The Economic Impact Of The Comprehensive Economic And Trade Agreement

October 11, 2021 at 11:25 am

A clear European position, according to which it intends to maintain and strengthen its economic relations with China under strict conditions, would be an important message for China. It would also strengthen the resolve of the many internationalists who are likely to hold key positions on the Biden team and those in the US Congress who want to take a more constructive approach to China. An attitude to which the president-elect would in any case be inclined, in relation to his long-standing commitment to foreign relations and with China, despite the electoral rhetoric. A widespread misunderstanding about trade agreements is the perception that they only concern the cross-border exchange of material goods. However, trade in services is expected to contribute twice as much to the economy as goods. Free movement and restriction of labour between the EU and Canada would likely promote the quality of labour in both countries in sectors such as environmental services, telecommunications and finance. Membership of the CPTPP may be a promising option for the EU, given the comprehensive and ambitious provisions of the agreement. The CPTPP already covers Asia and America and could also cover Europe. The fact that the EU already has trade agreements with the largest members, including Canada, Japan, Mexico, South Korea and Vietnam, could facilitate the negotiations, but also lead to further relatively limited trade liberalisation. The United Kingdom has already expressed interest in joining the CPTPP. This impact assessment sets out the potential effects of the Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada.

The analysis focuses on the economic impact of CETA on the UK. CETA aims to eliminate up to 98% of tariffs, which would save EU exporters up to €500 million in annual tariffs between the two economies. The agreement also aims to facilitate cross-border exchanges of professionals, including maintenance engineers and technical specialists, to provide after-sales services and support for technological products. Simplifying this process will benefit both businesses and consumers. If the EU decides to follow the China option, it should learn from Japan`s skilful economic diplomacy, which has so far successfully navigated between China and the US, concluded trade deals with both (and with the EU), while maintaining its close security alliance and trade relations with the US. . . .