The Comprehensive Economic and Trade

EXECUTIVE SUMMARY MAY 2016
The Comprehensive
Economic and Trade
Agreement (CETA).
What Impact Will It Have on Quebec?
At a Glance
• Quebec’s domestic economic growth will remain limited in the years ahead. The
province will have to expand its exports to increase its economic development. Closer
trade links with Europe are a possible means of increasing the volume of exports,
and thus economic growth.
• The Comprehensive Economic and Trade Agreement (CETA) between Canada and
the European Union will have a measurable impact on how we export to Europe.
• According to the forecast model used, the reduced customs tariffs provided for in
CETA could lead to a $324-million increase in annual export volumes by 2022.
A full French version of this publication follows this English executive summary.

THE COMPREHENSIVE ECONOMIC AND TRADE AGREEMENT (CETA)
What Impact Will It Have on Quebec
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Executive Summary
The signing of the Comprehensive Economic
and Trade Agreement (CETA) will give Quebec
companies better access to the European
market, letting them bid on public procurement
opportunities and consolidate the position
they hold with European importers. Among
other things, CETA will eliminate 99per cent
of general non-agricultural tariffs and 94per
cent of agricultural tariffs. It will reduce non-
tariff barriers such as certification rules and
offer improved labour mobility and a system
for recognizing professional qualifications.
It will also incorporate an accelerated
arbitration procedure.
CETA is the most comprehensive economic agreement ever signed by
both Canada and the European Union. It represents an unprecedented
opportunity for Quebec firms eager to export to Europe, particularly with
respect to government procurement.
It is important to remember that Quebec’s growth prospects remain weak
mainly because of its aging population. Without a major boost to exports
and improvements in productivity, Quebec’s economic growth will be
slower than that of its neighbours.
While signing CETA is not without risks, the agreement is essential to
improving Quebec’s exports. The United States admittedly remains the
province’s main trading partner, and potential there is still huge, but the
southern regions of the United States—where growth prospects are
strongest—are more integrated with Mexico. Unfortunately, Quebec
companies cannot compete on operating costs with Mexican companies.
It is therefore imperative for Quebec to continue to add to the list of
countries it exports extensively to.

Institut du Québec
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A wide range of Quebec products are currently exported to Europe.
In order of importance, they include air and space navigation devices,
iron ore and concentrates, gas turbines and turbojets, aluminum and
derivatives, and electronic equipment and devices. In 2014, these sales
were worth over $8billion. Quebec’s economic relationship with the
European market includes more than mere exchanges of goods: It also
embraces bilateral investments, trade in services, and labour mobility.
Europe thus constitutes a new natural market for many Quebec firms.
According to the forecast model used, the tariff reductions under CETA
could lead to a $324-million increase in exports in 2022,1 mainly in the
chemical products, plastics, and rubber sector.
1 In all, over $2-billion worth of additional sales are expected by 2022.

RAPPORT MAI 2016
L’AECG avec l’Europe
Évaluation des retombées pour le Québec