Chile Trade Deal Gives Quebec Firm Access to a “Golden Nugget”
For more than 15 years, Canadian companies such as Quebec-based Wildfire Environmental Inc. have credited the Canada-Chile Free Trade Agreement for their success in the South American country.
Marcello Iacovella, President and CEO of Wildfire Environmental, says his company’s success in Chile is a “direct result” of the trade agreement.
Wildfire Environmental, which designs and sells water-handling equipment for wilderness firefighters, has been working in Chile for more than 40 years. But Iacovella says the company got a major boost when Canada signed the trade agreement on December 5, 1996.
“Since [the] signing [of] that agreement, our sales have been a direct result of that reduction in tariffs,” he says, calling Chile the company’s “golden nugget.” Wildfire’s business with Chile now makes up a quarter of the company’s export sales, says Iacovella.
The company, founded in the 1920s, has a long-term contract with the Government of Chile that makes Wildfire’s pumps the standard for all the forest-fire suppression efforts in the country.
“As a result of them standardizing their forest firefighting equipment, we’ve had a base there that is quite substantial, and we have recurring sales in Chile of easily over half a million dollars a year,” says Iacovella.
Chile continues to be a great destination for Canadian exports because of the country’s approach to trade, he says, noting that “Chile has been very proactive when it comes to setting the platform for trade and economic reforms.” Iacovella adds that “Chile was way ahead of the curve when they signed the bilateral trade agreement with Canada. They saw early on the advantage of synergies between both countries, and they decided to lower trade barriers and tariffs so we [could] facilitate trade between both of our countries.”
The Canada-Chile Free Trade Agreement, which reduced tariffs on goods and services and also included a bilateral investment arrangement, was Canada’s first trade agreement with a South American country.
Since the agreement was implemented on July 5, 1997, trade between Canada and Chile has more than tripled, reaching $2.7 billion in 2011. Canadian direct investment in the South American country also grew to $13.3 billion in 2010, making Canada the largest source of direct investment in Chile over the last decade.
Canada’s relationship with Chile continues to expand. On April 16, 2012, the countries signed an agreement to amend the trade agreement to include financial services. Canada and Chile have also agreed to look at further expanding the trade agreement in the future.
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