Canada-European Union: Comprehensive Economic and Trade Agreement (CETA) Negotiations

At the Canada-EU Summit on May 6, 2009, in Prague, Czech Republic, Leaders announced the launch of negotiations toward a Comprehensive Economic and Trade Agreement (CETA). Since then, Canadian officials have been in regular contact with their EU counterparts, including a number of meetings to agree on approaches to modalities, procedures and timelines for the negotiations. The first of these meetings was held on the margins of the EU Trade Commissioner Catherine Ashton’s attendance at the Conference de Montréal. The first full round of negotiations will be held in the fall of 2009.

On March 5, 2009, Canada and the EU publicly released the Joint Report on the EU-Canada Scoping Exercise (pdf 105kb)*. The Joint Report outlines a broad and ambitious negotiating agenda, which will include: trade in goods and services; investment; government procurement; regulatory cooperation; intellectual property; temporary entry of business persons; competition policy and other related matters; labour; and environment (See News Release - March 5, 2009).

On October 16, 2008, Canada and the EU publicly released a Joint Study on Assessing the Costs and Benefits of a Closer EU-Canada Economic Partnership (pdf 1.5 mb)*. The study shows there are important benefits for both sides to pursuing a closer economic partnership. Liberalizing trade in goods and services could bring a potential 20% boost to bilateral trade and GDP gains of up to $12 billion (or €8.2 billion) for Canada by 2014. A CETA with the EU could deliver commercial benefits across many goods sectors, including aerospace, chemicals, plastics, wood products, aluminum, fish and seafood, light vehicles and automotive parts, and agriculture products such as wheat, beef, and pork; it could also deliver benefits across services sectors such as transportation, engineering and computer services. The study also shows potential for enhancing the relationship in areas such as investment, labour mobility, regulatory cooperation, environment, and science and technology.

Canada and the EU have a long history of economic cooperation. Comprised of 27 Member States with a total population of nearly 500 million and a GDP of over C$19 trillion last year, the European Union (EU) is the world’s largest single market, foreign investor and trader. As an integrated block, the EU represents Canada's second largest trading partner in goods and services. In 2008, Canadian goods and services exports to the EU totalled $52.2 billion, an increase of 3.9% from 2007, and imports from the EU amounted to $62.4 billion.

According to Statistics Canada, the EU is also the second largest source of foreign direct investment (FDI) in Canada, with the stock of FDI amounting to $133.1 billion at the end of 2008. In 2008, the stock of Canada's direct investment in the EU totalled $136.6 billion, and the EU is the destination of 21.4% of Canadian direct investment abroad. According to Eurostat, the EU identified Canada as its third largest destination and its fourth largest source of FDI in 2007. Bilateral economic relations with the EU are very important to Canada, and this economic relationship is a high priority for the Government of Canada.

Trade and Investment Enhancement Agreement (TIEA)

At the Canada-EU Summit in Ottawa on March 18, 2004, the leaders agreed to a framework for a new Canada-EU Trade and Investment Enhancement Agreement (TIEA) and reiterated their commitment to reaching a successful conclusion to the World Trade Organization’s (WTO) Doha Development Agenda.

The TIEA was intended to move beyond traditional market access issues, to include areas such as trade and investment facilitation, competition, mutual recognition of professional qualifications, financial services, e-commerce, temporary entry, small- and medium-sized enterprises, sustainable development, and science and technology. The TIEA was also to build on a Canada-EU regulatory cooperation framework (see News Release -  December 21, 2004) for promoting bilateral cooperation on approaches to regulatory governance, advancing good regulatory practices and facilitating trade and investment. In addition to lowering barriers, the TIEA was meant to heighten Canadian and European interest in each other’s markets and could bring considerable economic benefits to Canada.

Good progress was made on the TIEA until 2006 when Canada and the EU jointly decided to pause negotiations. With negotiations on a Comprehensive Economic and Trade Agreement (CETA), we have now moved beyond the TIEA toward an agreement with a much broader and more ambitious scope.

For more information on Canada-EU bilateral relations, see:

• General Canada-EU Factsheet (html | pdf 144 kb)*
• Mission of Canada to the EU

The government appreciates the input of all Canadians who have contributed to the consultative process to date and wishes to assure them that their views will be taken into account as the Canada-EU initiative proceeds and in the development of Canada's trade agenda more broadly.

Consultations will continue throughout the negotiations and Canadians are encouraged to provide their comments and input on trade issues.

• Notice of Intent to Conduct a Strategic Environmental Assessment of the Canada-EU Comprehensive Economic and Trade Agreement
  The Government of Canada is undertaking a Strategic Environmental Assessment of the negotiations for a Comprehensive Economic and Trade Agreement (CETA) with the EU. The deadline is September 18, 2009.

• Questionnaire on a Comprehensive Economic Agreement between Canada and the European Union
  The Department conducted consultations on various issues pertaining to the negotiations with the EU, including the areas of trade in goods, trade in services, temporary entry, and investment. Although the deadline was June 30, 2009, we continue to welcome comments.

• Consultation on Possible Comprehensive Economic Agreement Negotiations with the European Union
  The Government of Canada sought the views of Canadians on the possible scope of a economic and trade agreement with the EU. This information was taken into account in the decision to proceed with negotiations with the EU and in the development of Canadian positions for this initiative.

Interested Canadians may continue to make submissions on any area of the Canada-EU negotiations using either the existing consultation processes above, or through the departmental contact points below.

Regional Trade Policy Division (TBB)
Department of Foreign Affairs and International Trade
Lester B. Pearson Building
125 promenade Sussex Drive
Ottawa, Ontario, K1A 0G2

Fax: 613-944-3489
E-mail: consultations@international.gc.ca

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