Statement by Deputy Press Secretary Popadiuk on the Canada-United States Free Trade Agreement


December 31, 1988


Today President Reagan authorized the State Department to exchange diplomatic notes with the Canadian Government, bringing the U.S.-Canada free trade agreement into effect on January 1, 1989. The Canadian Parliament's final approval of the agreement on December 30 permitted the exchange of diplomatic notes. U.S. legislation was signed into law on September 28. The free trade agreement establishes the world's largest free trade zone involving two countries. The United States and Canada are already each other's most important trading partner, with two-way trade of nearly $150 billion in 1988.


The free trade agreement will eliminate over a 10-year period all tariffs on trade between Canada and the United States and will make substantial progress on the elimination or reduction of nontariff barriers. The agreement will also enhance energy security, improve the investment climate, and significantly increase opportunities in the services sector, including financial services. While the free trade agreement will not eliminate all trade issues between our two countries, it gives us the framework to manage them and the basis for expanding our economic relations.


The free trade agreement represents a single accomplishment in the long history of U.S.-Canada relations. It will strengthen the industrial base of our two countries and will demonstrate the multilateral system that it is possible to bring down trade barriers in an equitable and mutually beneficial manner.