CETA: the trade agreement between the EU and Canada
On 30 October 2016, the EU leaders and the Canadian Prime Minister met in Brussels for the 16th EU-Canada summit in order to sign the EU-Canada Comprehensive Economic and Trade Agreement (CETA).
CETA is the most comprehensive and progressive trade agreement between the EU and Canada. Itremoves over 99% of tariffs that currently hinder trade between the EU and Canada. It is expected to increase bilateral trade by €12 billion per year, and to generate growth and new jobs on both sides of the Atlantic.
In this occasion, the leaders also signed the Strategic Partnership Agreement (SPA). The SPA deepens cooperation between the EU and Canada in fields such as foreign policy, crisis management, security and defence, energy and climate, enhanced mobility and people-to-people exchanges.
From the sawmill Industries point of view, the most significant part of the agreement states: "The Parties recognise the importance of the conservation and sustainable management of forests for providing environmental functions and economic and social opportunities for present and future generations, and of market access for forest products harvested in accordance with the law of the country of harvest and from sustainably managed forests".
Almost 9% of the world’s forests is growing in Canada; forestry and wood industry are essential contributors to the national economy, as a matter of fact, Canada has the world’s largest forest product trade balance – 19.3 billion dollars. On the other side, EU numbers are slightly lower. In terms of the world’s forests EU accounts for 5% and the size and productivity of forestry-related industries is diverse, being the leaders in this field Finland and Sweden.
While most Canadian forest products already enter the EU duty-free, upon CETA’s entry into force, all Canadian forestry products will enjoy duty-free, quota-free market access to the EU. Current EU tariffs for forest products range from 2% to 10%. The EU is the world’s third largest importer of forest products – $46 billion in 2015 or 14% of global forest product imports in 2015. Canada’s advantage includes areas where EU demand is strong. Key exports from Canada, such as wood pellets, sawn/sliced coniferous wood, chemical wood pulp of coniferous wood, and seat components, have strong demand in the EU.
The CETA agreement:
The joint declaration on the EU-Canada partnership: