Question Period Note: Canada-Ukraine Free Trade Agreement

Status of Canada's trade with Ukraine since the CUFTA entered into force on August 1, 2017.

• The Canada-Ukraine Free Trade Agreement (CUFTA) entered into force on August 1, 2017, representing a significant milestone in our bilateral relationship

• CUFTA is a high-quality agreement, with outcomes that facilitate trade between Canada and Ukraine

• CUFTA demonstrates Canada's commitment to deepening trade relations with Ukraine, which can contribute to Ukraine's reform objectives, sovereignty, and economic growth

• In line with Prime Minister Trudeau and Ukrainian President Zelenskyy's agreement to expand the Agreement, Canada launched public consultations on February 15, 2020 to seek the views of Canadians on possible CUFTA modernization

Upon CUFTA's entry into force, Canada eliminated duties on 99.9 percent of imports from Ukraine. Similarly, Ukraine immediately eliminated tariffs on approximately 86 percent of Canada's exports, with the balance of tariff concessions to be implemented over seven years. The first Joint Commission meeting under CUFTA took place in Ottawa on October 19, 2018.

Since CUFTA's entry-into-force, two-way merchandise trade has grown to $346 million (2018), with Canada's merchandise exports to Ukraine reaching $220 million, and merchandise imports from Ukraine of $126 million. Canada's top four exports to Ukraine were mineral and fuel oils ($87.3 mill.), fish and seafood ($51.2 mill.), machinery ($19.9 mill.), and pharmaceuticals ($13.9 mill.).

Although CUFTA does not include chapters on services and investment, the Agreement includes a review clause whereby the Parties will undertake to review CUFTA within two years of its entry into force, with a view to extending its coverage to additional subjects, including services and investment. In the meantime, investors continue to benefit from the 1995 Canada-Ukraine Foreign Investment Promotion and Protection Agreement, while Canadian service providers benefit from Ukraine's liberal WTO General Agreement on Trade in Services commitments.

On July 2, 2019, PM Trudeau and Ukrainian President Zelenskyy agreed to discuss expanding the CUFTA. In fall 2019, officials held technical discussions on potential areas for inclusion in a modernization of the CUFTA - including investment and services. Canada launched public consultations on February 15, 2020 to seek the views of Canadians on possible CUFTA modernization.

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