Backgrounder: Opportunities in Canada-EU trade
Why the EU matters:
- The EU is the largest integrated economy in the world with 28 markets, more than 510 million consumers and a GDP of more than $21.7 trillion (2016).
- The EU is one of the world’s largest government procurement markets, worth an estimated $3.0 trillion per year, and is also the world’s largest services market.
- The EU is an innovative powerhouse, the world’s largest foreign investor (when including intra-EU investment) and the world’s largest merchandise trader.
|GDP: ($ billion)||21,733||2,027|
|GDP per capita: ($)||42,537||55,876|
|GDP growth rate: (%)||1.9||1.5|
Trends in Canada-EU trade:
- The EU is Canada’s second largest export market, after the United States.
- Canada and the EU exchange more than $136 billion in two-way trade in goods and services.
- Known EU stock of direct investment in Canada is $246.9 billion.
- Innovative companies with more highly skilled workers and more technologically sophisticated products are the most likely to remain active in the EU market.
- Canadian companies have been successful not only in traditional manufacturing exports but also in selling business expertise, services, and related products in the EU.
Opportunities for Canadian businesses in Europe
- The EU is the second largest consumers market and the world’s largest services market, with important growth potential, especially in Eastern European countries.
- The following sectors represent significant opportunities for Canadian enterprise: aerospace, agriculture and agri-food, automotive, clean technologies, fish and seafood, forestry and wood products, information and communication technologies, infrastructure, medical devices, metals, mining and minerals, oil and gas and pharmaceuticals.
- There exist regional and sub-regional differences within the EU, in terms of regulations, market dynamics, and economic trends, providing companies with a diversity of opportunities.
Some of these market-specific opportunities include:
- France and the Mediterranean countries: These markets are expected to grow in the medium term as the recovery and reforms implemented after the financial crisis are expected to pay off. Companies can benefit from opportunities in aerospace, agri-food and life sciences, among others.
- Northern Europe, the Benelux and Ireland: This group has low barriers to trade and investment and interesting B2B markets. Companies can benefit from opportunities in several sectors, including life sciences and clean technologies.
- Germany and Eastern Europe: Germany and Eastern Europe possess strongly integrated value chains that are rewarding to penetrate, and ideal conditions for foreign investment. Companies can benefit from opportunities in aerospace, automotive, information and communication technologies and clean technologies.
- The UK: The United Kingdom relies on imports for goods, as strong demographics are helping demand. The market is also equipped with a high skilled workforce and a slow wage growth. Companies can benefit from opportunities in agri-food, energy and financial services.
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