Wednesday 23 October 2019

Exporters boosted by Canadian trade deal

Business Minister Pat Breen. Picture: Steve Humphreys
Business Minister Pat Breen. Picture: Steve Humphreys

Lizzie Curran

The recent visit to Toronto by Minister of State for Trade, Employment and Business Pat Breen highlighted the increasing volume of trade between Ireland and Canada.

It also delivered a strong message to Irish companies looking to grow their business overseas: the Great White North is now far more attractive to exporters.

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There are a number of reasons for this, including the fact that Canada offers a stable, growing economy.

It has deep connections with Ireland and is home to a sizeable Irish diaspora. Some 14pc of Canada's population claims Irish roots, statistically more than that of the United States.

The relationship between the countries is enhanced by increasingly excellent flight connections. Most recently, these have included a new Dublin to Calgary direct service, in addition to existing flights to Toronto, Montreal, Vancouver and Halifax.

Canada is performing well economically, having avoided the travails of the Great Recession of a decade ago. Of particular interest to Irish exporters are its rapidly-growing city economies.

Indeed, Toronto was recently ranked the fastest-growing city in North America. In 2017, it added the greatest number of technology jobs of any city in North America, beating Silicon Valley.

Enterprise Ireland has witnessed this trend first-hand. Last year, companies we support continued to see growth in the Canadian market, reaching a record €348m in exports.

This included particularly strong results in sectors such as digital technologies, fintech, education, life sciences and industrial products.

Canada is now a top 10 market for Irish companies. In fact, it is the second-largest market outside of Europe for Enterprise Ireland-backed companies - second only to the US - in core areas of ICT and advanced manufacturing.

A key factor influencing this increase in trade has been the introduction of the Comprehensive Economic Trade Agreement, or Ceta, in September 2017.

The agreement resulted in the removal of tariffs for around 98pc of goods traded between Canada and the EU. For example, tariffs on apparel have been eliminated, in some cases taking tariffs of more than 20pc away from products entering Canada.

This is another sector where Enterprise Ireland-backed companies have seen growth. In 2018, our apparel segment grew by 23pc year-on-year. Direct feedback from Irish companies tells us that Ceta is helping them to retain customers, sell more to existing customers and find new buyers attracted by the removal of tariffs.

During his visit, Mr Breen met a range of Irish companies showing significant growth in the Canadian market across key sectors including technology (IoT, security, fintech), construction, education and retail.

They described how Ceta has positively influenced their exporting ability, not only through tariff reduction but also due to the greater ease of doing business that it facilitates.

Sinead Clarke, owner of the Irish Design House Store in Toronto, has been importing Irish apparel and giftware brands for the past five years and currently sells 80 Irish brands in her store.

She described how Ceta has greatly increased the attractiveness of Ireland as a market from which to import goods for Canadian retailers.

"A tariff of close to 20pc on wool textiles was eliminated, which was a huge advantage for me when importing," she said.

"This helps the Irish supplier and it helps the Canadian retailer to offer good value to the customer."

Other benefits experienced by Irish exporters as a result of Ceta arise in relation to procurement. Ceta facilitates easier access to public procurement, enabling Irish firms to bid for public contracts.

It also helps in relation to staffing. Ceta reduces the restrictions on EU professionals working in Canada, notably intra-company transferees.

Finally, it is helpful in relation to coordinating testing and certification procedures. A range of goods now have fewer administrative hurdles to overcome, such as the need to be 'double tested' on both sides of the Atlantic.

This move is particularly beneficial to smaller companies.

If Irish companies have ever asked 'O Canada?', the answer is clearly now 'O for opportunity'.

Lizzie Curran is a market executive for Canada with Enterprise Ireland.

Sunday Indo Business

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