Canada’s 2010 imports from MERCOSUR members originated in Brazil (68.2%) and Argentina (30.6%). Leading imports included precious stones and metals, inorganic chemicals, mineral fuels and oils, machinery, and sugar.
In 2009, Brazil made up the largest share of Canadian services exports to MERCOSUR countries, totalling $358 million, with exports to Argentina following at $82 million.
Available data indicates that at the end of 2010, stocks of Canadian Foreign Direct Investment in Brazil and Argentina totalled $9.7 billion and $2.5 billion, respectively. In 2010, Foreign Direct Investment in Canada amounted to $13.5 billion from Brazil and $53.0 million from Argentina (Please note that investment data for Paraguay and Uruguay is unavailable).
Sectors of opportunity initially identified for Canadian trade and investment include environmental industries, information and communication technologies, energy (nuclear, renewable and oil & gas) and agriculture. Emerging market niches exist in forestry and railways, and there is potential for targeted science and technology collaboration in Antarctic wind/fuel cells and organic foods. The mining and oil and gas sectors offer opportunities for suppliers of equipment and services.
Canada has Foreign Investment Promotion and Protection Agreements with Argentina (1993) and Uruguay (1999). In 2011, Canada and Brazil signed a bilateral Air Transport Agreement, a Social Security Agreement, as well as Memoranda of Understanding on Olympic Games Cooperation and on International Development Aid Effectiveness. Canada and Brazil also have a Science and Technology Cooperation Agreement, which was signed in November of 2008.
The Government of Canada is embarking on a public consultation process to allow all interested stakeholders an opportunity to provide comments and advice regarding how Canada and MERCOSUR could enhance its trading relationship. We welcome advice and views on any priorities, objectives and/or concerns relating to trade and investment with MERCOSUR.
Beginning on February 18, 2012, the Government of Canada has invited comments and input on enhancing Canada economic relations with MERCOSUR (see Canada Gazette: Consultations on Options to Enhance Trade With MERCOSUR).
All interested parties are invited to submit their views by Monday, March 19, 2012.
If you have questions or comments about this initiative, we would like to hear from you. Please contact Foreign Affairs & International Trade Canada at:
Trade Negotiations Consultations (TPE)
Foreign Affairs and International Trade Canada
Lester B. Pearson Building
125 Sussex Drive
Ottawa, Ontario, K1A 0G2