Backgrounder - Alberta and a Canada-EU Trade Agreement

The European Union is both the world’s largest integrated economy and its largest importing market for goods. As a result, the EU offers tremendous opportunities for Canadian exporters and for hard-working Canadians in Alberta and in every other region of the country.

A joint Canada-EU study conducted before the comprehensive economic and trade agreement (CETA) negotiations began found that an ambitious agreement could boost Canada’s annual income by $12 billion and bilateral trade by 20 percent. Put another way, the economic benefit would be equivalent to creating almost 80,000 new jobs or increasing Canada’s average household annual income by $1,000. This is like adding twice the total number of jobs currently in Alberta’s regional municipality of Wood Buffalo to the Canadian economy.

CETA would eliminate tariffs on almost all of Alberta’s key exports and provide access to new EU market opportunities. Exporters would also benefit from other CETA provisions, such as those that would ease regulatory barriers to trade, protect exporters’ intellectual property and ensure more transparent rules for market access.

Upon entry into force, a CETA would create new opportunities for exports from Alberta by eliminating tariffs on exports in the following key sectors:

• Metals and minerals. Alberta’s metal and mineral sector includes natural gas, conventional oil, coal, minerals and the oil sands. More specifically, Alberta’s metal refining and mineral sector is a foundational industry that allows for infrastructure development, as well as energy and natural resource production, in Alberta. It generated 28 percent of the province’s total GDP in 2011 and employs more than 181,000 Albertans, creating employment opportunities that provide some of the highest earnings in the Albertan economy. Although many exports of mineral products from Alberta to the EU enter duty-free, exports of metals face an average tariff of 1.7 percent, with tariffs as high as 10 percent on some products.
• Agriculture and agri-food. With more than 51 million acres used for crop and livestock production, Alberta produces an abundant supply of world-class agricultural commodities. The agriculture and agri-food sector employed nearly 76,000 Albertans in 2012 and contributed 2.5 percent to Alberta’s GDP in 2011. Between 2010 and 2012, Alberta’s exports of agricultural commodities to the European Union averaged $285.8 million annually, with tariff rates averaging 13.9 percent.
• Forest products. The forest products sector employs nearly 19,000 Albertans and represents a significant component of the Albertan economy. Alberta’s exports of forest products to the EU—averaging $62.6 million annually between 2010 and 2012—face average tariffs of 1.2 percent, with peaks of 10 percent. These tariff barriers will be eliminated under a Canada-EU trade agreement.
• Advanced manufacturing. Alberta’s advanced manufacturing industry employs more than 28,000 Albertans. Between 2010 and 2012, Alberta exported to the EU an annual average of $254.1 million in advanced manufacturing products, which faced tariffs as high as 22 percent on some goods. Industrial machinery, one of Alberta’s key advanced manufacturing exports to the EU, face average tariff rates of 2.1 percent, with peaks of 8 percent.
• Chemicals and plastics. Alberta is a major producer of chemicals and plastics. This industry employs 11,000 Albertans and is an important source of Alberta’s exports to the EU, with exports averaging $84.6 million annually between 2010 and 2012. These exports currently face average tariffs of 4.9 percent, with peaks of 6.5 percent.