International trade is a key contributor and supporter of Canada’s overall economy, as well as the scaling digital economy. The Comprehensive Economic and Trade Agreement (CETA), a free-trade agreement between Canada and the European Union, was ratified in 2017. CETA is benchmarked as one of Canada’s most progressive and beneficial free trade agreements. Two years after entering into force, the benefits of CETA are already evident for EU businesses but have been slower to appear for those in Canada. From end of 2017 to end of 2018, exports from the EU to Canada increased by 11%, whereas exports from Canada to the EU saw only about one-third of this growth (4%). Canada’s relatively slow uptick in trade with the EU suggests a clear need to effectively leverage CETA to accelerate commerce—specifically in digital technology—with what is one of the largest marketplaces in the world. This study investigates the trade relationship of EU digital businesses with Canada across sectors such as digital services, health and biotech, cleantech, fintech and others. While most EU businesses in these sectors have a favourable opinion of Canada, this is largely based on intrinsic values such as the stable political system and cultural symbiosis with the EU. However, many EU businesses have limited insight into the Canadian digital economy and Canadian successes in this space. The vast majority of EU businesses surveyed noted little to no knowledge of any Canadian developments in this area. Lack of visibility and scarcity of available information on Canadian digital success stories was highlighted as a major barrier to expanding trade relationships with Europe. This was coupled with challenges in understanding and navigating Canada’s fragmented provincial regulatory systems. Many EU businesses are interested in expanding trade partnerships with Canada through CETA but stressed that Canada needs to market itself more clearly and provide actionable and detailed intelligence about its digital economy to would-be EU partners.

The data collected for this research concluded at the end of 2019. Therefore, while this report reflects general trade dynamics between Canada and the EU, it does not take into consideration the impacts of the COVID-19 pandemic, which has destabilized supply chains and impacted trade relationships on a global level.


To cite this report:

Cutean, A., Herron, C., Ivus, M. (June 2020), CETA: Strengthening Canada-EU Ties and Scaling the Canadian Digital Economy. Information and Communica- tions Technology Council. Ottawa, Canada.

Designed by Faun Rice.

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