The updated free trade agreement between Ukraine and Canada will enter into force on July 1. What does it mean?

The updated free trade agreement between Ukraine and Canada (CUFTA) enters into force on July 1.

This was reported in the Ministry of Economy of Ukraine.

The updated CUFTA will benefit workers, businesses and consumers in both countries, strengthening trade and economic cooperation between Canada and Ukraine.

The agreement retains the market access conditions for goods from the 2017 agreement and has been updated to include chapters on investment, services and inclusive trade.

"In the long term, the updated CUFTA will strengthen our overall bilateral economic partnership," said the joint statement of Ukraineʼs Economy Minister Yulia Svyridenko and Canadaʼs Minister of Export Promotion, International Trade and Economic Development Mary Ng.

They noted that the ministers will continue to provide additional opportunities for Canadian and Ukrainian businesses and workers to foster a strong, sustainable and inclusive economic recovery.

The Minister of Economy of Ukraine is convinced that the updated free trade agreement will strengthen trade and economic cooperation between Ukraine and Canada, strengthen the economic partnership of both countries, and promote the participation of Canadian companies in the economic recovery and reconstruction of Ukraine.

"This is without exaggeration a historical event, because this agreement is one of the most modern in the world. This is the first agreement that clearly shows that Ukraine shares the trade agenda of Canada, the USA, the EU, Japan and our other partners," Svyridenko emphasized.

According to her, the updated CUFTA is the first free trade agreement in which special attention is paid to Crimea and the Crimean Tatars and to strengthening the role of indigenous peoples in the economy and international trade. This is the basis for the economic development of Crimea after the liberation of the peninsula from the occupiers.

The agreement, in particular, provides for the liberalization of the services market according to the negative list. That is, when everything is allowed for which there are no reservations written in the agreement. And investment protection will be strengthened with new complex and modern tools. This will contribute to the maximum development of trade in services between Ukrainian and Canadian companies.

In addition, thanks to this agreement, employees of Ukrainian companies that will provide services in Canada will be able to apply for temporary entry to Canada under simplified and extended conditions.

The agreement will also help Ukraine to build a free and open digital ecosystem of the economy — this will contribute to the development of digital technologies.

For goods that are exported to Canada without duties, it will be possible to use components from the EU, Britain, Israel. This will expand Ukraineʼs involvement in global supply chains.

The issues of the environment, labor, transparency and responsible business conduct occupy an important place in the agreement.

In general, the text of the document is based on the standards of the Canada-US-Mexico free trade agreement and the Trans-Pacific Partnership agreement, to which Ukraine is preparing to join. In fact, this is a pact with partners who support Ukraineʼs trade security.

• In 2021, the volume of trade between Ukraine and Canada reached its maximum and amounted to approximately 447 million Canadian dollars. Due to a full-scale Russian invasion of Ukraine in 2022, the volume dropped to 422 million Canadian dollars. However, already in 2023, trade has increased by more than 55% to 695 million Canadian dollars, mainly thanks to Canadian exports of military equipment to Ukraine.
• Only in the first four months of 2024, the growth of Ukrainian exports to Canada was recorded — it increased by 2.8 times, to $66 million.