Assessing the quality of trade agreements | KPMG | CA

Assessing the quality of trade agreements

Assessing the quality of trade agreements

C-Suite 43: Canadian business leaders continue to favor the emphasis on free trade agreements with global partners.

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Assessing the quality of trade agreements

The adoption of more free trade agreements remains top of mind for Canadian executives according to this quarter’s C-Suite survey. Most support building upon existing agreements while also supporting negotiating free trade with China. However, there is also concern regarding the possible economic impact on our economy if the TPP and EU agreement collapses. Nearly all agree that both the government and business need to better inform the public about how trade agreements are beneficial to Canada.

Top highlights

Trans-Pacific Partnership (TPP) & building on NAFTA

  • 87% support the ratification of the TPP (43% strongly support)
  • 90% would support the negotiation of a customs union between Canada and the US to allow for the removal of all tariffs between the two countries, and as many non-tariff barriers as possible, within the next ten years (53% strongly support this).

Free Trade Agreement with China

  • Most (51%) believe the Canada-China trade relationship is too restrictive. Only 9% think China should have less access to Canadian markets, while others think the trading relationship is just right.
  • Most (78%) said they would support the negotiation and ratification of a Canada-China free trade agreement within the next five years. However only 23% strongly support moving ahead with a Canada-China deal, 55% somewhat support the idea.

Prospects for Canadian economic growth

  • 7 out of 10 executives expect moderate growth for Canada’s economy over the next 12 months; up from just 4 out of 10 last quarter. That said not one executive in the C-Suite expects strong growth for Canada’s economy over that time frame suggesting simply that the worst is over and few expect any further contraction in GDP.
  • Canada’s trade deficit reached a historic low in March, yet most agree this will resolve itself when commodities rally. Only 35% said Canada has a structural or long-term trade deficit.

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