Manufacturing AUTOMATION

Ontario worried about impact of South Korean free trade deal on auto sector

March 11, 2014
By The Canadian Press

Ontario is expressing concern about “the potential for serious negative impacts” from Canada’s new free trade deal with South Korea when it comes to the province’s auto sector.

Economic Development and Trade Minister Eric Hoskins says two years isn’t enough time for domestic automakers to adjust to the removal of Canada’s 6.1 per cent tariff on imports of Korean cars.


Ontario told the federal government during the free trade negotiations that it needed the longest-possible phase-out period for the tariff, up to seven years.


The U.S. negotiated a five-year tariff phase-out period in its free trade deal with South Korea.

Hoskins complains Canada’s deal also doesn’t include the same snap-back provision the Americans negotiated that would have allowed Canada to re-impose tariffs if Korea imposes non-tariff barriers to restrict sales of Canadian cars.

He wants a task force consisting of the federal and Ontario governments and Canadian automakers that would report monthly on Korean auto imports.

Meanwhile, Ford Canada said South Korea will remain “one of the most closed automotive markets in the world,” and notes free trade deals with the U.S. and European Union “failed to reverse this one-sided automotive trade flow.”

“No Canadian manufacturer can compete with a market controlled by non-tariff barriers and currency manipulation,” said Ford president and CEO Dianne Craig.

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