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Canada has ratified the World Trade Organisation (WTO) Agreement on Trade Facilitation (TFA), which will modernize and simplify customs and border procedures.
Canada's legislation to implement the TFA received Royal Assent on December 12, 2016. The TFA is a multilateral trade agreement concluded in 2013, forming a part of the Doha Development Agenda, which would create a global free trade area.
The Canadian Government expects Canadian traders to benefit from the TFA "by expediting, streamlining, and enhancing the predictability of customs and border procedures for their exports in developing countries, which translates into lower trade costs."
According to Canada's Department of International Trade, Canadians stand to save up to CAD16bn (USD11.98bn) as a result of the reduction in bilateral trade costs. It said that the TFA will "create an environment that is easier for small- and medium-sized businesses, and particularly developing countries, to participate in international trade and global value chains."
The TFA will enter into force once it is ratified by two-thirds of WTO members. As of December 13, 2016, 102 of the required 110 WTO members had ratified the agreement.
A 2015 WTO study found that full implementation of the TFA could reduce members' trade costs by an average of 14.3 percent. It anticipates the TFA reducing the time to import goods by more than a day and a half, and the time to export by almost two days. These figures represent reductions of 47 percent and 91 percent, respectively, over the current average.
According to the WTO, the TFA also has the potential to increase global merchandise exports by up to USD1 trillion.
Chrystia Freeland, Canada's International Trade Minister, said: "Canada is delighted to ratify the trade facilitation agreement. When the costs of trade are reduced, more businesses will be encouraged to increase their exports. This contributes to economic growth for Canada and more jobs for our middle class and those working hard to join it. We look forward to the entry into force of this agreement so that its benefits can be tapped as soon as possible."
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