The Free Trade Agreement signed earlier this year between Canada and Korea makes expansion by Korean companies into Canada much more streamlined.
International companies like Korea’s Husteel, a leading manufacturer of steel pipe, are recognizing the scope of business opportunities created by British Columbia’s emerging LNG industry .
British Columbia’s liquefied natural gas industry is attracting investment on the West Coast ahead of any of the resources coming out of the ground. Husteel, a subsidiary of Korea’s Shinan Group, has opened an office in Vancouver, British Columbia to take advantage of opportunities arising from the province’s emerging natural gas and liquefied natural gas (LNG) industry, according to the Trade and Invest British Columbia website.
International companies like Korea’s Husteel, a leading manufacturer of steel pipe, are recognizing the scope of business opportunities created by British Columbia’s emerging LNG industry. Husteel has offices throughout Korea, in Houston, TX and now in Vancouver.
The Canada-Korea Free Trade Agreement will significantly improve market access opportunities for Canada’s metals and minerals sector by eliminating tariffs on all Canadian exports, including aluminum, iron, steel, nickel, non-ferrous metals, precious gems and metals, and other mineral products.
Upon the Agreement’s entry into force, 98.7 percent of tariff lines on metals and minerals will be duty-free and all remaining tariffs will be eliminated within five years, with current duties of up to 8 percent. (Source: Foreign Affairs, Trade and Development Canada)
South Korea is Canada’s seventh-largest trading partner with commerce between the two nations totalling close to $ 11 billion in 2013. (Source: http://pm.gc.ca/eng/news/2014/09/11)
When comparing 2013 to 2014, Canadian steel and iron imports from South Korea into British Columbia have increased 10.6 percent, for a total of over $128 million. This is by far the most for any province in Canada.
In 2013, iron and steel products made up close to 7 percent of Korean imports into Canada. With Husteel opening an office in Vancouver, this leading-edge Korean company might be looking to capitalize on a reduction in tariffs and marketing their steel pipe products to Canadian businesses in a variety of sectors. Conversely, aluminum products represented only 5 percent of Canada’s exports to South Korea, and steel was not one of Canada’s exports.
“Vancouver has positioned itself brilliantly as the West Coast hub for the vast majority of commodities Canada imports and exports with the Asia Pacific market,” said John Park, RCI Capital Group Chief Executive Officer. “Related industries on Canada’s West Coast are gearing up for the rise in activity that will accompany LNG production. It’s encouraging to see a Korean company like Husteel taking the initiative. I believe the Free Trade Agreement was a catalyst for this move.”
With all the infrastructure provided by the Federal and Provincial governments, Vancouver has a very robust transportation network for the efficient movement of the natural resources, which is highly desirable for countries like Korea. Investment into more railway capacity and Port Metro Vancouver facilities will improve Canadian competitiveness and attract greater investments, and British Columbia is preparing to capitalize on the LNG resources.
John Park said, “The Free Trade agreement will be a catalyst for a lot of pent-up demand for investment into Canada’s natural resource sector. With Canada and Korea sharing G20 status and having similar import and export goals, we view the next few years as a perfect opportunity for companies to expand operations in both countries.”