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Canada-Korea Free Trade Agreement (CKFTA)

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pointofreturn   Thursday, 03/13/14 10:37:47 AM
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Canada-Korea Free Trade Agreement (CKFTA)
This agreement is nothing to scoff at and has very positive implications for Loyalist!

"This landmark agreement constitutes Canada’s first free trade agreement in the Asia-Pacific region and will provide new access for Canadian businesses and workers to the world’s 15th-largest economy and the fourth-largest in Asia. In fact, the Canada-Korea Free Trade Agreement is projected to create thousands of jobs for hardworking Canadians by boosting Canada’s economy by $1.7 billion and increase Canadian exports to South Korea by 32 percent. South Korea is not only a major economic player in its own right and a key market for Canada; it also serves as a gateway for Canadian businesses and workers into the dynamic Asia-Pacific region as a whole." (FATD GoC Link)

South Korea already sends more students to Canada than any other country in the world, with this new agreement in place expect that number to increase substantially. South Koreans have a lot of incentive to now choose Canada as their place of education. Since Loyalist Group schools are the premiere choice for ESL students that come to study in Canada I expect the company to see increased enrollment across the board at its schools from South Korea.

Not only from new South Korean students who can now afford to study in Canada due to the decreased cost-of-living expenses associated with the CKFTA, but also from South Koreans who are studying elsewhere abroad and now have significantly more incentive to come to Canada.

Also, and this point should not be over-looked, Andrew is Korean and has very strong ties within the country and the community. Hopefully Andrew can leverage his connections to accelerate the rollout of the franchise program.

Loyalist has already signed five franchise agreements, and expects to add several more franchise agreements per quarter over the coming years.

"Franchising is the logical next step in our evolution towards becoming a truly global brand in the ESL market," said chief executive officer Andrew Ryu. "We are easily the No. 1 choice of foreign students who want to come to Canada. But there are millions of other students who will choose to study in their home countries rather than coming to Canada. These students still want a first-rate curriculum and the ability to earn a recognized diploma, and Loyalist can offer both of those things. We expect this to be highly accretive to our income as the cost of setting up and running this business is small relative to the potential revenues."
The CKFTA also allows Loyalist to more easily strike partnerships with South Korean schools and institutions, as well as negociate more favourable referall rates (and/or open more offices in South Korea for student referals in-house).

No matter how you break it down it's very good for the company going forward.

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