Bratislava, November 2 (TASR) – Trade relations between Canada and the European Union should expand thanks to the European-Canadian CETA trade agreement signed in Brussels on Sunday (October 30), TASR was told by various Slovak analysts on Wednesday.
Following the ratification of CETA in the European Parliament and in national parliaments, most import duties will be abolished. According to analysts, this will contribute towards deepening trading opportunities between the EU and Canada. “Some estimates show even a 20-percent hike in trade between the two sides, which would represent a profit of some €12 billion a year for the EU,” said Slovenska sporitelna analyst Katarina Muchova, adding that the benefits of the CETA agreement won’t be seen in one day, but gradually.
“CETA is important partly due to the fact that it’s the first EU agreement with a G7 country,” said Muchova.
The trade agreement will be beneficial also for Slovak exporters. At the moment, Slovak exports to Canada represent 0.4 percent of all the country’s exports, while imports from Canada to Slovakia represent only 0.1 percent of all imports.
“Scrapping import duties can help Slovak exporters to increase their competitiveness on the Canadian market and offer them some new business opportunities and vice versa,” said the analyst.
Moreover, CETA should ultimately reduce exporters’ costs. “Implementing the agreement will bring European exporters certain positive features, such as reducing the product and service costs of exports to the Canadian market. This will be possible thanks to the abolition of customs duties and other trade restrictions. All this will lead to facilitating international trade between the EU and Canada, which is certainly seen as a positive trait,” said another analyst from Postova banka Jana Glasova.
According to Glasova, duties and administrative burdens for imported goods make the entire import process too expensive. Moreover, they make it more complicated and discourage possible importers.
“Their scrapping will lead to more competition between manufacturers and sellers on the markets, which also brings certain benefits,” she said, adding that higher competition motivates producers to improve the quality of their products as well as to reduce their prices, which is beneficial for consumers.
“However, there are two sides to every story, and, of course, there are situations in which cheaper producers from abroad push domestic producers away from the market. This is often viewed negatively by people,” stated Glasova.