European Commission Directorate-General for Trade

Canada

The EU and Canada are currently negotiating the Comprehensive Economic and Trade Agreement (CETA) in order to bring their trade and investment  relationship to a new level. CETA will cover the key issues relevant to a modern trade and investment environment, from ambitious new market access opportunities to clear rules for European and Canadian traders and investors  Negotiations were launched in May 2009 and the content of the CETA and its general modalities were agreed in June 2009. The first round took place in October 2009. The negotiations are now in their final phase.

Commissioner de Gucht and his Canadian counterpart Trade Minister Fast met on 6/7 February 2013 to take stock of the remaining open points.  The aim is to conclude the CETA negotiations in the first half of 2013.

Trade picture

• In 2011 Canada was the EU's 11th most important trading partner, accounting for  1.8% of the EU's total external trade. In the same year the EU was Canada's second most important trading partner, after the U.S., with around  12% of Canada's total external trade.
• The value of bilateral trade in goods between the EU and Canada was €60.2 billion in 2011. Machinery, transport equipment and chemicals dominate the EU's exports of goods to Canada, and also constitute an important part of the EU's imports of goods from Canada.
• Trade in services is an important area of the EU-Canada trade relationship. The value of bilateral trade in services between the two partners amounted to €23.5 billion in 2011. Examples of often traded services between Canada and the EU are transportation, travel, insurance and communication.
• The investment relationship is equally highly important. In 2010, EU outward FDI stocks with Canada amounted to €197.4 billion; inward FDI totaled €143.1 billion.

EU and Canada

As a strong supporter of free trade, Canada has always been a natural ally and important trade partner for the EU. Strengthening the economic and trade relationship with Canada is therefore an important priority.

In 2009, the EU and Canada launched negotiations for a Comprehensive Economic and Trade Agreement (CETA). The negotiating process is in its final stages and the conclusion of an ambitious agreement is planned in the first half of 2013. Both the EU and Canada are committed to free trade, on the bilateral as well as on the multilateral level.

The EU-Canada Joint Study of October 2008 showed that both the EU and Canada can expect to gain from a closer bilateral trade relationship. A future agreement would contribute to economic growth and the creation of jobs. It would have several benefits, in particular:

• The economic model of the Joint Study  predicts annual real income gains of approximately €11.6 billion for the EU and €8.2 billion for Canada within seven years following the implementation of an agreement.
• Total EU exports to Canada are estimated to go up by 24.3% or €17 billion, while Canadian bilateral exports to the EU are predicted to increase by 20.6% or €8.6 billion.
• 50% of the total expected gains for the EU are related to trade in services, 25% to the removal of tariffs and the remaining 25% of the GDP gains can be reached by the dismantling of Non-tariff barriers (NTB).
• The benefits from the Agreement in the area of NTBs are estimated to result in a €2.9 billion gain for the EU and €1.7 billion for Canada.
• In the service sector new opportunities will arise both for European and Canadian companies.  Transparency as well as legal certainty for operators will be enhanced.
• Companies on both sides will benefit from the disciplines on investment protection which are currently being negotiated, making investment even safer.
• An agreement would bring the investment protection regimes on both sides to a comparable level.
• Both countries will gain from increased access to the respective public procurement markets. All sub-federal levels of government in Canada will be open to European companies to engage in tenders. 

Pending the conclusion of the CETA negotiations and the entry into force the agreement, current trade relations with Canada are guided by a Framework Agreement for Commercial and Economic Cooperation in force since 1976. The EU and Canada meet annually in bilateral summits and in the Joint Cooperation Committee to review a range of issues relating to EU-Canada economic and trade relations.

Over the years, a number of additional bilateral agreements designed to facilitate EU-Canada trade have been concluded.

• In 1997 an agreement was signed to foster closer cooperation between EU and Canadian customs administrators.
• The Veterinary Agreement of 1999 aimed at improving bilateral trade in live animals and animal products.
• The most recent agreements are the Wine and Spirits Agreement (2003), the Civil Aviation Safety Agreement (2009) and the Comprehensive Air Transport Agreement (2009)

Trading with Canada

• Importing into the EU from Canada
  • EU trade defence measures on imports from Canada
• Exporting from the EU to Canada
  • Export rules on food and plant health
  • Trade defence measures in force in Canada
• The EU is present on the ground in Canada
• Trade relations are part of the EU's overall political and economic relations with Canada
• Canada is a member of the World Trade Organisation
• The EU has analysed the social, environmental and economic impacts of a potential trade agreement with Canada in a Sustainability Impact Assessment (SIA)