Back to accessibility links

Canada-EU trade deal

How the historic agreement will affect Canadian industries

Last Updated: Oct. 18, 2013

On Oct. 18, 2013, Canada and the European Union signed a tentative deal on a Comprehensive Economic and Trade Agreement (CETA) in an effort to open up markets and drop nearly all import taxes on everything from food to cars to metal and forestry products.

The sweeping agreement will provide Canada with preferential market access to the EU's more than 500 million consumers and to its annual $17 trillion in economic activity. Here is a look at the key aspects of the deal as well as a breakdown of how CETA will potentially benefit each industry sector in Canada.

Highlights of the deal

Breakdown by sector

ADVANCED MANUFACTURING

employs almost

419,000

Canadians

contributed

$42.2B

to Canada's GDP in 2012

CETA will eliminate the vast majority of existing EU tariffs including:

  • industrial and power-generating machinery
  • agricultural and construction equipment
  • aerospace and rail products, (as high as 22 per cent on some products)
  • scientific and precision instruments (as high as 22 per cent on some products)
  • electrical parts and equipment (as high as 14 per cent)
  • medical devices (as high as 8 per cent)
AUTOMOTIVE INDUSTRY

employs over

115,000

Canadians

highly dependent on trade

85%

of auto production exported every year

CETA will eliminate existing EU tariffs:

  • passenger vehicles (10 per cent)
  • auto parts (as high as 4.5 per cent)

CETA includes flexible 'rules of origin':

  • allow for up to 100,000 passenger vehicles to be exported to Europe, a 12.5 fold increase from our current average exports
  • allow for the adjustment of the rules of origin to provide additional flexibility in the event that the EU strikes free trade deals with other countries, such as the United States.

CETA encourages 'made inCanada' production:

  • grants unlimited preferential treatment to vehicles with higher Canadian content that are exported to Europe.
CHEMICALS AND PLASTICS

employed close to

110,000

Canadians in 2012

contributed

$12.4 B

to the Canadian economy

exports to EU

$2 B

annually with 55% of production exported abroad

CETA will eliminate existing EU tariffs on all chemicals and plastics including:

  • inorganic and organic chemicals, as well as resins and plastic packaging (average tariffs of 4.9 per cent)
  • plastic floor coverings (from 6.5 per cent)
  • chemicals used in photography (from 6 per cent)
  • silicon (from 5.5 per cent)
AGRICULTURE AND AGRI-FOOD

employed over

585,000

Canadians in 2012

accounts for almost

3%

of Canada's GDP

exports to EU

$2.5 B

annual average (2010-12)

CETA will eliminate existing EU tariffs:

  • average EU tariffs of 13.9 per cent
  • almost 94 per cent of EU agricultural tariff lines will be duty-free, including
  • durum wheat (up to $190 per ton)
  • other wheat (up to $122 per ton)
  • oils, including canola oil (3.2 per cent - 9.6 per cent)
FOOD PROCESSING

contributed

$26.5 B

to Canada's GDP in 2012

exports to EU

$536 M

annual average (2010-12)

CETA will eliminate existing EU tariffs on processed foods and beverages

FOREST AND VALUE-ADDED WOOD PRODUCTS

contributed

$20.2 B

to Canada's GDP in 2012

employing about

235,000

Canadians

exports to EU

$1.2 B

annual average (2010-12)

CETA will eliminate existing EU tariffs:

  • on all forest products, such as softwood lumber, newsprint, wood pulp, wood panels (average tariffs of 1.2 per cent)
  • including those on plywood (7 per cent -10 per cent)
  • prefabricated wooded buildings (2.7 per cent),
  • particle board and oriented strand board panels (7 per cent)
METALS AND MINERAL PRODUCTS

contributed

$144.1 B

to Canada's GDP in 2012

employing over

387,000

Canadians

exports to EU

$20.4 B

annual average (2010-12)

CETA will eliminate existing EU tariffs, including:

  • iron and steel, and the products that are made from them (as high as 7 per cent)

Key exports include gold, nickel, diamonds, aluminum, and iron ore

FISH AND SEAFOOD PRODUCTS

contributed over

$2.2 B

to Canada's GDP in 2012

employing

41,000

Canadians

exports to EU

$400 M

annual average (2010-12)

CETA will eliminate existing EU tariffs:

  • average EU tariffs of 11 per cent
  • almost 96 per cent of EU tariff lines for fish and seafood products will be duty-free
  • 100 per cent of these tariff lines will be duty-free 7 years later
  • cooked and peeled shrimp (20 per cent)
  • live lobster (8 per cent)
  • frozen lobster (6 per cent -16 per cent)
  • frozen scallops (8 per cent)
INFORMATION AND COMMUNICATIONS TECHNOLOGY

contributed

$8.3 B

to Canada's GDP in 2012

employing

86,500

Canadians

exports to EU

$1.7 B

annual average (2010-12)

CETA will eliminate existing EU tariffs:

  • all ICT products (average tariff of 1 per cent and as high as 14 per cent on certain products)
  • parts for visual signalling equipment (from 2.2 per cent)
  • optical fibre cables (from 2.9 per cent)
SERVICES

accounted for

70%

of Canada's GDP in 2012 (argest sector in Canada)

employing over

13.6 M

Canadians

exports to EU

$14.5 B

annual average (2010-12)

Sector includes management services; computer and information services; architectural, engineering and other technical services; research and development services; and private education services.

CETA will reduce or eliminate barriers:

  • citizenship or residency requirements,
  • barriers to temporary entry
  • ownership and investment restrictions

CETA will establish preferential access to and greater transparency in the EU services market

INVESTMENT

Direct investment by Canadian companies in the EU totalled

$180.9 B

in 2012 representing 28.5% of Canadian direct investment abroad

Direct investment by European companies in Canada totalled

$171.5 B

in 2012 representing 24.1% of total foreign investment in Canada

CETA's investment chapter will:

  • provide Canadian and EU investors with greater certainty, stability, transparency and protection for their investments
  • preserve full rights for governments to legislate and regulate in the public interest
  • foster greater two-way investment, creating jobs for Canadians
GOVERNMENT PROCUREMENT

Workers in Canada employed in fields such as engineering, architecture and technology

EU's procurement market worth an estimated

$2.7

trillion annually

CETA will:

  • give Canadian suppliers of goods and services secure access to EU procurement processes on a preferential basis
  • provide significant new export opportunities
  • expand and secure opportunities for Canadian firms to supply their goods and services to the EU Commission, Parliament, and Council, the 28 EU member states and thousands of regional and local government entities

Canada - E.U. Comparison

CANADA

35 million

Population of Canada

«   »

EUROPEAN UNION

500 million

Population of European Union

By the numbers

28

Number of countries in the European Union.

$1.5 B

Annual value of increased agricultural exports expected by Canadian producers.

$700 M

What the EU expects in annual tariff savings (and what Canada would lose in duties).

20 %

The government's estimated increase in bilateral trade as a result of the deal.

29,000

(tonnes) EU cheese allowed into Canada tariff-free annually, up from 13,000, once fully implemented.

65,000

(tonnes) Annual quota for Canadian beef in Europe, up from 15,000, once fully implemented.

75,000

(tonnes) Annual quota for Canadian pork, up from 6,000, once fully implemented.

100,000

Number of cars Canadian automakers will be able to export a year, 12 times the current limit.

24

Number of languages into which the agreement must be translated.

2

(years) Extension of drug patents for brand-name pharmaceuticals.

5

(years) Time elapsed since initial study of a trade deal began.

2

(years) Expected length of time before deal is ratified.

Story Social Media

End of Story Social Media