Canadian Prime Minister Stephen Harper and Colombian President Alvaro Uribe signed a free trade agreement between the two countries while at the Asia-Pacific Economic Cooperation meeting in Lima Friday.
The move was first announced in June, after less than a year of negotiations. The accord will make access to markets easier for the $1.14 billion in annual bilateral trade between the two countries.
"In a time of global economic instability free trade is more important than ever," Harper said in a statement.
"By expanding our trading relationship with Colombia, we are not only opening up new opportunities for Canadian businesses in a foreign market, we are also helping one of South America's most historic democracies improve the human rights and security situation in their country."
U.S. President George Bush, arriving in Lima Friday, has made a free trade agreement with Colombia a priority for his last two months in office.
President-elect Barack Obama opposed the agreement during his campaign for president, raising concerns about Colombia's human-rights record.
Ottawa says the Canada-Colombia Free Trade Agreement will provide greater market access for Canadian exporters, particular for products such as wheat, pulses, barley, paper and heavy equipment. The government also says the agreement will provide stability for businesses involved in both the manufacturing and financial services.
Foreign Affairs Minister Lawrence Cannon and International Trade Minister Stockwell Day also signed three other deals with their Colombian counterparts on labour, the environment and double taxation.
Under the labour agreement, Colombia has agreed to enforce the elimination of child labour, forced labour and workplace discrimination.
The taxation deal will eliminate double taxation for individuals and companies from one country doing business in the other.
Harper acknowledged that Colombia faces many challenges, particularly in security. Colombia is the world's biggest supplier of cocaine according to the CIA, despite efforts from both their government and the United States.
"While there is no denying that Colombians continue to live with serious security challenges, the improvements we have seen over the last several years gives us much reason for optimism," Harper said. "Deepening both economic and political engagement between our countries is the best way Canadians can support the citizens of Colombia in their efforts to create a safer and more prosperous democracy."
Facts about the free trade deal:
- Colombia is a growing economy. Its GDP growth was 7.5 per cent in 2007 and has forecasted rates of 4.7 per cent for the next five years
- Colombia will eliminate tariffs on 98 per cent of current Canadian exports immediately, or over a 5- to 10-year period.
- Colombia is an investment desitination for more than 50 Canadian companies mostly from the mining, oil exploration and manufacturing sectors.
- Top imports to Canada from Colombia include coffee, bananas, coal and fuel.
