South Korea trade deal could save you money — someday

CBC News Posted: Mar 12, 2014 5:00 AM ET Last Updated: Mar 12, 2014 6:57 AM ET

The Canada-South Korea free trade agreement, which is expected to remove nearly all tariffs between the two countries, has been well received by various sectors of the Canadian economy — with the exception of the automotive industry, which has raised concerns about the potential for tens of thousands of manufacturing jobs lost.

The government insists the effects of removing Canadian tariffs on South Korean cars would be "negligible," citing a 2012 study conducted for the Department of Foreign Affairs that shows the potential for job losses in the hundreds — not tens of thousands.

Canadian exporters of agricultural products such as beef, pork, canola and grains will be among the winners in the free trade deal with South Korea, but the benefits to Canadian consumers may not be as striking.

However, International Trade Minister Ed Fast told CBC News Network's Power & Politics on Tuesday that the elimination of tariffs would be good for Canadian consumers.

"We're going to see better value for the consumer, there will be greater choice for our consumers. If you ask consumers on the street, 'Would you like to pay a little bit less for your TVs that you buy?' they would say absolutely yes."

Here are some of the products imported from South Korea that Canadian consumers could expect to pay less for:

Vehicles: Canada will drop its 6.1 per cent tariff on imports of South Korean vehicles over a three-year period, with the first cut coming once the agreement is in force. Two years after the agreement is in effect, tariffs will be completely eliminated, which means Canadians can expect prices to come down on South Korean-made makes such as Kia and Hyundai.Appliances: Canada will eliminate tariffs that currently run up to eight per cent on major appliances within three to five years. That means Canadians can expect to pay less for refrigerators, stoves, washers and dryers made by LG and other South Korean brands.Electronics: Duties run up to 14 per cent on consumer electronics imported from South Korea. Under the new free trade agreement, Canada will drop its tariffs over three to five years, and Canadians can expect to see prices come down on digital cameras, video camcorders and TVs made by Samsung and others in South Korea.Apparel and footwear: Canadians can expect to pay less for clothes and shoes made in South Korea once duties that currently run up to 20 per cent are removed over a period of three to 11 years.

While cars and major appliances figure on the list of top 25 products Canada imports from South Korea, consumer electronics, clothes and shoes do not, because Canada does not import them in significant amounts.

When it comes to paying less for imported goods, consumers in South Korea may come out a little further ahead than Canadian consumers. Under the new trade deal, South Korean shoppers could pay less on a greater array of food products.

Here are some of the products exported from Canada that South Korean consumers could expect to pay less for:

Vehicles: As soon as the agreement comes into force, South Korea will drop all existing tariffs on imports of Canadian vehicles. Current duties run up to eight per cent.Fish and seafoodLeather clothingBeef, pork, canola and grainsFrozen french fries Maple sugarRye whiskyIce wineChickpeas and lentils

The prospect of South Korea dropping its tariffs, which run up to 27 per cent, on chickpeas, primarily grown in Saskatchewan, did not go unnoticed by Premier Brad Wall, who thought it important enough to highlight in a post on Twitter.

Oh and phase out of Korean duties on our chick peas and lentils is also part of the @pmharper Korean trade deal. 3-5 yrs.

— Brad Wall (@PremierBradWall) March 11, 2014

Consumers will not feel the savings for some time to come, as there will have to be a legal review of the final trade agreement followed by translation into Korean, English, and French before it is tabled in Parliament and then ratified by both governments.

While it is not known how long that could take, the Canadian government hopes to have the agreement come into force "as soon as possible."

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Feta, parmesan, Gorgonzola cheese names prompt U.S.-Europe trade stink

The Associated Press Posted: Mar 12, 2014 11:35 AM ET Last Updated: Mar 12, 2014 11:50 AM ET

Errico Auricchio produced cheese with his family in Italy until he brought his trade to the United States more than 30 years ago. Now, the European Union is saying his cheese isn't authentic enough to carry a European name.

As part of trade talks, the EU wants to ban the use of names like Parmesan, feta and Gorgonzola on cheese made in the United States. The argument is that the American-made cheeses are shadows of the original European varieties and cut into sales and identity of the European cheeses.

Auricchio, president of Wisconsin-based BelGioioso Cheese Inc., says he has no idea what he would call his Parmesan if he had to find a new name.

"I Can't Believe It's Not Parmesan," he jokes.

The Europeans say Parmesan should only come from Parma, Italy, not from Auricchio's plant or those familiar green cylinders that American companies sell. Feta should only be from Greece, they say, even though feta isn't a place. The EU argues it "is so closely connected to Greece as to be identified as an inherently Greek product."

So, a little "hard-grated cheese" for your pasta? It doesn't have quite the same ring as Parmesan.

U.S. dairy producers, cheesemakers and food companies are all fighting the idea, which they say would hurt the $4 billion domestic cheese industry and endlessly confuse consumers.

"It's really stunning that the Europeans are trying to claw back products made popular in other countries," says Jim Mulhern, president of the National Milk Producers Federation, which represents U.S. dairy farmers.

The European Union would not say exactly what it is proposing or even whether it will be discussed this week as a new round of talks on an EU-United States free trade agreement opens in Brussels.

European Commission spokesman Roger Waite would only say that the question "is an important issue for the EU."

That's clear from recent agreements with Canada and Central America, where certain cheese names were restricted unless the cheese came from Europe. Under the Canadian agreement, for example, new feta products manufactured in Canada can only be marketed as feta-like or feta-style, and they can't use Greek letters or other symbols that evoke Greece.

Though it has not laid out a public proposal, the EU is expected to make similar attempts to restrict marketing of U.S.-made cheeses, possibly including Parmesan, Asiago, Gorgonzola, feta, fontina, grana, Muenster, Neufchatel and Romano.

And it may not be just cheese. Other products with traditional ties to European countries that could be affected include bologna, Black Forest ham, Greek yogurt, Valencia oranges and prosciutto, among other foods.

The trade negotiations are important for the EU as Europe has tried to protect its share of agricultural exports and pull itself out of recession. The ability to exclusively sell some of the continent's most famous and traditional products would prevent others from cutting into those markets.

Concerned about the possible impact of changing the labels on those popular foods, a bipartisan group of 55 senators wrote U.S. Trade Representative Michael Froman and Agriculture Secretary Tom Vilsack this week asking them not to agree to any such proposals by the EU.

Led by New York Sen. Chuck Schumer, D-N.Y., and Pennsylvania Sen. Patrick Toomey, R-Pa., the members wrote that in the states they represent, "many small- or medium-sized, family-owned businesses could have their businesses unfairly restricted" and that export businesses could be gravely hurt.

Schumer said artisanal cheese production is a growing industry across New York.

"Muenster is Muenster, no matter how you slice it," he says.

Trevor Kinkaid, a spokesman for the U.S. trade representative, said that conversations on the issue are in the early stages but that the U.S. and E.U. have "different points of view" on the topic.

The agency wouldn't disclose details of the negotiations, but Kinkaid said the U.S. government is "committed to increasing opportunity for U.S. businesses, farmers and workers through trade."

Large food companies that mass produce the cheeses are also fighting the idea. Kraft, closely identified with its grated Parmesan cheese, says the cheese names have long been considered generic in the United States.

"Such restrictions could not only be costly to food makers, but also potentially confusing for consumers if the labels of their favourite products using these generic names were required to change," says Kraft spokesman Basil Maglaris.

Jaime Castaneda works for the U.S. Dairy Export Council and is the director of a group formed to fight the EU changes, the Consortium for Common Food Names. He says the idea that great cheese can only come from Europe "is just not the case anymore."

He points out that artisanal and locally produced foods are more popular than ever here and says some consumers may actually prefer the American brands. European producers can still lay claim to more place-specific names, like Parmigiano-Reggiano, he says.

"This is about rural America and jobs," he says.

Auricchio and other producers say they are angry because it was Europeans who originally brought the cheeses here, and the American companies have made them more popular and profitable in a huge market.

"We have invested years and years making these cheeses," Auricchio says. "You cannot stop the spreading of culture, especially in the global economy."

Mar 12, 2014 4:41 PM ET Mar 12, 2014 4:34 PM ET Mar 12, 2014 4:15 PM ET Mar 12, 2014 4:34 PM ET Mar 12, 2014 4:41 PM ET

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Datawind aims to make $20 tablet computer

The Canadian makers of the "world's lowest cost tablet," the UbiSlate 7Ci, think $37.99 still isn't cheap enough.

They figure there's still room to knock about 50 per cent off its price and make tablet ownership possible for anyone and everyone.

"This idea is to bridge the digital divide, it's really that simple, the idea is to overcome the affordability barrier," says Datawind CEO Suneet Singh Tuli during an interview at his Toronto-area office, one of five the company has in Canada, England, Germany and India.

"We think as the Scandinavians do that (internet access) is a fundamental human right."

On the second floor of an unassuming strip mall — strategically located within spitting distance of Toronto's Pearson airport, where Tuli says he's coming from or going to a few times a week — the Datawind team is working on its strategy to sell cut-rate "good enough" tablets.

Datawind CEO Suneet Singh Tuli says the company's founders think internet access is a fundamental human right. (Parivartan Sharma/Reuters)

The company is best known for its work with the Indian government, which it supplied with low-cost tablets for a program to get technology into the hands of students.

Datawind was recently named one of the world's 50 smartest companies by the MIT Technology Review magazine for launching those tablets, branded under the Aakash name.

While India's government is considering proposals from Datawind and other vendors to make the next version of the Aakash, the company has turned its attention to North America and the U.K. to sell its tablets directly to consumers under the UbiSlate brand.

The cheapest version of the seven-inch tablet, the UbiSlate 7Ci, has a not-too-sharp screen resolution of 800 by 480 pixels, four gigabytes of memory, half a gigabyte of RAM, runs a current version of Google's Android operating system and can only get online with WiFi. It sells online for $37.99 plus taxes and shipping. The next model up, the UbiSlate 7C+, costs an additional $42 to gain access to EDGE mobile networks. The most expensive model, the UbiSlate 3G7 at $129.99 plus taxes and shipping, has a better screen and processor and can also access HSDPA 3G mobile networks.

Tuli says the company can sell the tablets so inexpensively because of the scale of its production runs and the fact that it makes its own screens, which helps boost profit margins. A preloaded web browser also displays ads that generate additional revenue for Datawind — although users can choose to download another ad-free browser — and the company monetizes some downloads of apps.

Datawind has also kept its prices down by selling directly to consumers through its website and not seeking retail partners.

"Something that costs $50 to make ends up at $150 easily at retail," he says.

"In our case, something that costs $32 to make ends up at $38 in the consumers' hands."

Tuli says he envisions the price of Datawind's lower-end tablet slipping below $20 "within the next year or two," especially if revenues from ads and apps grow.

"We think pricing will continue coming down and we think features will continue going up. We will keep our high end between $100 to $150, we don't see ourselves going up anything higher than that, but we'll continue pushing the barriers on the lower end," he says.

While he insists that Canadian consumers won't find the tablets lacking, the reviews for Datawind's tablets in India were far from positive. And anyone who has used an iPad or a higher-end Android tablet will notice a major difference in performance.

But he believes there is a strong market of consumers who are willing to trade performance for a low price.

"What we tried to focus on was realizing that for our customer, price is the most important feature and starting with that element we said, 'What can we bundle in to provide a performance experience that would be good enough for them?"' Tuli says.

"You want something for your kids to take to school.... Kids are going to lose them or break them and you want something that you're not worried (about)."

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