VANCOUVER (NEWS 1130) – The newly-signed Comprehensive Economic and Trade Agreement (CETA) will soon eliminate import tariffs on most goods travelling between Canada and the European Union.
But this doesn’t necessarily mean BC consumers will see a noticeable drop in the price of European wines, cheeses, clothing, or import cars, according to UBC Institute for European Studies director Kurt Huebner.
For one thing, there’s no guarantee that companies will pass import savings on to consumers.
“In some sectors, companies have higher market powers than in others,” Huebner says. “If (prices) stay put, this indicates not so much a failure of CETA, but maybe a failure of competition policy in this regard in Canada.”
Savings on tariffs could also be absorbed by exchange rates if the value of Canada’s dollar falls further below the Euro.
Huebner adds that while provinces like Ontario and Quebec import many consumer products from Europe, BC’s imports from the continent are mainly investment goods, such as equipment for companies.
“The more east we go in Canada, the stronger the positive effects for Canadian consumers,” he says.
BC’s Minister of International Trade Teresa Wat praised CETA in a statement, saying exporters will now enjoy duty-free access to a huge market for wood products, metals, and seafood.