Skip to main content
The Globe and Mail
Get full access to globeandmail.com
Support quality journalism
Just $1.99 per week for the first 24weeks
Just $1.99 per week for the first 24weeks
The Globe and Mail
Support quality journalism
Get full access to globeandmail.com
Globe and Mail website displayed on various devices
Just$1.99
per week
for the first 24weeks

var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){console.log("scroll");var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))}pencilInit(".js-sub-pencil",!1);

A Hyundai dealership in Mississauga.

J.P. MOCZULSKI/The Globe and Mail

Ontario is demanding the federal government do more to protect auto makers in a new free-trade agreement with South Korea, arguing the deal as it currently stands would "negatively impact" the industry in the province.

Economic Development Minister Eric Hoskins says he wants Ottawa to secure protections similar to ones the United States received in its own deal with South Korea in 2011.

"This free-trade agreement, as negotiated by the federal government, may not be good for the auto sector, may actually be quite challenging and problematic and negatively impact the sector in Ontario and Canada," he said in an interview Thursday. "If Michigan was important enough for the Americans, then Ontario should be that important to Harper and the federal government as well."

Story continues below advertisement

The wide-ranging agreement would see Canada phase out its tariffs in exchange for South Korea doing the same. This would help some Canadian businesses – particularly pork and beef exporters – while allowing South Korean auto makers even greater access to the Canadian market.

Mr. Hoskins said he has no problem with getting rid of the auto tariffs, but he wants guarantees Seoul will not slap other barriers on Canadian vehicles, such as additional taxes.

To make sure they do not do this, Mr. Hoskins wants tariffs phased out over a five-year period and a "snap-back" provision that would allow Canada to raise its tariffs back up if South Korea puts any barriers in place.

Sources familiar with the talks said one proposal on the table in current negotiations calls for tariffs to be phased out over a period shorter than five years.

A spokesman for federal International Trade Minister Ed Fast said Canada will only approve a deal if it contains "tools" to stop South Korea from imposing non-tariff barriers. He would not comment on the specific measures Mr. Hoskins is asking for.

"We will only sign an agreement that's in the best interest of hard-working Canadians including through the elimination of Korean tariffs and creation of effective tools to counter non-tariff barriers to trade," Rudy Husny wrote in an e-mail.

Auto makers have difficulty believing South Korea will eliminate or reduce its non-tariff barriers in part because of actions that country took after free-trade agreements with Europe and the United States came into effect.

Story continues below advertisement

The offices of the top five import brands were raided by officials from the Korea Fair Trade Commission earlier this year after their sales of vehicles made outside South Korea rose to 10 per cent of the market. The South Korean offices of BMW AG, Toyota Motor Co., Audi AG, Volkswagen AG and the Mercedes-Benz division of Daimler AG were raided.

Officials from the Detroit Three auto makers have complained that South Korean tax authorities launch audits of South Koreans who buy imported cars, but it's not clear if that practice still persists.

Ford Motor Co. of Canada Ltd. president Dianne Craig has publicly spoken out against the free-trade deal as it currently stands, and auto workers' union Unifor has also raised concerns. Mr. Hoskins said he spoke with Chrysler group chairman Sergio Marchionne at length about the deal when the pair met at the Detroit Auto Show.

That Ontario is lining up behind auto makers is no surprise: On top of the 93,000 jobs it estimates the sector has in the province, Queen's Park has recently been trying to land more investment from them, as it competes with U.S. states and Mexico, and has strong reasons to support the car companies.

Canada's automotive imports from South Korea totalled $2.6-billion in 2012, while exports amounted to just $12.5-million.

Both Hyundai Auto Canada Corp. and Kia Canada Inc., the two South Korean-based auto makers that sell vehicles in Canada, reduced their imports of finished vehicles from that country last year. But their imports exceeded 100,000 vehicles.

Report an error Editorial code of conduct
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies