The EU-Canada FTA: An Econometric Assessment of The Impact on Goods Trade

This paper econometrically assesses the impact on EU goods trade of the EU-Canada Comprehensive Economic and Trade Agreement (CETA), which has been provisionally applied since 2017. As opposed to many other studies, this analysis is carried out at the most disaggregated level of publicly available trade data - the 8-digit level. Furthermore, we control for nomenclature changes and revisions. Most EU trade with Canada are concentrated in a handful of broad product groups which were already duty-free (MFN0 duties). The paper nevertheless finds positive and significant impacts on EU exports to Canada. On the other hand, CETA seems to have increased EU imports from Canada only in goods that were already subject to MFN0 duties. The results suggest that there are positive effects on trade of the agreement beyond tariff reductions, something which requires additional research.