Canada has upgraded its free trade deal with Chile, introducing changes that should give Canadian banks and insurance firms better access to the South American country's financial services market, Minister of International Trade Ed Fast said Monday.

The upgrade to the 16-year-old treaty also includes new rules on government procurement, customs procedures and dispute settlement.

Fast said the financial services deal will ensure Canada's banks, insurance companies and asset-management firms will enjoy enhanced access to Chile. The original 1997 trade deal between Canada and Chile had no specific provisions for financial services. 

"This chapter sent a clear signal, again, to Canadians that Chile is open to business and is a great place to do business," Fast said in an interview with CBC's Lang & O'Leary Exchange on Monday.

"And for those on the ground, what it does, it locks in the commitment both sides have made in terms of an open environment in which financial institutions can do business."

Equal treatment

The financial sector represents about 16 per cent of Chile's gross domestic product. The new trade deal specifies that Canadian banks must be subject to the same rules and accorded the same treatment as Chilean banks. Insurance and asset management companies are also covered under the new deal.

Similarly, Chilean banks can operate freely in Canada if they conform to the same standards as Canadian banks.

Fast said the new rules reflect Canada's expanding trade relationship with Chile. 

"Chile is one of our most trusted and like-minded trading partners in the Americas," the minister said. "It's a country that we've got a rapidly growing trade relationship with, somewhere in the order of $2.5 billion a year, which is triple what it was back in 1997 when we first signed a trade agreement."

Expanding trade beyond U.S.

The Harper government has made expanding trade a key pillar of its economic strategy, although Canada still remains heavily dependent on the U.S. for its export markets.

"Our government has embarked upon the most ambitious trade plan that Canada has ever seen, but we still notice and we are still sensitive to the fact that many small and medium-sized enterprises in Canada are either unaware of new market opportunities for Canada that have presented themselves around the world or are too cautious," Fast said.

"What I'd like to remind them of is that we have resources at the government level, including our trade commissioner service, that can remove uncertainty when they enter a new market."

Fast said Canada is negotiating trade deals with more than 50 countries, including India and Japan, and trading blocs such as the TransPacific Partnership and the European Union.

The EU deal is progressing, although it has been held up longer than anticipated, Fast said.

"The number of expanding issues is very small," he said. "As the prime minister said, there are still significant gaps, but we continue to find creative ways of bridging those gaps, and we are, indeed, making progress."