Canada and Ecuador team up to explore free trade deal

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Commerce Minister Mary Ng said she and her Ecuadorian counterpart have agreed to explore the possibility of a free trade deal between the new countries, the latest example of the Canadian government’s attempts to reduce its reliance on trade with the United States and China. to decrease.

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Ng made the announcement from Mexico City on Nov. 24. She and Ecuador’s Commerce Minister Julio José Prado attend a summit of the Pacific Alliance, a trade bloc made up of four Latin American countries with histories of openness to freer markets: Chile, Colombia, Mexico and Peru.

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Ecuador, a Pacific country of about 18 million people bordering Colombia and Peru, is expected to join the group by the end of the year. Meanwhile, Canada has been negotiating a trade deal with the Pacific Alliance since 2017. an effort to “modernize and streamline our existing agreements” and “expand elements of these existing bilateral agreements”.

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The talks with Ecuador come amid a sort of reset of Prime Minister Justin Trudeau’s trade policy after years of clashes with the world’s major economies. Trudeau’s attempt to sign a free trade deal with China after first being elected in 2015 ultimately failed, and he then spent nearly two years negotiating a new North American free trade deal after former President Donald Trump threatened to end the Canadian privileged access to the largest economy in the world.

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Ecuador is small and relatively poor, with a gross domestic product per capita of $6,000, according to the World Bank.

But commercial relations with Canada are on the rise. Canadian direct investment in Ecuador has tripled over the past five years to more than $3.7 billion by 2021, while bilateral trade in goods has exceeded $953 million. Ecuador mainly supplies Canada with agricultural products, including wheat, tropical fruits and flowers, while Canada supplies oats, lentils, wheat, peas and barley.

Ecuador plans to open a new trading office in Ottawa on Dec. 1, the press release said.

In the coming weeks, Canada will consult with Canadians to see what they think of a free trade agreement between Canada and Ecuador.

“Canada and Ecuador are important commercial partners in the hemisphere and share commitments to democracy, human rights and the international rules-based system,” the press release said.

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