Parted by the Atlantic Ocean, Canada and Europe share past events, trade relations, and a legacy of good intercontinental relations.
The European Union is Canada’s second-largest trading partner, after the United States, making up for about 10% of their trade in goods with the world in 2018. On the European side, Canada accounted for about 2% of the European Union’s total external trade in goods in the same year. In order to boost trade relations and strengthen the overall relationship between both territories, the CETA Agreement (Canada-European Union Comprehensive Economic and Trade Agreement) was created. CETA entered into force, provisionally, on the 21st of September 2017. For a definite entry into force of CETA, all EU Member-States need to ratify the Agreement in line with their national procedures – this process is still ongoing.
What are the perks of CETA?
This trade agreement reduces taxes and facilitates the export of goods and services, which in turn, benefits businesses and people, both in the EU and in Canada. The agreement has a strong strategic dimension for both territories, namely because:
– Creates opportunities for both parties to enter the market of goods, services, and public procurement;
– Reinforces the cooperation, by removing tariff and non-tariff barriers, ensuring convergence of economic regulation, protecting consumers and workers, and setting commitments regarding sustainable development;
– Promotes the investment between the EU and Canada;
– Improves the rules of intellectual property protection of individuals and companies;
– Reduces transaction costs between the two territories.
In 2020 the 3rd CETA anniversary was celebrated, with a positive balance, showing an increase of 24% in goods transactions, and 25% in services transactions, between the EU and Canada. Despite the impact of the COVID-19 pandemic on the global economy, the flow of transactions EU – Canada increased by 15%, compared to the figures observed pre-CETA.
If your company is located in Canada and you want to explore the European markets, or if your business is located in the EU but you wish to expand to Canada, CETA may be an important factor in the success of your internationalization process.
Market Access has a team of consultants specialized in the internationalization of companies in several European markets and in Canada. Contact us to find out how we can help you in the internationalization of your business!