Potential benefits of a Canada-Mercosur free trade agreement for Canadian sectors
Forestry sector
What could a free trade agreement with Mercosur mean for Canada’s forestry sector?
Canada’s forestry sector is a major source of wealth for Canadians, and the Government of Canada is actively exploring new opportunities to develop markets for Canadian wood and wood products.
- In 2020, Canada’s forestry sector contributed close to $20.6 billion to Canada’s real GDP and employed about 170,000 Canadians, including many in highly skilled jobs.
- Canada is one of the world’s largest lumber producers and exporters.
- By value, Canada is both the world’s leading exporter of newsprint and third-largest exporter of wood pulp.
A comprehensive and ambitious FTA with Mercosur could enhance market access for Canadian world-class goods, creating more opportunities for established and first-time exporters to tap a rapidly growing market while creating new jobs at home.
- From 2017 to 2020, Canada exported an average of $84 million worth of forestry products annually to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s forestry exports by up to 35%.
- That means exporters of Christmas trees, newsprint and wood pulp from British Columbia, New Brunswick, Ontario and Quebec could find new, more accessible markets for their products, and thus expand their businesses at home.
Automotive sector
What could a free trade agreement with Mercosur mean for Canada’s automotive sector?
The automotive sector is one of Canada’s largest manufacturing sectors. Its skilled workforce combined with deep expertise position Canada to play a leadership role as the industry evolves.
- In 2020, the automotive sector contributed more than $34.1 billion in factory shipments to, or about 8% of, Canada’s manufacturing real GDP.
- The sector contributes to 439,193 jobs across Canada, with 83% of those jobs in Ontario, 7% in Quebec, 4% in Western Canada and 6% in Atlantic Canada.
- Canada is the world’s tenth-largest vehicle-producing nation.
- The motor vehicle industry is Canada’s largest manufacturing sector.
A comprehensive and ambitious FTA with Mercosur could enhance market access for Canadian world-class goods, creating more opportunities for established and first-time exporters to tap a rapidly growing market while generating new jobs at home.
- In 2020, Canada exported $29.4-million worth of automotive products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s automotive exports by up to 35%.
- While the vast majority of Canada’s automotive and auto parts production is for export to the U.S. market, an FTA with Mercosur could support diversification by providing access to new markets in the Americas.
Fish and seafood sector
What could a free trade agreement with Mercosur mean for Canada’s fish and seafood sector?
The fish and seafood industry is a vital part of Canada’s economy and communities, and helps to create jobs in coastal cities and towns.
- Fish and seafood are among Canada’s largest exports of food products. In 2020, Canada exported $5.9-billion worth of fish and seafood products.
- In 2020, the fish and seafood industry contributed nearly $2.3billion to the Canadian economy and employed an estimated 83,600 Canadians.
- In 2020, Canada was the world’s seventh-largest exporter of fish and seafood products.
A comprehensive and ambitious FTA with Mercosur could enhance market access for Canadian world-class goods, creating more opportunities for established and first-time exporters to tap a rapidly growing market while generating new jobs at home.
- In 2019, Canada exported $2.7-millionworth of fish and seafood products to Mercosur countries, demonstrating that there are tremendous opportunities for growth in a market of more than 295 million customers.
- Reduced tariffs could enhance market access for Canadian fish and seafood exports, which currently face tariffs of up to 32%.
Industrial goods sector
What could an FTA with Mercosur mean for Canada’s industrial goods?
A comprehensive and ambitious FTA with Mercosur could enhance market access for Canadian world-class goods, creating more opportunities for established and first-time exporters to tap a rapidly growing market while generating new jobs at home.
Tariff elimination on industrial goods could be wide-ranging, covering a variety of key Canadian export sectors, including:
Chemical and plastic products
- In 2020, the chemicals sector contributed close to 79,000 jobs across Canada, while the plastics sector contributed more than 88,000. Overall, employment in these sectors is concentrated in Ontario, Alberta and Quebec.
- In 2020, Canada exported $65.7-million worth of chemical and plastic products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s chemicals and plastics exports by up to 35%.
Medical goods and pharmaceuticals (life sciences)
- In 2020, the life sciences sector supported 56,000 jobs across Canada, with the majority of employment concentrated in Ontario, Quebec and British Columbia.
- In 2020, Canada exported $98.5-million worth of pharmaceutical products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s medical goods and pharmaceuticals exports by up to 14%.
Aluminum
- In 2020, the Canadian aluminum sector employed approximately 10,000 workers while contributing $3.1 billion to Canada’s real GDP—representing about 2.5% of Canada’s manufacturing real GDP.
- In 2020, Canada exported $43.7-million worth of aluminum products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s aluminum exports by up to 20%.
Industrial machinery
- In 2020, the industrial machinery sector contributed over 128,000 jobs across Canada.
- In 2020, Canada exported $401.5-million worth of machinery and equipment products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s industrial machinery exports by up to 35%.
Information and communications technology
- In 2020, the information and communications technology (ICT) sector employed 335,000 workers in Canada’s major urban centres, particularly Toronto, Montréal, Vancouver, Ottawa, Waterloo, Calgary, Edmonton and the city of Québec.
- The sector contributed $63.5 billion to, or 2.6% of, Canada’s real GDP in 2020.
- In 2020, Canada exported $78.1-million worth of ICT products to Mercosur countries.
- A comprehensive and ambitious FTA with Mercosur could reduce tariffs on Canada’s ICT exports by up to 35%.
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