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Cablegate: Canada and Jordan Agree to Negotiate a Free Trade

VZCZCXRO4185
PP RUEHGA RUEHHA RUEHQU RUEHVC
DE RUEHOT #0272 0522210
ZNR UUUUU ZZH
P 212210Z FEB 08
FM AMEMBASSY OTTAWA
TO RUEHC/SECSTATE WASHDC PRIORITY 7350
INFO RUEHAM/AMEMBASSY AMMAN PRIORITY 0078
RUCNCAN/ALL CANADIAN POSTS COLLECTIVE

UNCLAS OTTAWA 000272

SIPDIS

SIPDIS

STATE FOR WHA/CAN, NEA/ELA, AND EEB/TPP
STATE PASS USTR

E.O. 12958: N/A
TAGS: ETRD ECON CA JO
SUBJECT: CANADA AND JORDAN AGREE TO NEGOTIATE A FREE TRADE
AGREEMENT


1. (U) Summary: Canada has announced it is launching
negotiations with Jordan on a free trade agreement (FTA).
Negotiations are to begin in April in Amman. If concluded,
the agreement would be Canada,s first FTA with an Arab
country. Canada hopes the FTA would serve as a gateway to
other Middle Eastern and North African markets. End Summary.

2. (U) On February 20, Trade Minister Emerson announced the
launch of negotiations toward a free trade agreement between
Canada and Jordan. The first round of negotiations is
planned for Amman in April. The talks will cover a wide
range of issues, including trade in goods, rules of origin,
customs procedures, trade facilitation, monopolies and state
enterprises, dispute settlement and institutional provisions.
Canada will also seek to address labor- and
environment-specific issues through the negotiation of
parallel agreements in these fields.

3. (U) DFAIT believes that Jordan's expanding economy
provides opportunities for Canadian exporters in
manufacturing, agriculture and food, and forest products. An
agreement would also better position Canadian business
vis-a-vis competitors, such as the U.S. and the EU, which
already have FTAs with Jordan. An FTA would build on the
bilateral Air Services Agreement announced in July 2007 as
well as the Foreign Investment Promotion and Protection
Agreement (FIPA) negotiations which concluded in June 2007.

4. (U) The upcoming FTA talks had their genesis during Prime
Minister Harper's July 2007 visit to Jordan when he and King
Abdullah announced that both governments would begin studying
the feasibility of negotiating an FTA. During the fall the
Canadian government conducted a domestic consultation
process, which indicated support for the FTA. Canadian and
Jordanian officials then had exploratory discussions in
November.

5. (U) Canadian-Jordan trade flows are modest. In 2007,
Canada exported C$60.4 million in goods to Jordan, mostly
forest products, agriculture and agri-food products, and
machinery. Imports from Jordan were even less - C$16 million
last year, comprised mainly of apparel and agricultural
products.

6. (U) Canada has FTAs in force with the U.S. and Mexico
(NAFTA), and with Chile, Israel, and Costa Rica. In 1999 it
also concluded a "Framework for Economic Development" with
the Palestine Liberation Organization on behalf of the
Palestinian Authority. Several years ago, however, Canada
lost interest in FTAs, concentrating instead on multilateral
trade discussions, such as Doha. However, in 2006, after
Doha's prospects faded and seeing its major trading partners,
including the U.S. and EU, negotiate many FTAs, Canada
decided to re-energize its FTA efforts. It recently
concluded FTA negotiations with Peru and signed an agreement
last month with the European Free Trade Association countries
of Iceland, Liechtenstein, Norway, and Switzerland (after
more than a decade's effort). Besides Jordan, Canada has
ongoing FTA negotiations with Colombia, South Korea, the
Caribbean Community, the Dominican Republic, Singapore, and
four Central American countries.

Visit Canada,s Economy and Environment Forum at
http://www.intelink.gov/communities/state/can ada

WILKINS

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