An ICTC Study
Strengthening Canada-EU Ties and Scaling the Canadian Digital Economy
Published by ICTC, July 2020
Free trade agreements have many broad and sweeping advantages. They strengthen relationships between nations and are recognized as key drivers of economic growth, imports and exports, foreign direct investment, technology and idea transfer, and much more. Focusing on what is frequently described as Canada’s most progressive free trade agreement to date, this study offers an overview the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU from a digital economy trade perspective. This includes an analysis of digital priority areas, EU market needs and core strengths, and a deeper examination of existing challenges and critical barriers.
Two years after CETA came into force, much has changed for Canada’s trade prospects with the EU, but little has changed in terms of Canada’s export numbers. Canadian technology goods exported to the EU increased by 4% during the period, while imports of technology goods from the EU to Canada grew by almost 11%. By examining the framework of this trade agreement, this study highlights critical priority areas in the EU digital economy and finds that sectors such as fintech, advanced manufacturing, and cleantech are ripe with opportunity (these are also areas of innovation
for many Canadian digital businesses).
Canada is one of the EU’s closest trading partners. The modern relationship reaches back about 80 years to the end of the Second World War. Since then, the commitment to democratic principles, human rights, fundamental freedoms, and the respect for the rule of law have only strengthened and solidified this relationship. In 2017, the ratification of CETA expanded on this deeply entrenched partnership and marked the start of a new beginning. Leveraging CETA to accelerate trade and promote closer ties between Canadian and European digital economies holds the promise of elevating this alliance to new levels.
Researched and written by Alexandra Cutean (Senior Director, Research & Policy), Maryna Ivus (Manager, Labour Market Research), and Chris Herron (Junior Research Analyst), with generous support from Zhenzhen Ye (Senior Economist) and the ICTC Research & Policy Team.