Trade agreement’s expansion brings greater advantages for Canadian companies

The Comprehensive and Progressive Agreement for Trans‑Pacific Partnership (CPTPP) is opening even more doors for Canadian goods and services, and investment opportunities, as it marks its third anniversary. This free trade agreement continues to expand — with further implementation as well as ratification by an additional country — offering ever‑more benefits for Canadian companies in Asia and Latin America.

With the pact’s entry into force in Peru, Canada now has enhanced trade and investment ties there, especially in high‑priority sectors. Canadian companies have increased market access to Peruvian consumers, and can benefit from Peru’s sustained economic growth.

The country’s ratification moves the CPTPP a step further toward full implementation. Currently, eight of the 11 member states have ratified: Australia, Canada, Japan, Mexico, New Zealand, Peru, Singapore and Vietnam.

Since entering into force on December 30, 2018, the agreement has solidified and enhanced Canada’s relationships in these dynamic markets, ensuring that Canadian companies are positioned as well as — or better than — competitors there. The CPTPP covers virtually all sectors and aspects of trade between Canada and member countries.

The pact is helping to create jobs, strengthen economic relations and boost Canada’s trade with important trading partners. Once fully implemented — when Brunei, Chile and Malaysia ratify there will be 11 countries in all — the CPTPP will form a trading bloc representing 500 million consumers and 13.5 percent of global GDP.

It gives Canadian companies an advantage on the world stage by providing preferential access, reducing tariffs and offering a wide range of non‑tariff benefits. It provides much‑needed visibility and stability for Canadian exports, with the support of the Canadian Trade Commissioner Service (TCS) on the ground.

“The TCS is your guide to all of the possibilities that the CPTPP presents,” says Anouk Bergeron‑Laliberté, Canada’s Senior Trade Commissioner in Peru.

Over the past decade, the country has been one of the fastest‑growing economies in Latin America, she says, and although annual growth has diminished with the COVID‑19 pandemic, it is one of the quickest countries in the region to recover from the crisis. Peru was Canada’s second‑largest bilateral trading partner in South and Central America (not including Mexico) in 2020. It was also Canada’s second‑largest destination for direct investment in the region, with $15 billion invested in 2020, the 13th‑largest destination worldwide.

With a population of about 33 million, Peru generates good volume but is “not unmanageable” for a company entering the country for the first time, says Bergeron‑Laliberté, who calls it “a market of niche opportunities.”

Agriculture is the cornerstone of trade in both directions, she says, and Peru is a key market for mining investments, offering opportunities for Canadian suppliers of mining equipment, technologies and services, especially in green mining, mining 4.0 and cleantech. Education is also key, as are educational services, such as providing customized training modules to the private sector. There are also opportunities in areas such as renewable energy, defence and security, transportation, infrastructure and building products.

Bergeron‑Laliberté, who previously worked for nine years in the TCS network in Brazil, notes that Latin America is a region where Canada enjoys several free trade agreements. “Hemispheric trade always has been a priority due to proximity, both in terms of geography and in people‑to‑people links,” she explains.

Peru is one of the few countries for which the CPTPP is building on a previous pact, the Canada‑Peru Free Trade Agreement, which entered into force in 2009. The CPTPP adds to “an already longstanding privileged trade relationship,” Bergeron‑Laliberté says, offering additional tariff preferences, mostly for agricultural products such as pork, beef and poultry, some sugar and some dairy products. Canadian exporters can choose between the trade agreements, claiming preferences under the agreement that best fits their needs, she points out.

The CPTPP provides more ambitious outcomes for trade in services, including professional and financial services, and it can be leveraged for service‑providers supporting the “green shift” needed to help Peru mitigate climate change effects. The CPTPP also expands rules‑of‑origin benefits, Bergeron‑Laliberté says, and its simplified trade provisions help underrepresented business groups, such as women, LGBTQ+ and Indigenous entrepreneurs, participate fully in the economic recovery post‑COVID.

The CPTPP provides a more transparent and predictable trading environment for Canadian agriculture and agri‑food products, she says, through strong rules on sanitary and phytosanitary measures, technical barriers to trade and products of modern biotechnology. And the CPTPP will allow Canadian companies to invest with greater confidence in Peru, she notes, offering them strengthened protections from unfair and discriminatory treatment.

New commitments on temporary entry will make it easier for certain categories of Canadian business‑persons to temporarily work in Peru, she says, including high‑skilled Canadian professionals and technicians, as well as their spouses.

Bergeron‑Laliberté says companies interested in such issues in CPTPP markets like Peru can get all kinds of assistance from the TCS. There are also programs like CanExport SMEs that can help them adapt their products and services to local markets.

She encourages entrepreneurs interested in coming to Peru to do initial research, have a concrete plan and contact the TCS. “We are here to guide you and offer a frank and honest assessment of the market potential and opportunities for your products and services in Peru. Come and talk to us!”

Bergeron‑Laliberté promises companies “unvarnished discussions” of the challenges and possibilities in Peru. For instance, having Spanish language capabilities “is a must”, as is and finding a local partner, she adds, “and we can help find one.”