CKFTA

1. Tariff Elimination and Market Access

• High level of tariff removal: Canada committed to eliminate 97.8% of tariffs on imports from South Korea, while South Korea committed to remove 98.2% of tariffs on imports from Canada.

• Sector-specific benefits:

  • Automobiles: Canada agreed to phase out tariffs on South Korean vehicles within two years.

  • Agriculture: South Korea will eliminate its 40% tariff on Canadian beef over 15 years, creating long-term export opportunities for Canadian ranchers.

• Resource trade: Canada’s exports of energy, minerals, forestry products, and agricultural goods gain improved access to South Korea’s dynamic market.

2. Strategic Importance and Economic Impact

• First Asia-Pacific agreement: The CKFTA marked Canada’s entry into Asia-Pacific trade liberalization, helping offset earlier competitive disadvantages created by South Korea’s trade deals with the EU and the U.S.

• Bilateral trade growth: The agreement set the stage for stronger flows of goods and services — from Canadian natural resources and food products to South Korean automobiles, electronics, and machinery.

• Dispute resolution: To address industry concerns, the agreement includes a streamlined process to resolve trade disputes — particularly in the automotive sector — within 177 days.

• Investment opportunities: With barriers reduced, both countries have strengthened prospects for cross-border investment in manufacturing, energy, and technology.