Ontario worries South Korean deal will harm auto sector

The Canadian Press
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Ontario is worried about “the potential for serious negative impacts” from Canada’s new free trade deal with South Korea on the province’s automakers, Economic Development and Trade Minister Eric Hoskins said Tuesday.
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, Hoskins said in reaction to the deal announced in Seoul by Prime Minister Stephen Harper.

“Our government remains very concerned regarding the potential for serious negative impacts this agreement could have on Ontario’s auto sector,” he said.

“The province and the auto sector have repeatedly expressed that without sufficient safeguards, this agreements creates an unequal playing field between South Korean and Canadian car manufacturers.”

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

Hoskins complained that Canada’s deal also doesn’t include a provision that would have allowed Ottawa to reimpose tariffs if South Korea imposes non-tariff barriers to restrict sales of Canadian cars in their market.

“I am also disappointed that the federal government, despite our repeated requests, was unable to secure the same snap-back provisions that the U.S. negotiated through its deal with South Korea,” said Hoskins.

He called for a task force consisting of the federal and Ontario governments and Canadian automakers that would report monthly on the level of Kia and Hyundai vehicles imported from Korea.

“To protect the hundreds of thousands of families that directly and indirectly depend on auto sector jobs for their livelihoods, the province is calling for the establishment of a task force to monitor the implementation of this agreement,” said Hoskins.

Hoskins did acknowledge that the new trade pact would benefit other sectors of Ontario’s economy, saying it contains “positive measures that will open new markets to a variety of industries, particularly the agriculture and food processing sectors.”

Ontario’s Progressive Conservatives welcomed the free trade deal with South Korea negotiated by their federal cousins.

“Anything that assists in growing jobs and the flow of goods is a good thing,” said PC critic Lisa Thompson. “I have every confidence in our federal government that we are going to benefit from this.”

While the New Democrats said the Korean free trade deal would open up new markets for Ontario ice wines and pork, they warned it was “a blow” to the province’s auto sector.

“It is starting to seem like Ottawa and Ontario are prepared to kill off good auto jobs in this province,” said NDP economic development critic Catherine Fife.

 

—By Keith Leslie

Organizations: Progressive Conservatives, Hyundai

Geographic location: Ontario, South Korea, U.S. Ottawa Canada Korea

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Recent comments

  • steve
    March 12, 2014 - 15:38

    New Veteran : you are 100 % correct. The CORRUPT ONTARIO LIBERALS have ruined Ontario with their Green Energy Act.After 7 years in Ontario,we left.I pity Newfoundland and Canada if they re elect tax and spend lioberals. As for the auto sector,they were looking for any reason to leave Ontario,now they got it.

  • saelcove
    March 12, 2014 - 10:11

    It cost more to build cars in south Korea and and the healthcare the receive the caw could only dream

  • New Veteran
    March 12, 2014 - 07:23

    The Feds are not the ones killing jobs in Ontario. The McGuinty/Wynne Liberals created Hydro rates that manufacturers won't pay. So, manufacturing jobs are moving out of Ontario as fast as they can. One small company saved $1 Million a year in Hydro costs by moving to Manitoba. This will just ensure the car makers make their decisions faster. The Liberal policies that created a Hydro surplus in Ontario without adding any production, did so by driving out the jobs that consumed the Hydro. Now they are being called on it and want to deflect the blame somewhere else.