Just weeks after Canada signed the USMCA trade deal with the US and Mexico, they were back at the trade table to join another international agreement, this time without the US.
The brand new trade deal is called the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). The deal includes 11 different countries, mostly in the Asia-Pacific region. It has been in the making for years now but was just officially agreed to by Canada and other nations like Australia and New Zealand this week.
The terms of the trade agreement are expected to go into effect in early 2019. While all the countries involved will benefit from it, Canada seems to be getting a significantly better end of the deal.
Not only does the deal give Canada easy access to hot new markets like Japan and Malaysia, but it also makes us the first major nation with free trade deals in America, Europe, and the Asia-Pacific Region.
The deal also allows for 99% free trade between Canada and the other partner nations which are Australia, New Zealand, Japan, Vietnam, Malaysia, Mexico, Brunei, Chile, Peru, and Singapore.
According to our government, the new free trade agreements will improve not only the Canadian economy but will benefit every single province and territory, too.
The positives of this agreement aren't just on a large economic scale, though - the consumers will also see some major benefits. Now that Canada will have tariff-free trading with all these countries, the costs of all goods being shipped in are going to be a lot cheaper.
For example, a car coming from Japan such as a Honda could cost $1500 less than it does right now. The lower costs will also be applied to a number of other products too, like food, specifically milk and protein, and even home-goods like furniture. This will be significant given the number of goods that are already being imported to Canada from Asia.
Beyond lowering prices on existing goods in Canada, the trade agreement opens the door for a bigger variety of goods to come in. This means that once the deal is formally in place, you could see new types of clothing, food, furniture, beauty products, and more in local stores.
Despite all the good news now, this trade deal has been years in the making and it wasn't always a smooth road. Originally, the deal was meant to include the US, as it was originally being negotiated while Barack Obama was the president. When Donald Trump took office in 2017, he pulled out of the deal.
Initially, the hope was that the CPTPP would be in place and tariffs would be lifted by January 2017. But since they had to re-negotiate without the US, the deal has just now been formally agreed upon. Hopefully, consumers will start seeing lower prices and more benefits by as early as January 2019.