ASSESS_CETA: Assessing the claimed benefits of the EU-Canada Trade Agreement (CETA)

CETA: Ökonomische Bewertung der prognostizierten Effekte des EU-Kanada-Freihandelsabkommens

Werner G. Raza, Bernhard Tröster and Rudi von Arnim

No 4/2016, Research Reports from Austrian Foundation for Development Research (ÖFSE)

Abstract: In late 2016, a decision will be made by the Council of the European Union whether to launch the ratification process of the free trade agreement between the EU and Canada (CETA). The European Commission (EC) is promoting the agreement with the prospects of more trade, stronger economic relations and job creation. However, studies on the economic impact of CETA report only marginal effects on GDP of 0.03% to 0.08% for the whole of the EU. In other words, CETA is expected to generate a one-time income effect of around 20 EUR per EU citizen after a 10 years implementation period. Despite these small effects by CETA, it is worthwhile to question models and assumptions that stand behind these estimations and show neglected risks and adjustment costs. This task is highly relevant, given that the EC is stressing the innovative character of the agreement as it includes intensive regulatory cooperation and strengthens investor protection via the controversially discussed investor arbitration mechanism. CETA is therefore considered the blueprint of the future EU trade policy that focuses on new topics such as regulation, liberalization of public procurement and the promotion and protection of investment.

Date: 2016
Note: Commissioned by the Chamber of Labour Vienna. Updated Final Report, 03 August 2016
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:oefser:42016

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