Minister Optimistic About Canada-Israel Trade Relationship

Oct. 14, 2020

By RON CSILLAG

Mary Ng is bullish on Israel, and says she has her reasons.

Not only has the Canada-Israel Free Trade Agreement (CIFTA) seen the value of trade between the two countries triple – nudging $2 billion in 2018 – but the recently revised agreement puts both nations on surer footing in a changing business environment.

CIFTA came into force in 1997, and Ng, Canada’s Minister of Small Business, Export Promotion and International Trade since 2018, calls the deal “heartwarming” because it was first free trade agreement Canada signed with a partner outside North America.

Minister Mary Ng

That, Ng said, “says a lot about the Canada-Israel relationship.”

In 2018, the two nations updated the agreement to provide better access to each other’s markets, but also to include terms for gender equality, corporate responsibility, and environmental and labour protections, among other modernizing provisions.

Other new provisions are aimed at reducing red tape for businesses, increasing transparency in regulatory matters, and establishing mechanisms for resolving disputes over non-tariff barriers.

Ng granted the CJR an interview on the recent first anniversary of the modernized agreement having taken effect.

She emphasized that the revised CIFTA will benefit female-owned and small businesses in both countries, and that it also addresses corporate social responsibility.

“These are areas that really are important to both countries, and the modernized trade agreement lends itself to work that is a lot more inclusive than ever before,” Ng said.

With the COVID pandemic, it’s even more important, she said.

“You can’t use COVID as an excuse to stop trading and to look inward. In fact, we need to make sure there are multilateral trading systems [that] continue to work for our economy and people, and that we do have to make a deliberate effort to ensure that those systems are working for our businesses.”

Neither is it just about removing tariffs, she added.

“Israel is known to be a start-up nation and there are incredible innovations and great companies [there]. Canada has done a lot of investing in innovative start-up companies, so this agreement really provides an opportunity for those kinds of synergies.”

Indeed, science and technology are “significant drivers of the Israeli economy,” notes a federal government website profiling business opportunities in the Jewish state. Canada, Ontario and Quebec maintain active science and innovation agreements with Israel, providing more than $13 million in annual funding for research and technology commercialization, it adds.

From 2016 to 2018, Canada’s top merchandise exports to Israel were aircraft and parts; industrial machinery; precious stones and metals; electrical and electronic equipment; and scientific and precision instruments.

In the same period, this country’s leading merchandise imports from Israel were, in order of value, industrial machinery; electrical and electronic equipment; scientific and precision instruments; pharmaceutical products; and precious stones and metals.

In tourism, Canada welcomed 68,053 visitors from Israel in 2018, while in 2016, nearly 100,000 Canadians travelled to Israel, according to the government website.

The website adds that the best opportunities for Canadian investors are in the following Israeli sectors: Aerospace and defence; agriculture and agri-food; clean technologies; education; information and communications technologies; and health and life sciences.

Under the modernized CIFTA, nearly all Canadian agriculture, agri-food, and fish and seafood exports to Israel benefit from preferential tariff treatment.

Asked to name a Canadian success story in the bilateral relationship, Ng mentioned LED Roadway Lighting Ltd. in Halifax, a Canadian-owned and operated clean technology company that designs and manufactures energy-efficient LED streetlights and adaptive control solutions.

“Thanks to CIFTA,” said Ng, the company has sold more than 10,000 smart street lights to Israel – from Ashdod to Tel Aviv – 2,000 of which are connected to a wireless network that can be controlled remotely. The Canadian company’s products also light airport runways in Israel, she added.

It’s a “tangible example that demonstrates the real business environment.”

Another example, Ng noted, is SodaStream, an Israeli success story globally. Canada is the company’s fourth-largest market in the world, and last year, it opened a plant in Mississauga, Ont., where spent carbonators are recharged, creating about two dozen jobs.

When it comes to trade, Ng said she takes the long view.

“I tend to always talk about trade agreements as being infinite,” she said, “of helping businesses grow, and that growth leads to jobs, and jobs lead to prosperity.”

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On Oct. 12, Ng spoke with Amir Peretz, Israel’s Minister of the Economy and Industry.

According to a news release from Global Affairs Canada, the two discussed the ongoing collaboration between Canada and Israel in response to COVID, including efforts to support economic recovery for workers and businesses in both countries.

“The ministers exchanged views on how to deepen the Canada-Israel trade partnership, which is led by engagement in science, technology and innovation and strengthened by the modernized Canada-Israel Free Trade Agreement (CIFTA),” the statement read.

Ng highlighted CIFTA’s potential to advance the Canada-Israel partnership in the years ahead and reviewed ongoing joint work in implementing parts of the agreement that will ensure that the benefits of trade are more widely shared by people in the two countries. These include strong provisions on gender and small businesses, as well as high standards for labour and the environment.

Ng also “emphasized Canada and Israel’s steadfast friendship, as well as Canada’s continued commitment to strengthening all aspects of the relationship while supporting deeper trade ties, economic recovery, and growth in both countries.”