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Canada’s free-trade deal with Europe will smooth the movement of capital and people across the Atlantic, a benefit that could help the mining sector even more than provisions that reduce tariffs on physical metals and minerals.
While the Canada-Europe trade agreement (CETA) will reduce tariffs currently as high as seven per cent on some mineral products, there are many other ancillary benefits that are just as important, federal Minister of Natural Resources Joe Oliver told the board of the Prospectors & Developers Association of Canada on Tuesday.
The EU has promised better market access for Canadian investment, and the deal will “establishing a predictable, rules-based investment climate and provide a high standard of protection for investors,” Mr. Oliver said.
In fact, the investment environment will be improved in both directions, Mr. Oliver said, because there will be no unpleasant surprises. “There will be a sense that [investors] will be treated fairly.” Certainly in Canada, “we will see foreign direct investment increase,” he said.
The service provisions of the deal will also allow Canadian companies to sell expertise in research and development, technical testing and environmental services to European clients, he noted, and new qualification rules “will make it easier for businesspeople in the mining sector to work in the EU and Canada.”
Under current rules, most raw minerals can be exported to the EU without any duty. But value added products – such as steel and aluminum – get hit with tariffs, and these tariffs will be eliminated under CETA. Out of about $20-billion of Canadian metal and mineral products that are exported to the EU annually, only about $2-billion worth are currently subject to tariffs.
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