Transcript Economics Implications of CETA

Economic & Political
Implications of CETA
Patrick Leblond
ECSA-C Business Roundtable
ECSA-C Biennial Conference
Montreal, 8 May 2014
© Patrick Leblond. 6 May 2014
Joint Study (Oct. 2008) Results
• Jump in GDP
– €11.6 billion in the EU (0.08% of GDP)
– €8.2 billion in Canada (0.77% of GDP)
• Increase in trade (€25.7 billion or 22.9%)
– Goods (€18.6 billion)
• Canada to EU: €6.3 billion (24.3%)
• EU to Canada: €12.2 billion (36.6%)
– Services (€7.0 billion)
• Canada to EU: €4.8 billion (14.2%)
• EU to Canada: €2.2 billion (13.1%)
© Patrick Leblond. 6 May 2014
What are the key drivers?
• Tariff elimination
– Goods will be more competitive on the EU market
– EU goods will be cheaper for Canadian firms
• Greater market access
– E.g., beef and pork
– Subnational public procurement
• New investments
– Canadian, European and third-country firms
• Labour (skilled) mobility
– Important for professional and after-sale services
• Regulatory cooperation and mutual recognition
© Patrick Leblond. 6 May 2014
Conditions
• Canadian firms must meet EU standards for goods
and services and vice versa
• Effective and efficient rules of origin
• Provincial and municipal implementation of public
procurement rules
• Agreement on the MR of professional qualifications
– Provinces and provincial orders
• Obtain necessary working permits rapidly
• Cooperation between regulators in trying to
harmonize new rules and regulations
• SME capacity to develop the other market
© Patrick Leblond. 6 May 2014
Conclusions
• Who knows exactly what the economic implications will be?
– We do know that trade liberalization increases trade and
ultimately GDP
• Benefits might be relatively “marginal” but as long as they
are positive on a net basis, then we should do it
– Why would we give up a potential of $10-20 billion more
for the Canadian economy?
• But many benefits will take time to materialize, if they ever
do (“walk the talk”)
– Pressure and monitoring from business and political
leaders will be key to ensure that many conditions are
satisfied
• Not doing CETA might make things worse if the EU and the
US manage to agree to a TTIP
© Patrick Leblond. 6 May 2014
THANK YOU!
© Patrick Leblond. 6 May 2014