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Free Trade Area of the Americas
(FTAA) |
Current FTAA Negotiations
Frequently-Asked Questions
What is the Free Trade Area of the Americas (FTAA) and how did
it start?
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The idea of the FTAA was conceived in 1994. Negotiations started
in 1998, with the goal of concluding an agreement by January
2005. The 34 democratic countries of the hemisphere are participating
in the negotiations.
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The proposed FTAA is an integral part of the broader Summit
of the Americas process, complementing such Summit objectives
as strengthening democracy, promoting human rights and finding
ways to address a range of social and economic issues through
hemispheric co-operation.
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The FTAA is perhaps the most visible element of the Summit
process, but its principal objectives of growth and development
through enhanced economic integration are ultimately intended
to reinforce the Summit’s broader objectives.
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Canada hosted the Third Summit of the Americas in Quebec City
in April 2001, and continues to play a significant role in the
broader Summit process, most notably by forging consensus among
the 34 members of the Organization of American States (OAS)
on the holding of a Special Summit of the Americas, which will
take place in January 12-13, 2004 in Mexico.
What are Canada's objectives for the FTAA Ministerial in Miami?
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Canada will be seeking guidance and instructions from Ministers
in support of a comprehensive, high-quality agreement that reaffirms
the January 2005 deadline for the completion of the negotiations.
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In addition, Canada will continue to promote transparency
and accountability in the FTAA. For the third time, we will
be seeking the agreement of the 34 Ministers to make public
the latest version of the draft negotiating text.
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Canada will also continue to pursue linkages between the FTAA
process and elements of the broader Summit agenda, including
labour and environment.
What is the status of FTAA negotiations?
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Considerable progress has been made to date. Nevertheless,
much work remains.
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Canada remains strongly committed to the FTAA process and
to negotiating, multilaterally, by January 2005, a comprehensive
and high quality agreement, which is compatible with the WTO.
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A comprehensive agreement refers to coverage of all nine subject
areas originally mandated by Ministers, including the elimination
of tariffs and trade barriers for agricultural and non-agricultural
goods, and broad market access provisions for services, investment
and government procurement.
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We are also seeking parallel agreements on labour and environment,
and to include appropriate environmental provisions in the FTAA
itself.
What are the benefits of the FTAA to Canada?
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The Americas region represents Canada’s most important
market, and strengthening our economic ties with the region
through the FTAA is a high trade policy priority.
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The FTAA would create the world’s largest free trade
area. With a combined gross domestic product (GDP) of more than
$20.1 trillion, the FTAA would constitute about 40 percent of
the world’s economic activity.
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With international trade accounting for over 40 percent of
Canada’s economy, we must grasp this opportunity to seek
improved access to the growing markets of the region, to the
benefit of Canadian consumers and businesses, both small and
large.
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The FTAA would provide rules that create a stable and predictable
environment, which will encourage investment throughout the
hemisphere.
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As in past negotiations, Canada will preserve its ability
to maintain or establish measures in sectors such as health,
public education and social services.
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Canada’s position is very clear: health, public education,
social services are not negotiable.
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Canada will also maintain its ability to protect the Canadian
environment.
What benefits will the FTAA bring to smaller economies?
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For small and emerging economies, the FTAA holds the promise
of achieving sustainable economic growth and reinforcing their
comparative advantage.
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We recognize the particular challenges of smaller economies
and support the provision of technical assistance, and, on a
case-by-case basis, the inclusion of measures in the FTAA to
ease the transition of smaller economies, provided these are
specific and time-limited.
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In June 2003, Canada announced that it will contribute $24
million to the Hemispheric Cooperation Program (HCP) to respond
to trade-related technical assistance and capacity building
needs as identified by participating countries themselves.
Is the Government negotiating away our health care system (medicare)?
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Canada will not negotiate on health care in any of our trade
initiatives.
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Canada's trade obligations do not require us to privatize
our health care system.
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Whether and to what extent Canadian governments reform their
health care systems is for Canadians themselves to decide.
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We have preserved full policy flexibility for health care
in all of our trade agreements. Canadian governments are free
to maintain the programs, or make the reforms, that Canadians
deem appropriate.
Will the FTAA negotiations affect the WTO TRIPS and access to
medicines agreement?
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Canada is very pleased with the August 30, 2003 decision of
all World Trade Organization (WTO) Member countries regarding
the Agreement on Trade related Aspects of Intellectual Property
Rights (TRIPS) and public health.
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This historic decision will allow poor, developing countries
to better access the medicines they need to treat serious public
health epidemics like HIV/AIDS. At the same time, it will assure
intellectual property protection essential for the ongoing development
of new and better drugs.
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Canada will ensure that the FTAA Agreement does not create
an impediment to the implementation of the August 30, 2003 WTO
decision in the Hemisphere.
Does Canada support the inclusion of health, public education
and social services in the FTAA negotiations?
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No. Canada's position on these issues is very clear: health,
public education and social services are not negotiable.
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As is the case in the NAFTA, Canada will preserve its right
in the FTAA to adopt or maintain any measure for health, public
education and social services that has a public purpose.
Will the FTAA services negotiations threaten Canada's ability
to pursue cultural policy objectives?
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Canada is committed to maintaining flexibility to pursue its
domestic cultural policy objectives in the FTAA negotiations.
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Pending the development of a new legal instrument on cultural
diversity, Canada's position is to continue its traditional
approach to bilateral and regional agreements and seek a general
exemption for culture as in its free trade agreements with Chile,
Israel and Costa Rica.
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This new international instrument on cultural diversity would
set out clear ground rules allowing states to maintain policies
that promote their cultures while also respecting the rules
of the international trading system and ensuring markets for
cultural exports.
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The FTAA is one of many important fora in which Canada can
promote a coherent approach to multilateral efforts undertaken
to ensure cultural diversity.
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Canada has proposed language for the FTAA preamble that recognizes
the importance of cultural diversity and has encouraged FTAA
countries to involve themselves in the process of developing
a new Convention on cultural diversity that is now underway
in the United Nations Educational, Scientific and Cultural Organization
(UNESCO).
Do investment rules give special rights to foreign companies?
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No. Investment rules do not exempt foreign investors from
domestic laws of the host country.
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Foreign investors are required to obey all Canadian laws and
regulations (e.g., labour and environmental standards).
What is Canada’s position on investor-state dispute settlement
in the FTAA negotiations?
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Canada supports effective investment protection provisions,
and transparent and efficient dispute settlement procedures
in the FTAA.
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Canada continues to collaborate with its NAFTA partners to
promote clarity and transparency in the investor-state dispute
settlement procedures.
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Canada will work to ensure that the FTAA investment chapter
incorporates these improvements.
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Free trade agreements and investment-protection agreements
generally provide for a mechanism for the settlement of investment
disputes. Such a dispute settlement mechanism is essential and
ensures that disputes are settled on the basis of mutually agreed
rules, rather than through size or political might.
Will the FTAA result in lower environmental
standards?
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Canada is undertaking a national environmental assessment
of the FTAA negotiations. The assessment takes into account
Canada’s framework of policies and legislation for the
protection of the environment.
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Canada will retain the right to maintain strong environmental
policies and regulations in the FTAA. Based on the Initial environmental
assessment, the FTAA's environmental impacts are expected to
be minimal.
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Canada has negotiated environmental co-operation agreements
alongside the NAFTA and its free trade agreements with Chile
and with Costa Rica. These agreements promote mutually supportive
trade and environment policies and sound environmental management
through a combination of national obligations and commitments
to environmental cooperation and capacity building.
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Canada is seeking a parallel agreement on environment, and
to include appropriate environmental provisions in the FTAA
itself.
Will Canada’s FTAA obligations cover bulk water?
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Nothing in any of Canada’s international trade obligations
affects Canada’s ability to regulate water as a natural
resource.
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Water in its natural state is a natural resource and is not
a good for the purposes of trade agreements. Only when water
becomes a good is it subject to trade disciplines dealing with
trade in goods.
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As is the case in the NAFTA, Canada will preserve its right
in the FTAA to enact measures to protect the integrity and safety
of water resources.
How will the FTAA promote labour conditions, democracy
and human rights?
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The FTAA is an integral component of the Summit of the Americas
process. The FTAA process directly reinforces and complements
the objectives of the Summit, including by helping to raise
living standards and improve working conditions in the Hemisphere.
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Canada has been at the forefront of addressing social issues
in tandem with trade liberalization, for example through our
positive experience with agreements on labour and environment
alongside free trade agreements such as the NAFTA and Canada
Chile. These models are relevant to the FTAA process.
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Canada is of the view that there is a relationship between
the FTAA and the Inter-American Democratic Charter, and is considering
ways to give this relationship effect.
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At the Quito Ministerial last year, Ministers asked to receive
a report of the Working Group on Labour Dimensions on the Summit
of the Americas, which had been established by the Inter American
Conference of Ministers of Labour to examine, among others,
questions of globalization related to employment and labour.
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Ministers of Labour for Canada, Mexico and Brazil have agreed
to present the report to the Trade Ministers in Miami. Canada
is pleased with this development as it underscores the important
relationship of trade and labour issues.
How has the outcome of the WTO Ministerial in Cancún
affected the FTAA negotiations?
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There are connections between the negotiating agenda for the
WTO and FTAA, but it is too early to determine the impact of
the Cancun Ministerial on the FTAA.
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While the cornerstone of Canada's trade policy agenda remains
the WTO, we believe that the FTAA can yield trade and investment
benefits faster in the short term than the WTO at this time.
Are Canadians being kept in the dark on the FTAA negotiations?
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No. Openness and transparency are fundamental to the way in
which Canada approaches trade negotiations.
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Canada’s position for all trade negotiations is developed
by the Government of Canada in partnership with provincial and
territorial governments, and reflects the results of extensive
consultations with Canadian stakeholders, including Parliamentarians
and citizens.
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These consultations are an important part of the Government’s
overall commitment to ensure that Canada’s position continues
to reflect the interests of all Canadians.
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Canada’s position and proposals in each negotiating
area can be found on the Department of Foreign Affairs and International
Trade’s FTAA web site.
How is Canada promoting openness in the FTAA negotiations?
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Canada championed the creation of the FTAA Committee of Government
Representatives on the Participation of Civil Society, which
plays an important role at the hemispheric level in bringing
the views of civil society directly to the attention of negotiators
and trade ministers.
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Canada successfully pushed for the public release of the first
and second versions of the draft consolidated text of the FTAA
Agreement, and will seek the same at the Miami Ministerial.
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Canada’s long-standing efforts to instil a new culture
of transparency in trade negotiations are taking hold in the
region.
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