Benefits of the CPTPP for Ontario
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a trading block that represents 580 million people with a combined gross domestic product of CAD $19 trillion – a full 15.6% of global GDP. Through the CPTPP, Canada has preferential access to more than half a billion consumers in the world’s most dynamic and fast-growing market – a move that will strengthen Canadian businesses, grow the economy, and create more well-paying jobs for middle class Canadians.
Main advantages for Ontario
- Tariff elimination: The CPTPP will provide new opportunities for Ontario exporters by eliminating tariffs on almost all of the province’s key exports, including:
- agricultural and agri-food products (dried beans, wheat, dog and cat food, processed foods, and sugar and chocolate confectionery)
- industrial goods (chemicals and plastics, vehicles and automotive parts, industrial machinery, and information and communications technology)
- metals and minerals (nickel and diamonds).
- Services exports: The CPTPP will provide more transparent and predictable access for services suppliers in key sectors, including financial, professional, environmental, construction, and research and development services.
- Temporary entry: The CPTPP will provide improved market access commitments for the temporary entry of high-skilled Canadian business professionals.
- Reduced non-tariff barriers: The CPTPP includes strong provisions on non-tariff measures, backed up by fast and effective dispute settlement provisions.
- Government procurement: The CPTPP establishes rules to ensure that Canadian suppliers of goods, services and construction services have access to open, fair and transparent government procurement processes.
- Investment: The CPTPP includes predictable, non-discriminatory rules for Canadian investors.
Ontario – Indo-Pacific trade snapshot
Ontario Merchandise Exports to CPTPP Markets (2015-2017 average)
Text version
Top Ontario Merchandise Exports to CPTPP Markets (2015-2017 average)
- Total: $7,029,527,091
- Vehicles and Vehicle Parts: $1,621,654,393
- Industrial Machinery: $1,058,939,377
- Agricultural Goods: $907,398,634
- Metals and Minerals: $725,538,007
- Consumer Electronics and Appliances: $678,555,092
- Medical Goods: $645,031,817
Opening new markets for exports from Ontario to Indo-Pacific countries
The elimination of tariffs will help make exports from Ontario more price-competitive in CPTPP markets. Examples of Ontario products that will benefit from improved access include the following:
Vehicles and automotive parts products
Passenger vehicles
- In Malaysia, tariffs of up to 30% will be eliminated within 12 years.
Automotive parts
- In Vietnam, tariffs of up to 50% will be eliminated within 10 years.
- In Malaysia, tariffs of up to 30% will be eliminated within 10 years.
- In New Zealand, tariffs of up to 10% will be eliminated within seven years.
- In Australia, tariffs of up to 5% will be eliminated within three years.
Metals and minerals products
Nickel
- In Japan, tariffs of up to 11.7%, or 44 yen/kilogram (kg), whichever is less, will be eliminated within 10 years.
Diamonds
- In Brunei, tariffs of 5% will be eliminated upon the Agreement’s entry into force.
Agricultural and agri-food products
Dried beans
- In Japan, in-quota tariffs of 10% will be eliminated upon the Agreement’s entry into force.
- In Vietnam, tariffs of up to 10% will be eliminated within two years.
Wheat
- In Japan, Canada will have access to a country-specific quota for food wheat that starts at 40,000 tonnes and will grow to 53,000 tonnes within six years. Mark-ups within this country-specific quota will be reduced by 45% or 50%.
- In Vietnam, tariffs of up to 5% on all wheat products will be eliminated upon the Agreement’s entry into force.
Dog and cat food
- In Japan, tariffs of more than 36 yen/kg will be eliminated upon the Agreement’s entry into force.
- In Vietnam, tariffs of up to 7% will be eliminated upon the Agreement’s entry into force.
Processed foods
- In Japan, tariffs range from 5% to 29.8% (plus a specific tariff of 1,155 yen/kg). The CPTPP will provide significantly improved access to this market through a combination of phase-outs, reductions and quotas.
- In Vietnam, tariffs of up to 25% will be eliminated within five years.
- In Malaysia, tariffs of up to 20% will be eliminated upon the Agreement’s entry into force.
- In Australia, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
Sugar and chocolate confectionery and food preparations containing cacao
- In Japan, Canadian exports of sugar and chocolate confectionery, and food preparations containing cacao, currently face tariffs of up to 23.8% (plus a specific tariff of 679 yen/kg). The CPTPP will improve access through a combination of phase-outs, reductions and quotas.
- In Vietnam, tariffs of up to 25% will be eliminated within six years.
- In Malaysia, tariffs of 15% will be eliminated upon the Agreement’s entry into force.
- In Australia, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
- In New Zealand, tariffs of up to 5% will be eliminated within five years.
Industrial machinery products
Pumps for liquids
- In Vietnam, tariffs of up to 24% will be eliminated within three years.
- In Malaysia, tariffs of up to 25% will be eliminated within five years.
- In Australia, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
- In New Zealand, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
Taps, cocks and valves for pipes and boilers
- In Vietnam, tariffs of up to 20% will be eliminated within three years.
- In Malaysia, tariffs of up to 25% will be eliminated within five years.
- In Australia, tariffs of up to 5% will be eliminated within three years.
- In New Zealand, tariffs of up to 5% will be eliminated within seven years.
Moulds and machinery for manufacturing rubber or plastics
- In Australia, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
- In New Zealand, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
Information and communications technology products
Certain types of headphones, loudspeakers and microphones
- In Vietnam, tariffs of up to 24% will be eliminated within three years.
- In Malaysia, tariffs of up to 15% will be eliminated upon the Agreement’s entry into force.
- In Australia, tariffs of up to 5% will be eliminated upon the Agreement’s entry into force.
- In New Zealand, tariffs of up to 5% will be eliminated within seven years.
- In Brunei, tariffs of up to 5% will be eliminated within seven years.
Certain types of monitors and projectors
- In Vietnam, tariffs of up to 37% will be eliminated within three years.
- In Malaysia, tariffs of up to 30% will be eliminated within two years.
Chemicals and plastics products
Ethylene polymers
- In Japan, tariffs of up to 6.5% or 22.40 yen/kg, whichever is less, will be eliminated upon the Agreement’s entry into force.
- In Malaysia, tariffs of up to 15% will be eliminated within five years.
Opening new markets for exports of services from Ontario to Indo-Pacific countries
The CPTPP provides Ontario’s services suppliers with greater predictability and enhanced market access across a broad range of sectors, including the following:
- professional services (e.g. legal, engineering and architectural) and transport services in all 10 CPTPP export markets
- computer-related services in Australia, Chile, Malaysia, and Mexico
- research and development in Australia, Chile, Japan, Malaysia, New Zealand, Singapore and Vietnam
- construction services in Australia, Mexico, New Zealand and Vietnam
- education services in Malaysia, New Zealand, Singapore and Vietnam
- environmental services in Australia, Brunei, Japan, Malaysia, Mexico, New Zealand, Peru and Vietnam
- mining-related services in Brunei, Chile, Malaysia and Singapore
- services incidental to energy distribution in Brunei, Chile, Malaysia, New Zealand and Singapore
- financial services in Malaysia, Vietnam and Singapore.
Ontario telecommunications services providers can expect the regulatory authorities of CPTPP countries to act impartially and in a transparent fashion.
Ontario enterprises that engage in electronic commerce as a means of trade will benefit from trade rules such as the prohibition on applying customs duties to content transmitted electronically, and ensuring the protection of online personal information.
Improving temporary entry for business people
The CPTPP will improve labour mobility for highly- skilled business persons, making it easier for professionals from Ontario to provide expertise in CPTPP markets. In particular, the CPTPP facilitates the temporary entry of Canadian business visitors, intra-corporate transferees, investors, highly-skilled professionals, technicians, as well as the spouses of some of these Canadian business persons—contributing to greater certainty and predictability for prospective business entrants.
Reducing non-tariff barriers
The CPTPP includes enforceable provisions to help secure market access gains for Canadian exporters so that exporters are not undermined by unnecessary measures that restrict trade, such technical barriers to trade or sanitary and phytosanitary measures. As a result, the CPTPP will create a more predictable trading environment for Canadian exporters, without compromising the ability of the government to protect the health and safety of Canadians or safeguard animal and plant health.
Expanding access to government procurement
The CPTPP establishes clear rules to ensure that Canadian suppliers of goods, services and construction services have access to open, fair and transparent processes when bidding for procurement contracts in CPTPP countries. The Agreement expands government procurement commitments with existing free trade agreement partners, including Chile and Peru, and secures new access to procurement opportunities in Australia, Brunei, Malaysia and Vietnam.
Facilitating two-way investment between Ontario and the Indo-Pacific region
The CPTPP’s investment rules will provide greater stability and protection for investors, while preserving the rights of the federal, provincial and territorial governments to legislate and regulate in the public interest. In areas such as energy, mining, manufacturing, financial services and professional services, Canadian investors will enjoy transparent and predictable access to CPTPP markets. Strong rules will ensure that investors from Canada are treated in a fair, equitable and non-discriminatory manner, allowing them to compete on an equal footing with other investors in CPTPP countries. Canadian investors will also have access to a fair and transparent investor-state dispute settlement mechanism.
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