Transcript PSU briefing for Bulgarian visitors

Proposed Canada-EU FTA and
Agricultural Trade
David Blandford
[email protected]
Regional Trade Agreements (RTAs):
New developments and expectations
AES/CEAS Conference
School of Economics, University of Kent
24th June, 2011
1
Canada-EU FTA:




A proposal to conclude a Comprehensive
Economic and Trade Agreement (CETA)
between the EU and Canada was announced in
June 2009
Seven rounds of negotiations have been
completed since October 2009
The aim is conclude the negotiations by 2012
The EU is Canada’s 2nd largest trading partner
taking $C49.2 billion of exports and supplying
$C55.2 billion of imports in 2010
2
Canada-EU FTA:



Joint Canada-EU study has suggested a gain of
0.77% in Canada’s GDP and 0.08% in EU GDP
from liberalization of trade in goods and services
The study and its conclusions have been
controversial in Canada
Canada already has an FTA with the US its
largest trading partner: NAFTA, 1994 the
successor to CUSTA, 1988
3
Million dollars
Leading US agricultural export destinations
(2010)
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Source: Foreign Agricultural Trade of the US
4
Leading US agricultural export destinations
(2010)
16%
Percent of total
14%
12%
10%
8%
6%
4%
2%
0%
Source: Foreign Agricultural Trade of the US
5
Million dollars
Leading US sources of agricultural
imports (2010)
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Source: Foreign Agricultural Trade of the US
6
Percent of total
Leading US sources of agricultural
imports (2010)
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Source: Foreign Agricultural Trade of the US
7
US agricultural trade with Canada
8
US agricultural trade with Canada
9
US agricultural trade with Canada
10
US agricultural exports to the EU
(2010)
2,500
Million dollars
2,000
1,500
1,000
500
0
Source: Foreign Agricultural Trade of the US
11
US agricultural imports from the EU
(2010)
1,800
1,600
Million dollars
1,400
1,200
1,000
800
600
400
200
0
Source: Foreign Agricultural Trade of the US
12
Canada’s total trade with the EU
From J. Stanford, “Out of equilibrium: the impact of EU-Canada free trade on the real economy”, October 2010.
13
Canada’s trade with the EU, 2009
Category
Exports
Imports
Trade
balance
Average
Cdn. tariff
Million C$
Average
EU tariff
Percent
Agriculture
1,724
258
1,467
2.3
6.6
Processed
foods
719
1,450
-731
32.5
15.6
Beverages
and
tobacco
26
1,767
-1,741
4.8
7.4
29,443
44,268
-14,825
3.5
2.2
All goods
Source: J. Stanford, “Out of equilibrium: the impact of EU-Canada free
trade on the real economy”, October 2010.
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Structure of Canada-EU trade 2009
Canadian exports to EU
EU exports to Canada
8%
6%
39%
50%
86%
11%
Primary
Processed primary
Value-added
Source: J. Stanford, “Out of equilibrium: the impact of EU-Canada free
trade on the real economy”, October 2010.
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Major agricultural products in CanadaEU trade, 2009
EU exports to Canada
Canadian exports to EU
0.9
0.9
0.8
0.8
0.7
0.7
0.6
0.6
0.5
0.5
0.4
0.4
0.3
0.3
0.2
0.2
0.1
0.1
0
0
Wheat
Soybeans
Leguminous
vegetables
Wines
Spirits and
Liqueurs
Beer
Source: J. Stanford, “Out of equilibrium: the impact of EU-Canada free
trade on the real economy”, October 2010.
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Wine policies in Canada
MFN tariff on beer, spirits and most types of
wine (made from grapes) is zero
But:
1.
2.





3.
A Federal excise tax of 51.22 cents/litre is applied for wine
over 7% alcohol
A 5% goods and services tax (GST) is added on top of the
excise duty
Provincial liquor control boards or commissions (13) apply a
mark-up to the wine (e.g., 17% in BC)
Provincial liquor sales taxes are applied on top of all this (1012%)
Total tax can be over 50%
A Canada-EC wine and spirits agreement has
existed since 2003 – primarily for GIs
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Access to Canada’s dairy market
1.
2.
3.
A supply management system has operated
since 1970
NAFTA (and the earlier Canada-US FTA) had
very little impact on U.S. market access for
dairy products
Canada created TRQs for dairy products as
part of the URAA (e.g., the tariff-free access
for yogurt of 332 metric tons – the over quota
tariff is 237.5%). The TRQ for cheese is
20,411.866 tonnes
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Proposed Canada-EU FTA and
Agricultural Trade
David Blandford
[email protected]
Regional Trade Agreements (RTAs):
New developments and expectations
AES/CEAS Conference
School of Economics, University of Kent
24th June, 2011
19