The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), signed on March 8, 2018, provides an opportunity for our companies to grow. Once it comes into effect, our exporters will have preferential access to a trade bloc of 495 million consumers, thanks in part to the elimination of customs duties on virtually all of our province's major exports. In this context, Japan's position as a prime market for our exporters is strengthened, and our trade links will be facilitated by the opening of a new direct flight between Montréal and Tokyo.
The CPTPP in a few figures
The CPTPP comprises 11 countries, namely Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. It thus includes two of Canada’s major trading partners: Japan and Mexico.
This zone represents a combined GDP of CAD 13.5 trillion, or 13.5% of the global GDP, and includes mature and emerging markets. Asia will account for the largest share of global economic growth in the coming decades and represents a region with great potential for our businesses’ expansion.
Collectively, the CPTPP countries are Canada's third largest trading partner, according to Peter G. Hall, Vice President and Chief Economist at EDC: in 2017, trade in goods and services reached $100 billion.
According to the Office of the Chief Economist, “Canadian exporters are expected to benefit from tariff savings of $428 million per year, with the majority coming from exports to Japan ($338 million).”
An agreement that creates business opportunities
The CPTPP positions Canada as one of the only G7 countries with free trade agreements in the Americas (NAFTA), Europe (CETA) and the Asia-Pacific region (CPTPP). This is a unique context for our businesses, which need to develop new markets to ensure their growth and competitiveness, and to limit risks in the event of an economic crisis or any other country-related problem. In addition, this agreement is an opportunity to increase the integration of our companies into global value chains.
Main benefits of the CPTPP
- Abolition of customs duties on agricultural and agri-food products (pork, maple syrup and sugar, frozen blueberries, etc.); industrial products (metals and minerals, aerospace, industrial machinery, automobile parts, information and communication technologies); forestry products and value-added wood products (newsprint, sanitary and household paper, etc.).
- Reduction of tariff barriers. Canadian importing companies will have privileged access to lower cost goods (e.g. parts and components) and services while allowing them to be more competitive in turn by accessing a larger market of suppliers.
- Opening of public procurement markets. This is all the more important for companies in the construction and infrastructure sector, as many Asian governments are planning to increase spending on infrastructure development.
Privileged access to the Japanese market
Japan is a prime market for our companies:
- Third largest economy in the world
- Quebec's seventh largest trading partner
- Quebec's second largest trading partner in Asia, just after China
In particular, the country offers opportunities for our agri-food processors, as it is the third largest export market for Canadian agriculture and agri-food products. It also represents a strong potential for creative and innovative high-tech companies, particularly those in the energy and green technology sectors.
It is with this in mind and in order to support companies in their internationalization efforts that Air Canada has decided to open a new direct route between two international cities, Montréal and Tokyo. Japan’s capital is now accessible year-round in around 12 hours, with daily flights in the high summer season and three flights per week in the winter season. The first inaugural flight on Friday, June 1, 2018, welcomed on board a delegation from the economic mission to Japan led by the Mayor of Montréal and organized by our Acclr international trade experts.
Learn more about the new Montréal-Tokyo flight:
» Read the press release by Air Canada