Canada’s tariff regime by aua56698

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									       THE CANADIAN PREFERENTIAL TARIFF REGIME AND POTENTIAL ECONOMIC
                           IMPACTS OF ITS EROSION




                                               by Przemyslaw Kowalski 1

                                           Przemyslaw.Kowalski@oecd.org




                               Preliminary draft – not for citation, comments welcome




                                                 Version 29 July 2005




           Prepared for International Symposium on "Preference Erosion: Impacts and Policy Responses"
                                          Geneva, June 13-14, 2005


1
    Przemek Kowalski is an economist at the Trade Directorate of the OECD Secretariat. The views expressed in this
           paper do not necessarily represent those of the OECD or any of its members.
The author would like to thank Raed Safadi and Simon Evenett for their helpful comments, Karinne Logez for her
         statistical assistance and Caroline Mirkovic for research assistance. The assistance of Diane Kelloway of
         the Finance Canada in providing the underlying trade data and associated technical explanations was
         greatly appreciated and made this paper possible. All remaining errors are those of the author.


                                                         1
Executive summary

       •   In 2003, Canada’s imports from NAFTA partners accounted for approximately 65% of its
           total imports. This agreement offered significant margins of preferences over MFN duties
           and, to a lesser extent, over GPT and LDCT treatments. Canada’s imports form developing
           countries accounted for 18.6% of its total imports. 74% of imports from developing countries
           entered Canada under MFN treatment at an average tariff rate of 5.8%, 15% under GPT
           treatment at an average tariff rate of 2.2% and 0.7% under LDCT treatment at an average
           tariff rate of 0%.

       •   The extensive reliance of several developing countries on non-preferential access to Canada’s
           market suggests their strong interest in further liberalisation of the MFN regime. Cases of
           over-reliance on preferential trade with Canada are limited to few LDCs where trade under
           preferential schemes accounts for the bulk of total exports to Canada. As a result, the latter
           group of countries appears as potential opponents to further cuts to MFN tariffs.

       •   One of the possible solutions to the preference erosion problem that may be considered in the
           DDA negotiations is a simultaneous lowering of MFN and corresponding preferential rates so
           that preferential margins are preserved. This paper finds that out of 19,147 records where
           positive imports from developing countries were recoded in 2003 simultaneous reductions of
           MFN and preferential rates would be in principle feasible on up to 7,582 lines covering 66%
           of total imports from developing countries entering under non-reciprocal preferential
           schemes. 7,382 lines covering 24% of preferential trade would not be affected by MFN cuts
           since on these lines both the MFN and preferential rates are already zero. Declines of
           preferential margins would be inevitable on 4,183 lines covering 20% of total preferential
           imports from developing countries including all preferential trade with LDCs.

       •   As far as the value of preferences is concerned, the main beneficiaries include several more
           advanced developing countries such as Mexico, South Korea, China, India, Brazil, Israel,
           Malaysia Hong Kong-China as well as some LDCs such as Bangladesh, Cambodia or Haiti.
           Expressed as percentage of total beneficiary’s exports to world the value of preferences does
           not typically exceed 1%. Nevertheless, several LDC countries exhibit higher-than-average
           ratios of value of preferences to total exports (0.52% in Bangladesh, 0.43% in Cambodia,
           0.28% in Haiti, 0.23% in People’s Democratic Republic of Laos, 0.22% in Maldives, 0.20%
           in Lesotho). Remarkably, this seems to be a consequence of the 2003 extension of the LDC
           scheme to textiles and clothing.

       •   Imports under the LDC scheme exhibit a heavy concentration in textile and clothing products
           Five HS textile and clothing chapters (61-65) accounted for 98% of imports entering under
           the LDC scheme.

       •   High tariff-line concentration of value of preferences in the case of LDCT and, to a lesser
           extent, GPT schemes suggests that exclusion of relatively few lines from MFN liberalisation
           could alleviate a substantial part of potential negative effects of preference erosion in the
           Canadian market. However, the benefits of such an option should be compared with benefits
           (to Canada and its other trading partners) that could be obtained by reducing MFN tariffs on
           these lines.

       •   Bearing in mind the qualifications associated with the use of the particular model and data, a
           conclusion that could be drawn from the simplified model assessment implemented in the
           paper, is that the welfare impact of Canadian preferences is very small for most developing


                                                  2
countries analysed here. Notwithstanding the significant variation in the utilisation and value
of preferences across beneficiaries, this is consistent with the generally small shares of
preferential trade with Canada in these countries’ total trade. Therefore, erosion of
preferential schemes does not appear as a major hurdle to further reduction of Canadian MFN
rates.




                                        3
Introduction

     This paper seeks to identify Canada’s trade partners and products that may be potentially vulnerable
to the problems of preference erosion following MFN liberalisation under the Doha Development Agenda.
This is achieved through a two-track approach. First, a detailed statistical analysis of the structure of
Canadian preferences is undertaken drawing on the trade preferences database collected by the OECD
Secretariat. 2 The database contains actual trade flows under preferential arrangements for Canada in years
1998, 2002 and 2003 (for description of database coverage and methodology see Lippoldt and Kowalski,
2005). The statistical analysis includes overviews of: structure of preferential trade flows; associated tariff
levels and preferential margins; utilisation, utility and coverage rates; the value of preferences by scheme
and beneficiary as well as information on key tariff lines where the value of preferences is concentrated.
The second complementary approach in this paper employs the standard GTAP model and the GTAP 6
database to examine the trade and welfare impacts of removing Canada’s preferential duties.

An overview of Canadian tariff preferences

     The extent and potential economic impacts of Canada’s preferential schemes on beneficiary countries
need to be considered in relation to market access conditions that Canada’s other trading partners face in
the Canadian market. In particular the trade impact of GPT and the LDC schemes appear to have been
limited by the relatively low protection levels afforded to other trading partners be it on the MFN basis or
through reciprocal trade agreements (free trade areas).

     Indeed, judging by the simple average tariffs, Canada’s tariffs are relatively moderate. Simple
average tariff on all MFN tariff lines was estimated at around 6.8% in 2002 (WTO, 2003) and simple
average tariff on tariff lines where imports from developing were positive was estimated at 5.8% in 2003
(see Table 3). However, noticeable differences are reported in the levels of protection of agricultural and
non-agricultural products (WTO, 2003). For example, the average MFN tariff calculated for Agriculture 3
in 2002 was 21.7% as compared to an average of 4.2% for Non-agricultural products (WTO, 2003).
Within agricultural products category, the highest tariffs are placed against imports of Dairy products
(237%), Live animals and products thereof (52.7%), Beverages and spirits (8.3%) and Fruits and
vegetables (4.8%). Within non-agricultural products, average MFN tariff rate in Textiles and clothing was
calculated at 9.9%. It is also reported that tariff escalation continues to inhibit exports of downstream
products to Canada by countries exporting under MFN treatment (WTO, 2003). This is the case
particularly for imports of food and beverages, textiles and clothing, wood products, chemicals and non-
metallic mineral products.

     Currently, Canada has five reciprocal preferential agreements: Canada-Chile Free Trade Agreement,
Canada-Costa Rica Free Trade Agreement, Canada-Israel Free Trade Agreement, Canada-United Sates
Free Trade Agreement, and North-American Free Trade Agreement. These reciprocal agreements offer
significant margins of preferences over MFN duties and, albeit to a lesser extent, over GPT and LDCT
treatments (see Table III.2 in WTO, 2003). For example, under NAFTA 98.8% and 93.8% of tariff lines of
imports originating, respectively, from the US and Mexico were duty free in 2002 (WTO, 2003). The
average import duties for United States and for Mexico under NAFTA were 2.6% and 2.7% while those for
the GPT and LDCT were respectively 5.4% and 4.1%. The significance of these advantages and their
potential impact on market access of other trading partners is further strengthened by the sheer shares of
the NAFTA partners in the Canadian market – in 2004 imports from the US and Mexico accounted
together for around 63% of total Canadian imports (see Table 1). The remaining free trade agreements also

2
    Tariff-line data on Canada’s imports from developing countries were kindly provided by Finance Canada.
3
    According to the WTO definition.


                                                          4
grant substantial advantages to respective trading partners but the volumes of trade are significantly
smaller as compared to NAFTA.

Non-reciprocal preferential schemes

     Table 2 presents basic information on Canada’s non-reciprocal preferential tariff schemes with respect
to developing countries. Currently Canada provides non-reciprocal tariff preferences to developing
countries under the Generalized Preferential Tariff (GPT), the Least Developed Country Tariff (LDCT)
and under the CARIBCAN. However, certain Canadian imports from developing countries are classified
under other preferential (reciprocal and non-reciprocal) schemes (see Table 3 for the composition of
preferential trade flows).

     The Generalized Preferential Tariff (GPT) scheme took effect in 1974 and was subsequently renewed
and expanded in 1984, 1995 and 2004. It is worth mentioning that the 1995 revision aimed to take into
account the effects of erosion of preferential margins following the Uruguay Round negotiations, mainly
through expansion of product coverage and lower GPT duty rates (UNCTAD, 2001). At present GPT rates
granted for selected agricultural and industrial products 4 range from duty-free to MFN rates.

     However, the evolution of Canada's tariff preferences in favour of developing countries over the past
two decades reflects mainly a number of special measures introduced for LDCs (see e.g. Weston, 2003).
In 1983 LDCs were granted a zero rate on GPT-covered products with exception of clothing, footwear,
certain labour-intensive industrial products as well as some agricultural products. As of 1999, and
reflecting consultations held since 1994, the GPT (and LDC) product coverage was extended by some 220
product lines and the GPT tariffs were lowered to two thirds of the corresponding MFN rates. As pointed
out by Weston (2003), in addition to improving market access under GPT, this also resulted in effective cut
of margins enjoyed by the LDC countries. In 2000 further 570 tariff lines were added to the duty free list
for LDCs bringing the share of duty-free lines for LDCs to 90%.

     Nevertheless, a number of sensitive products were still excluded. Weston (2003), citing UNCTAD
(2001) and UNCTAD and Commonwealth Secretariat (2001), indicates that at the beginning of 2000s,
despite the apparently high tariff line coverage, the LDC programme of Canada was not granting real
market access opportunities for LDCs: only 15 products were exported to Canada by LDCs; only around
30% of non-oil, non-arms imports from LDCs were duty-free in 2000; of the Quad countries, Canada had
the highest proportion of imports form LDCs facing tariffs above 5%. Indeed, the extension of product
coverage in 2000 led to very limited changes as textiles and clothing products remained excluded. These
accounted for 38% of total LDC exports to Canada in 2000 (Kowalski and Lippoldt, 2005). As discussed
below, however, an unambiguous increase in the utilization rates of LDCT scheme by some LDC
beneficiaries points to beneficial effects of more flexible rules of origin (ROO) (see Rules of origin below).

      From 1 January 2003 all remaining tariff and quota restrictions on imports from LDCs (with the
exception of supply-managed agricultural products 5 and Myanmar) were removed. The initiative included
textiles and clothing and a modification of ROOs. Before the extension to textiles and clothing, excluded
products were 93% of total dutiable LDC imports (Lippodlt and Kowalski, 2005). In 2003, the share of
excluded products was expected to go down to almost zero which, as data indicates, is what actually
happened (see Utilisation, utility and coverage of preferences). As argued by Weston (2003) the new LDC
initiative was controversial not only because of the potential impact on Canadian producers (mainly in the

4
    Excluded products encompass: textiles, footwear, products of the chemical, plastic and allied industries, specialty
            steels and electron tubes (UNCTAD, 2001).
5
    Supply-side managed products referred to here are dairy, poultry and eggs products the supply of which is regulated
            in Canada through a system of quotas.


                                                            5
clothing industry) but also because of the short-term nature of benefits it would afford to LDCs in the
context of inevitable phase out of MFA quotas in 2004. It was expected that benefits to LDC exporters that
would profit from the new initiative would disappear with expansion of quotas on non-LDC, in particular
Chinese, clothing products. Weston (2003) also points out that uncertainty associated with non-binding
nature of preferential margins, associated conditionalities and supply constraints in the exporting
developing countries have all contributed to the scope of benefits associated with these preferential
schemes.

Rules of origin

      Rules of origin (ROO) are employed under preferential as well as non-preferential tariff schemes in
order to require a minimum level of local content in products imported from eligible suppliers. They can
help to ensure that the products imported under the preferences are not merely transhipped from non-
eligible countries via the eligible suppliers with little or no local value added. While under certain
circumstances the ROO can play a role in ensuring the intended beneficiary countries actually reap the
benefits from preferential programmes they are also perceived as the main reason for underutilisation of
preferences (e.g. Inama (2003)).

     In the 1980s Canada introduced more generous rules of origin for LDCs than for other developing
countries with a minimum requirement of 40% of local value added compared to 60% required for other
GPT countries. The 2000 reform of the system further relaxed ROO allowing up to half of 40% minimum
value added originate from another developing countries (Weston, 2003). The 2003 LDC initiative
included a modification of ROO for textiles and clothing products. To be eligible under the new ROOs the
cloth has to be cut and sewn or fabric woven from yarn produced in the eligible country. The new
cumulation system allows inputs from all beneficiary countries provided that a minimum of 25% of value
added originates from the exporting LDC country. For goods other than textiles and apparel the existing
pre-2003 rules of origin for the LDCT remained in force.

Other forms of compliance verification

     To be eligible for the LDCT or GPT, in addition to ROO requirements, goods must satisfy the
requirement of certification and direct shipment. Direct shipment requires in essence that goods are either
shipped directly from an eligible country or transhipped through an intermediate country provided that the
goods remained under customs transit control in the intermediate country and did not undergo additional
processing, trade, consumption or storage exceeding 6 months in the intermediate country (CCRA, 2003;
UNCTAD, 2001). The required documentation consists of a thorough bill of landing (TBL) and related
shipping documents if a TBL does not specify all points of transhipping (CCRA, 2003).

      The system distinguishes between two types of certificates of origin, one for non-textile and apparel
goods and one for textile and apparel goods, that should be used to claim entitlement to the benefits of
duty-free market access under the LDCT. The verification procedure involves an origin questionnaire or
letter which is sent to the exporter for completion and return to Canada Customs and Revenue Agency
(CCRA). This document is the basis on which an auditor determines whether goods are eligible or not. If
additional information is required the auditor may request a visit to the premises of the exporter.

The value of preferences

A number of approaches to measuring the benefits from preferential arrangements, or alternatively the
losses from their erosion, have been employed in the existing literature. At the theoretical level, trade
preferences and regional agreements can be analysed in the first instance within the same analytical setting.
This is because both kinds of arrangements share discriminatory properties, in that they involve


                                                     6
geographically selective trade liberalisation. The static trade and welfare effects of regional agreements and
trade preferences have to be examined in a “second-best” context, in which the final judgement as to any
economic benefits that might accrue is an empirical question.

     Among the most popular methods for measuring the benefits of preferential schemes are simple
calculations of the value of benefits based on fixed trade values, estimations of trade creation/trade
diversion impacts, or general equilibrium evaluations. In the first of these approaches, the benefit to the
preference-receiving country is usually defined as the difference between the MFN rate and the preferential
rate multiplied by the value of imports under the given preferential scheme evaluated at world prices. The
effect of preference erosion is then calculated as the difference between the value of the preference before
and after a multilateral liberalization. An example of such an approach in the literature is the assessment of
preference erosion in agricultural products by Yamazaki (1996). A limitation of this methodology is that
changes in MFN tariffs are likely to induce changes in the volumes traded under both preferential and non-
preferential schemes resulting in lower benefit to preference-receiving countries after MFN liberalisation.
Disregarding these changes to trade volumes may result in underestimation of the impacts of preference
erosion.

     A number of studies improve upon this approach by modelling the demand and supply schedules in
partial equilibrium models (see e.g. Subramanian, 2003, and Alexandarki and Lankes, 2004). This
methodology differentiates products by country of origin and controls for trade creation/diversion effects in
response to changes in trade protection measures. Under this approach, MFN liberalisation typically results
in an increased demand for products imported under MFN treatment and decreased demand for imports
entering under preferential rates. The advantage of this approach is its relative ease of interpretation and
the possibility of its application at the very detailed level of product classification – an advantage over the
data-intensive general equilibrium assessments that have to be conducted at a high level of aggregation. Its
shortcoming is that it cannot relate changes in tariffs and trade on one good to those on other goods - i.e. it
is partial equilibrium. Where a far-reaching reform is under consideration –such as currently is the case in
the DDA, this can be a handicap and result in unrealistic estimates of the economic value of preferential
trading arrangements.

     Computable general equilibrium evaluations of MFN liberalisation capture the effects of substitution
between imports and domestic production, imports from preferential to non-preferential sources in the
preference-giving country, changes in demand for intermediate inputs, reallocation of productive resources
across industrial sectors, terms of trade and balance of payments effects. It can therefore better capture
some of the costs inherent in preferential trading arrangements such as, for example, preferences-driven
concentration of resources in relatively uncompetitive activities. In such a framework, in addition to the
potentially negative impact in a particular preference-receiving sector (e.g. in terms of output reduction),
economy-wide implications of reallocation of productive resources towards other activities are evaluated.
This important advantage enables accounting for the ‘package’ nature of multilateral trade agreements
where the potential negative effects associated with a particular sector or preferential scheme can be
analysed in conjunction with other effects. One drawback of CGE modelling is its high data requirements
and the resulting high-level of aggregation of different types of economic activity – a feature that may be
particularly problematic in a study of preference erosion where the focus is on selected product categories
and in a limited group of small countries.

      No matter what approach one takes, caution in interpreting the results is called for. Most analyses of
the liberalisation benefits arising from preference schemes rely on trade flow data, estimates of changes in
preferential margins, coverage or exclusion ratios, changes in trade shares, and the like. One of the
problems with this kind of analysis is that even where a relationship seems to exist between changes in a
preferential arrangement and changes in trade flows or shares, it is often necessary simply to assume a
causal link, despite the possibility that a range of other factors may have influenced an observed outcome.


                                                      7
Similarly, the absence of a positive trade response in the presence of preferences does not necessarily mean
that the preferences are deficient -- the constraint could lie elsewhere. Indeed, as we will see later in the
paper, benefits from the Canadian preferential schemes may have been limited on account of relatively low
to modest MFN duties, and/or the number of FTAs that Canada has concluded with its major trading
partners.



Structure and utilization of preferences

Data

     The analysis presented below draws on tariff preference database collected by the OECD Secretariat.
The Canadian data covering tariff lines for which there were imports from developing countries in 1998,
2002 and 2003 were provided by Finance Canada. The database consists of bilateral import flows at the
HS-8 digit level differentiated by treatment claimed at the time of import. In addition to LDCT and GPT
treatments, imports from developing countries have been registered under Commonwealth Caribbean
Countries Tariff, British Preferential Tariff, Chile tariff, General Tariff, Mexican Tariff, Mexican-United
States tariff, United States Tariff, Canada-Israel Agreement Tariff and Costa Rica Tariff. The database
makes a distinction between total and dutiable imports for each specific tariff line and treatment. Dutiable
imports refer to the portion of imports that was used for calculating duty paid or payable. 6

      An overview of 2002 and 2003 data underlying calculations in this part of the paper is presented in
Table 3, including an indication of the number of tariff lines on which at least one positive import flow
between Canada and a developing country occurred under the specific tariff treatment. The corresponding
minimum, maximum and simple average tariffs are also provided. For the sake of comparison, an average
MFN rate calculated on corresponding tariff lines is also presented. The last column indicates the number
of lines on which ad valorem duties were specified.

     The source data on preferential trade of Canada provided by Finance Canada include descriptions of
specific duties. Non-ad valorem tariffs on records concerning Canada’s trade with developing countries
take mostly the form of mixed rates. 7 The share of non ad valorem tariffs on MFN lines on which trade
with developing countries was recorded in 2003 was 2.6%. For GPT this figure was even lower (1.4%
corresponding to 0.26% of value of GPT imports) and for LDCT it was nil. Additionally, only for 0.40% of
value of imports entering Canada under the GPT scheme in 2003 was the corresponding MFN duty rate
specified in non-ad valorem terms. For LDCT the corresponding ratio was 0.14%.

     In view of the relatively low incidence of non ad valorem items and given the non-availability of data
on imported quantities or collected tariff revenue, the ad valorem components of mixed and compound
rates are used in calculations referring to these lines. This is arguably an ad hoc and crude way of dealing
with specific rates but, compared with excluding these items from calculations, it delivers a more realistic

6
    The data set contains some problematic entries where for example positive values of dutiable imports are recorded
            for duty free records. It is important to note that Canada’s simplified tariff regime that came into effect on
            January 1, 1998 was reported to have caused misunderstandings with respect to coding of documents, duty
            rates, classifications etc. This could explain these anomalies for 1998. However, they do also occur in other
            years.
7
    Mixed rates take the form of a conditional expression determining either an ad valorem or a specific tariff (for
           example X ¢/kg but not less than Y % or X ¢/kg but not to exceed Y %). Other types of specific duties
           used in the Canadian Customs Tariff schedule include specific, compound (combining both specific and ad
           valorem components) and technical rates (duty dependent on the input content).


                                                             8
portrait of the protection structure (especially in the limited number of agricultural and food product lines
where non ad valorem rates are concentrated).

Composition and significance of trade flows

     The 2003 data indicate that around 74% of total imports from developing countries entered Canada
under MFN treatment, 15% via GPT and 0.7% via LDCT treatment (Table 4). Corresponding shares
computed on the basis of dutiable imports are respectively 64%, 33% and 0%. The differences are
explained by the shares of duty-free imports within each of these treatments. In 2003, around 72% of
imports from developing countries entering under MFN treatment were duty free while the corresponding
share for the GPT and LDCT were 41% and 100% (Table 7). It is worth pointing out that imports from
developing countries entering Canada under United States Tariff originated from Mexico, Brazil, China,
Ecuador, Pakistan, Morocco, Thailand and South Korea.

     In order to shed more light on the importance of the Canadian market for developing countries’
exports Tables 4 and 5 present exports to Canada under all schemes (including MFN) (Table 4) and all
preferential schemes (Table 5) as a share in beneficiary’s exports to all trading partners. 8 Taking 2003 as a
reference year, the shares concerning all (preferential and non-preferential) exports were significant and
reached up to 30% for some developing countries. Nevertheless, exports under preferential schemes
typically accounted for less than 1% of total beneficiary exports. In 2003, this ratio was higher than 1
percent for only nine developing countries (Bangladesh, Mexico, Cambodia, Haiti, People’s Democratic
Republic of Laos, Maldives, Barbados, Trinidad and Tobago, and Lesotho). It is worth noting that for six
of these countries significant export increases took place in 2003, most likely, as a result of the
introduction of the new LDC initiative.

     The remarkable reliance of some developing countries on non-preferential access to Canada’s market
suggests their obvious interest in further liberalisation of the MFN regime. However, for a few countries,
mainly LDCs trade under preferential schemes accounts for the bulk of their exports to Canada. This
suggests that the latter group of countries would have no major interest (apart, of course, from preventing
any negative effects of preference erosion) in lowering MFN tariffs. These contrasting situations point to
potential divisions in developing countries’ positions over the issue of lowering Canadian MFN tariffs.

     Table 8 presents the 2003 product structure of imports from developing countries entering Canada
under LDCT, GPT and MFN treatments. Imports under the LDCT scheme exhibit a heavy concentration in
5 HS-2 digit textile and clothing chapters (61-65). These chapters accounted for 98% of imports entering
under the LDCT scheme. Exports under the GPT scheme were more diversified. Still, 6 top HS chapters
accounted for more than a half of imports under this treatment. Furniture products (HS2 chapter 94)
accounted for 13% of imports under GPT scheme; Electrical machinery and equipment (HS chapter
85)11%; Toys, games and sports requisites (HS2 chapter 95) 7.5%; Plastics and articles thereof (HS2
chapter 39) 7.4%; Articles of leather (HS chapter 42) 6.2%; Nuclear reactors, boilers (HS chapter 84)
5.3%). Structure of imports from developing countries under MFN scheme was also relatively concentrated
with more than 50% of imports under MFN treatment were in 4 HS2 chapters: Electrical machinery and
equipment (HS chapter 85) 18.2% of imports under MFN treatment; Nuclear reactors, boilers (HS chapter
84) 16.5%; Mineral fuels, oils and products thereof (HS chapter 27) 14.3% and Vehicles other than
railway or tramway rolling stock (HS chapter 87) 5.7%.




8
    Data on total exports of a given developing country were collected from the WITS database.


                                                           9
Preferential tariff rates

     Substantial shares of imports from developing countries enter Canada via duty-free or low MFN tariff
rates. In 2003, 72% of imports from developing countries entering Canada under MFN treatment were free
of duty (Table 6) and simple average MFN tariff rate on lines with imports from developing countries was
5.8% (down from 6% in 2002). On a simple average basis, LDCT offered 12 percentage point advantage
over MFN rates on LDCT eligible-lines. This was significantly higher than GPT (2 percentage points),
CARIBCAN (3.5 percentage points) or various country-specific tariffs (see columns 5 and 6 of Table 3).
Notably, the GPT rates were available on many more lines than the other Canadian preferential
arrangements.

     As far as individual tariff lines were concerned, preferential margins reached up to maximum 20
percentage points for LDCT treatment, 18.5 percentage points for GPT and 12.5 for CARIBCAN.
Nevertheless, the bulk of preferential trade associated with these schemes occurred on lines with medium
and small preferential margins (see Figure 1).

     Simple averages of preferential margins calculated at the HS chapter level for all and each of the
LDCT, GPT and CARIBCAN schemes presented in Table 9 indicate a marked dispersion across products.
For the three schemes assessed together, in 2003 highest average margins (up to 13 percentage points)
were observed in textile & clothing products (HS chapters 61-64) which was largely an implication of
margins enjoyed by LDCT beneficiaries (up to 18 percentage points). GPT margins in these chapters were
also consistently higher than the average. However, the four chapters accounted for only 6% of imports
entering under GPT, LDCT and CARIBCAN schemes.

   Figure 1. Count of tariff lines with positive trade flows under LDCT, GPT and CARIBCAN treatments and
                                         associated preferential margins


                               120,000,000                                                                         25


                                                                                 value of imports

                               100,000,000   margin
                                                                                                                   20




                                                                                                                        associated preferntial margin (% points)
                                80,000,000
       Value of imports, US$




                                                                                                                   15


                                60,000,000


                                                                                                                   10

                                40,000,000




                                                                                                                   5
                                20,000,000




                                        0                                                                          0
                                                      Spectrum of 19,147 tariff lines with positive trade values




                                                                     10
      One of the possible solutions to the preference erosion problem that may be considered in the DDA
negotiations is a simultaneous lowering of MFN and corresponding preferential rates so that preferential
margins are preserved. Discussion of the linear formula case provided in the Annex shows how this could
be done. Certainly, such a procedure can only apply to tariff rates where existing preferential rates are non-
zero. Additionally, in order to preserve initial preferential margins, proportional cuts to preferential rates
would need to be deeper than those concerning MFN rates and, as is discussed in the annex, for lines where
initial difference between MFN and preferential rates is large such strategy is only feasible for relatively
shallow cuts of MFN rates.

     In this context it is worth presenting the structure of Canadian preferential tariffs distinguishing
between the relative size of the preferential and corresponding MFN rates. Figure 2 offers such a
presentation where all 19,147 records with positive trade values are divided into a subset of lines where the
problem of preference erosion associated with MFN liberalisation could in principle be dealt with by
simultaneous reductions of preferential rates and lines for which this is not feasible (rates where
preferential rates are already zero). In addition a distinction is made between 7,382 lines where both
preferential and MFN rates are zero and 4,138 lines where only preferential rates are zero. This distinction
is important because the latter set of lines would be affected by declining margins under MFN
liberalisation while the former would not. Overall, simultaneous reductions of MFN and preferential rates
would in principle be feasible on up to 7,582 lines 9 covering 66% of total imports entering under GPT,
LDCT or CARIBCAN schemes. 7,382 lines covering 24% of preferential trade would not be affected by
MFN cuts since on these lines both the MFN and preferential rates are already zero. Declines of
preferential margins would be inevitable on 4,183 lines covering 20% of preferential trade including all
preferential trade with LDCs.




9
    The exact number of lines for which this is feasible depends on the ambition of the associated cut to MFN rates.


                                                            11
                  Figure 2. Count of tariff lines with positive trade flows under LDCT, GPT and CARIBCAN treatments and
                                                  associated ratio of preferential to MFN tariff


                          120,000,000                                                                                                                                         120


                                        ratio of tariffs
                                                                                        value of imports

                          100,000,000                                                                                                                                         100




                                                                                                                                                                                    Preferntial tariff / corresponding MFN tariff * (100)
                           80,000,000                                                                                                                                         80
  Value of imports, US$




                                                                          4,183 lines with positive MFN and 0 preferential


                           60,000,000                                                                                                                                         60


                                                                                                                             7,382 lines with 0 MFN and 0 preferential rate


                           40,000,000                                                                                                                                         40




                           20,000,000                                                                                                                                         20




                                   0                                                                                                                                          0
                                                           Spectrum of 19,147 tariff lines with positive trade values


Coverage, utilisation and utility of preferences

      The literature highlights three dimensions of preferential programmes and the associated trade flows:
coverage, utilisation and utility. Inama (2003) provides an overview of these dimensions, although there is
some variation in the way these concepts are applied by various authors. In this assessment, Product
coverage is calculated as the ratio between imports that are covered by a preferential trade arrangement and
total imports from beneficiary countries. While this ratio gives an indication of the extent of eligibility for
preferences it also reflects the structure of imports from beneficiary countries.

     Coverage ratios by beneficiary for LDCT, GPT and CARIBCAN schemes are presented in Table 10.
With some exceptions, these ratios tend to be high (often close to 100%) and consistent across time for
CARIBCAN beneficiaries. Across GPT beneficiaries there is no clear tendency across countries or in time.
In fact 54% of GPT beneficiaries record a decrease in coverage ratios between 1998 and 2002. This
observation is not easily reconciled with the 1999 extension of the GPT and LDC product coverage by
some 220 product lines and lowering of the GPT tariff to two thirds of the corresponding MFN rates (see
An overview of Canadian tariff preferences above). A similar drift is observed in LDC coverage ratios with
the difference that all (apart from Afghanistan) LDC beneficiaries move to 100% coverage ratio in 2003.
Undoubtedly, this is a result of the almost complete removal of all remaining tariff and quota restrictions
on imports from LDCs in 2003. The expansion of exports under the LDC scheme, mostly in textile and
clothing products which are not covered by the GPT, has also certainly affected the coverage ratios
calculated for the GPT scheme.

     Utilisation rates are computed as ratios between imports actually entering under a preferential scheme
and imports covered by the scheme. They are presented for each beneficiary in Table 11. Utilisation rates
give an indication of the take up by importers of the offer of preferential access. It is argued that this take
up rate depends crucially on the stringency and complexity of rules of origin and ancillary requirements

                                                                                   12
(Inama, 2003). Utilization rates calculated for the GPT indicate a very uneven take up and there is no
consistent tendency in time. In fact an increase in utilisation rate from 1998 to 2002 was observed in only
45% of beneficiaries, an increase from 2002 to 2003 in 31% of countries and an overall increase between
1998 and 2003 in 37% of beneficiaries. The structure of LDC utilisation rates seems very dichotomous.
For 35 LDC countries utilisation rates have remained consistently at zero in the three considered years. In
most remaining LDC beneficiaries a positive tendency of increasing utilisation rates was observed. In
particular, the change of regime in 2003 seems to have had a significant impact on utilisation rates of
Bangladesh (89% utilisation rate in 2003), Cambodia (89%), People’s Democratic Republic of Laos
(89%), Madagascar (16%), Malawi (16%), Maldives (47%), Nepal (51%). As is explained in the next
section these substantial increases can be almost entirely attributed to increased trade flows in textiles and
wearing apparel products.

      A comment on utilisation of alternative preferential schemes is warranted. Why do some LDC
beneficiaries continue to use both GPT and LDC schemes even though the LDC scheme seems more
generous? Such a situation arises often if both the GPT and LDC tariff rates are zero. Additionally, access
under the GPT scheme may be chosen if the LDC ROOs or other forms of compliance verification
constitute more of a hurdle than those applicable under the GPT. As indicated in Overview of Canadian
tariff preferences above, the 2003 new LDC initiative included a modification of ROO for textiles and
clothing products. To be eligible under the new ROOs the cloth has to be cut and sewn or fabric woven
from yarn produced in the eligible country. It is difficult to establish whether the ROO introduced in 2003
have indeed been particularly restrictive. Nevertheless, such a possibility would be suggested by postulates
put forward by the Canadian clothing industry which opposed the initiative during the consultation period
and urged the government if it went ahead to have strict rules of origin and controls to avoid transhipment
(Weston, 2003). The new ROOs for textiles and clothing products are one potential explanation of
utilisation of both GPT and LDCT for shipments of the same products.

      This utility rate is calculated as the ratio of imports actually receiving preference and all imports
(covered or not) and gives an indication of the importance of preferences in relation to all trade (with
Canada). It is a combined indication of the generosity of a given preferential scheme, simplicity of its use
as well as of export capabilities of beneficiaries. The calculated utility rates are presented in Table 12.
Similarly to utilisation rates, utility rates of LDCT exhibit a certain dichotomy with 35 LDCs recording
consistent zero utilisation rates and other LDCs recording marked increases in 2003. The GPT utility rates
are also very dispersed with a significant number of countries displaying marked reliance on preferences in
their trade with Canada and others for which preferences seem unimportant.

Value of preferences

     The value of preferential programmes of Canada is estimated by calculating the difference between
the MFN rate and the corresponding preferential rate and weighting by the value of imports. Total values
of preferences calculated in this way for all preferential schemes and years are presented in Table 13.
Remarkably, the value of preferences granted to Mexico under Mexican and Mexican-United States tariff
exceeded the combined value of GPT and LDC preferences in 2003. Up until 2002 the value of GPT
preferences was close to 300 times the value of LDC preferences. In 2003 the value of LDC preferences
multiplied by factor of 100 and accounted for one third of the value of GPT scheme. The value of
CARIBCAN preferences, was more than a double of LDC preferences in years 1998 and 2002 and only
approximately one twentieth in 2003.

    As far as the individual beneficiaries are concerned, the largest beneficiaries include several more
advanced countries such as Mexico, South Korea, China, India, Brazil, Israel, Malaysia, Hong Kong-China
as well as some LDCs such as Bangladesh or Cambodia. Expressed as percentage of total beneficiary’s



                                                     13
exports the value of preferences did not typically exceed 1%. 10 Nevertheless, several LDCs exhibited
higher than average ratios of value of preferences to total exports (0.52% in Bangladesh, 0.43% in
Cambodia, 0.28% in Haiti, 0.23% in People’s Democratic Republic of Laos, 0.22% in Maldives, 0.20% in
Lesotho). Remarkably, the corresponding ratios for 1998 and 2002 were significantly lower.

     The striking increase in the value of preferences in 2003 observed for many LDC countries does not
reflect an error in data or calculations but rather a marked increase in the utilization of preferences by
LDCs and preferential margins on textile and clothing products that were up to this date excluded from the
duty-free treatment. As argued above, these changes are clearly related to the introduction of the new
Canadian LDC initiative. The percentage increases in the value of preferences in 2003 relative to the
average for 1998 and 2002 are very significant: 4000% for Bangladesh, 5500% for Cambodia, 8890% for
Laos, 4658% for Maldives, 5061% for Madagascar or a stunning 1.5 million % for Lesotho. Focusing on
Lesotho’s case, this increase can be entirely attributed to changes on 11 HS 8-digit tariff lines – all of them
within the two 2-digit HS chapters Articles of apparel and clothing accessories, not knitted or crocheted
(61) and Articles of apparel and clothing accessories, not knitted or crocheted (62). Prior to the
introduction of the 2003 scheme each of these 11 tariff lines faced an import duty of 19 or 18%. In 2003 all
these lines gained duty-free and quota-free access and the corresponding value of trade increased by 80%.

Value of preferences by tariff line level

     Which tariff lines carry the highest value of preferences granted under GPT and LDCT schemes? An
answer to this question may help decide whether exclusion of certain lines from MFN liberalisation could
alleviate the bulk of negative effects of preference erosion. Additionally, and perhaps more importantly,
identification of such lines will be a necessary step in the assessment of costs and benefits of such potential
exclusion or in designing any prospective compensation schemes. Tables 17 and 18 present the importance
of individual tariff lines in the value of LDC and GPT preferences.

      As far as the LDCT scheme is concerned, there were altogether 390 8-digit tariff lines for which
positive trade values were recorded in 2003. However, for some lines these values were very small. A
criterion of at least 1 US$ million in terms of revenue forgone at the tariff line level was used to identify
the tariff lines where the value of LDC preferences was greatest (in Table 17). There were 13 such lines: 6
in Chapter 61 (Art of apparel & clothing access, knitted or crocheted) of HS classification 6 in Chapter 62
of HS classification (Art of apparel & clothing access, not-knitted or crocheted) and 1 in Chapter 63
(Other made-up textile articles). These tariff lines accounted for 64% of total value of LDCT preferences
in 2003. At the same time the associated values of preferences for each or these individual lines did not in
any case exceed US$ 8.6 million and accrued consistently to a small group of beneficiaries such as
Bangladesh, Cambodia, Laos, Lesotho, Madagascar, Malawi, Maldives, Nepal, Niger and Haiti (see Table
17).

     As far as the GPT scheme is concerned, there were 2000 8-digit tariff lines for which positive trade
values were recorded in 2003. Table 18 adopts the same criterion 11 that was used for the assessment of the
LDC scheme to identify the tariff lines carrying the greatest value of GPT preferences. There were 32 such
lines: 7 in HS chapter 94 (Furniture; bedding, mattress, matt), 4 in each HS chapter 39 (Plastics and
articles thereof.) and 42 (Articles of leather; saddlery and harnesses, travel goods, handbags), among
others. These tariff lines accounted for 38% of the total value of GPT preferences in 2003. The noticeable
difference is that for each of the identified tariff lines the number of beneficiaries was typically larger than
in the LDC case. However, the highest value of preferences calculated at the tariff line level was lower
than in the LDC case (around US$ 5 million) and typically the value of GPT preferences accounted for
10
     An exception are Turks and Caicos Islands - an overseas territory of the UK.
11
     Minimum of 1 US$ million in terms of revenue forgone at the tariff line level.


                                                            14
smaller shares of beneficiaries’ exports. A striking feature of the value of GPT preferences that transpires
from Table 18 is that for the majority of the identified tariff lines most of the value of preferences was
associated with imports from China (see shares in fourth column of Table 18). Overall, China accounted
for 64% of value of Canadian GPT preferences in 2003.

     High tariff line concentration of value of preferences in the case of LDCT and, to a lesser extent, GPT
schemes suggests that exclusion of relatively few lines from MFN liberalisation could alleviate the bulk of
negative effects of preference erosion in the Canadian market. However, the benefits of such an option
would have to be weighed against the costs of unrealized liberalisation. For example, the value of LDCT
preferences on HS-8 digit line 62046200 (US$ 8.6 million – see Table 17 ) should be compared with
benefits (to Canada and its trading partners) that could be obtained by reducing protection on the US$ 257
million worth of Canadian non-LDC imports on this line.

Economic value of preferences in 2001 - a general equilibrium assessment

     This section reports on the results of a model assessment of value of Canadian preferences. The
analysis employs the standard GTAP model 12 and the version 6 of the GTAP database. The model
approach allows a fuller economic assessment of the value of preferences which depends on consideration
of the interaction of impacts across preference receiving and other sectors within a given beneficiary
country as well as an assessment of impacts across trading partners. Changes in market access conditions
for one product category are linked to developments in other sectors through goods and factors markets.
Representation of such inter-sectoral linkages permits accounting for the reality that while some producers
in selected preference-receiving sectors may be affected negatively, the resources that are freed from that
sector can be employed in other sectors that may gain better access to world markets or be simply more
productive.

     One disadvantage of this approach is its high level of product and country aggregation that may mask
some individual effects. This shortcoming is nevertheless partially offset by insights gained from the more
detailed analysis of Canadian preferences presented in the first part of this paper. Additionally, in contrast
to earlier iterations of the GTAP database, version 6 of GTAP database used here takes into account an
exhaustive range of tariff preferences and therefore offers an opportunity to verify some of the general
hypotheses that arise from the analysis of Canadian preferences structure.

     The scenario considered here involves an equalisation of product-level bilateral ad valorem measures
of protection (see next Section for an explanation) with the pre-shock average calculated across all trading
partners (a proxy for the MFN rate). Admittedly, this is not a very realistic scenario in that it is unrelated to
any multilateral tariff liberalisation that may be agreed in the DDA negotiations. Instead, this scenario
mimics a situation in which, starting from the 2001 base, all preferential access to the Canadian market is
removed. This allows us to gauge the value of Canadian preferences.

Preferential access to Canadian market in the GTAP framework

      The dataset used for the simulations comprises data with a base year of 2001 and covering 57 broad
economic sectors and 87 countries. For our purposes, the database has been aggregated to 44
countries/regions and 22 sectors. The choice of country aggregation was aimed at maintaining the
maximum number of individual developing as well as key industrialized countries (including a separate
treatment of all major preference granting countries). The choice of sectoral aggregation has been made so
as to permit a comparison of sectors according to differing protection patterns.

12
     The most comprehensive description of the model is in Hertel (1997). Information more recent developments can
           be accessed at www.gtap.org


                                                         15
      The distinct advantage of protection data in the employed database is that it fully integrates the
information on bilateral ad valorem tariffs (both MFN and preferential), ad valorem equivalents of specific
tariffs (MFN and preferential), as well as tariff rate quotas from CEPII/ITC Market Access Maps
(MAcMaps) database. 13 The resulting ad-valorem equivalent measure of applied protection is thus an all –
inclusive measure of protection that is consistent across all bilateral trade flows. In the employed model
and database, the tariff line information on protection measures is aggregated to broad product categories
by means of trade weighting. Hence, necessarily, the analysis presented here masks the detail present in the
underlying tariff-line data and is incapable of shedding light on impacts on very specific product
categories. Due to the level of data aggregation, each bilateral ad valorem equivalent measure of applied
protection included in the database by necessity combines the information on MFN and preferential market
access as well as the actual composition of trade within the product category. Thus, bilateral protection
rates for a given product category vary from one trading partner to another. To illustrate the structure of
protection and preferential access to the Canadian market for each product category and trading partner,
differences between trade-weighted averages of ad valorem rates of protection across all trading partners
and the rate applied to imports from a specific trading partner are calculated. These equivalent measures of
applied protection are then used in the simulation described in the following sub-sections.

     It is worth mentioning that the difference between the average trade-weighted ad-valorem equivalent
and bilateral rates may provide a better indication of preferential market access as compared to the
difference between the official MFN and bilateral rates. As discussed in the part reviewing the detailed
structure of Canadian preferential programmes, MFN rates typically apply only to a share of the actual
trade flow making the trade-weighted average of ad valorem equivalent measures a better indication of the
average trade restrictiveness. 14 Table 19 presents the differences (measured as percentage points) between
average and bilateral rates in the Canadian market. The positive and negative values shown in the table
reflect respectively lower-than-average and higher-than-average restrictiveness of access to a given
destination market for each source country and product category.

     The presented margins provide an indication of the extent of preferential treatment enjoyed in a
particular product by beneficiary countries. 15 They take into account the preferential situation of a given
exporter relative to all the exporters to the Canadian market, including other developing countries and not
simply those countries exporting under MFN rates. For example, Canada offers duty-free access to its
market for Paddy rice – margins are nil across all source countries indicating that none of the partners
receives a preferential treatment (Table 19). In contrast, in Dairy products, where protection is particularly
high, a number of Canada’s trading partners benefit from preferential margins reaching up to 50 percentage
points (e.g. Singapore and Uruguay). At the same time, several other countries (including a number of
developing countries) face ad valorem rates that are several percentage points higher than the average.


13
             The dataset is documented in detail in Bouët, A., Fontagné, L., Mimouni, M., and F. Von Kirchbach
             (2002), Market Access for GTAP: A Bilateral Measure of Merchandise Trade Protection by GTAP
             Resource #1045, available at the following web address (confirmed on 8 January 2005):
             http://www.gtap.agecon.purdue.edu/resources/res_display.asp?RecordID=1045 .
14
     It has to be pointed out that this approach has its weaknesses. By calculating the average rate for each product
              category we run a risk of imposing a lower counterfactual tariff rate (since certain trading partners pay
              tariff rates higher than the average). An alternative would be to use, for a given product, the maximum
              tariff rate paid by a trading partner as the proxy for the counterfactual MFN rate. The latter approach would
              result in a higher counterfactual rate. However, it would also mean a change in the pattern of Canadian
              tariff protection across broad product categories – an effect that is absent when the average rate for each
              product is used.
15
             As indicated above, because of the level of aggregation, these margins may also reflect different structures
             of trade within aggregated product categories.


                                                             16
Such an approach allows us to identify product categories and source countries that may be vulnerable to
erosion of preferential margins.

     Data presented in Table 19 sketch the relative importance of existing preferential trading
arrangements across selected product categories as reported in version 6 of the GTAP database. Such a
presentation facilitates identification of producers in certain countries that may be vulnerable to preference
erosion. However, in order to develop basic intuition about potential country-level impacts trade shares
also need to be considered. Therefore, we build on the already calculated product-level margins and
calculate average trade-weighted preference margins for each of Canada’s trading partners. The product-
level margins in destination markets are weighted by the shares of these products in the overall exports of a
given beneficiary to Canada yielding a measure of an average preference margin enjoyed in a particular
preference-granting market. Hence, such average country-level margins permit a comparison of
vulnerability to preference erosion among beneficiaries (Annex Figure 2). 16 In 2001, exports of a number
of African and Latin American countries – in particular 17 – enjoy petite average preferential margins
reaching up to 2 percentage points in Tanzania, 1.3 in Malawi, 1.1 in Chile and 0.8 in Botswana. 18

Trade shares

     In addition to the size of the preferential margins, the value of preferences to beneficiary countries
will depend crucially on importance of Canada as a destination market for beneficiaries’ exports. Shares of
Canada in exports of its trading partners, as per GTAP, are presented in Table 20. For majority of
developing countries included in this analysis these shares do not exceed 3%. Highest export shares (in the
range of 2%) are observed for developing countries in Latin America, in East and South Asia these shares
are typically in the range of 1.5% and in Sub-Saharan Africa typically below 1%. Among industrialised
economies the highest shares are observed for the United States (16%) and Mexico (3%) – the two major
recipients of preferential market access within NAFTA. Corresponding shares of the remaining Quad
countries and Australia in developing countries’ exports are presented in Table 21 for comparison. It is
clear that Canada is a relatively small destination for developing countries’ exports hinting at, from a
global perspective, a comparatively low value of Canadian preferential schemes.

      Moreover, the product structure of exports to Canada presented in the same table indicates that only in
few cases trade is concentrated is products actually receiving preferential market access. The Other
manufacturing category for example displays consistently high shares in exports across developing
countries. Yet, this is also a category where protection levels (and thus the extent of preferential access) are
comparatively low. The most distinctive exceptions include Food products nec, Primary agriculture and
Leather products. The contribution of particular product categories to the average trade-weighted
preferential margin by beneficiary is best gauged from Annex Figure 1 which combines the information on
the size of margins with the information on export shares.

Simulation results

    As indicated above, the shock considered here is an equalisation of product-level bilateral ad valorem
measures of protection with the pre-shock average calculated across all trading partners (a proxy for the

16
     Annex Figure 1 provides corresponding information on the contributions to these margins by selected product
           categories.
17
     Composite Rest of North America region is in GTAP a partially artificial region.
18
             As can be seen in Annex Figure 4, Food products nec and Primary agriculture nec as well as Meat
             products and Beverages and tobacco products contribute significantly to these margins across a number of
             beneficiary countries.


                                                           17
MFN rate). Welfare results associated with the considered scenario (Table 22) indicate that the removal of
Canadian preferences has a very minor impact on developing country partners’ welfare. For ten developing
country regions (including Thailand, Mexico, Chile, South Africa, Malawi, Tanzania, Uganda, and three
composite developing regions (Rest of North America, Rest of Middle East and North Africa and Rest of
Sub Saharan Africa) the reported welfare changes are negative. However, the associated proportional
welfare changes with respect to base do not exceed one-tenth of a percent in any of the cases.

     At the same time it worth bearing in mind that estimates presented here for 2001 are based on a static
resource allocation exercise taking resources, technology and institutions as given. If the trade reform
encouraged inflows of technology (as it is expected to do)—say, through increased imports or exports,
FDI, licensing etc. - or if it introduced fundamental institutional reform, it could have more pronounced
effects on welfare. The magnitude of obtained welfare change estimates would undoubtedly change if
some these components of reality were incorporated into the model structure. Given the nature of this
exercise, the results can be interpreted with more confidence in relative terms than in absolute terms.

     Table 23 includes a comparison of impacts with a scenario involving a 50% lowering of tariff
protection in all regions. Not only such a scenario provides a benchmark for comparison of magnitudes
with effects of preferences removal, but it may also serve as a comparison with gains that can be obtained
from a worldwide halving of applied tariff rates that would be predicted by this particular CGE model and
data. Of course, such a scenario embodies elements of both preference erosion in other Quad markets and
effects of liberalisation by third countries including own effects of liberalisation by developing countries.
A more detailed discussion of such a scenario in the context of preference erosion issue is provided in
Lippoldt and Kowalski (2005).

     Notwithstanding some sign differences, it is clear that the effects of multilateral liberalisation are up
to two orders of a magnitude higher than those associated with removal of Canadian preferences. Focusing
on countries that are affected negatively by the removal of Canadian preferences, Mexico which is
estimated lose 0.01% of welfare from the removal of Canadian preferences is estimated to gain 0.10%
from the worldwide lowering of tariffs. Malawi which is likewise estimated to lose 0.01% from preference
erosion stands to gain 1.42% from the worldwide lowering of tariffs. Thailand which is unaffected by the
removal of Canadian preferences experiences a 1% per cent welfare gain from multilateral liberalisation. It
is worth noting that a number of developing countries predominantly in Sub-Saharan Africa which are not
affected by the removal of Canadian preferences are affected negatively with negative impacts of
multilateral liberalisation scenario reaching up to 0.30% of their base welfare. As discussed in Lippoldt and
Kowalski (2005) these negative effects are explained largely by the effects of tariff liberalisation in the EU
which are in turn determined by a combination of the high EU shares in the total exports of several
beneficiary countries and the substantial size of EU preferential margins in certain sectors.

     As already emphasized, the latter experiment includes tariff cutting by countries other than Canada,
and so the resulting numbers cannot be used directly to ascertain the effects of MFN tariff reductions on
the value of Canadian preferences. They rather give a sense of the magnitude of preference erosion. To
further facilitate the interpretation of results, Table 23 includes welfare estimates of a scenario involving a
50% lowering of tariff protection only by Canada. We can conclude that results from this experiment are
very similar to those associated with the removal of Canadian preferences, both qualitatively and
quantitatively.

     There are a number of reasons why our results need to be treated with considerable caution. Firstly,
the data constraints imply high levels of country and product aggregation which may mask some impacts
on smaller developing countries and producers of specific products. Secondly, as discussed in the first part
of the paper, the 2003 introduction of the new LDC initiative had significant implications for preferential
trade with Canada of selected textile and clothing-producing LDCs. Nevertheless, even this remarkable


                                                      18
change has not had a major impact on total shares of Canada in these countries’ exports. On this account,
the small welfare impacts of Canadian schemes estimated with the 2001 data may be not too far from
results that would obtain with 2003 data.

     Bearing in mind all the qualifications associated with the use of the particular model and data, a
conclusion that could be drawn from this simplified model assessment is that the value of Canadian
preferences is very small for most developing countries analysed here. Notwithstanding the significant
variation in the utilisation and value of preferences across beneficiaries, this is consistent with the
generally small shares of preferential trade with Canada in these countries’ total trade and already low
level of Canadian tariffs. Therefore, erosion of preferential schemes does not appear as a major hurdle to
further reduction of Canadian MFN rates.

Conclusions

     The extent and potential economic impacts of Canada’s preferential schemes on beneficiary countries
need to be considered in relation to market access conditions that Canada’s other trading partners face in
the Canadian market. In particular, the trade impact of GPT and the LDC schemes appear to have been
limited by the relatively low protection levels afforded to other trading partners be it on the MFN basis or
through reciprocal trade agreements. The extensive reliance of several developing countries on non-
preferential access to Canada’s market suggests their strong interest in further liberalisation of the MFN
regime. Cases of over reliance on preferential trade with Canada are limited to few LDCs where trade
under preferential schemes accounts for the bulk of total exports to Canada and is concentrated in textile
and clothing products. A conclusion that could be drawn from the simplified model assessment
implemented in the paper is that the welfare impact of Canadian preferences is very small for most
developing countries analysed here. Notwithstanding the significant variation in the utilisation and value of
preferences across beneficiaries, this is consistent with the generally small shares of preferential trade with
Canada in these countries’ total trade. Therefore, erosion of preferential schemes does not appear as a
major hurdle to further reduction of Canadian MFN rates.




                                                      19
                                           REFERENCES



ALEXANDRAKI, K. and LANKES, H.P. (2004), “Estimating the impact of preference erosion on Middle-
    Income countries”, IMF Working Paper, July.

CANADA BORDER SERVICES AGENCY, (2005), “Customs Tariff. Departmental Consolidation”.

CANADA CUSTOMS AND REVENUE AGENCY, (2003). “An Introductory Guide to the Market Access
    Initiative for the Least Developed Country and the Least Developed Country Tariff”, January 2003.

INAMA, S. (2003), “Trade Preferences and the World Trade Organization Negotiations on Market
    Access”, Journal of World Trade, 37(5).

LIPPOLDT, D. and KOWALSKI, P., (2005), “Trade Preference Erosion: Potential Economic Impacts”,
     OECD Trade Policy Working Paper no. 17, OECD, Paris.

SAFADI, R. (2003), “The Economic Impact of Generalized System of Preferences”, paper presented to
    the 137th session of the OECD Trade Committee, OECD.

SUBRAMANIAN, A. (2003), “Financing of Losses from Preference Erosion”, Communication from the
    International Monetary Fund, World Trade Organisation, WT/TF/COH/14, 14 February.

UNCTAD, (2001), "Generalized System of Preferences: Handbook on the Scheme of Canada", UNCTAD
    Technical Cooperation Project on Market Access, Trade Laws and Preferences,
    UNCTAD/ITCS/TSB/Misc.66, December 2001, Geneva.

WESTON, A., (2003) “Bangladesh’s Access to the Canadian Market: Implications of the New Canadian
    LDC Initiative and Prospects for Export Diversification, The North-South Institute, Ottawa, January
    2003.

WTO (2003), Trade Policy Review: Canada, Report by the Secretariat, World Trade Organisation,
    WT/TPR/S/112

YAMAZAKI, F. (1996), “Potential Erosion of Trade Preferences in Agricultural Products”, Food Policy,
   Volume 21, Issue 4-5, Sept.-Nov. 1996, Pages 409-417.




                                                  20
Annex. Reduction of MFN tariffs at unchanged preferential margins.


Subject to certain constraints, MFN tariffs can be reduced while at the same preserving the initial
preferential margins. Consider a simple linear cut formula:

(1)         t1 = at 0

where t0 is the initial tariff and t1 is the resulting tariff and a is the reduction coefficient bound between 0
and 1. Associated percentage cut is expressed as (1-a)*100.

Applied to MFN and preferential tariff lines separately the linear tariff reduction formula yields:

                    = at 0
                M        M
( 2)       t1
(3)       t1P = a P t 0P
where the superscripts P and M denote respectively preferential and MFN tariffs.

aP is the reduction coefficient applied to preferential tariff. The idea is to establish the relationship between
aP and a subject to the condition that preferential margin after the tariff cut is equal to the preferential
margin before the tariff cut.

( 4)      t 0M − t 0P = t1M − t1P

Subtracting (3) from (2), substituting (4) and simple rearrangement leads to:
             M
            t0
(5)      a = P (a − 1) + 1
           P

            t0

It is clear from (5) that following a cut of MFN rate, preference margins can be preserved by applying the
same proportional tariff cut coefficient only if initial preferential tariff rate is equal to the MFN rate
                                                                   M
                                                                  t0
t 0 = t 0P . Larger ratios of MFN to preferential rates
  M
                                                                      require relatively deeper cuts of preferential
                                                                  t0P
tariffs if the size of preferential margin is to be maintained. It is also clear that for t 0 = 0 no such aP
                                                                                             P


coefficient exists (in simple words – tariff margin cannot be preserved if initial preferential tariff is zero). 19

                                                                                                   M
                                                                                                  t0
It is also worth noting that the larger the difference between MFN and preferential rates             the higher the
                                                                                                  t0P
a coefficient (the lass ambitious the MFN reduction) has to be in order to satisfy the condition 0<aP. In
intuitive terms, for lines where initial difference between MFN and preferential rates is large, only for
shallow MFN reduction will there be an equivalent preferential tariff reduction that preserves the
preferential margin.


                              M
                             t0
19
     Note that, since          P
                                 ∈ (1;+∞) , condition 0<aP<1 does not impose additional constraints on a.
                             t0



                                                             21
In the case of the simple Swiss formula for tariff cuts an implicit version of condition (5) can be derived as:

       aP      tM ⎡ a           ⎤
(6)           = 0P ⎢         − 1⎥
    a P + t 0P t 0 ⎣ a + t 0
                           M
                                ⎦




                                                      22
                                                 ANNEX: TABLES



                           Table 1. Top 10 sources of Canadian imports (US$ millions)



                                                  2000          2001       2002     2003      2004

          United States                         154,630    140,972      139,104   145,384   160,484
          China                                   7,604      8,217       10,191    13,251    18,511
          Mexico                                  8,120      7,829        8,115     8,695    10,301
          Japan                                  11,185      9,455        9,821     9,859    10,272
          United Kingdom                          8,771      7,567        6,201     6,570     7,414
          Germany                                 5,234      5,166        5,281     6,162     7,234
          Korea, South                            3,556      2,974        3,098     3,644     4,474
          France                                  2,802      3,557        3,729     3,616     4,096
          Norway                                  2,940      2,263        2,504     3,078     3,806
          Italy                                   2,471      2,600        2,827     3,296     3,512

          10 Top Total                          207,313    190,600      190,870   203,555   230,104

          Others                                 33,050        30,980    31,277    36,154    42,851

          ALL Countries                         240,363    221,581      222,147   239,709   272,955

                                                                        shares

          United States                            64%           64%       63%       61%       59%
          China                                     3%            4%        5%        6%        7%
          Mexico                                    3%            4%        4%        4%        4%
          Japan                                     5%            4%        4%        4%        4%
          United Kingdom                            4%            3%        3%        3%        3%
          Germany                                   2%            2%        2%        3%        3%
          Korea, South                              1%            1%        1%        2%        2%
          France                                    1%            2%        2%        2%        2%
          Norway                                    1%            1%        1%        1%        1%
          Italy                                     1%            1%        1%        1%        1%

          10 Top Total                             86%           86%       86%       85%       84%

          Others                                   14%           14%       14%       15%       16%

          ALL Countries                           100%         100%       100%      100%      100%



Source: Finance Canada, author's calculations



                                                          23
                                       Table 2. Generalized and selected regional preference schemes of Canada

   Country /
                                                                                 Scope of tariff and non-
  preference         Dates                    Eligible economies                                             Special provisions        Exemptions / Restrictions
                                                                                    tariff preferences
     scheme
GPT (General   Brought        into   Algeria, American Samoa, Anguilla,          Type of preference:                              Excluded items:
Preferential   effect 01/07/1974     Antigua and Barbuda, Argentina,             Reductions from the MFN                          Some agricultural products, refined
Tariff)        Last     renewed      Armenia,       Ascension,    Azerbaijan,    rate or duty-free access                         sugar, most textiles, apparel and
               2004,     effective   Bahamas,         Bahrain,     Barbados,                                                      footwear.
               until 2014            Belarus, Belize, Bermuda, Bolivia,          Coverage:
                                     Bosnia and Herzegovina, Botswana,           Selected agricultural and                        Rules of origin:
                                     Brazil, British Indian Ocean Territory,     industrial products                              • 60% local content
                                     British Virgin Islands, Brunei, Bulgaria,                                                    • Cumulation from any other GPT
                                     Cameroon, Caroline Islands, Cayman                                                              beneficiary country or Canada
                                     Islands, Chile, China, Christmas                                                             • Direct shipment required
                                     Island, Cocos Islands, Colombia,
                                     Congo (Brazza-ille), Cook Islands,                                                           Safeguard measures
                                     Costa Rica, Côte d’Ivoire, Croatia,
                                     Cuba, Dominica, Dominican Republic,
                                     Ecuador, Egypt, El Salvador, Falkland
                                     Islands, Fiji, French Polynesia, French
                                     Southern and Antarctic Territories,
                                     Gabon, Georgia, Ghana, Gibraltar,
                                     Grenada, Guam, Guate-ala, Guyana,
                                     Honduras,       Hong     Kong,     India,
                                     Indonesia, Iran, Iraq, Israel, Jamaica,
                                     Jordan, Kazakhstan, Kenya, Korea,
                                     Kuwait, Kyrgyzstan, Lebanon, Macao,
                                     Macedonia,         Malaysia,     Mariana
                                     Islands, Marshall Islands, Mauritius,
                                     Mexico,         Moldova,       Mongolia,
                                     Montserrat, Morocco, Namibia, Nauru,
                                     Netherlands Antilles, New Caledonia,
                                     Nicaragua, Nigeria, Niue, Norfolk
                                     Island, Pakistan, Panama, Papua New
                                     Guinea, Paraguay, Peru, Philippines,
                                     Pitcairn, Qatar, Romania, Russian
                                     Federation, Seychelles, Singapore,
                                     Slovak Republic, Slovenia, South
                                     Africa, Spanish North Africa, Sri
                                     Lanka, St. Kitts and Nevis, St. Helena,
                                     St. Lucia, St. Vincent and the
                                     Grenadines, Suriname, Swaziland,
                                     Syria, Tadjikistan, Thailand, Tokelau,
                                     Tonga, Trinidad and Tobago, Tristan
                                     da      Cunha,      Tunisia,     Turkey,
                                     Turkmenistan, Turks and Caicos
                                     Islands,        Ukraine,        Uruguay,
                                                                                     24
                                     Uzbekistan, Venezuela, Viet Nam,
                                     United Arab Emirates, US Virgin
                                     Islands, Zimbabwe

                                     +LDCs

                                     (See note at bottom of table.)
LDCT     (Least   1998               Afghanistan, Angola, Bangladesh,          Type of preference:            Excluded Items:
Developed                            Benin, Bhutan, Burkina Faso, Burundi,
Country Tariff)                      Cambodia, Cape Verde, Central             Duty free or preferential      Food products (ISIC 311)c , Animal
granted     by                       African Republic, Chad, Comoros,          rates access (variable         feeds and other food products (ISIC
Canada                               Democratic Republic of the Congo,         from product to product)       312c), textiles and clothing (CITI 322),…
                                     Djibouti, Equatorial Guinea, Eritrea,
                                     Ethiopia, Gambia, Guinea, Guinea-                                        Excluded Country:
                                     Bissau, Haiti, Kiribati, Lao People's
                                     Democratic      Republic,      Lesotho,   Coverage:                      Myanmar
                                     Liberia,     Madagascar,        Malawi,
                                     Maldives,       Mali,       Mauritania,   82% of tariff lines in duty-   Rule of Origin:
                                     Mozambique, Myanmar, Nepal, Niger,        free access for 48 LDCs.
                                     Rwanda, Samoa, Sao Tome and               Average of non duty-free       ● 40% local content (only content from
                                     Principe, Sierra Leone, Solomon           lines: 29%                     least developed countries or Canada
                                     Islands, Somalia, Sudan, Togo,            Average of ad valorem          was considered originating for purposes
                                     Tuvalu, Uganda, United Republic of        tariff: 5%                     of the 40% rule)
                                     Tanzania, Vanuatu, Yemen and                                             ● Cumulation only with other LDCs and
                                     Zambia                                                                   Canada (since 2000, cumulation with
                                                                                                              any other GSP country)
                                                                                                              ● Specific rules for textiles and clothing
                                                                                                              ● Direct shipment required

LDCT (Least       In present form    Afghanistan, Angola, Bangladesh,          Type of preference:            Excluded items:
Developed         since 01/01/2003   Benin, Bhutan, Burkina Faso, Burundi,     Duty-    and    quota-free     Supply-managed agricultural products
Country Tariff)                      Cambodia, Cape Verde, Central             access for 48 LDCs             like dairy products, poultry and eggs
                                     African Republic, Chad, Comoros,
                                     Democratic Republic of Congo,             Coverage:                      Excluded country:
                                     Djibouti, Equatorial Guinea, Eritrea,     Almost all products (see       Burma
                                     Ethiopia, Gambia, Guinea, Guinea-         excluded items) since
                                     Bissau, Haiti, Kiribati, Lao People’s     extension on 01/01/2003        Rules of origin:
                                     Democratic     Republic,      Lesotho,                                   • 40% local content
                                     Liberia,    Madagascar,        Malawi,                                   • Cumulation from any other LDCT or
                                     Maldives,      Mali,        Mauritania,                                     GPT beneficiary country or Canada
                                     Mozambique, Nepal, Niger, Rwanda,                                        • Specific rules of origin for textiles
                                     São Tomé and Príncipe, Senegal,                                             and apparel
                                     Sierra Leone, Solomon Islands,                                           • Direct shipment required
                                     Somalia,    Sudan,      Tanzania,Togo,
                                     Tuvalu, Uganda, Vanuatu, Western                                         Safeguard measures
                                     Samoa, Yemen, Zambia

CARIBCAN          Introduced 1986    Anguilla, Antigua and        Barbuda,     Type of preference:            Excluded items:
                  Renewed in 1996    Bahamas,      Barbados,        Belize,    Duty-free    access      for   Some agricultural products, textiles,

                                                                                   25
               until 2007   Bermuda, British Virgin Islands,             qualifying goods for most     apparel and footwear
                            Cayman Islands, Dominica, Grenada,           Commonwealth
                            Guyana, Jamaica, Montserrat, St. Kitts       Caribbean States              Rules of origin:
                            and Nevis, St. Lucia, St. Vincent and                                      • 60% local content
                            the Grenadines, Trinidad and Tobago,         Coverage:                     • Cumulation from any other
                            Turks and Caicos Islands                     Similar to GPT; slightly         beneficiary country or Canada
                                                                         broader for agricultural      • Direct shipment required
                                                                         goods
Commonwealth   Effective    Anguilla, Antigua and Barbuda,               Type of preference:           Rules of origin:
Developing     01/01/1998   Ascension, Bahamas, Bangladesh,              Duty-free     access  or      • 50% local content
Countries                   Barbados,         Belize,       Bermuda,     referential duty rate         • Cumulation is allowed among
Remission                   Botswana, British Indian Ocean                                                Commonwealth countries
Order                       Territory, British Virgin Islands, Brunei,   Coverage:                     • Direct shipment required
                            Cayman Islands, Christmas Island,            171 tariff lines, mostly
                            Cocos Islands, Cook Islands, Cyprus,         textile products
                            Dominica, Falkland Islands, Fiji,
                            Gambia, Ghana, Gibraltar, Grenada,           This treatment continues
                            Guyana, India, Jamaica, Kenya,               to provide preferences
                            Kiribati, Lesotho, Malawi, Malaysia,         equivalent to the former
                            Maldives,         Malta,        Mauritius,   British Preferential Tariff
                            Montserrat, Namibia, Nauru, Nigeria,         (BPT), which was revoked
                            Norfolk Island, Pakistan, Papua New          on 01/01/1998
                            Guinea, Pitcairn, St. Kitts and Nevis,
                            St. Helena, St. Lucia, St. Vincent and
                            the Grenadines, Seychelles, Sierra
                            Leone, Singapore, Solomon Islands,
                            Sri Lanka, Swaziland, Tanzania,
                            Tokelau, Tonga, Trinidad and Tobago,
                            Tristan Da Cunha, Turks and Caicos
                            Islands, Tuvalu, Uganda, Vanuatu,
                            Western Samoa, Zambia, Zimbabwe




                                                                             26
                                                     Table 3. Overview of preferential tariffs in Canada (2002 and 2003)

                                                     Based on HS 8-digit with imports in 2002-2003 (excluding chapter 99)



                                                       Number of lines                               Corresponding Average                                               Count of ad Valorem
                                                                               Average Tariff (2)                              Minimum Tariff       Maximum Tariff
                                                        concerned (1)                                    MFN Tariff (3)                                                         tariffs

                                                      2002        2003        2002         2003          2002      2003       2002       2003       2002       2003        2002         2003
      MFN                                              6,931       7,057      6.0%         5.8%                                0%         0%      298.5%     295.5%           6,735       6,875
      GPT                                              4,122       4,250      2.1%         2.2%          4.4%     4.3%         0%         0%      16.5%      16.5%            4,040       4,192
      LDCT                                               170         489      0.0%         0.0%          6.9%     12.4%        0%         0%       0.0%       0.0%              169         489
      Canada-Israel Agreement Tariff                     761         776      0.0%         0.0%          6.7%     6.8%         0%         0%       5.0%       5.0%              757         760
      Chile Tariff                                       174         199      0.6%         0.0%          5.7%     7.9%         0%         0%       19.0%      0.0%              170         197
      Commonwealth Caribbean Countries Tariff            206         182      0.0%         0.0%          3.8%     3.5%         0%         0%        0.0%      0.0%              206         182
      Costa Rica Tariff                                    2          51      0.0%         1.4%          6.3%     5.5%         0%         0%        0.0%      15.0%               2          47
      Mexican Tariff                                   3,166       3,097      0.2%         0.0%          5.5%     5.5%         0%         0%       3.0%       0.0%            3,149       3,091
      Mexican-United States Tariff                       657         650      0.0%         0.0%          4.0%     3.6%         0%         0%       2.5%       0.0%              656         649
      No tariff data available
      British Preferential Tariff                          133         126    N/A           N/A         18.9%     18.4%       N/A        N/A        N/A        N/A                  0          0
      General Tariff                                        30          39    N/A           N/A          5.2%      4.1%       N/A        N/A        N/A        N/A                  0          0
      Informal Entries & Aggregated records                 12           8    N/A           N/A          6.7%      2.4%       N/A        N/A        N/A        N/A                  0          0
      United States Tariff                              1,044       1,090     N/A           N/A          6.2%      5.5%       N/A        N/A        N/A        N/A                  0          0



(1) Number of HS 8-digit level different lines that entered Canada under the treatment indicated.
(2) Simple average of lines where there have been imports. Calculations based on ad valorem tariffs and mixed tariffs (Cf below table of mixed tariff conversion into ad valorem)


(3) Simple average of MFN tariffs in these lines. Calculations based on ad valorem tariffs and mixed tariffs.
(4) 2002 and 2003 Imports from respectively 181 and 180 countries (the same minus East Timor) eligible for Canadian GSP preferences.




                                                                                             27
                                                               Table 4. Composition of preferential trade flows by scheme

                                          Total imports                                                                                           Dutiable imports

                 Value (US$)                     1998               2002             2003                                Value (US$)                      1998              2002              2003
MFN                                          19,419,219,701      26,755,325,836   33,040,175,636        MFN                                             4,947,159,095    6,296,041,967     7,322,468,762
GPT                                           3,793,215,259       5,682,616,009    6,664,637,490        GPT                                             1,981,347,527    3,196,377,080     3,842,853,550
LDCT                                               2,702,986          5,975,168      298,726,863        LDCT                                                   54,371            42,760         4,538,858
British Preferential Tariff                      59,484,944         341,117,268      276,790,073        British Preferential Tariff                        56,853,180      328,585,784       265,063,774
Chile Tariff                                      43,700,863         71,262,468       75,862,682        Chile Tariff                                       15,994,776         8,612,433           363,928
Commonwealth Caribbean Countries Tariff          28,128,522          97,714,557       80,360,783        Commonwealth Caribbean Countries Tariff               685,472           395,542         2,329,959
General Tariff                                       383,363             18,270       27,274,329        General Tariff                                        374,029            15,392           169,397
Informal Entries & Aggregated records                 21,671             86,785           81,798        Informal Entries & Aggregated records                       0               196                 0
Mexican Tariff                                1,819,426,515       3,189,930,547    3,351,344,370        Mexican Tariff                                    856,218,587      254,294,299         56,317,907
Mexican-United States Tariff                    184,154,553         474,519,727      596,783,693        Mexican-United States Tariff                       10,861,640           205,324           270,254
United States Tariff                             20,213,126          28,072,864       32,186,445        United States Tariff                                  497,487         1,112,808           473,225
Canada-Israel Agreement Tariff                                       93,697,567      111,868,698        Canada-Israel Agreement Tariff                                          456,988           927,396
Costa Rica Tariff                                                        62,968        3,430,690        Costa Rica Tariff                                                             0           196,786
Grand Total                                  25,370,651,502      36,740,400,035   44,559,523,550        Grand Total                                     7,870,046,165   10,086,140,572    11,495,973,796

                    % share                      1998                2002             2003                                  % share                        1998             2002              2003
MFN                                             76.5%               72.8%            74.1%              MFN                                               62.9%            62.4%             63.7%
GPT                                             15.0%               15.5%            15.0%              GPT                                               25.2%            31.7%             33.4%
LDCT                                             0.0%                0.0%             0.7%              LDCT                                               0.0%            0.0%              0.0%
British Preferential Tariff                      0.2%               0.9%             0.6%               British Preferential Tariff                       0.7%             3.3%              2.3%
Chile Tariff                                     0.2%                0.2%             0.2%              Chile Tariff                                      0.2%             0.1%              0.0%
Commonwealth Caribbean Countries Tariff          0.1%               0.3%             0.2%               Commonwealth Caribbean Countries Tariff           0.0%             0.0%              0.0%
General Tariff                                   0.0%                0.0%             0.1%              General Tariff                                    0.0%             0.0%              0.0%
Informal Entries & Aggregated records            0.0%                0.0%             0.0%              Informal Entries & Aggregated records             0.0%             0.0%              0.0%
Mexican Tariff                                   7.2%               8.7%             7.5%               Mexican Tariff                                    10.9%            2.5%              0.5%
Mexican-United States Tariff                     0.7%                1.3%             1.3%              Mexican-United States Tariff                      0.1%             0.0%              0.0%
United States Tariff                             0.1%               0.1%             0.1%               United States Tariff                              0.0%             0.0%              0.0%
Canada-Israel Agreement Tariff                   0.0%               0.3%             0.3%               Canada-Israel Agreement Tariff                    0.0%             0.0%              0.0%
Costa Rica Tariff                                0.0%               0.0%             0.0%               Costa Rica Tariff                                 0.0%             0.0%              0.0%
Grand Total                                     100.0%             100.0%           100.0%              Grand Total                                      100.0%           100.0%            100.0%

       % increase from previous period           1998               2002             2003                      % increase from previous period            1998             2002              2003
MFN                                              100                  38               23               MFN                                                100               27                 16
GPT                                               100                 50               17               GPT                                                100               61                 20
LDCT                                              100                121             4899               LDCT                                               100              -21              10515
British Preferential Tariff                      100                473               -19               British Preferential Tariff                        100              478                -19
Chile Tariff                                      100                 63                6               Chile Tariff                                       100              -46                -96
Commonwealth Caribbean Countries Tariff          100                 247              -18               Commonwealth Caribbean Countries Tariff            100              -42               489
General Tariff                                   100                 -95            149187              General Tariff                                     100              -96              1001
Informal Entries & Aggregated records             100                300               -6               Informal Entries & Aggregated records                                                 -100
Mexican Tariff                                   100                  75               5                Mexican Tariff                                     100              -70                -78
Mexican-United States Tariff                      100                158               26               Mexican-United States Tariff                       100              -98                 32
United States Tariff                             100                  39               15               United States Tariff                               100              124                -57
Canada-Israel Agreement Tariff                                                         19               Canada-Israel Agreement Tariff                                                         103
Costa Rica Tariff                                                                    5348               Costa Rica Tariff
Grand Total                                      100                 45                76               Grand Total                                        100              28                14

Source: Finance Canada data, author’s calculations


                                                                                                   28
                                          Table 4. Total exports to the Canadian market as percentage of beneficiary’s exports

                                                                                 (sorted by 2003 values)
     Country Name        1998     2002     2003        Country Name     1998    2002    2003            Country Name       1998    2002    2003       Country Name         1998    2002    2003
 Guyana                24.04%   30.17%   28.20%   Israel              0.83%    1.47%   1.47%        Tonga                0.32%    0.07%   0.49%   Senegal                 0.09%   0.15%   0.14%
 Cuba                  15.82%   17.16%   23.68%   Philippines          1.98%   1.76%   1.46%        Russia                0.68%   0.26%   0.49%   Surinam                10.16%   6.68%   0.13%
 Turks/Caicos Is.      5.32%    6.48%    18.40%   Laos P. Dem. Rep.   0.52%    1.31%   1.44%        Mauritius             0.82%   0.55%   0.47%   Antigua and Barbuda     6.36%   0.26%   0.13%
 Sao Tome/Principe      0.10%    7.81%   17.93%   Nigeria             1.72%    0.91%   1.41%        Kenya                 0.72%   0.52%   0.46%   Saint Vincent/Gren.     0.10%   0.26%   0.13%
 Equatorial Guinea      0.03%   10.02%   12.11%   Ecuador             2.46%    1.79%   1.40%        Slovakia              0.44%   0.25%   0.45%   Kazakhstan              0.19%   0.08%   0.13%
 Jamaica                9.12%   12.43%   11.96%   Malaysia            1.61%    1.30%   1.34%        Saint Lucia           1.08%   0.46%   0.45%   Cyprus                  0.18%   0.15%   0.13%
 Saint Kitts/Nevis      6.05%    6.92%    9.55%   Neth. Antilles      1.56%    0.13%   1.30%        Samoa, American       0.11%   0.07%   0.42%   Gibraltar               1.82%   0.01%   0.11%
 Iraq                  1.07%    7.90%     9.46%   Belize              1.87%    2.46%   1.26%        Uzbekistan           0.43%    0.42%   0.42%   Papua New Guinea        0.17%   0.04%   0.10%
 Algeria                3.13%    6.45%    7.66%   Sierra Leone         1.35%   1.09%   1.20%        Zimbabwe              0.75%   0.41%   0.41%   Mauritania              0.03%   0.07%   0.10%
 Mexico                4.47%    5.12%     5.23%   Syrian Arab Rep.    0.26%    0.51%   1.18%        Mali                 4.13%    1.81%   0.38%   Belarus                 0.02%   0.12%   0.09%
 Montserrat            0.60%    6.96%     4.33%   Vietnam             1.30%    1.21%   1.17%        Togo                 14.16%   0.30%   0.36%   Vanuatu                 0.32%   0.07%   0.09%
 Uruguay               1.32%    1.51%     3.85%   Madagascar          0.54%    0.39%   1.15%        Seychelles           0.13%    0.05%   0.36%   Anguilla                0.07%   0.35%   0.08%
 Kyrgyzstan             0.00%    0.03%    3.83%   Egypt               0.46%    0.62%   1.13%        Hungary              0.27%    0.33%   0.34%   Brunei Darussalam       0.02%   0.12%   0.07%
 Haiti                 0.92%    2.35%     3.54%   Nepal               0.49%    1.93%   1.13%        Swaziland            0.02%    0.36%   0.33%   Gabon                  0.01%    0.06%   0.05%
 Guinea                 2.10%    3.24%    3.46%   Nauru               0.25%    0.44%   1.10%        Bahrain              0.16%    0.39%   0.32%   Niue                   67.70%   2.21%   0.05%
 Bangladesh             1.88%    1.68%    3.24%   Hong Kong           1.64%    1.24%   1.07%        Croatia              0.30%    0.35%   0.31%   New Caledonia           0.06%   0.05%   0.05%
 Chile                 1.56%    2.46%     2.98%   Ethiopia            1.20%    0.95%   1.04%        Gambia                0.06%   0.10%   0.30%   Burkina Faso            0.04%   0.02%   0.05%
 Trinidad and Tobago    0.99%    3.09%    2.87%   South Africa        1.28%    1.08%   1.00%        Slovenia              0.49%   0.39%   0.30%   United Arab Emir.       0.04%   0.07%   0.05%
 Cambodia               0.54%    0.71%    2.66%   Indonesia           1.21%    1.11%   0.99%        Georgia              0.31%    0.09%   0.29%   Qatar                  0.13%    0.00%   0.04%
 Maldives              2.56%    0.85%     2.59%   El Salvador          0.79%   1.33%   0.98%        Ukraine               0.36%   0.39%   0.29%   Rwanda                  1.74%   1.12%   0.04%
 Bahamas                2.50%    0.95%    2.55%   Pitcairn Island     20.23%   2.93%   0.93%        Tanzania, Un. Rep.    0.11%   0.43%   0.28%   Congo                   0.85%   0.04%   0.04%
 Peru                   2.08%    2.94%    2.51%   Niger               0.82%    0.99%   0.92%        Moldova               0.12%   0.32%   0.27%   Zambia                 4.58%    0.19%   0.03%
 Nicaragua             1.76%    3.22%     2.42%   Argentina           0.66%    0.84%   0.90%        Czech Republic        0.34%   0.31%   0.26%   Central Afric. Rep.     0.06%   0.13%   0.03%
 Grenada               1.65%    3.21%     2.39%   Guam                0.00%    1.11%   0.85%        Bermuda              3.30%    1.46%   0.26%   Chad                   0.03%    0.04%   0.03%
 China People`s Rep.   1.83%    2.28%     2.31%   French Polynesia    0.31%    1.03%   0.85%        Armenia              0.27%    0.52%   0.25%   Kiribati               0.01%    0.01%   0.03%
 Macau                 1.84%    2.46%    2.30%    Uganda              1.05%    0.12%   0.82%        Liberia              0.05%    0.17%   0.25%   Azerbaijan             0.05%    0.03%   0.03%
 Ghana                 0.64%    1.84%    2.07%    Singapore           1.00%    0.89%   0.81%        Bri. Indian O. Ter    0.01%   0.18%   0.25%   Cape Verde              0.00%   0.05%   0.03%
 Costa Rica            2.35%    2.29%     2.05%   St-Helena           0.17%    0.89%   0.81%        Christmas Is Aust    0.10%    0.27%   0.24%   Solomon Islands         0.03%   0.05%   0.02%
 Venezuela              3.20%    3.45%    2.05%   Lebanon             0.88%    0.80%   0.79%        Bosnia'herzegovina    0.04%   0.19%   0.24%   Bhutan                  0.02%   0.12%   0.02%
 Mongolia               1.15%    1.28%    2.03%   Turkey              0.68%    0.79%   0.77%        Panama               1.51%    0.40%   0.24%   Western Samoa           0.01%   0.14%   0.01%
 Guatemala             2.47%    2.41%     2.03%   Cocos Islands       0.06%    0.01%   0.72%        Falkland Islands     0.10%    0.00%   0.24%   Mozambique             0.38%    0.01%   0.01%
 Pakistan               1.97%    2.25%    2.03%   Lithuania           0.46%    0.32%   0.71%        Norfolk Island       0.23%    0.11%   0.24%   Sudan                   0.07%   0.01%   0.01%
 Korea, South          1.87%    2.18%     2.01%   Bulgaria            0.76%    0.84%   0.68%        Jordan                0.07%   0.23%   0.23%   Western Sahara          0.05%   0.00%   0.01%
 Comoros               0.31%    0.23%     2.00%   Morocco             0.76%    0.66%   0.67%        Latvia                0.07%   0.27%   0.23%   Tajikistan              1.42%   0.06%   0.01%
 Colombia               1.90%    2.17%    1.99%   Burundi             0.77%    1.24%   0.66%        Malawi                0.52%   0.27%   0.23%   Congo, D.R. (eZaire)            0.00%   0.00%
 Brazil                 1.76%    2.12%    1.91%   Turkmenistan        0.00%    1.63%   0.65%        Cameroon             0.48%    0.36%   0.23%   Yemen                  0.01%    0.00%   0.00%
 Djibouti              0.13%    4.51%     1.83%   Estonia             0.64%    0.84%   0.62%        Br. Virgin Is.        0.29%   0.14%   0.22%   Benin                  0.00%    0.00%   0.00%
 India                 1.64%    1.92%     1.74%   Dominica            1.38%    1.46%   0.62%        Cayman Islands       0.38%    1.06%   0.22%   Angola                 0.29%    0.00%   0.00%
 Thailand               1.53%    1.75%    1.73%   Bolivia              0.99%   0.84%   0.61%        Macedonia             0.26%   0.35%   0.22%   Guinea-Bissau          0.00%    0.01%   0.00%
 Honduras               1.42%    2.04%    1.59%   Cook Islands        1.72%    0.59%   0.60%        French S. Terr.      0.37%    0.00%   0.22%   Antarctica             0.00%    0.00%   0.00%
 Dominican Rep.         1.53%    1.55%    1.55%   Malta               1.15%    0.33%   0.57%        Afghanistan           0.24%   0.51%   0.22%   Bouvet Island          0.00%    0.00%   0.00%
 Côte d'Ivoire          1.62%    1.21%    1.53%   Botswana            0.02%    0.03%   0.57%        Kuwait                0.02%   0.12%   0.22%   Heard/McDonald Is               0.00%   0.00%
 Namibia                2.84%    1.65%    1.52%   Paraguay            0.19%    0.56%   0.57%        Tunisia               0.10%   0.17%   0.18%   East Timor              4.50%   0.62%
 Sri Lanka              1.50%    1.68%    1.52%   Romania             0.92%    0.60%   0.56%        Eritrea              0.04%    0.55%   0.18%   Mariana Islands        59.85%
 Barbados               3.78%    1.96%    1.49%   Poland               0.45%   0.54%   0.54%        Iran, Islamic Rep.    0.85%   0.20%   0.18%   Marshall Islands        0.02%
 Lesotho               1.63%    0.94%     1.48%   Fiji                0.37%    0.79%   0.52%        Somalia              0.05%    0.66%   0.17%   Micronesia             0.18%
                                                                                                                                                  Tokelau                35.46%




Source: Finance Canada data, author’s calculations

                                                                                               29
                              Table 5. Preferential exports to the Canadian market as percentage of beneficiary’s exports (all schemes)

                                                                        (sorted by 2003 values)

        Country Name              1998    2002       2003   Country Name          1998     2002   2003      Country Name          1998    2002   2003
        Bangladesh                0.3%    1.0%       2.9%   South Africa          0.2%     0.1%   0.1%      Honduras              0.0%    0.2%   0.0%
        Mexico                    1.7%    2.3%       2.4%   Mauritius             0.1%     0.1%   0.1%      Cyprus                0.0%    0.0%   0.0%
        Cambodia                  0.0%    0.0%       2.4%   Lithuania             0.0%     0.1%   0.1%      French Polynesia      0.1%    0.0%   0.0%
        Haiti                     0.1%    0.6%       1.6%   Romania               0.1%     0.1%   0.1%      Mali                  0.0%    0.2%   0.0%
        Laos P. Dem. Rep.         0.0%    0.0%       1.3%   Argentina             0.1%     0.1%   0.1%      Nicaragua             0.0%    0.0%   0.0%
        Maldives                  0.1%    0.1%       1.2%   Paraguay              0.0%     0.1%   0.1%      Azerbaijan                           0.0%
        Barbados                  1.9%    1.3%       1.2%   Comoros               0.1%            0.1%      Bahrain                       0.0%   0.0%
        Trinidad and Tobago       0.3%    2.6%       1.1%   Latvia                0.0%     0.1%   0.1%      Uganda                0.0%    0.0%   0.0%
        Lesotho                   0.0%    0.0%       1.1%   Bosnia'herzegovina             0.0%   0.1%      Cameroon              0.0%    0.0%   0.0%
        Guyana                    0.3%    0.5%       0.9%   Malawi                0.3%     0.0%   0.1%      Somalia                       0.2%   0.0%
        Cuba                      2.3%    1.4%       0.9%   Ecuador               0.1%     0.0%   0.1%      Gabon                         0.0%   0.0%
        Jamaica                   0.7%    0.9%       0.8%   Armenia                        0.0%   0.1%      Ethiopia              0.0%    0.1%   0.0%
        Nepal                     0.2%    1.0%       0.8%   Slovenia              0.2%     0.1%   0.1%      Guinea                0.0%    0.0%   0.0%
        China People`s Rep.       0.7%    0.8%       0.8%   Iran, Islamic Rep.    0.1%     0.1%   0.1%      Western Samoa                 0.0%   0.0%
        Pakistan                  0.3%    0.9%       0.7%   Dominican Rep.        0.1%     0.1%   0.1%      Antigua and Barbuda                  0.0%
        Sri Lanka                 0.5%    0.8%       0.7%   Brunei Darussalam     0.0%     0.1%   0.1%      Macedonia                     0.0%   0.0%
        India                     0.4%    0.8%       0.6%   Togo                  0.0%     0.0%   0.1%      Tanzania, Un. Rep.    0.0%    0.0%   0.0%
        Thailand                  0.4%    0.5%       0.4%   Croatia               0.1%     0.0%   0.0%      New Caledonia         0.0%    0.0%   0.0%
        Peru                      0.6%    0.9%       0.4%   Côte d'Ivoire         0.0%     0.0%   0.0%      Surinam                       0.0%   0.0%
        Grenada                   0.0%    0.0%       0.4%   Saint Kitts/Nevis     0.0%     0.0%   0.0%      Moldova                       0.0%   0.0%
        Brazil                    0.3%    0.4%       0.4%   Slovakia              0.1%     0.1%   0.0%      Uzbekistan                    0.0%   0.0%
        Israel                    0.0%    0.4%       0.4%   Cook Islands                   0.1%   0.0%      Bri. Indian O. Ter                   0.0%
        Lebanon                   0.4%    0.4%       0.4%   Br. Virgin Is.        0.0%     0.0%   0.0%      Congo                         0.0%   0.0%
        Chile                     0.4%    0.5%       0.4%   Estonia               0.0%     0.0%   0.0%      Zambia                0.0%    0.0%   0.0%
        Guatemala                 0.8%    0.5%       0.4%   Singapore             0.0%     0.0%   0.0%      Benin                                0.0%
        Bahamas                   0.8%    0.4%       0.3%   Ghana                 0.0%     0.0%   0.0%      Cayman Islands        0.0%           0.0%
        Fiji                      0.2%    0.5%       0.3%   Afghanistan                    0.0%   0.0%      Kazakhstan                           0.0%
        Uruguay                   0.2%    0.4%       0.3%   Belarus               0.0%     0.0%   0.0%      Georgia               0.1%    0.0%   0.0%
        Vietnam                   0.2%    0.3%       0.3%   Panama                0.1%     0.2%   0.0%      Turkmenistan          0.0%    0.0%   0.0%
        Botswana                  0.0%    0.0%       0.2%   Russia                0.0%     0.0%   0.0%      Mozambique            0.0%           0.0%
        Colombia                  0.1%    0.1%       0.2%   Mongolia                       0.0%   0.0%      Nigeria               0.0%    0.0%   0.0%
        Korea, South              0.3%    0.3%       0.2%   Czech Republic        0.1%     0.0%   0.0%      Tokelau               5.9%
        Madagascar                0.0%    0.0%       0.2%   Saint Lucia           0.6%     0.1%   0.0%      Turks/Caicos Is.      0.0%    0.8%
        Costa Rica                0.1%    0.3%       0.2%   Ukraine               0.0%     0.0%   0.0%      Djibouti                      0.3%
        Indonesia                 0.2%    0.2%       0.2%   Namibia                        0.0%   0.0%      Saint Vincent/Gren.   0.0%
        Sierra Leone              0.5%    0.2%       0.2%   Morocco               0.0%     0.0%   0.0%      Kyrgyzstan                    0.0%
        Turkey                    0.2%    0.2%       0.2%   Mauritania            0.0%     0.0%   0.0%      French S. Terr.               0.0%
        Poland                    0.1%    0.1%       0.1%   Bermuda               0.0%     0.1%   0.0%      Nauru                         0.0%
        Belize                    1.5%    0.6%       0.1%   Hungary               0.0%     0.0%   0.0%      Equatorial Guinea     0.0%
        Dominica                  0.1%    0.1%       0.1%   Malta                 0.1%     0.0%   0.0%      Vanuatu               0.0%
        Egypt                     0.1%    0.1%       0.1%   Jordan                0.0%     0.0%   0.0%      Iraq                  0.0%
        Macau                     0.1%    0.2%       0.1%   Tunisia               0.0%     0.0%   0.0%      Neth. Antilles                0.0%
        Hong Kong                 0.2%    0.2%       0.1%   Bolivia               0.0%     0.0%   0.0%      Kuwait                        0.0%
        Malaysia                  0.2%    0.2%       0.1%   Kenya                 0.0%     0.0%   0.0%      Central Afric. Rep.           0.0%
        Zimbabwe                  0.1%    0.2%       0.1%   Syrian Arab Rep.      0.0%     0.0%   0.0%      Tajikistan            0.0%
        Algeria                   0.0%    0.0%       0.1%   Senegal               0.0%     0.0%   0.0%      Papua New Guinea      0.0%
        El Salvador               0.1%    0.0%       0.1%   Burkina Faso          0.0%     0.0%   0.0%      Qatar                 0.0%
        Swaziland                 0.0%    0.0%       0.1%   Venezuela             0.0%     0.1%   0.0%      Bhutan                0.0%
        Philippines               0.2%    0.1%       0.1%   Niger                 0.0%     0.0%   0.0%      Guam
        Bulgaria                  0.2%    0.2%       0.1%   United Arab Emir.     0.0%     0.0%   0.0%




Source: Finance Canada data, author’s calculations

                                                                                 30
                                                 Table 6. Developing country exports under LDCT, GPT and MFN treatments by product

   HS2                Product Name              GPT             LDCT               MFN              Total                  HS2                    Product Name             GPT              LDCT             MFN           Total

      1   Live animals                                  4,054                           3,348,641         3,352,695               49 Printed books, newspapers, pictures       16,080,414            8,082      134,919,120    151,007,616
      2   Meat and edible meat offal                  412,384                          76,615,795        77,028,178               50 Silk.                                      1,823,954              561       12,855,889     14,680,403
      3   Fish & crustacean, mollusc & other       23,157,468          2,447,824      438,834,512       464,439,803               51 Wool, fine/coarse animal hair, hors        4,155,676                        44,966,155     49,121,831
      4   Dairy prod; birds' eggs; natural ho       4,624,420                          25,703,284        30,327,703               52 Cotton.                                    1,921,632           12,455      128,362,225    130,296,312
      5   Products of animal origin, nes or         1,270,377                          12,605,999        13,876,375               53 Other vegetable textile fibres; pap        1,677,363          249,545        6,671,770      8,598,677
      6   Live tree & other plant; bulb, root       2,074,664                11        68,955,172        71,029,847               54 Man-made filaments.                       15,951,917                        91,847,333    107,799,249
      7   Edible vegetables and certain roots      11,587,187            33,802       224,595,438       236,216,428               55 Man-made staple fibres.                    7,612,704           5,176        89,966,240     97,584,120
      8   Edible fruit and nuts; peel of citr      10,719,053            46,040       744,995,104       755,760,197               56 Wadding, felt & nonwoven; yarns; tw        3,624,592             288        22,296,288     25,921,169
      9   Coffee, tea, matn and spices.            14,525,121           189,603       244,046,120       258,760,843               57 Carpets and other textile floor co        55,756,436         333,949        15,449,656     71,540,041
     10   Cereals                                  10,850,669            15,568        47,871,969        58,738,205               58 Special woven fab; tufted tex fab;         8,941,090          14,133        26,550,065     35,505,287
     11   Prod.mill.indust; malt; starches;         2,298,827             6,481         3,942,562         6,247,870               59 Impregnated, coated, cover/laminate        6,846,049               1        13,236,412     20,082,462
     12   Oil seed, oleagi fruits; miscell gr       8,127,697                28        68,916,669        77,044,395               60 Knitted or crocheted fabrics.              2,985,058          14,535        67,069,334     70,068,928
     13   Lac; gums, resins & other vegetable       1,169,723             1,173        17,113,004        18,283,900               61 Art of apparel & clothing access,         35,847,771     117,875,849       997,509,122  1,151,232,743
     14   Vegetable plaiting materials; veget         724,367                           2,253,416         2,977,782               62 Art of apparel & clothing access, n       42,797,852     154,037,162     1,413,946,893  1,610,781,907
     15   Animal/veg fats & oils & their clea      26,159,476                          24,368,367        50,527,843               63 Other made up textile articles; set       27,070,950      17,337,645       324,143,322    368,551,917
     16   Prep of meat, fish or crustaceans,       91,234,975                          88,416,696       179,651,672               64 Footwear, gaiters and the like; par       15,048,049         231,042       849,437,734    864,716,826
     17   Sugars and sugar confectionery.         211,493,553                          15,545,583       227,039,135               65 Headgear and parts thereof.               60,976,888       3,036,342        28,158,167     92,171,397
     18   Cocoa and cocoa preparations.            26,535,270                         187,165,658       213,700,928               66 Umbrellas, walking-sticks, seat-sti       22,111,453                         4,650,973     26,762,427
     19   Prep.of cereal, flour, starch/milk;      52,620,826             1,217        18,441,822        71,063,864               67 Prepr feathers & down; arti flower;       36,008,570               13       20,575,040     56,583,623
     20   Prep of vegetable, fruit, nuts or o      21,638,686             5,482       225,377,852       247,022,021               68 Art of stone, plaster, cement, asbe       48,113,053            1,622       30,370,388     78,485,063
     21   Miscellaneous edible preparations.       14,089,525                 5        23,147,202        37,236,732               69 Ceramic products.                        188,583,593           15,244       58,497,405    247,096,242
     22   Beverages, spirits and vinegar.          37,052,891                          87,293,279       124,346,171               70 Glass and glassware.                      65,880,517            5,005      145,644,426    211,529,949
     23   Residues & waste from the food indu      13,649,338                          27,823,633        41,472,970               71 Natural/cultured pearls, prec stone       92,315,172          909,152      500,320,029    593,544,353
     24   Tobacco and manufactured tobacco su      17,607,414                31         4,620,680        22,228,125               72 Iron and steel.                           56,902,297                2      573,025,489    629,927,788
     25   Salt; sulphur; earth & ston; plaste      13,807,795                 8        64,710,412        78,518,215               73 Articles of iron or steel.               273,268,335            1,838      477,496,421    750,766,594
     26   Ores, slag and ash.                      15,612,297                96       519,702,555       535,314,948               74 Copper and articles thereof.              36,084,409            3,453      238,014,390    274,102,253
     27   Mineral fuels, oils & product of th         635,744                       4,715,366,656     4,716,002,400               75 Nickel and articles thereof.               4,465,038                        12,887,593     17,352,631
     28   Inorgn chem; compds of prec mtl, r       63,099,740               238       335,174,330       398,274,308               76 Aluminium and articles thereof.           93,038,838             546        58,154,167    151,193,550
     29   Organic chemicals.                       41,722,721                         340,966,882       382,689,603               78 Lead and articles thereof.                   371,271                           436,784        808,056
     30   Pharmaceutical products.                  7,061,569                          93,365,087       100,426,656               79 Zinc and articles thereof.                 2,094,438                         6,568,798      8,663,236
     31   Fertilisers.                                 58,402                          96,642,977        96,701,379               80 Tin and articles thereof.                  6,494,846                        11,789,903     18,284,748
     32   Tanning/dyeing extract; tannins &        12,114,219                12        36,979,961        49,094,193               81 Other base metals; cermets; article       27,326,771                        29,122,044     56,448,815
     33   Essential oils & resinoids; perf,        28,451,772             4,532        27,797,715        56,254,019               82 Tool, implement, cutlery, spoon & f      160,529,294           56,738       96,231,396    256,817,428
     34   Soap, organic surface-active agents      35,229,700               108        15,186,356        50,416,164               83 Miscellaneous articles of base meta      122,524,278           21,642       89,364,969    211,910,889
     35   Albuminoidal subs; modified starche       9,643,302                          17,253,386        26,896,688               84 Nuclear reactors, boilers, mchy & m      351,187,204                     5,457,483,668  5,808,670,872
     36   Explosives; pyrotechnic prod; match       7,412,969                 6         2,862,041        10,275,016               85 Electrical mchy equip parts thereof      744,549,306             604     6,024,471,540  6,769,021,451
     37   Photographic or cinematographic goo         566,323                          24,743,382        25,309,705               86 Railw/tramw locom, rolling-stock &        15,235,191                        15,471,436     30,706,627
     38   Miscellaneous chemical products.          9,845,128                          32,198,866        42,043,994               87 Vehicles o/t railw/tramw roll-stock      136,075,038                     1,897,348,193  2,033,423,231
     39   Plastics and articles thereof.          494,279,978           809,780       183,250,113       678,339,870               88 Aircraft, spacecraft, and parts the        1,005,944                        46,610,271     47,616,215
     40   Rubber and articles thereof.            122,196,544                         370,506,702       492,703,246               89 Ships, boats and floating structure        2,909,632                         8,711,605     11,621,237
     41   Raw hides and skins (other than fu       26,428,342             7,946        43,391,650        69,827,939               90 Optical, photo, cine, meas, checkin      101,702,569           13,334      797,390,347    899,106,250
     42   Articles of leather; saddlery/harne     412,878,339           162,427       125,650,065       538,690,831               91 Clocks and watches and parts thereo       61,447,650                1       58,336,308    119,783,959
     43   Furskins and artificial fur; manuf       21,973,505                           3,397,478        25,370,983               92 Musical instruments; parts and acce       28,251,485           13,554       30,484,282     58,749,321
     44   Wood and articles of wood; wood ch      178,240,587            18,331       215,477,679       393,736,597               93 Arms and ammunition; parts and acc         2,268,138                         6,371,712      8,639,849
     45   Cork and articles of cork.                1,114,786                             898,536         2,013,322               94 Furniture; bedding, mattress, matt       863,664,320          687,961      861,304,771  1,725,657,052
     46   Manufactures of straw, esparto/othe      26,176,038            16,793         6,645,097        32,837,928               95 Toys, games & sports requisites; pa      501,543,954            8,437    1,010,038,711  1,511,591,102
     47   Pulp of wood/of other fibrous cellu       7,256,174                          19,579,923        26,836,097               96 Miscellaneous manufactured articles       92,216,487              995       68,196,178    160,413,660
     48   Paper & paperboard; art of paper pu      75,805,880            54,246       108,869,311       184,729,438               97 Works of art, collectors' pieces an        1,968,737            8,171       13,361,021     15,337,929
                                                                                                                                  98                                              167,363                        42,151,243     42,318,606
                                                                                                                           Grand Total                                      6,664,663,403     298,726,863    33,040,882,843 40,004,273,110




Source: Finance Canada data, author’s calculations


                                                                                                                      31
Table 7. Share of duty-free trade by scheme

 Scheme                                                              1998          2002     2003
                                                       Total         62%           68%      70%
                        by scheme:
                                           MFN                       65%            70%      72%
                                           GPT                       47%            42%      41%
                                          LDCT                      100%           100%     100%
          Commonwealth Caribbean Countries Tariff                   100%           100%     100%
Source: Finance Canada data, author’s calculations


                                         Table 8. Average tariff rates by scheme

                  Simple average
                    Description                              1998           2002     2003
 LDCT                                                        0.0%           0.0%     0.0%
 GPT                                                         2.4%           2.1%     2.2%
 British Preferential Tariff                                 0.0%           0.0%     0.0%
 Canada-Israel Agreement Tariff                                             0.0%     0.0%
 Chile Tariff                                                2.3%           0.6%     0.0%
 Commonwealth Caribbean Countries Tariff                     0.0%           0.0%     0.0%
 Costa Rica Tariff                                                          0.0%     1.4%
 General Tariff                                              0.0%           0.0%     0.0%
 Informal Entries & Aggregated records                       0.0%           0.0%     0.0%
 Mexican Tariff                                              1.8%           0.2%     0.0%
 Mexican-United States Tariff                                1.0%           0.0%     0.0%
 United States Tariff                                        0.0%           0.0%     0.0%
 MFN                                                         6.6%           6.0%     5.8%

                    Trade weighted average
                     Description                             1998           2002     2003
 LDCT                                                        0.0%           0.0%     0.0%
 GPT                                                         3.2%           3.1%     3.1%
 British Preferential Tariff                                 0.0%           0.0%     0.0%
 Canada-Israel Agreement Tariff                                             0.0%     0.0%
 Chile Tariff                                                1.2%           0.0%     0.0%
 Commonwealth Caribbean Countries Tariff                     0.0%           0.0%     0.0%
 Costa Rica Tariff                                                          0.0%     0.2%
 General Tariff                                              0.0%           0.0%     0.0%
 Informal Entries & Aggregated records                       0.0%           0.0%     0.0%
 Mexican Tariff                                              1.6%           0.1%     0.0%
 Mexican-United States Tariff                                0.3%           0.0%     0.0%
 United States Tariff                                        0.0%           0.0%     0.0%
 MFN                                                         4.4%           3.5%     3.1%
Note: Excludes chapter 99. Trade-weighted average based on total imports.
Source: Finance Canada data, author’s calculations




                                                               32
                                                    Table 9. Average tariff margins by HS chapter and treatment (2003)*

                        HS chapter                All three   CARIBCAN   GPT    LDCT                          HS chapter                All three   CARIBCAN   GPT    LDCT

       01   Live animals                           0.0%                  0.0%                52   Cotton.                                3.2%                  1.0%   12.0%
       02   Meat and edible meat offal             0.4%                  0.4%                53   Other vegetable textile fibres; pap    1.2%                  1.2%    1.5%
       03   Fish & crustacean, mollusc & other     0.2%         1.7%     0.0%   3.0%         54   Man-made filaments.                    1.4%                  1.4%
       04   Dairy prod; birds' eggs; natural ho    1.8%         0.0%     1.8%                55   Man-made staple fibres.                1.2%                  0.6%   15.0%
       05   Products of animal origin, nes or      0.0%                  0.0%                56   Wadding, felt & nonwoven; yarns; tw    1.3%                  1.1%    7.5%
       06   Live tree & other plant; bulb, root    2.1%         4.5%     2.0%   0.0%         57   Carpets and other textile floor co     6.1%                  5.9%   10.9%
       07   Edible vegetables and certain roots    0.7%         0.0%     0.7%   5.2%         58   Special woven fab; tufted tex fab;     3.0%                  2.4%   10.4%
       08   Edible fruit and nuts; peel of citr    0.1%         0.3%     0.1%   0.0%         59   Impregnated, coated, cover/laminate    3.5%                  3.4%   14.5%
       09   Coffee, tea, matn and spices.          1.0%         0.8%     1.1%   0.7%         60   Knitted or crocheted fabrics.          4.3%                  2.4%   15.0%
       10   Cereals                                0.0%         0.0%     0.0%   0.0%         61   Art of apparel & clothing access,      12.2%                 2.1%   18.4%
       11   Prod.mill.indust; malt; starches;      1.6%         1.5%     1.6%   2.0%         62   Art of apparel & clothing access, n    13.0%                 3.9%   17.5%
       12   Oil seed, oleagi fruits; miscell gr    0.2%         0.0%     0.2%   0.0%         63   Other made up textile articles; set    9.2%                  5.8%   16.8%
       13   Lac; gums, resins & other vegetable    0.0%                  0.0%   0.0%         64   Footwear, gaiters and the like; par    8.4%                  6.7%   17.6%
       14   Vegetable plaiting materials; veget    0.0%         0.0%     0.0%                65   Headgear and parts thereof.            2.7%                  1.8%    8.7%
       15   Animal/veg fats & oils & their clea    5.0%         7.1%     4.8%                66   Umbrellas, walking-sticks, seat-sti    1.6%                  1.6%
       16   Prep of meat, fish or crustaceans,     1.1%         3.7%     1.1%                67   Prepr feathers & down; arti flower;    7.0%                  7.0%   5.0%
       17   Sugars and sugar confectionery.        3.6%         7.9%     3.4%                68   Art of stone, plaster, cement, asbe    3.5%                  3.5%   5.0%
       18   Cocoa and cocoa preparations.          2.3%         6.0%     2.3%                69   Ceramic products.                      5.0%                  4.9%   6.8%
       19   Prep.of cereal, flour, starch/milk;    1.4%         3.6%     1.3%    5.0%        70   Glass and glassware.                   0.7%                  0.6%   3.6%
       20   Prep of vegetable, fruit, nuts or o    1.6%         4.8%     1.2%    4.0%        71   Natural/cultured pearls, prec stone    2.6%                  2.3%   7.5%
       21   Miscellaneous edible preparations.     3.5%         7.2%     3.0%   10.5%        72   Iron and steel.                         0.5%        0.0%     0.5%   0.0%
       22   Beverages, spirits and vinegar.        4.7%         8.0%     4.4%                73   Articles of iron or steel.              2.0%        6.7%     1.9%   4.8%
       23   Residues & waste from the food indu    1.2%         0.0%     1.2%                74   Copper and articles thereof.            2.5%                 2.5%   3.0%
       24   Tobacco and manufactured tobacco su    6.2%                  6.0%   12.5%        75   Nickel and articles thereof.            2.3%                 2.3%
       25   Salt; sulphur; earth & ston; plaste    0.6%                  0.6%    2.5%        76   Aluminium and articles thereof.         2.2%        6.5%     2.1%   6.5%
       26   Ores, slag and ash.                    0.0%                  0.0%    0.0%        78   Lead and articles thereof.              2.8%                 2.8%
       27   Mineral fuels, oils & product of th    3.8%                  3.8%                79   Zinc and articles thereof.              0.6%                 0.6%
       28   Inorgn chem; compds of prec mtl, r     1.2%                  1.2%   3.5%         80   Tin and articles thereof.               2.6%                 2.6%
       29   Organic chemicals.                     2.4%         5.5%     2.4%                81   Other base metals; cermets; article     1.5%                 1.5%
       30   Pharmaceutical products.               0.2%         0.0%     0.2%                82   Tool, implement, cutlery, spoon & f     2.7%        7.0%     2.6%   8.9%
       31   Fertilisers.                           0.0%                  0.0%                83   Miscellaneous articles of base meta     2.1%                 2.1%   6.4%
       32   Tanning/dyeing extract; tannins &      3.0%                  3.0%   0.0%         84   Nuclear reactors, boilers, mchy & m     1.5%                 1.5%
       33   Essential oils & resinoids; perf,      3.8%         3.8%     3.8%   6.4%         85   Electrical mchy equip parts thereof     2.0%        4.1%     1.9%   3.8%
       34   Soap, organic surface-active agents    3.8%         6.5%     3.7%   6.5%         86   Railw/tramw locom, rolling-stock &      3.2%                 3.2%
       35   Albuminoidal subs; modified starche    3.2%                  3.2%                87   Vehicles o/t railw/tramw roll-stock     0.6%                 0.6%
       36   Explosives; pyrotechnic prod; match    4.9%                  4.8%   6.5%         88   Aircraft, spacecraft, and parts the     0.6%                 0.6%
       37   Photographic or cinematographic goo    5.2%                  5.2%                89   Ships, boats and floating structure     4.0%                 4.0%
       38   Miscellaneous chemical products.       2.5%                  2.5%                90   Optical, photo, cine, meas, checkin     1.6%                 1.6%   1.5%
       39   Plastics and articles thereof.         3.3%         7.0%     3.2%   7.1%         91   Clocks and watches and parts thereo     2.6%                 2.6%   0.0%
       40   Rubber and articles thereof.           2.2%                  2.2%                92   Musical instruments; parts and acce     2.0%                 2.0%   2.0%
       41   Raw hides and skins (other than fu     2.4%                  2.4%   2.5%         93   Arms and ammunition; parts and acc      4.5%                 4.5%
       42   Articles of leather; saddlery/harne    3.5%                  3.1%   8.0%         94   Furniture; bedding, mattress, matt      2.4%        8.3%     2.2%   8.9%
       43   Furskins and artificial fur; manuf     3.0%                  3.0%                95   Toys, games & sports requisites; pa     1.2%                 1.2%   0.0%
       44   Wood and articles of wood; wood ch     3.0%         3.0%     2.9%   6.3%         96   Miscellaneous manufactured articles     2.9%        4.5%     2.8%   7.0%
       45   Cork and articles of cork.             0.0%                  0.0%                97   Works of art, collectors' pieces an     1.5%                 1.5%   0.0%
       46   Manufactures of straw, esparto/othe    3.5%                  3.2%   6.5%
       47   Pulp of wood/of other fibrous cellu    0.0%                  0.0%
       48   Paper & paperboard; art of paper pu    0.0%                  0.0%   0.0%
       49   Printed books, newspapers, pictures    0.2%         0.8%     0.2%   0.0%
       50   Silk.                                  0.0%                  0.0%   0.0%
       51   Wool, fine/coarse animal hair, hors    3.3%                  3.3%




Source: Finance Canada data, author’s calculations




                                                                                        33
                                                                                Table 10. Product coverage


                               GPT                  LDCT             CARIBCAN                                      GPT                  LDCT             CARIBCAN
                       1998    2002   2003   1998   2002   2003   1998 2002 2003                            1998   2002   2003   1998   2002   2003   1998 2002 2003

Afghanistan            100%    92%     99%   100%   92%    98%                         Cuba                 96%    97%    99%
Algeria                100%    100%   100%                                             Djibouti             100%   100%   100%   100% 100% 100%
Angola                 100%    100%   100%   100% 100% 100%                            Dominica             95%    87%    89%                         94%   87%   65%
Anguilla               100%    100%   100%                        100% 100% 100%       Dominican Rep.       70%    69%    78%
Antigua and Barbuda    100%    100%   99%                         100% 100% 76%        Ecuador              93%    83%    82%
Argentina               82%    71%     71%                                             Egypt                51%    69%    85%
Armenia                 44%    46%     56%                                             El Salvador          59%    27%    34%
Azerbaijan             100%    82%     96%                                             Equatorial Guinea    100%   100%   100%   100% 100% 100%
Bahamas                 82%    45%     85%                        99%    100%    99%   Eritrea              67%    99%    100%   67%  99% 100%
Bahrain                 82%    68%     51%                                             Ethiopia             100%   100%   99%    100% 100% 100%
Bangladesh              12%    11%      7%   12%    11%    100%                        Falkland Islands     100%   66%    100%
Barbados                85%    99%     99%                        99%    100% 100%     Fiji                 90%    91%    91%
Belarus                 76%    87%     89%                                             French Polynesia     100%   99%    100%
Belize                  83%    76%     87%                        95%    81%     87%   French S. Terr.      100%   100%   100%
Benin                  100%    100%    93%   100% 100% 100%                            Gabon                97%    100%   100%
Bermuda                100%    100%    99%                        100% 100% 100%       Gambia               100%   100%   99%    100% 100% 100%
Bhutan                   8%    100%   100%   8%     100% 100%                          Georgia              100%   89%    92%
Bolivia                 96%    98%     95%                                             Ghana                100%   99%    100%
Bosnia'herzegovina      43%    25%     55%                                             Gibraltar            100%   100%   100%
Botswana                 2%    45%     98%                                             Grenada              100%   100%   100%                        100% 100% 100%
Br. Virgin Is.          96%    89%     99%                        100%   97%     99%   Guam                 94%    98%    98%
Brazil                  82%    80%     83%                                             Guatemala            91%    84%    83%
Bri. Indian O. Ter     100%    100%    86%                                             Guinea               100%   100%   100%   100% 100% 100%
Brunei Darussalam        5%     1%      2%                                             Guinea-Bissau        100%   100%   100%   100% 100% 100%
Bulgaria                54%    44%    48%                                              Guyana               100%   100%   99%                         100% 100% 100%
Burkina Faso           100%    95%    100%   100%   95%    100%                        Haiti                56%    23%    15%    56%    50%    100%
Burundi                100%    98%     99%   100%   98%    100%                        Honduras             55%    42%    44%
Cambodia                11%     5%      1%   11%     5%    100%                        Hong Kong            55%    58%    60%
Cameroon               100%    99%    100%                                             India                58%    58%    60%
Cape Verde              36%    100%    98%   36%    100% 100%                          Indonesia            69%    72%    75%
Cayman Islands         100%    100%   100%                        100% 100% 100%       Iran, Islamic Rep.   100%   90%    98%
Central Afric. Rep.    100%    100%    99%   100% 100% 100%                            Iraq                 100%   100%   100%
Chad                   100%    99%     99%   100% 99% 100%                             Israel               97%    93%    92%
Chile                   80%    88%     90%                                             Jamaica              96%    98%    99%                         97%   99%   100%
China People`s Rep.     79%    80%     83%                                             Jordan               95%    19%    24%
Christmas Is Aust      100%    80%    100%                                             Kazakhstan           45%    100%   61%
Cocos Islands          100%    77%     96%                                             Kenya                98%    95%    80%
Colombia                85%    82%     80%                                             Kiribati             100%   100%   100%   100% 100% 100%
Comoros                100%    99%    100%   100% 100% 100%                            Korea, South         83%    87%    90%
Congo                  100%    99%    100%                                             Kuwait                 3%   99%    100%
Congo, D.R. (eZaire)   #####   100%   100%          100% 100%                          Kyrgyzstan           93%    98%    100%
Cook Islands            99%    100%   100%                                             Laos P. Dem. Rep.     24%     6%     3%   24%    6%     100%
Costa Rica              89%    96%     97%                                             Lebanon               78%    85%    88%
Côte d'Ivoire          100%    100%   100%                                             Lesotho                0%     0%     0%    0%   0%  100%
Croatia                 84%    63%     65%                                             Liberia              100%   100%   100%   100% 100% 100%




Source: Finance Canada data, author’s calculations


                                                                                            34
                                                                 Table 10. (continued) Product coverage

                          GPT                  LDCT              CARIBCAN                                     GPT                  LDCT            CARIBCAN
                   1998   2002   2003   1998   2002 2003      1998 2002 2003                           1998   2002   2003   1998   2002 2003    1998 2002 2003



Macau              13%    11% 11%                                                Saint Kitts/Nevis     99%    100%   100%                       99% 100% 100%
Macedonia          11%    31% 24%                                                Saint Lucia           97%    92%    93%                        98% 97% 91%
Madagascar         81%    70% 80%       81% 72% 100%                             Saint Vincent/Gren.   100%   100%   99%                        100% 100% 99%
Malawi             100%   100% 69%      100% 100% 100%                           Samoa, American        72%    92%   100%
Malaysia           95%    95% 96%                                                Sao Tome/Principe     100%   100%   100%   100% 100% 100%
Maldives            3%    23%   2%       3%  23% 100%                            Senegal                              93%             100%
Mali               100%   100% 100%     100% 100% 100%                           Seychelles             96%    86%   100%
Mariana Islands     0%                                                           Sierra Leone          94%    91%    91%    94%    99%   100%
Marshall Islands   98%                                                           Singapore             99%    98%    98%
Mauritania         51%    87%     93%   51%    87%   100%                        Slovakia              30%    78%    91%
Mauritius          14%    26%     29%                                            Slovenia              89%    76%    78%
Mexico             95%    93%     93%                                            Solomon Islands       96%    84%    100%   96%    85% 100%
Moldova            41%     7%      6%                                            Somalia               84%    63%    91%    84%    100% 100%
Mongolia           84%     2%      3%                                            South Africa          84%    85%    86%
Montserrat         99%    100%   100%                          99%   100% 100%   St-Helena             93%    100%   100%
Morocco            93%    89%     89%                                            Sudan                 100%   100%   100%   100% 100% 100%
Mozambique         100%   100%    54%   100% 100% 100%                           Surinam               100%   100%   100%
Namibia            100%   100%    98%                                            Swaziland             89%    95%    92%
Nauru              84%    100%    48%                                            Syrian Arab Rep.      89%    96%    97%
Nepal              57%    66%     55%   57%    66%   100%                        Tajikistan            100%    1%    99%
Neth. Antilles     100%   100%   100%                                            Tanzania, Un. Rep.    100%   99%    99%    100% 100% 100%
New Caledonia      100%   96%    100%                                            Thailand              84%    86%    86%
Nicaragua          71%    85%     90%                                            Togo                  100%   100%   95%    100% 100% 100%
Niger              98%    95%     97%   98%    95%   100%                        Tokelau               41%
Nigeria            100%   100%   100%                                            Tonga                 100%   92%    100%
Niue               100%   96%    100%                                            Trinidad and Tobago   90%    92%    94%                        100% 100% 100%
Norfolk Island     33%    100%    99%                                            Tunisia               72%    56%    54%
Pakistan           24%    26%     27%                                            Turkey                41%    42%    54%
Panama             100%   99%     99%                                            Turkmenistan          100%    2%    14%
Papua New Guinea   100%   100%   100%                                            Turks/Caicos Is.      13%    58%    10%                        11%   17%   1%
Paraguay           97%    94%     92%                                            Uganda                100%   100%   100%   100% 100% 100%
Peru               93%    94%     92%                                            Ukraine               49%    55%    80%
Philippines        91%    90%    89%                                             United Arab Emir.     56%    62%    63%
Pitcairn Island    100%   100%   100%                                            Uruguay               82%    87%    96%
Qatar              99%    14%     92%                                            Uzbekistan            100%   88%    52%
Romania            29%    52%     57%                                            Vanuatu               100%   100%   100%   100% 100% 100%
Russia             61%    76%     95%                                            Venezuela             98%    96%    96%
Rwanda             99%    100%    96%   99%    100% 100%                         Vietnam               43%    53%    59%
                                                                                 Western Samoa         100%   34%    76%    100% 34% 100%
                                                                                 Yemen                 100%    99%   100%   100% 99% 100%
                                                                                 Zambia                100%    99%    93%   100% 99% 100%
                                                                                 Zimbabwe               97%    96%    99%




                                                            Source: Finance Canada data, author’s calculations
                                                                                      35
                                                                    Table 11. Utilisation rates by country and scheme


                                 GPT                  LDCT               CARIBCAN                                    GPT                  LDCT             CARIBCAN
                          1998   2002   2003   1998   2002   2003     1998 2002 2003                          1998   2002   2003   1998   2002   2003   1998 2002 2003

   Afghanistan             0%     4%    16%    0%     0%     0%                          Cuba                 15%     9%     4%
   Algeria                 0%     0%    0%                                               Djibouti              0%     7%    0%     0%     0%     0%
   Angola                  0%     0%     0%    0%     0%     0%                          Dominica              2%     0%     0%                         2%   5%   27%
   Anguilla                0%     0%     0%                            0%    0%    0%    Dominican Rep.        6%     5%     5%
   Antigua and Barbuda     0%     0%     0%                            0%    0%    2%    Ecuador               2%     2%     5%
   Argentina              26%    17%    14%                                              Egypt                37%    35%    14%
   Armenia                 0%    17%    41%                                              El Salvador          14%     1%    36%
   Azerbaijan              0%     0%    33%                                              Equatorial Guinea     0%     0%    0%     0%     0%     0%
   Bahamas                 1%     2%     0%                            30%   44%   12%   Eritrea               0%     0%    0%     0%     0%     0%
   Bahrain                 0%     2%     4%                                              Ethiopia              1%    11%     0%    0%     0%     0%
   Bangladesh             23%    34%    10%    16%    20%    89%                         Falkland Islands      0%     0%    0%
   Barbados               10%    39%    63%                            41%   26%   19%   Fiji                 67%    71%    61%
   Belarus                 7%    33%    40%                                              French Polynesia     22%     1%    1%
   Belize                  0%     8%     1%                            86%   6%    2%    French S. Terr.       0%    99%    0%
   Benin                   0%     0%    22%    0%     0%     0%                          Gabon                 0%     0%     9%
   Bermuda                 0%     4%     9%                            0%    0%    0%    Gambia                0%     0%     0%    0%     0%     0%
   Bhutan                  0%     0%     0%    0%     0%     0%                          Georgia              20%     3%     0%
   Bolivia                 3%     3%     3%                                              Ghana                 3%     1%     2%
   Bosnia'herzegovina      0%    57%    49%                                              Gibraltar             0%     0%     0%
   Botswana                2%     1%    44%                                              Grenada               0%     0%     7%                         1%   0%   11%
   Br. Virgin Is.          0%    17%    18%                            2%    0%    0%    Guam                  1%     0%     0%
   Brazil                 22%    26%    26%                                              Guatemala            37%    26%    21%
   Bri. Indian O. Ter      0%     0%     0%                                              Guinea                0%     0%     0%    0%     0%     0%
   Brunei Darussalam       0%     6%    18%                                              Guinea-Bissau         0%     0%     0%    0%     0%     0%
   Bulgaria               58%    47%    34%                                              Guyana                1%     1%     2%                         0%   0%    1%
   Burkina Faso           10%     8%    16%    27%    40%     9%                         Haiti                11%     2%     1%    3%     52%    46%
   Burundi                 0%     0%     0%     0%     0%     0%                         Honduras              3%    19%     2%
   Cambodia                6%     1%     2%     0%     0%    89%                         Hong Kong            19%    22%    21%
   Cameroon                0%     2%     3%                                              India                37%    34%    30%
   Cape Verde              0%     0%     0%    0%     0%     0%                          Indonesia            26%    27%    26%
   Cayman Islands          2%     0%     0%                            0%    0%    0%    Iran, Islamic Rep.   16%    41%    33%
   Central Afric. Rep.     0%     0%     0%    0%     0%     0%                          Iraq                  0%     0%     0%
   Chad                    0%     0%     0%    0%     0%     0%                          Israel                1%     1%     1%
   Chile                   9%     2%     1%                                              Jamaica               3%     3%     2%                         4%   4%    5%
   China People`s Rep.    50%    44%    40%                                              Jordan               11%    43%    35%
   Christmas Is Aust       0%     0%     0%                                              Kazakhstan            0%     0%     0%
   Cocos Islands           0%     0%     0%                                              Kenya                 4%     8%     5%
   Colombia                3%     6%    15%                                              Kiribati              0%     0%     0%    0%     0%     0%
   Comoros                47%     0%     4%    0%     0%     0%                          Korea, South         17%    13%    12%
   Congo                   0%     1%     1%                                              Kuwait                0%     0%     0%
   Congo, D.R. (eZaire)    0%     0%     0%           0%     0%                          Kyrgyzstan            0%    49%    0%
   Cook Islands            0%    11%     7%                                              Laos P. Dem. Rep.     4%    13%    10%    12%    38%    89%
   Costa Rica              3%    12%     8%                                              Lebanon              58%    62%    55%
   Côte d'Ivoire           0%     2%     3%                                              Lesotho               0%    46%     0%    0%     0%     76%
   Croatia                52%    21%    23%                                              Liberia               0%     0%     0%    0%     0%      0%




Source: Finance Canada data, author’s calculations



                                                                                              36
                                                        Table 11. (continued) Utilisation rate by country and scheme


                             GPT                  LDCT            CARIBCAN                                   GPT                  LDCT           CARIBCAN
                      1998   2002   2003   1998   2002 2003    1998 2002 2003                         1998   2002   2003   1998   2002 2003   1998 2002 2003



Macau                 25%    79%    52%                                         Samoa, American        0%     0%     0%
Macedonia              0%     4%     4%                                         Sao Tome/Principe      0%     0%     0%    0%     0%    0%
Madagascar             6%     9%     1%    1%     0%    16%                     Senegal                0%     0%     9%                 1%
Malawi                58%     2%     0%    0%     0%    28%                     Seychelles             0%     0%     0%
Malaysia              10%    11%     9%                                         Sierra Leone          39%    22%    15%    0%     0%    0%
Maldives               0%     0%     0%    0%     29%   47%                     Singapore              2%     3%     4%
Mali                   0%    12%     2%    0%      0%    0%                     Slovakia              56%    32%    10%
Mariana Islands        0%     0%     0%                                         Slovenia              48%    42%    25%
Marshall Islands       0%     0%     0%                                         Solomon Islands        0%     0%     0%    0%      0%   0%
Mauritania            19%    77%    28%    0%     0%    0%                      Somalia                0%     0%     3%    0%     37%   0%
Mauritius             12%    13%    12%                                         South Africa          16%    13%    12%
Mexico                 0%     0%     0%                                         St-Helena              0%     0%     0%
Moldova                0%     3%     6%                                         Sudan                  0%     0%     0%    0%     0%    0%
Mongolia               0%     0%    46%                                         Surinam                0%     0%     1%
Montserrat             0%     0%     0%                         0%   0%    0%   Swaziland              0%     0%    31%
Morocco                4%     4%     5%                                         Syrian Arab Rep.       2%     2%     1%
Mozambique             0%     0%     0%    10%    0%    0%                      Tajikistan             0%     0%     0%
Namibia                0%     0%     0%                                         Tanzania, Un. Rep.     4%     0%     0%    0%     0%    1%
Nauru                  0%     1%     0%                                         Thailand              32%    33%    30%
Nepal                 30%    39%    35%    37%    42%   51%                     Togo                   0%     7%     9%    0%     3%    5%
Neth. Antilles         0%     1%     0%                                         Tokelau               41%     0%     0%
New Caledonia         12%     6%     3%                                         Tonga                  0%     0%     0%
Nicaragua              1%     0%     0%                                         Trinidad and Tobago    1%     4%     1%                       34%   79%   39%
Niger                  0%     3%     0%    0%     0%    1%                      Tunisia               21%    11%    20%
Nigeria                0%     0%     0%                                         Turkey                53%    57%    38%
Niue                   0%     0%     0%                                         Turkmenistan           0%     7%     0%
Norfolk Island         0%     0%     0%                                         Turks/Caicos Is.       0%     0%     0%                       0%    70%   0%
Pakistan              53%    62%    63%                                         Uganda                 0%     5%     1%    1%     0%    0%
Panama                 4%    51%    14%                                         Ukraine                8%     7%    12%
Papua New Guinea       0%     0%     0%                                         United Arab Emir.     26%    29%    35%
Paraguay              12%    13%    16%                                         Uruguay               20%    30%     8%
Peru                  29%    34%    19%                                         Uzbekistan             0%     2%     0%
Philippines           10%     8%     8%                                         Vanuatu                0%     0%     0%    0%     0%    0%
Pitcairn Island        0%     0%     0%                                         Venezuela              1%     2%     1%
Qatar                  0%     0%     0%                                         Vietnam               43%    41%    40%
Romania               35%    35%    29%                                         Western Samoa          0%    40%     0%    0%     0%    18%
Russia                 7%    12%     7%                                         Yemen                  0%     0%     0%    0%     0%     0%
Rwanda                 0%     0%     0%    0%     0%    0%                      Zambia                 0%     1%     2%    0%     0%     0%
Saint Kitts/Nevis      0%     0%     0%                         0%    0%   0%   Zimbabwe              17%    49%    30%
Saint Lucia            0%     0%     0%                        60%   15%   7%
Saint Vincent/Gren.   47%     0%     0%                         0%    0%   0%




Source: Finance Canada data, author’s calculations


                                                                                     37
                                                                              Table 12. Utility rates


                              GPT                  LDCT             CARIBCAN                                   GPT                  LDCT             CARIBCAN
                       1998   2002   2003   1998   2002   2003   1998 2002 2003                         1998   2002   2003   1998   2002   2003   1998 2002 2003

Afghanistan             0%     4%    16%    0%     0%     0%                       Cuba                 15%     8%     4%
Algeria                 0%     0%     0%                                           Djibouti              0%     7%     0%    0%     0%     0%
Angola                  0%     0%     0%    0%     0%     0%                       Dominica              2%     0%     0%                         2%   4%   17%
Anguilla                0%     0%     0%                         0%    0%    0%    Dominican Rep.        4%     4%     4%
Antigua and Barbuda     0%     0%     0%                         0%    0%    2%    Ecuador               1%     2%     4%
Argentina              21%    12%    10%                                           Egypt                19%    24%    12%
Armenia                 0%     8%    23%                                           El Salvador           8%     0%    12%
Azerbaijan              0%     0%    31%                                           Equatorial Guinea     0%     0%     0%    0%     0%     0%
Bahamas                 1%     1%     0%                         29%   44%   12%   Eritrea               0%     0%     0%    0%     0%     0%
Bahrain                 0%     1%     2%                                           Ethiopia              1%    11%     0%    0%     0%     0%
Bangladesh              3%     4%     1%    2%     2%     89%                      Falkland Islands      0%     0%     0%
Barbados                9%    38%    62%                         41%   26%   19%   Fiji                 61%    65%    56%
Belarus                 6%    29%    36%                                           French Polynesia     22%     1%     1%
Belize                  0%     6%     1%                         82%   5%    2%    French S. Terr.       0%    99%     0%
Benin                   0%     0%    20%    0%     0%     0%                       Gabon                 0%     0%     9%
Bermuda                 0%     4%     9%                         0%    0%    0%    Gambia                0%     0%     0%    0%     0%     0%
Bhutan                  0%     0%     0%    0%     0%     0%                       Georgia              20%     3%     0%
Bolivia                 3%     3%     3%                                           Ghana                 3%     1%     2%
Bosnia'herzegovina      0%    14%    27%                                           Gibraltar             0%     0%     0%
Botswana                0%     1%    43%                                           Grenada               0%     0%     7%                         1%   0%   11%
Br. Virgin Is.          0%    15%    18%                         2%    0%    0%    Guam                  1%     0%     0%
Brazil                 18%    21%    22%                                           Guatemala            34%    22%    18%
Bri. Indian O. Ter      0%     0%     0%                                           Guinea                0%     0%     0%    0%     0%     0%
Brunei Darussalam       0%     0%     0%                                           Guinea-Bissau         0%     0%    0%     0%     0%     0%
Bulgaria               31%    21%    16%                                           Guyana                1%     1%     2%                         0%   0%    1%
Burkina Faso           10%     8%    16%    27%    38%     9%                      Haiti                 6%     0%     0%    2%     26%    46%
Burundi                 0%     0%     0%     0%     0%     0%                      Honduras              1%     8%     1%
Cambodia                1%     0%     0%     0%     0%    89%                      Hong Kong            11%    13%    12%
Cameroon                0%     2%     3%                                           India                21%    20%    18%
Cape Verde              0%     0%     0%    0%     0%     0%                       Indonesia            18%    20%    19%
Cayman Islands          2%     0%     0%                         0%    0%    0%    Iran, Islamic Rep.   16%    37%    33%
Central Afric. Rep.     0%     0%     0%    0%     0%     0%                       Iraq                  0%     0%     0%
Chad                    0%     0%     0%    0%     0%     0%                       Israel                1%     1%     1%
Chile                   7%     2%     1%                                           Jamaica               3%     3%     2%                         4%   4%    5%
China People`s Rep.    39%    35%    33%                                           Jordan               11%     8%     8%
Christmas Is Aust       0%     0%     0%                                           Kazakhstan            0%     0%     0%
Cocos Islands           0%     0%     0%                                           Kenya                 4%     8%     4%
Colombia                3%     5%    12%                                           Kiribati              0%     0%     0%    0%     0%     0%
Comoros                47%     0%     4%    0%     0%     0%                       Korea, South         15%    12%    11%
Congo                   0%     1%     1%                                           Kuwait                0%     0%     0%
Congo, D.R. (eZaire)    0%     0%     0%           0%     0%                       Kyrgyzstan            0%    48%     0%
Cook Islands            0%    11%     7%                                           Laos P. Dem. Rep.     1%     1%     0%    3%     2%     89%
Costa Rica              3%    12%     8%                                           Lebanon              46%    53%    48%
Côte d'Ivoire           0%     2%     3%                                           Lesotho               0%     0%     0%    0%     0%     76%
Croatia                43%    13%    15%                                           Liberia               0%     0%     0%    0%     0%      0%




Source: Finance Canada data, author’s calculations


                                                                                        38
                                                                    Table 12. (continued) Utility rates


                             GPT                  LDCT           CARIBCAN                                    GPT                  LDCT           CARIBCAN
                      1998   2002   2003   1998   2002 2003   1998 2002 2003                          1998   2002   2003   1998   2002 2003   1998 2002 2003



Macau                  3%     9%     6%                                         Samoa, American        0%     0%     0%
Macedonia              0%     1%     1%                                         Sao Tome/Principe      0%     0%     0%    0%     0%    0%
Madagascar             5%     6%     1%    1%     0%    16%                     Senegal                0%     0%     9%                 1%
Malawi                58%     2%     0%    0%     0%    28%                     Seychelles             0%     0%     0%
Malaysia               9%    10%     8%                                         Sierra Leone          37%    20%    14%    0%     0%    0%
Maldives               0%     0%     0%    0%     7%    47%                     Singapore              2%     3%     4%
Mali                   0%    12%     2%    0%     0%     0%                     Slovakia              17%    25%     9%
Mariana Islands        0%     0%     0%                                         Slovenia              42%    32%    20%
Marshall Islands       0%     0%     0%                                         Solomon Islands        0%     0%     0%    0%      0%   0%
Mauritania            10%    67%    26%    0%     0%    0%                      Somalia                0%     0%     3%    0%     37%   0%
Mauritius              2%     3%     4%                                         South Africa          14%    11%    11%
Mexico                 0%     0%     0%                                         St-Helena              0%     0%     0%
Moldova                0%     0%     0%                                         Sudan                  0%     0%     0%    0%     0%    0%
Mongolia               0%     0%     1%                                         Surinam                0%     0%     1%
Montserrat             0%     0%     0%                       0%    0%    0%    Swaziland              0%     0%    29%
Morocco                4%     4%     4%                                         Syrian Arab Rep.       2%     2%     1%
Mozambique             0%     0%     0%    10%    0%    0%                      Tajikistan             0%     0%     0%
Namibia                0%     0%     0%                                         Tanzania, Un. Rep.     4%     0%     0%    0%     0%    1%
Nauru                  0%     1%     0%                                         Thailand              27%    28%    26%
Nepal                 17%    25%    19%    21%    28%   51%                     Togo                   0%     7%     9%    0%     3%    5%
Neth. Antilles         0%     1%     0%                                         Tokelau               17%     0%     0%
New Caledonia         12%     5%     3%                                         Tonga                  0%     0%     0%
Nicaragua              1%     0%     0%                                         Trinidad and Tobago    1%     4%     1%                       34%   79%   39%
Niger                  0%     2%     0%    0%     0%    1%                      Tunisia               15%     6%    11%
Nigeria                0%     0%     0%                                         Turkey                22%    24%    21%
Niue                   0%     0%     0%                                         Turkmenistan           0%     0%     0%
Norfolk Island         0%     0%     0%                                         Turks/Caicos Is.       0%     0%     0%                       0%    12%   0%
Pakistan              13%    16%    17%                                         Uganda                 0%     5%     1%    1%     0%    0%
Panama                 4%    51%    14%                                         Ukraine                4%     4%    10%
Papua New Guinea       0%     0%     0%                                         United Arab Emir.     15%    18%    22%
Paraguay              12%    12%    14%                                         Uruguay               16%    26%     7%
Peru                  27%    32%    18%                                         Uzbekistan             0%     2%     0%
Philippines            9%     7%     8%                                         Vanuatu                0%     0%     0%    0%     0%    0%
Pitcairn Island        0%     0%     0%                                         Venezuela              1%     2%     1%
Qatar                  0%     0%     0%                                         Vietnam               19%    22%    24%
Romania               10%    18%    17%                                         Western Samoa          0%    14%     0%    0%     0%    18%
Russia                 4%    11%     6%                                         Yemen                  0%     0%     0%    0%     0%     0%
Rwanda                 0%     0%     0%    0%     0%    0%                      Zambia                 0%     1%     2%    0%     0%     0%
Saint Kitts/Nevis      0%     0%     0%                        0%    0%   0%    Zimbabwe              16%    48%    30%
Saint Lucia            0%     0%     0%                       59%   15%   7%
Saint Vincent/Gren.   47%     0%     0%                        0%    0%   0%




Source: Finance Canada data, author’s calculations
                                                                                     39
                                    Table 13. Value of preferences by scheme (US$)

                                                              Year
                                                              1998             2002          2003
        Canada-Israel Agreement Tariff                                             6,599,067     8,881,239
        Chile Tariff                                                 796,849       1,981,289     2,627,091
        Commonwealth Caribbean Countries Tariff                      977,169       1,297,913     3,022,676
        Costa Rica Tariff                                                              4,089        87,795
        GPT                                                     99,343,661       151,473,214 173,895,632
        LDCT                                                       306,747           518,712    53,032,727
        Mexican Tariff                                          79,503,301       189,103,895 212,471,049
        Mexican-United States Tariff                             8,556,558        26,436,984    34,088,074

Source: Finance Canada, author's calculations




                                                         40
                                                                       Table 14. Value of preferences (sorted by 2003 value)


                                      Value US$                        As % of country's total exports                                                   Value US$                         As % of country's total exports
    Country Name          1998       2002       2003            1998           2002            2003               Country Name         1998             2002       2003             1998           2002            2003

    Mexico                166,241,506 271,515,970 302,137,097           0.14%         0.17%          0.18%        Uruguay                     733,503       363,465       311,103          0.02%          0.02%          0.01%
    China People`s Rep.    70,269,542 129,684,381 154,194,298           0.02%         0.03%          0.03%        Cuba                        586,214       315,564       309,204          0.04%          0.03%          0.03%
    Bangladesh              1,270,457     679,118 39,877,493            0.03%         0.01%          0.52%        Dominican Rep.              275,536       263,093       291,165          0.01%          0.01%          0.01%
    India                   9,217,033 11,704,834 16,142,199             0.02%         0.03%          0.03%        El Salvador                 105,733       265,666       289,243          0.00%          0.01%          0.01%
    Korea, South           13,807,704 16,921,976 14,498,484             0.01%         0.01%          0.01%        Costa Rica                  101,960       218,832       280,559          0.00%          0.00%          0.00%
    Thailand                8,847,146 12,593,012 13,357,996             0.02%         0.02%          0.02%        Slovenia                    482,272       541,379       233,396          0.01%          0.01%          0.00%
    Brazil                  7,268,002 10,325,772 10,673,512             0.01%         0.02%          0.01%        Lithuania                    19,779       160,412       221,624          0.00%          0.00%          0.00%
    Israel                    665,910   7,813,061 10,140,461            0.00%         0.03%          0.03%        Jamaica                     250,992       223,511       220,497          0.01%          0.02%          0.01%
    Cambodia                    2,909     345,651   9,737,714           0.00%         0.02%          0.43%        Turkmenistan                      1       337,249       219,987          0.00%          0.07%          0.03%
    Malaysia                4,412,398   5,438,629   5,295,343           0.01%         0.01%          0.00%        Bahamas                     334,126       249,207       199,132          0.06%          0.02%          0.01%
    Indonesia               4,735,368   4,927,097   4,869,000           0.01%         0.01%          0.01%        Ecuador                      71,553       142,780       149,439          0.00%          0.00%          0.00%
    Vietnam                 2,066,707   3,044,507   4,516,651           0.02%         0.02%          0.02%        Zimbabwe                    173,729       226,218       141,039          0.01%          0.02%          0.01%
    Poland                  1,682,782   2,230,087   3,786,965           0.01%         0.01%          0.01%        Ukraine                     518,747       131,175       131,994          0.00%          0.00%          0.00%
    Hong Kong               8,919,000   4,567,827   3,683,236           0.02%         0.01%          0.01%        Tunisia                      26,998        48,750       127,744          0.00%          0.00%          0.00%
    Turkey                  2,960,895   3,400,800   3,567,124           0.01%         0.01%          0.01%        Bosnia'herzegovina            4,187        91,004       117,053          0.00%          0.01%          0.01%
    Romania                   327,854   2,185,163   2,865,989           0.00%         0.02%          0.02%        Guatemala                   134,932       144,116       110,319          0.00%          0.00%          0.00%
    Chile                   1,293,245   2,042,598   2,684,157           0.01%         0.01%          0.01%        Estonia                      39,662        98,058       109,714          0.00%          0.00%          0.00%
    Trinidad and Tobago       315,239     806,671   2,592,162           0.01%         0.02%          0.04%        Lebanon                      68,888       102,114       101,511          0.01%          0.02%          0.01%
    Singapore               1,817,028   1,815,758   2,465,995           0.00%         0.00%          0.00%        Malta                        30,764        22,993       100,351          0.00%          0.00%          0.00%
    Philippines             2,216,989   2,070,333   2,421,493           0.01%         0.01%          0.01%        Croatia                     168,562        91,736        95,229          0.01%          0.00%          0.00%
    Pakistan                1,571,767   1,986,169   2,020,743           0.02%         0.02%          0.02%        Latvia                        7,020        52,912        87,609          0.00%          0.00%          0.00%
    Macau                     289,778   1,469,156   1,906,308           0.01%         0.06%          0.07%        Morocco                      35,102        50,905        82,758          0.00%          0.00%          0.00%
    Hungary                   401,998   1,051,229   1,609,879           0.00%         0.00%          0.00%        Mauritius                   151,687        60,049        77,902          0.01%          0.00%          0.00%
    Bulgaria                  662,419   1,448,037   1,326,447           0.02%         0.03%          0.02%        Saint Kitts/Nevis             9,874        10,038        71,975          0.02%          0.01%          0.11%
    Czech Republic            728,627     922,676   1,203,752           0.00%         0.00%          0.00%        Macedonia                    54,819       164,704        71,866          0.00%          0.02%          0.01%
    Haiti                     164,085     271,027   1,047,368           0.05%         0.09%          0.28%        Kyrgyzstan                        0           526        69,925          0.00%          0.00%          0.02%
    Turks/Caicos Is.           23,164      93,475     926,573           0.27%         0.41%          2.99%        Belarus                       2,326        89,361        68,646          0.00%          0.00%          0.00%
    Argentina               1,389,312     706,367     916,415           0.01%         0.00%          0.00%        Fiji                         44,983       129,888        68,313          0.01%          0.03%          0.01%
    Lesotho                         4         111     877,250           0.00%         0.00%          0.20%        Côte d'Ivoire                 1,289        24,336        61,989          0.00%          0.00%          0.00%
    Iran, Islamic Rep.      1,299,999     908,962     876,756           0.01%         0.01%          0.00%        Malawi                      137,539           256        54,490          0.03%          0.00%          0.01%
    Peru                    1,041,780     602,605     815,086           0.02%         0.01%          0.01%        Jordan                        4,500        18,087        32,591          0.00%          0.00%          0.00%
    Russia                    943,903     656,807     812,810           0.00%         0.00%          0.00%        Paraguay                      6,771        20,961        31,950          0.00%          0.00%          0.00%
    Sri Lanka               1,239,578     662,094     780,060           0.03%         0.02%          0.02%        Panama                       62,003       167,621        29,199          0.00%          0.01%          0.00%
    Laos P. Dem. Rep.          10,708       4,731     693,929           0.01%         0.00%          0.23%        Botswana                          7           137        24,183          0.00%          0.00%          0.00%
    Venezuela                  90,979     201,922     667,270           0.00%         0.00%          0.00%        Br. Virgin Is.                  165         2,841        22,936          0.00%          0.00%          0.01%
    South Africa              941,962     669,733     636,914           0.00%         0.00%          0.00%        Syrian Arab Rep.             12,892        14,276        20,017          0.00%          0.00%          0.00%
    Honduras                1,506,089   1,781,311     579,220           0.04%         0.04%          0.01%        Barbados                    122,976        22,247        17,346          0.06%          0.01%          0.01%
    Slovakia                  266,229     306,657     562,542           0.00%         0.00%          0.00%        Bermuda                      50,265        15,923        17,138          0.03%          0.01%          0.00%
    Nepal                      89,463     243,070     559,794           0.02%         0.08%          0.09%        Swaziland                       283         2,973        13,564          0.00%          0.00%          0.00%
    Egypt                     225,074     432,477     492,555           0.00%         0.01%          0.01%        Nicaragua                    35,702        74,128        13,277          0.00%          0.01%          0.00%
    Maldives                    3,501      15,655     455,823           0.00%         0.01%          0.22%        Kenya                        25,600        18,312        11,185          0.00%          0.00%          0.00%
    Colombia                  833,866     487,622     422,178           0.01%         0.00%          0.00%        Ghana                         2,851         3,578         9,683          0.00%          0.00%          0.00%
    Madagascar                  8,165       5,655     356,637           0.00%         0.00%          0.03%        Cameroon                        936         5,076         8,553          0.00%          0.00%          0.00%
    Mongolia                      113     238,894     319,443           0.00%         0.05%          0.06%        Uzbekistan                       24         8,235         8,305          0.00%          0.00%          0.00%
    United Arab Emir.          96,514     149,060     316,318           0.00%         0.00%          0.00%        Niger                         7,943         3,821         8,013          0.00%          0.00%          0.01%




Source: Finance Canada data, author’s calculations

                                                                                                             41
                                                                                         Table 15. (continued) Value of preferences

                                        Value US$                          As % of country's total exports                                               Value US$                       As % of country's total exports
Country Name           1998            2002          2003           1998           2002            2003           Country Name          1998            2002          2003        1998           2002            2003

Uganda                             1           216          7,816           0.00%         0.00%          0.00%    Gibraltar                         0            11          30           0.00%         0.00%          0.00%
Sierra Leone                  15,133         4,154          7,237           0.01%         0.00%          0.00%    Bhutan                          207           166          19           0.00%         0.01%          0.00%
Bahrain                          433         4,244          7,176           0.00%         0.00%          0.00%    Comoros                         518             1          11           0.00%         0.00%          0.00%
Guyana                         3,740         6,973          6,824           0.00%         0.00%          0.00%    Kazakhstan                   25,733             2          10           0.00%         0.00%          0.00%
Togo                               0         1,924          6,621           0.00%         0.00%          0.00%    St-Helena                         1             0           8           0.00%         0.00%          0.00%
Senegal                          388        23,604          6,322           0.00%         0.01%          0.00%    Tajikistan                        0             0           7           0.00%         0.00%          0.00%
Armenia                            0         2,032          5,893           0.00%         0.00%          0.00%    Liberia                           0            10           7           0.00%         0.00%          0.00%
Belize                        50,084        10,992          5,889           0.02%         0.01%          0.00%    Mozambique                       65             0           7           0.00%         0.00%          0.00%
Georgia                       12,200           433          5,303           0.00%         0.00%          0.00%    Samoa, American                  28             9           7           0.00%         0.00%          0.00%
Nigeria                        1,953           552          5,125           0.00%         0.00%          0.00%    Antarctica                        0             1           5           0.00%         0.00%          0.00%
Moldova                          871         1,455          5,106           0.00%         0.00%          0.00%    French Polynesia                  0            42           4           0.00%         0.00%          0.00%
Azerbaijan                         0         4,930          4,657           0.00%         0.00%          0.00%    Yemen                             0             0           3           0.00%         0.00%          0.00%
Cyprus                         7,429         1,707          4,603           0.00%         0.00%          0.00%    Burundi                           0             7           3           0.00%         0.00%          0.00%
Afghanistan                      273         1,288          4,420           0.00%         0.00%          0.00%    Sao Tome/Principe                 0             2           3           0.00%         0.00%          0.00%
Dominica                       3,379         1,907          3,631           0.00%         0.00%          0.01%    Sudan                             1             1           2           0.00%         0.00%          0.00%
Zambia                         7,479           309          3,485           0.00%         0.00%          0.00%    Angola                            0             0           1           0.00%         0.00%          0.00%
Bolivia                       22,243         5,287          3,070           0.00%         0.00%          0.00%    Montserrat                       10             7           1           0.00%         0.00%          0.00%
Congo, D.R. (eZaire)                         1,718          1,676                         0.00%          0.00%    Bri. Indian O. Ter                0             0           1           0.00%         0.00%          0.00%
Mauritania                       565           360          1,498           0.00%         0.00%          0.00%    Chad                              1             0           1           0.00%         0.00%          0.00%
Tanzania, Un. Rep.             1,174         2,022            803           0.00%         0.00%          0.00%    Niue                              0             0           1           0.00%         0.00%          0.00%
Brunei Darussalam                 31           249            790           0.00%         0.00%          0.00%    Saint Vincent/Gren.               0             0           1           0.00%         0.00%          0.00%
Ethiopia                           5         8,762            763           0.00%         0.00%          0.00%    Anguilla                         51             1           0           0.00%         0.00%          0.00%
Namibia                          436           428            680           0.00%         0.00%          0.00%    Cape Verde                        0             0           0           0.00%         0.00%          0.00%
Mali                              30         3,458            651           0.00%         0.00%          0.00%    Solomon Islands                   9           705           0           0.00%         0.00%          0.00%
Burkina Faso                   2,016           549            540           0.00%         0.00%          0.00%    Nauru                             1         1,078           0           0.00%         0.01%          0.00%
Antigua and Barbuda              764           377            526           0.00%         0.00%          0.00%    Gabon                           719             7           0           0.00%         0.00%          0.00%
Congo                             15            17            363           0.00%         0.00%          0.00%    Eritrea                           0            85           0           0.00%         0.00%          0.00%
Qatar                             74           177            334           0.00%         0.00%          0.00%    Bouvet Island                     0             0           0           0.00%         0.00%          0.00%
Guinea                            47           800            266           0.00%         0.00%          0.00%    Christmas Is Aust                 1            20           0           0.00%         0.00%          0.00%
Benin                              0            13            256           0.00%         0.00%          0.00%    Cocos Islands                     0             0           0           0.00%         0.00%          0.00%
Gambia                             2             0            160           0.00%         0.00%          0.00%    Djibouti                          0           711           0           0.00%         0.01%          0.00%
Saint Lucia                   22,591         1,465            151           0.02%         0.00%          0.00%    Equatorial Guinea                 0             0           0           0.00%         0.00%          0.00%
Cook Islands                      11            16            147           0.00%         0.00%          0.00%    Falkland Islands                  0             0           0           0.00%         0.00%          0.00%
Cayman Islands                   126           290            135           0.00%         0.00%          0.00%    French S. Terr.                   0            10           0           0.00%         0.00%          0.00%
Western Samoa                      0           353            120           0.00%         0.00%          0.00%    Guinea-Bissau                     0            12           0           0.00%         0.00%          0.00%
New Caledonia                  1,495         1,466            112           0.00%         0.00%          0.00%    Heard/McDonald Is                             355           0                         0.00%          0.00%
Seychelles                       256             0            100           0.00%         0.00%          0.00%    Iraq                            744             0           0          0.00%          0.00%          0.00%
Guam                           3,676           432             94           0.00%         0.00%          0.00%    Kiribati                          0             0           0          0.00%          0.00%          0.00%
Somalia                           77             0             89           0.00%         0.00%          0.00%    Norfolk Island                    0             8           0          0.00%          0.00%          0.00%
Central Afric. Rep.                1        13,035             86           0.00%         0.01%          0.00%    Papua New Guinea                469             1           0          0.00%          0.00%          0.00%
Algeria                        1,170           557             84           0.00%         0.00%          0.00%    Pitcairn Island                   0            14           0          0.00%          0.00%          0.00%
Grenada                            1             1             62           0.00%         0.00%          0.00%    Rwanda                            1             1           0          0.00%          0.00%          0.00%
Kuwait                             2           687             53           0.00%         0.00%          0.00%    Tonga                             0             1           0          0.00%          0.00%          0.00%
Surinam                           12           187             45           0.00%         0.00%          0.00%    Vanuatu                           0             0           0          0.00%          0.00%          0.00%
Neth. Antilles                   688           469             38           0.00%         0.00%          0.00%    Western Sahara                    0             0           0          0.00%          0.00%          0.00%
                                                                                                                  East Timor                        0            17                      0.00%          0.00%
                                                                                                                  Mariana Islands              41,123                                    0.23%
                                                                                                                  Marshall Islands                115                                    0.00%
                                                                                                                  Micronesia                       12                                    0.00%
                                                                                                                  Tokelau                      39,862                                    0.38%



Source: Finance Canada data, author’s calculations

                                                                                                                 42
                                                                   Table 16. Value of preferences by HS chapter


                        HS chapter                  1998           2002           2003                            HS chapter                 1998         2002         2003

         87   Vehicles o/t railw/tramw roll-stock     86,849,394    149,283,825    156,229,861    92   Musical instruments; parts and acce      507,203      670,408     930,941
         62   Art of apparel & clothing access, n     28,971,254     44,765,048     78,361,065    55   Man-made staple fibres.                  901,823      999,321     897,539
         85   Electrical mchy equip parts thereof     48,520,095     60,829,126     69,628,287    20   Prep of vegetable, fruit, nuts or o      543,122      734,529     857,282
         61   Art of apparel & clothing access,        8,887,787     17,860,187     42,785,535    56   Wadding, felt & nonwoven; yarns; tw      275,067      937,008     836,910
         94   Furniture; bedding, mattress, matt      10,308,270     23,458,645     29,552,418    36   Explosives; pyrotechnic prod; match      136,968      691,349     806,285
         84   Nuclear reactors, boilers, mchy & m     15,196,436     21,030,554     26,280,790    43   Furskins and artificial fur; manuf       359,974      653,610     797,146
         39   Plastics and articles thereof.          10,830,354     24,088,483     24,958,551    41   Raw hides and skins (other than fu     1,255,471      952,511     760,356
         64   Footwear, gaiters and the like; par      7,496,873     18,092,792     21,901,933    18   Cocoa and cocoa preparations.            708,704      489,550     754,789
         29   Organic chemicals.                       4,672,564      9,846,313     16,824,376    81   Other base metals; cermets; article      894,056      502,865     676,523
         42   Articles of leather; saddlery/harne     11,957,417     15,284,359     16,380,965    32   Tanning/dyeing extract; tannins &        532,375      686,303     645,998
         69   Ceramic products.                        7,833,005     12,806,500     13,561,547    59   Impregnated, coated, cover/laminate      230,998      582,984     606,566
         63   Other made up textile articles; set      1,834,629      6,484,494     11,770,577    72   Iron and steel.                        2,299,548      585,560     537,032
         73   Articles of iron or steel.               5,563,974      9,462,638     10,884,814    22   Beverages, spirits and vinegar.          451,376      478,749     526,137
         95   Toys, games & sports requisites; pa      3,322,949      7,866,880      8,171,862    38   Miscellaneous chemical products.         209,907      408,125     518,601
         83   Miscellaneous articles of base meta      2,329,993      6,626,654      7,911,867    35   Albuminoidal subs; modified starche      397,548      427,976     498,030
         44   Wood and articles of wood; wood ch       2,412,402      4,625,620      6,441,314    66   Umbrellas, walking-sticks, seat-sti      262,922      456,965     472,396
         90   Optical, photo, cine, meas, checkin      3,304,212      6,027,391      6,415,600    89   Ships, boats and floating structure       98,880      147,481     422,068
         57   Carpets and other textile floor co       8,585,315      6,459,481      6,348,840    93   Arms and ammunition; parts and acc       506,106      168,375     392,328
         40   Rubber and articles thereof.             1,910,149      4,827,856      5,587,169    03   Fish & crustacean, mollusc & other       229,117      454,347     379,535
         82   Tool, implement, cutlery, spoon & f      3,279,870      4,330,002      5,551,149    04   Dairy prod; birds' eggs; natural ho       44,742      257,135     367,531
         51   Wool, fine/coarse animal hair, hors      6,125,303      2,855,750      4,211,365    06   Live tree & other plant; bulb, root      381,076      333,168     315,112
         96   Miscellaneous manufactured articles      2,340,791      3,450,082      4,111,947    25   Salt; sulphur; earth & ston; plaste       34,606      111,051     300,814
         71   Natural/cultured pearls, prec stone      1,348,987      3,171,221      3,389,407    23   Residues & waste from the food indu      720,237      288,898     284,969
         16   Prep of meat, fish or crustaceans,       3,230,730      3,062,587      2,895,366    80   Tin and articles thereof.                106,048      200,014     200,803
         76   Aluminium and articles thereof.            477,651      2,098,051      2,892,559    09   Coffee, tea, matn and spices.             80,050      116,823     145,886
         52   Cotton.                                    849,735      2,675,828      2,837,652    53   Other vegetable textile fibres; pap      107,798       52,549      77,058
         68   Art of stone, plaster, cement, asbe        972,415      2,020,600      2,724,690    97   Works of art, collectors' pieces an       17,153       29,237      58,565
         91   Clocks and watches and parts thereo      1,354,249      2,352,405      2,700,695    79   Zinc and articles thereof.               121,136       47,978      56,910
         65   Headgear and parts thereof.              1,407,442      1,993,841      2,404,180    49   Printed books, newspapers, pictures      220,532      182,112      24,256
         54   Man-made filaments.                      1,470,198      1,926,511      2,067,162    11   Prod.mill.indust; malt; starches;          6,146       10,588      13,046
         33   Essential oils & resinoids; perf,          456,782      2,179,586      1,982,564    27   Mineral fuels, oils & product of th        2,960        4,407      11,205
         60   Knitted or crocheted fabrics.            4,116,599      1,833,970      1,954,464    78   Lead and articles thereof.               285,735          247      11,197
         34   Soap, organic surface-active agents      1,175,953      1,607,919      1,851,325    75   Nickel and articles thereof.               4,963       13,939       6,691
         86   Railw/tramw locom, rolling-stock &         379,849      2,097,112      1,838,516    12   Oil seed, oleagi fruits; miscell gr        1,519        1,556       3,099
         37   Photographic or cinematographic goo      1,581,070      1,716,543      1,677,317    02   Meat and edible meat offal                     0            0       2,224
         70   Glass and glassware.                       112,888        866,088      1,593,347    88   Aircraft, spacecraft, and parts the          978        9,424       1,673
         17   Sugars and sugar confectionery.          1,156,918      1,476,555      1,561,976    30   Pharmaceutical products.                       0            2          42
         15   Animal/veg fats & oils & their clea      1,189,292      1,131,320      1,459,815    01   Live animals                                   0            0           0
         24   Tobacco and manufactured tobacco su      3,500,082      1,321,443      1,396,348    05   Products of animal origin, nes or              0            0           0
         07   Edible vegetables and certain roots        313,756        331,527      1,285,643    10   Cereals                                        0            0           0
         28   Inorgn chem; compds of prec mtl, r         603,396        936,564      1,285,310    13   Lac; gums, resins & other vegetable          157            0           0
         19   Prep.of cereal, flour, starch/milk;        852,510        741,745      1,256,039    14   Vegetable plaiting materials; veget            0            0           0
         67   Prepr feathers & down; arti flower;        575,080      1,083,981      1,161,293    26   Ores, slag and ash.                            0            0           0
         58   Special woven fab; tufted tex fab;         355,208        900,397      1,101,116    31   Fertilisers.                                   0            0           0
         08   Edible fruit and nuts; peel of citr         44,573        138,334      1,085,125    45   Cork and articles of cork.                     0            0           0
         74   Copper and articles thereof.               518,851        898,768      1,077,279    47   Pulp of wood/of other fibrous cellu            0            0           0
         21   Miscellaneous edible preparations.       1,371,981        845,281      1,035,950    48   Paper & paperboard; art of paper pu    1,918,008    1,206,633           0
         46   Manufactures of straw, esparto/othe        538,789        875,812        952,567    50   Silk.                                          0            0           0




Source: Finance Canada data, author’s calculations


                                                                                             43
      Table 17. LDCT tariff lines accounting for at least 1 US$ million in terms of preference value (2003)


                                    Value of    As share in                                            Value of    As share in
                                  preferences* beneficiary's                                         preferences* beneficiary's
 Tariff Item    Country Name                     exports             Tariff Item    Country Name                    exports
  62046200 Bangladesh                5,915,094    0.08%               61142000 Bangladesh               1,182,601    0.02%
             Cambodia                2,096,481    0.09%                          Cambodia                 572,457    0.03%
             Laos P. Dem. Rep.           3,340    0.00%                          Laos P. Dem. Rep.         23,468    0.01%
             Lesotho                   115,365    0.03%                          Lesotho                   69,416    0.02%
             Madagascar                114,307    0.01%                          Madagascar                18,415    0.00%
             Malawi                     54,474    0.01%                          Nepal                     11,769    0.00%
             Maldives                  302,259    0.15%             Total/average                       1,878,127    0.01%
             Nepal                      43,689    0.01%               62034300 Bangladesh               1,215,973    0.02%
             Niger                           29   0.00%                          Cambodia                  48,997    0.00%
Total/average                        8,645,037    0.04%                          Nepal                     26,386    0.00%
  62034200 Bangladesh                4,503,235    0.06%             Total/average                       1,291,356    0.01%
             Cambodia                  992,762    0.04%               63062200 Bangladesh               1,214,958    0.02%
             Laos P. Dem. Rep.         366,953    0.12%             63062200 Total                      1,214,958    0.02%
             Lesotho                   179,374    0.04%               61082100 Bangladesh               1,150,011    0.01%
             Madagascar                 28,446    0.00%                          Cambodia                  16,703    0.00%
             Maldives                   46,127    0.02%                          Madagascar                 1,343    0.00%
             Nepal                      38,815    0.01%             61082100 Total                      1,168,057    0.01%
Total/average                        6,155,711    0.04%               62019300 Bangladesh                 948,762    0.01%
  61091000 Bangladesh                3,362,902    0.04%                          Cambodia                 170,286    0.01%
             Cambodia                  138,571    0.01%             62019300 Total                      1,119,048    0.01%
             Haiti                     552,036    0.15%               61051000 Bangladesh                 721,544    0.01%
             Laos P. Dem. Rep.          61,916    0.02%                          Cambodia                 161,694    0.01%
             Lesotho                    43,314    0.01%                          Laos P. Dem. Rep.         89,300    0.03%
             Madagascar                 21,308    0.00%                          Lesotho                   22,749    0.01%
             Maldives                   17,362    0.01%                          Maldives                  29,514    0.01%
             Nepal                      33,455    0.01%                          Nepal                     23,834    0.00%
             Niger                           21   0.00%             61051000 Total                      1,048,635    0.01%
Total/average                        4,230,885    0.03%               62052000 Bangladesh                 891,061    0.01%
  61103000 Bangladesh                3,001,476    0.04%                          Cambodia                 147,671    0.01%
             Cambodia                  187,092    0.01%                          Madagascar                 4,378    0.00%
             Laos P. Dem. Rep.          12,951    0.00%                          Nepal                      3,592    0.00%
             Lesotho                     1,639    0.00%                          Niger                          38   0.00%
             Madagascar                  7,132    0.00%             62052000 Total                      1,046,740    0.00%
             Nepal                         502    0.00%               62045200 Bangladesh                 555,095    0.01%
Total/average                        3,210,792    0.01%                          Cambodia                 347,958    0.02%
  61102000 Bangladesh                1,903,795    0.02%                          Laos P. Dem. Rep.            154    0.00%
             Cambodia                  803,314    0.04%                          Madagascar                 2,844    0.00%
             Haiti                      42,083    0.01%                          Maldives                  17,147    0.01%
             Laos P. Dem. Rep.          29,274    0.01%                          Nepal                      6,452    0.00%
             Lesotho                   228,425    0.05%                          Niger                          42   0.00%
             Madagascar                 95,390    0.01%                                                   929,691    0.00%
             Nepal                      55,629    0.01%
Total/average                        3,157,908    0.02%



Source: Finance Canada data, author’s calculations




                                                               44
        Table 18. GPT tariff lines accounting for at least 1 US$ million in terms of preference value (2003)

Tariff Item            Value of    Number of        China's share Average share
                     preferences* GPT countries in value of       in beneficiary's
                                   with positive    preferences       exports
                                   value of
                                   preferences
94036010                 5,099,196               42           45%        0.000%
42031000                 4,390,024               18           75%        0.000%
69089010                 3,938,421               22            2%        0.000%
39269090                 3,488,955               39           87%        0.000%
94032000                 3,104,124               34           93%        0.000%
85281293                 3,027,344                6           23%        0.000%
94016110                 2,919,286               32           56%        0.000%
16041490                 2,590,567               12            0%        0.001%
69120090                 2,575,756               39           78%        0.000%
42032990                 2,330,979               16           91%        0.000%
87120000                 2,320,666                9           69%        0.000%
69111090                 2,225,484               30           74%        0.000%
94017910                 2,005,264               18           97%        0.000%
94035000                 1,965,864               37           45%        0.000%
39241000                 1,905,831               28           82%        0.000%
39249000                 1,859,100               30           89%        0.000%
94051000                 1,683,021               24           98%        0.000%
42029290                 1,628,602               28           92%        0.000%
57011090                 1,626,246               15            4%        0.001%
85091000                 1,614,516                5           78%        0.000%
73269090                 1,591,589               32           91%        0.000%
39231090                 1,417,987               26           93%        0.000%
85281291                 1,394,615                4            5%        0.000%
42022290                 1,235,144               24           98%        0.000%
94054090                 1,200,112               20           91%        0.000%
44111990                 1,157,916                6           29%        0.000%
44219090                 1,152,348               40           85%        0.000%
95069990                 1,122,918               17           92%        0.000%
63014000                 1,118,307               14           63%        0.000%
65059020                 1,095,529               31           85%        0.000%
73239300                 1,084,235               25           75%        0.000%
17049090                 1,038,221               44           25%        0.000%
Source: Finance Canada data, author’s calculations




                                                        45
                             Table 19. Canada: differences between market average and bilateral ad valorem
                                  measures of protection by product and source country (%)




                                                             Vegetables, fruits and




                                                                                                                                                         Other manufacturing
                                                                                      Bovine cattle, sheep



                                                                                                               Bovine cattle, sheep
                                                                                      Primary argiculture




                                                                                                                                                         Vegetable oils and




                                                                                                                                                                                                                            Food products nec
                                                                                      Sugar cane, sugar




                                                                                                               Natural resources
                                                                                      and goats, horses




                                                                                                                                                                                                                            tobacco products




                                                                                                                                                                                                                                                                                 Leather products
                                                                                                                                                                                                                                                             W earing apparel
                                                                                                                                                                                Dairy products




                                                                                                                                                                                                                            Beverages and
                                                                                                                                       M eat products




                                                                                                                                                                                                 Processed rice
                                                                                                               and goat meat
                                                             Cereal grains
                                     Paddy rice




                                                                                      Oil seeds




                                                                                                                                                                                                                                                 Textiles
                                                   W heat




                                                                                                                                                                                                                   Sugar
                                                                                      beet
                                                             nuts




                                                                                                                                                         fats
                                                                                      nec
   Rest of Oceania                   0             0         0           -2           0    0     3    0        0         -3           41                -1         -1          -16               0                -1        -2        1          -3         -2                  6
   Australia                         0             1         0            0           0    0     3    0        0         -5            47                0         -3          -22               0                 1        -2        0          -1          5                   1
   China                             0            1         0            -1           0    0    -2    0        0         2            23                -1         -4          110               0                -7         3       -5          -8         -1                  -2
   North/East Asia                   0             0         0           -1           0    0     2    0        0          2           43                -2         -8           14               0                -6         4      -11          -8         -3                   1
   Japan                             0             1         0            0           0    0     3    0        0          7            47               -2         -7           19               0                -4         1        1          -1         -1                   2
   Indonesia                         0             1        0             0           0    0     4    0        0          7            -1               -1         -1           80               0                -9        7        -5          -7         -3                  -5
   Malaysia                          0            1         0             0           0    0     2    0        0          7           46                 0         -1          110               0                -7        4       -16          -9         -3                  -3
   Philippines                       0             1         0            0           0    0     3    0        0          7            -1                0          1          -24               0                -4         5      -16         -11         -3                   4
   Singapore                         0             1         0            0           0    0     3    0        0          7            49                0         -4          -51               0                -6         5       -6         -13         -4                   4
   Thailand                          0             1         0            0           0    0     3    0        0          0           -41               -1          1           14               0                -4         6      -21          -6         -4                  -1
   Vietnam                           0             1         0            0           0    0     3    0        0          7            20               -2          1           26               0                 1         8      -21         -10         -3                  -4
   Rest of the World                 0            -2        0             0           0    0     3    0        0          6           48                 0          0           33               0                 0         7        4          -9         -2                  3
   Bangladesh                        0             1         0            0           0    0     4    0        0          7           -35                0          1          110               0                 1         8        5         -12         -3                   8
   India                             0            -2        0             0           0    0     4    0        0          4           50                -1          0           56               0                -5        6         0          -6         -3                  0
   Sri Lanka                         0             1        -1           -1           0    0     4    0        0          7           51                -3         -1          -27               0                -5         6       -8         -12         -3                  0
   Canada                            0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5           5         14                   9
   United States                     0             1         0            0           0    0    -2    0        0          7            -5                0          0           27               0                 1        0        -2           5         14                  9
   Mexico                            0             1         0           -1           0    0     4    0        0          7           51                 0          1          110               0                -2        -1        5           5         12                   9
   Rest of North America             0             1        0             0           0    0     4    0        0          7           51                 0          1          110               0                 1         7        5          -4          3                   9
   Colombia                          0             1         0            0           0    0     2    0        0          7            50                0         -3          110               0                 0         7      -11          -2         -4                   5
   Peru                              0             1        0            -2           0    0     3    0        0        -36           51                 0          1          -21               0                 1         8       -7          -8         -4                   5
   Venezuela                         0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         6        5           5         -5                   6
   Argentina                         0             1        0            -1           0    0     4    0        0         -7           46                 0          1          -16               0                -3       -19      -21           2         10                   9
   Brazil                            0             1         0            0           0    0     4    0        0          4            45               -1          1           16               0                -1         2        0          -9         -2                   0
   Chile                             0            -1        0             0           0    0     4    0        0          7           43                 0          1           18               0                 1        7         5           5         14                   8
   Uruguay                           0             1         0            0           0    0     4    0        0         -6           51                -1          1          -46               0                -3         8       -2           1          8                   9
   EU                                0             1         0           -2           0    0     2    0        0          5           46                -1          1           -9               0                -5       -10        1          -4         -2                  1
   Rest of Europe                    0             1         0           -2           0    0     4    0        0          7           48                -1         -2           31               0                -2         5        0          -5         -3                  -1
   Turkey                            0            -1        0             0           0    0     4    0        0          7            -4               0          1           110               0                -9        3        -3          -6         -3                  5
   Rest of Middle East and North A   0             1         0           -1           0    0     4    0        0          7             3                0         -2           43               0                -4        2        -5          -1          1                  5
   Morocco                           0             1         0            0           0    0     3    0        0          7            19                0          1          110               0                -6         5      -11         -11         -4                  -1
   Tunisia                           0             1         0            0           0    0     4    0        0          7            51               -1          1          110               0                -3         4       -7         -12         -2                  -2
   Botswana                          0             1        0             0           0    0     4    0        0          7           51                 0          1          110               0                 1         8        5         -14         -4                   9
   South Africa                      0             1         0           -1           0    0     3    0        0         -7           18                 0         -4          110               0                 0         3       -2           0         -3                   4
   Rest of SACU                      0             1         0           -2           0    0     4    0        0          7           51                -1          1          110               0                 1         8        3         -14         -4                  -3
   Malawi                            0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5           5         -4                   9
   Mozambique                        0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5           5         -3                   9
   Tanzania                          0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5           1         14                   9
   Zambia                            0             1         0            0           0    0     3    0        0          7            51                0          1          110               0                 1         8        5           0         14                   9
   Zimbabwe                          0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5          -1         14                   9
   Rest of SADC                      0             1         0            0           0    0     3    0        0          7            51                0          1          110               0                -1         7        5         -14         -4                   4
   Madagascar                        0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5         -13         -4                   7
   Uganda                            0             1         0            0           0    0     4    0        0          7            51                0          1          110               0                 1         8        5           0          7                   9
   Rest of Sub-Saharan               0             1        0            -1           0    0     4    0        0          7           -60                0          0          110               0                 1         7        4          -8         -1                   0


Source: GTAP 6 database; author’s calculations.




                                                                                                          46
Table 20. Composition of Canadian imports by product group and beneficiary (2001)




                                                                                   Vegetables, fruits and




                                                                                                                                                                                                                                                     Other manufacturing
                                                                                                                                                                  Bovine cattle, sheep




                                                                                                                                                                                                             Bovine cattle, sheep
                         Share of Canada in




                                                                                                                                            Primary argiculture




                                                                                                                                                                                                                                                                                                                                          Food products nec
                                                                                                                        Sugar cane, sugar




                                                                                                                                                                                                                                                                           Vegetable oils and
                                                                                                                                                                   and goats, horses



                                                                                                                                                                                         Natural resources




                                                                                                                                                                                                                                                                                                                                                              tobacco products




                                                                                                                                                                                                                                                                                                                                                                                                              Leather products
                                                                                                                                                                                                                                                                                                                                                                                            Wearing apparel
                                                                                                                                                                                                                                                                                                                                                               Beverages and
                                                                                                                                                                                                                                                                                                                 Processed rice
                                                                                                                                                                                                                                                                                                Dairy products
                                                                                                                                                                                                               and goat meat



                                                                                                                                                                                                                                     Meat products
                                                                   Cereal grains
                            total exports



                                              Paddy rice




                                                                                                            Oil seeds




                                                                                                                                                                                                                                                                                                                                                                                                                                 Services
                                                                                                                                                                                                                  products




                                                                                                                                                                                                                                                                                                                                                                                 Textiles
                                                           Wheat




                                                                                                                                                                                                                                                                                                                                  Sugar




                                                                                                                                                                                                                                                                                                                                                                                                                                            Total
                                                                                                                              beet
                                                                                           nuts




                                                                                                                                                   nec




                                                                                                                                                                                                                                                                                 fats
Rest of Oceania           2.2%                0.0          0.0     0.0                3.5                   0.1            0.0                1.1                     0.7                 1.0                    27.5                0.2             22.9                     0.0               12.0             0.0              0.0     2.5                    1.0             1.0        1.7               0.2                24.3       100
Australia                 2.0%                0.0          0.0     0.0                0.5                   0.1            0.0                0.4                     0.0                 4.1                     9.2                0.0             44.4                     0.0                0.9             0.0              6.8      1.0                   4.8             0.6         0.2               0.1               26.9       100
China                      2.2%               0.0          0.0     0.0                0.6                   0.1            0.0                0.4                     0.0                 0.4                     0.0                0.0             68.1                     0.0                0.0             0.1              0.0      1.1                   0.1             4.0        10.1              10.0                4.9       100
North/East Asia            2.0%               0.0          0.0     0.0                0.1                   0.0            0.0                0.1                     0.0                 0.0                     0.0                0.0             60.4                     0.0                0.0             0.0              0.0      0.7                   0.1             6.1         5.6               0.6               26.2       100
Japan                      2.1%               0.0          0.0     0.0                0.1                   0.0            0.0                0.0                     0.0                 0.0                     0.0                0.0             91.7                     0.0                0.0             0.0              0.0      0.2                   0.0             0.5         0.0               0.0                7.3       100
Indonesia                 1.0%                0.0          0.0     0.0                0.2                   0.0            0.0                9.5                     0.0                 3.6                     0.0                0.1             41.0                     0.1                0.0             0.1              0.0      2.5                   0.1             7.6        14.4               5.6               15.1       100
Malaysia                  1.4%                0.0          0.0     0.0                0.0                   0.0            0.0                1.2                     0.0                 0.1                     0.0                0.3             64.3                     0.2                0.0             0.0              0.0      0.4                   0.1             1.0         2.5               0.1               29.7       100
Philippines               1.4%                0.0          0.0     0.0                2.1                   0.0            0.0               1.0                      0.0                 1.2                     0.0                0.1             59.0                     0.8                0.0             0.1              0.0      5.9                   0.3             2.2        13.3               1.4               12.4       100
Singapore                 1.1%                0.0          0.0     0.0                0.1                   0.0            0.0                0.4                     0.0                 0.0                     0.0                0.0             52.7                     0.0                0.0             0.0              0.0      0.9                   0.0             0.7        0.8               0.0                44.3       100
Thailand                  1.6%                0.0          0.0     0.0                1.0                   0.0            0.0                2.2                     0.0                 0.1                     0.0                0.1             44.8                     0.0                0.0             2.1              0.0     17.4                   0.1             3.1        7.2               1.8                20.0       100
Vietnam                    1.5%               0.0          0.0     0.0                3.7                   0.0            0.0               11.8                     0.0                 0.1                     0.0                0.2             12.3                     0.0                0.0             0.3              0.0     10.5                   0.2             2.9        13.5              18.5               25.8       100
Rest of the World         1.5%                0.0          0.1     0.1                2.0                   0.2            0.0                2.0                     0.0                 1.4                     0.1                0.1             52.1                     0.0                0.1             0.1              1.8      3.0                   0.9             5.1         6.1               0.3               24.4       100
Bangladesh                1.8%                0.0          0.0     0.0                0.2                   0.0            0.0                0.0                     0.0                 0.0                     0.0                0.0              6.6                     0.0                0.0             0.0              0.0      1.9                   0.0             25.7       59.0               0.4                6.1       100
India                      1.7%               0.1          0.0     0.0                1.2                   0.3            0.0                2.0                     0.0                 1.5                     0.0                0.0             24.5                     0.1                0.1             0.9              0.1      2.3                   0.1             15.9       23.4               2.5               25.1       100
Sri Lanka                  1.8%               0.1          0.0     0.0                0.4                   0.0            0.0                5.6                     0.0                 0.1                     0.0                0.1             14.0                     0.1                0.0             0.1              0.0      1.0                   0.0             5.2        42.3              1.7                29.3       100
Canada                       -                 -            -       -                  -                     -              -                  -                       -                   -                       -                  -                -                       -                  -               -                -        -                     -                -          -                 -                  -        100
United States             16.2%               0.0          0.0     0.2                1.2                   0.2            0.0                0.5                     0.1                 1.3                     0.2                0.4             86.1                     0.1                0.0             0.0              0.1      2.2                   0.3             1.8         0.3              0.1                 5.0       100
Mexico                     3.3%               0.0          0.0     0.0                1.8                   0.0            0.0                0.2                     0.0                 3.3                     0.0                0.0             83.3                     0.0                0.0             0.0              0.1      0.4                   0.7             1.6         1.2               0.2                7.2       100
Rest of North America     1.4%                0.0          0.0     0.0                0.0                   0.0            0.0                0.6                     0.0                12.3                     0.0                0.0             10.1                     0.0                0.0             0.0              0.0     42.9                   2.0              0.0        0.1               0.0               31.9       100
Colombia                  1.6%                0.0          0.0     0.0                0.6                   0.0            0.0               30.2                     0.0                28.1                     0.1                0.1              9.2                     0.0                0.0             0.0              2.5      1.3                   0.1              3.3        2.3               0.8               21.4       100
Peru                       2.3%               0.0          0.0     0.0                5.4                   0.0            0.0                6.4                     0.0                31.8                     7.4                0.1              8.4                     0.0                0.0             0.0              0.0     18.0                   0.1             3.0         1.8              0.1                17.4       100
Venezuela                 2.1%                0.0          0.0     0.0                0.0                   0.0            0.0                0.0                     0.0                53.4                     0.0                0.0             41.8                     0.0                0.0             0.0              0.0      0.2                   0.1             0.0         0.0               0.0                4.2       100
Argentina                 1.1%                0.0          0.0     0.0                7.9                   3.5            0.0                0.5                     0.0                15.7                     3.4                0.1             28.2                     0.1                0.4             0.0              0.0      7.1                   2.0             0.6         0.7               5.8               23.9       100
Brazil                     1.6%               0.0          0.0     0.0                1.8                   0.0            0.0                3.2                     0.0                 4.9                     0.3                0.1             56.0                     0.0                0.1             0.0              6.0      2.1                   0.0             2.5         0.2               3.9               18.9       100
Chile                     2.3%                0.0          0.0     2.8               23.6                   0.2            0.0                1.0                     0.0                29.4                     0.0                0.1             15.6                     0.0                0.0             0.0              0.0      6.1                   7.5             0.9         0.4               0.1               12.2       100
Uruguay                    3.6%               0.0          0.0     0.0                1.4                   0.0            0.0                1.4                     0.0                 0.0                    49.5                0.0              3.2                     0.0                1.5             0.2              0.0      3.5                   0.3             3.1         3.3              13.1               19.2       100
EU                         1.5%               0.0          0.0     0.0                0.2                   0.0            0.0                0.4                     0.0                 7.6                     0.0                0.1             49.0                     0.1                0.3             0.0              0.0      1.2                   1.7             1.0         0.6               1.0               36.8       100
Rest of Europe            0.8%                0.0          0.0     0.0                0.1                   0.0            0.0                0.4                     0.1                 0.8                     0.1                0.2             30.7                     0.1                0.5             0.0              0.0      5.4                   1.0             1.2         2.6               0.8               56.1       100
Turkey                     1.2%               0.0          0.0     0.0                2.2                   0.1            0.0                1.0                     0.0                 0.4                     0.0                0.0             19.7                     0.4                0.1             0.0              0.2      0.5                   0.1              7.7        7.8               0.3               59.5       100
Rest of Middle East and N 1.0%                0.0          0.0     0.0                1.1                   0.0            0.0                0.3                     0.0                41.3                     0.0                0.0             20.9                     0.0                0.0             0.0              0.2      0.5                   0.1             2.1         1.3               0.2               31.7       100
Morocco                    1.2%               0.0          0.4     0.2               14.9                   0.0            0.0                1.4                     0.2                 6.9                     0.0                0.1              8.9                     0.1                0.1             0.0              0.2      2.4                   0.2             0.3        3.2               0.7                59.8       100
Tunisia                   0.8%                0.0          0.5     0.2                1.9                   0.0            0.0                1.1                     0.3                 0.4                     0.0                0.0              8.0                     0.4                0.1             0.0              0.3      1.7                   0.1              0.7        5.6               1.7               76.9       100
Botswana                   0.2%               0.0          0.0     0.2                0.1                   0.0            0.0                0.0                     0.0                 0.9                     0.4                1.1             11.4                     0.0                0.4             0.0              0.0      0.3                   0.9             0.5         4.7               0.0               79.0       100
South Africa              1.1%                0.0          0.0     0.0               11.1                   0.1            0.0               0.6                      0.0                3.6                      0.1                0.0             48.9                     0.0                0.0             0.0              0.0      3.3                   3.0             2.3        0.4               0.1                26.4       100
Rest of SACU               0.7%               0.0          0.0     0.2                0.1                   0.0            0.0                0.5                     0.0                 0.7                     0.2                0.1              7.6                     0.1                0.0             0.0              0.0     1.1                    0.6             3.5        30.0              0.4                54.9       100
Malawi                    0.4%                0.0          0.0     0.7                3.1                   0.0            0.0               29.0                     0.0                 0.7                     0.0                0.1              3.4                     0.0                0.1             0.0              0.0      0.3                   0.7              0.1        0.5               0.0               61.1       100
Mozambique                 0.6%               0.1          0.0     0.4                5.0                   0.0            0.0                0.9                     0.0                 1.4                     0.0                0.1              0.5                     0.1                0.0             0.0              0.0      0.7                   0.1             0.1         0.3               0.0               90.3       100
Tanzania                  1.0%                0.2          0.0     2.4                3.5                   2.1            1.0                6.8                     0.1                 4.3                     0.3                0.9              4.8                     0.1                0.0             0.2              0.0      4.8                   2.7              1.5        4.4               0.5               59.5       100
Zambia                     0.3%               0.0          0.0     0.4                0.2                   0.0            0.0               1.4                      0.0                4.2                      0.0                0.2             10.1                     0.1                0.0             0.0              0.0      0.8                   0.3             0.4         0.6               0.1               81.1       100
Zimbabwe                  0.5%                0.0          0.0     0.1                0.1                   0.0            0.0                6.1                     0.1                 1.7                     0.0                0.1             12.3                     0.1                0.0             0.0              0.0      0.5                   0.6             2.8         0.2               0.3               75.1       100
Rest of SADC               0.8%               0.0          0.0     0.2                0.1                   0.0            0.0                1.0                     0.0                22.5                     0.0                0.1             3.3                      0.1               0.0              0.0              0.1      1.6                   0.6             1.4        11.9              0.0                56.9       100
Madagascar                0.5%                0.0          0.0     0.0                3.0                   0.0            0.0               12.4                     0.2                1.5                      0.0                0.0             11.9                     0.0                0.0             0.1              0.1      0.9                   0.2             15.2       36.1               0.1               18.3       100
Uganda                    0.9%                0.0          0.0     0.9                5.1                   0.1            0.0               19.0                     0.2                 2.1                     0.1                0.0              4.2                     0.0                0.0             0.0              0.2      1.1                   0.9             0.1         0.2               0.2               65.4       100
Rest of Sub-Saharan       0.9%                0.0          0.0     0.1                0.1                   0.2            0.0               13.6                     0.1                38.0                     0.0                0.1             10.2                     0.0                0.0             0.1              0.0      1.8                   0.4             0.3         0.2               0.1               34.4       100




Source: GTAP database and author’s calculations.




                                                                                                                                                                                                                                47
Table 21. Export shares of key preference granting countries


                                             Canada     EU       US    Japan   Austarlia
          Rest of Oceania                     2.2%    23.2%    14.9%   13.2%    13.0%
              Australia                       2.0%    18.4%    11.6%   18.3%     0.0%
                China                         2.2%    19.6%    28.7%   15.1%     1.5%
          North/East Asia                     2.0%    19.1%    23.0%   9.2%      1.3%
                Japan                         2.1%    18.8%    27.4%   0.0%      1.8%
             Indonesia                        1.0%    17.2%    16.1%   19.1%     3.1%
              Malaysia                        1.4%    18.8%    19.0%   11.2%     1.9%
             Philippines                      1.4%    15.6%    30.5%   15.8%     0.7%
             Singapore                        1.1%    20.6%    15.5%    6.4%     1.7%
              Thailand                        1.6%    19.7%    21.5%   14.5%     1.9%
              Vietnam                         1.5%    36.6%     8.9%   17.4%     4.4%
         Rest of the World                    1.5%    28.9%    16.7%    3.4%     0.3%
            Bangladesh                        1.8%    44.8%    37.4%    1.9%     0.4%
                 India                        1.7%    30.1%    19.8%    4.6%     0.9%
              Sri Lanka                       1.8%    31.8%    36.6%    4.9%     1.0%
              Canada                          0.0%    10.7%    74.5%   3.2%      0.4%
           United States                     16.2%    30.9%     0.0%   8.2%      1.5%
               Mexico                         3.3%     7.2%    78.7%    1.3%     0.3%
      Rest of North America                   1.4%    67.1%    11.7%   5.2%     0.2%
              Colombia                        1.6%    20.2%    37.1%    2.2%     0.3%
                 Peru                         2.3%    31.0%    23.7%    5.7%     0.6%
            Venezuela                         2.1%    12.9%    46.4%    1.3%     0.1%
             Argentina                        1.1%    22.2%    10.0%    2.0%     0.4%
                Brazil                        1.6%    29.3%    22.5%    4.2%     0.5%
                Chile                         2.3%    27.2%    18.9%   11.7%     0.3%
              Uruguay                         3.6%    24.9%    12.3%    2.7%     0.6%
                  EU                          1.5%    58.4%    11.5%   3.1%      0.7%
          Rest of Europe                      0.8%    62.0%     7.1%   1.7%      0.3%
               Turkey                         1.2%    53.5%    12.0%   2.4%      0.5%
Rest of Middle East and North Africa          1.0%    27.4%    16.8%   13.9%     0.6%
              Morocco                         1.2%    61.6%     9.6%   3.7%      0.6%
               Tunisia                        0.8%    71.5%     6.4%   2.0%      0.4%
             Botswana                         0.2%    85.7%     2.5%    0.5%     0.1%
            South Africa                      1.1%    34.2%    13.4%   8.1%      1.3%
           Rest of SACU                       0.7%    37.9%    14.4%    1.8%     0.3%
               Malawi                         0.4%    31.0%    19.9%    8.6%     1.1%
           Mozambique                         0.6%    70.2%     5.5%   3.9%      0.2%
             Tanzania                         1.0%    51.6%     8.4%   6.1%      0.5%
              Zambia                          0.3%    51.7%     1.8%   4.4%      0.1%
             Zimbabwe                         0.5%    41.0%    10.0%   8.1%      0.4%
           Rest of SADC                       0.8%    47.4%    31.9%   2.1%      0.3%
            Madagascar                        0.5%    54.4%    23.1%   3.0%      0.1%
               Uganda                         0.9%    49.1%    7.4%    2.3%      0.4%
        Rest of Sub-Saharan                   0.9%    40.9%    22.4%   2.5%      0.2%




Source: GTAP 6 database and author’s calculations.




                                                       48
                                                                                                                                                                   Table 22. Removal of preferences in 2001- simulation results
                                                                                                                                                                                                                                                                                                                                                                                    % change in output




                                                                                                       e x p o rts (% c h a n g e )
                                       E q u iv a le n t v a ria tio n




                                                                                                                                                                                                                                                                 P rim a ry a rg ic u ltu re
                                                                         p e r c a p ita u tility (%




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 F o o d p ro d u c ts n e c
                                                                                                                                                                                                                                            S ugar cane, sugar




                                                                                                                                                                                                                                                                                                                                                                                                                                      V e g e ta b le o ils a n d
                                                                                                                                                                                                                                                                                                                             N a tu ra l re s o u rc e s
                                                                                                                                                                                                                                                                                               s h e e p a n d g o a ts ,
                                                                                                                                                                                            V e g e ta b le s , fru its




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               to b a c c o p ro d u c ts




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         L e a th e r p ro d u c ts
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             W e a rin g a p p a re l
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                                                                                                                                                                                                                                                                                                                                                                                                                                                 fa ts
EV
Rest of Oceania                           9.8                             0.02                              0.00                      -0.13               0.00       0.11                    0.02                         -0.12             -0.05                 0.18                              0.10                    -0.15                             0.16                   -0.26                    -0.06                   -0.01                          0.65                    -0.07                      0.00    -0.09                          -0.03                        -0.05            0.05                       -0.21                          0.00
Australia                                 8.7                             0.00                              0.00                      -0.03              -0.06      -0.04                    0.00                         -0.05             -0.05                 0.04                              0.19                    -0.03                             0.45                   -0.05                    -0.02                   0.00                           0.27                    -0.02                     -0.24     0.01                          -0.02                         0.00           -0.02                        0.00                         0.00
China                                   122.5                             0.01                              0.02                       0.01               0.01      -0.01                    0.00                         -0.02             0.02                  0.02                              0.05                    -0.04                             0.05                   -0.02                    -0.02                   -0.01                          0.07                     0.00                     0.04     -0.02                          0.00                         0.18             0.00                        0.14                         0.00
North/East Asia                         150.5                             0.02                               0.02                      0.00              -0.02      -0.03                    0.00                         -0.03             -0.01                -0.02                             -0.02                    -0.08                             -0.04                  -0.04                    -0.01                   0.00                          -0.01                     0.00                     -0.02    -0.04                           0.02                        0.57             0.18                       -0.06                         -0.01
Japan                                   292.3                             0.01                              0.01                      -0.01              -0.11      -0.07                   -0.01                         -0.04             -0.01                -0.02                             -0.07                    -0.11                             -0.08                  -0.08                    -0.01                    0.02                          0.00                    -0.01                     -0.01    -0.01                           0.00                        -0.04           -0.02                       -0.04                          0.00
Indonesia                                 6.1                             0.01                              0.01                       0.00               0.03      -0.03                    0.00                         -0.01             -0.01                -0.06                              0.01                    -0.01                             0.00                    0.03                    -0.04                   -0.03                          0.03                     0.00                     -0.01    -0.06                          0.00                         0.32             0.20                        0.34                         0.00
Malaysia                                  1.1                             0.00                               0.00                      0.00               0.04      -0.01                    0.00                         -0.01             -0.01                -0.06                             -0.01                     0.01                             -0.12                  -0.32                    -0.02                    0.03                         -0.04                    -0.02                      0.04    -0.05                           0.08                         0.76            0.49                        0.20                          0.00
Philippines                               2.6                             0.00                              0.00                      -0.01              -0.03      -0.05                    0.00                         -0.03             0.00                 -0.01                              0.01                    -0.03                             -0.01                   0.00                    -0.01                   -0.08                          0.12                     0.00                     0.00     -0.08                           0.02                        0.47             0.30                       -0.51                         0.00
Singapore                                 7.4                             0.01                              -0.01                      0.02              -0.01       0.00                    0.01                         -0.02             -0.01                -0.02                              0.05                    -0.03                             -0.03                  -0.09                    -0.01                    0.00                          0.11                    -0.08                     -0.01    -0.12                           0.02                         1.09            0.23                        0.06                          0.00
Thailand                                 -2.5                             0.00                               0.00                      0.01               0.00      -0.32                   -0.04                         -0.05              0.00                -0.02                             -0.01                     0.01                             -0.02                   0.37                     0.01                   -0.07                          0.03                     0.01                      0.00    -0.61                           0.02                         0.28            0.21                        0.01                         -0.01
Vietnam                                   6.8                             0.02                               0.07                     -0.04               0.06       0.02                    0.02                          0.01             -0.01                -0.07                              0.03                    -0.01                             -0.02                  -0.25                     0.01                   -0.05                          0.01                     0.02                     -0.02    -0.28                           0.04                         0.70            0.30                        0.40                         -0.01
Rest of the World                        26.9                             0.00                              0.00                      -0.01              -0.01      -0.02                   -0.01                         -0.01             -0.01                -0.02                             -0.01                    -0.01                             -0.03                  -0.05                    -0.01                   -0.01                         -0.01                    -0.01                     -0.02    -0.06                          -0.01                        0.27             0.01                       -0.02                          0.00
Bangladesh                                7.7                             0.02                              0.08                       0.00              -0.20      -0.03                   -0.02                         -0.12             -0.02                 0.03                             -0.04                    -0.05                             -0.01                   0.77                    -0.18                   -0.09                         -0.09                     0.00                     -0.02    -0.11                           0.01                         0.35           -0.26                       -0.48                         -0.01
India                                    27.3                             0.01                              0.02                      -0.01              -0.01       0.00                   -0.01                         -0.01             0.00                  0.01                              0.00                    -0.05                             -0.05                  -0.87                    -0.03                   -0.02                         -0.01                    -0.01                     -0.01    -0.08                           0.00                        0.22             0.51                       -0.10                         0.00
Sri Lanka                                 2.4                             0.02                              0.00                       0.01              -0.04       0.11                    0.01                         -0.05             0.05                 -0.05                              0.02                    -0.07                              0.02                  -0.01                    0.02                    0.00                           0.48                    -0.01                      0.77    -0.08                          -0.02                        0.23             0.01                       -0.36                         -0.01
Canada                                  339.8                             0.05                               0.07                      0.04               0.07      -0.17                   -0.03                         -0.02             -0.14                -0.42                             -0.52                    0.06                              -0.69                  -1.23                    -0.03                   0.02                          -0.69                     0.06                     -0.17    -0.10                           0.01                        -0.83            0.11                       -0.32                         0.03
United States                          -1173.4                           -0.01                              -0.18                      0.08               0.09       0.01                   -0.01                          0.07             0.00                  0.09                             -0.11                     0.06                             -0.13                   0.15                     0.01                    0.05                         -0.07                     0.10                      0.00     0.00                           0.01                        -0.73           -0.15                       -0.28                          0.00
Mexico                                  -25.9                            -0.01                              0.00                       0.00               0.04      -0.01                   0.03                          0.01              0.00                 -0.02                             -0.05                    0.04                              -0.01                  -0.01                    0.01                    0.00                           0.02                     0.01                     0.01      0.00                          -0.02                        -0.20           -0.15                       -0.02                         0.00
Rest of North America                    -1.7                            -0.06                               0.18                     -0.01              -0.02      -0.01                    0.11                         -0.02             -0.02                 0.03                              0.02                     0.13                              0.02                   0.05                     0.16                   -0.02                          0.04                     0.01                     -0.02    -0.03                          -0.03                        0.09             0.08                        0.09                         -0.01
Colombia                                  0.1                             0.00                               0.00                      0.00               0.00       0.00                    0.01                          0.01              0.00                -0.08                              0.00                     0.02                              0.00                   0.00                     0.00                    0.01                          0.02                     0.00                      0.00    -0.01                           0.00                         0.09            0.06                       -0.02                          0.00
Peru                                     18.8                             0.04                               0.10                      0.89               0.29       0.38                    0.00                          0.69             0.91                  0.19                              0.80                    -0.64                              8.80                  -0.03                    -0.28                    0.00                         -0.03                     0.00                      0.21    -0.39                           0.01                        -0.09           -0.12                       -0.08                         -0.01
Venezuela                                1.4                              0.00                              -0.01                      0.00              -0.01       0.00                    0.00                         0.00              0.00                  0.00                              0.00                    0.00                              0.00                   -0.02                    -0.01                   0.00                           0.00                     0.00                     0.00      0.00                           0.00                        0.02             0.01                        0.01                         0.00
Argentina                                 7.1                             0.00                              -0.01                      0.06               0.00       0.01                    0.05                         -0.01             0.02                  0.01                              0.04                    -0.03                              0.05                  -0.05                    -0.03                    0.02                          0.03                     0.02                     0.03      0.14                           0.06                        -0.04           -0.03                       -0.40                         0.00
Brazil                                   21.3                             0.01                               0.00                      0.02               0.01      -0.02                   -0.01                         -0.02             0.01                 -0.04                             -0.01                    -0.01                             -0.01                  -0.02                    -0.01                    0.00                         -0.01                     0.01                      0.03    -0.01                           0.00                         0.20            0.00                       -0.05                          0.00
Chile                                    -1.9                             0.00                              -0.01                     -0.01              -0.05      -0.04                   -0.02                          0.02             -0.08                -0.03                              0.01                     0.07                              0.02                  -0.01                     0.02                   0.00                           0.01                    -0.01                     -0.08    -0.09                          -0.15                        -0.09           -0.06                       -0.04                         0.00
Uruguay                                   6.0                             0.04                              -0.16                     -0.22              -0.11      -0.09                   -0.10                         -0.06             -0.01                -0.02                              0.95                    -0.44                              1.33                  -0.65                    -0.15                   -0.08                          0.71                    -0.13                     -0.02    -0.16                           0.00                        -0.61           -0.73                       -2.50                          0.00
EU                                      477.5                             0.01                              0.01                      -0.05              -0.01       0.00                    0.01                         -0.03             0.02                 -0.01                             -0.02                    -0.03                             -0.01                  -0.05                    0.01                    0.00                           0.03                    -0.02                     0.02      0.07                          -0.01                         0.08            0.02                       -0.07                          0.00
Rest of Europe                            1.0                             0.00                               0.00                      0.00              -0.01      -0.02                    0.00                         -0.01             -0.01                -0.01                              0.00                    -0.01                             -0.01                  -0.03                     0.01                   -0.01                         -0.06                    -0.02                     -0.01    -0.06                           0.00                         0.09            0.08                        0.04                          0.00
Turkey                                    6.4                             0.01                              0.00                      -0.02              -0.02      -0.01                    0.00                         -0.02             0.01                 -0.02                              0.03                    -0.03                             -0.02                  -0.03                    -0.02                   -0.03                         -0.02                    -0.03                     0.01     -0.03                          0.00                         0.13             0.06                       -0.05                         0.00
Rest of Middle East and North Africa     -7.2                             0.00                              0.00                       0.00              0.00       -0.01                   0.00                          0.00              0.01                 0.00                               0.01                    0.00                              0.01                    0.00                    0.01                    0.01                           0.02                    0.00                      0.02      0.00                          0.00                         0.00            -0.03                        0.00                          0.00
Morocco                                   0.7                             0.00                               0.01                      0.01              -0.01      -0.01                    0.00                         -0.01              0.00                 0.00                              0.00                    -0.03                              0.08                  -1.27                     0.01                    0.00                         -0.03                     0.00                      0.01    -0.01                           0.02                         0.10            0.07                        0.04                          0.00
Tunisia                                   0.6                             0.00                               0.01                     -0.01              -0.02      -0.02                    0.00                          0.01              0.02                -0.01                              0.00                    -0.01                              0.00                   0.01                     0.00                    0.02                         -0.04                    -0.07                      0.02    -0.07                           0.00                         0.09            0.04                        0.06                          0.00
Botswana                                  0.4                             0.01                               0.00                      0.00              -0.04       0.00                    0.00                          0.00              0.00                -0.01                              0.00                    -0.02                              0.02                  -0.05                     0.00                   -0.04                         -0.01                    -0.06                     -0.02    -0.01                           0.00                        0.18             0.26                        0.02                         0.00
South Africa                             -0.7                             0.00                               0.00                      0.00              -0.02      -0.02                    0.04                         -0.01              0.00                -0.01                              0.01                     0.00                              0.01                  -0.01                     0.00                    0.00                          0.00                     0.00                      0.01    -0.03                           0.02                         0.00            0.04                        0.03                          0.00
Rest of SACU                              0.7                             0.02                              0.01                      -0.01              -0.03       0.00                    0.00                         -0.01             -0.01                 0.00                              0.00                    -0.06                              0.01                  -0.06                    -0.03                   -0.01                         -0.05                    -0.01                     -0.01    -0.02                           0.00                         0.16            0.35                        0.07                          0.00
Malawi                                   -0.1                            -0.01                               0.00                      0.00               0.02       0.00                    0.00                          0.02              0.02                -0.01                             -0.01                     0.01                             -0.01                  -0.01                     0.01                    0.02                         -0.01                     0.00                      0.03     0.00                           0.00                         0.06            0.02                        0.03                          0.00
Mozambique                                0.1                             0.01                              0.00                       0.00              -0.02       0.00                    0.00                         -0.03             -0.10                 0.00                              0.00                    -0.01                             0.00                   -0.02                    0.02                    -0.01                         -0.01                     0.01                     -0.13     0.00                           0.00                        0.03             0.03                        0.02                         0.00
Tanzania                                 -0.2                             0.00                              0.00                       0.00               0.01       0.00                    0.00                         0.00              0.00                  0.00                             -0.01                    0.01                              -0.02                  -0.05                    0.04                    0.03                           0.00                     0.01                     0.08     -0.01                          -0.01                        0.10            -0.13                       -0.06                         0.00
Zambia                                    0.2                             0.01                              0.00                      -0.01              -0.01       0.00                    0.00                         -0.01             -0.01                 0.00                              0.00                    -0.01                              0.00                  -0.01                     0.01                    0.00                          0.02                    -0.01                     -0.01     0.00                           0.00                         0.03           -0.02                        0.00                          0.00
Zimbabwe                                  0.1                             0.00                              0.00                       0.00               0.00       0.00                    0.01                          0.00             0.01                  0.00                              0.00                    -0.01                             0.03                    0.00                    0.00                    0.00                           0.01                    -0.01                     0.01      0.00                           0.00                        0.01            -0.03                        0.02                         0.00
Rest of SADC                              0.0                             0.00                              0.01                       0.00              -0.02       0.00                    0.00                          0.05             0.01                  0.01                             -0.02                    -0.01                             0.00                   -0.05                    0.00                    0.00                          -0.02                    -0.01                     0.03     -0.02                          -0.01                        0.18             0.21                       -0.01                         -0.01
Madagascar                               0.0                              0.00                              0.02                       0.00               0.02       0.01                    0.00                         0.00              0.01                 -0.02                              0.00                    0.00                              0.00                   -0.02                    0.00                    -0.02                          0.00                     0.00                     0.00      0.00                           0.00                         0.14            0.03                        0.01                          0.00
Uganda                                   -0.1                             0.00                               0.01                      0.00               0.01       0.00                    0.00                          0.00              0.01                -0.01                              0.00                     0.01                             -0.01                  -0.02                     0.03                    0.02                         -0.02                    -0.01                      0.00     0.02                           0.00                         0.06            0.00                       -0.05                          0.00
Rest of Sub-Saharan                      -5.7                            -0.01                               0.00                      0.00              -0.01       0.00                    0.01                          0.00             0.00                 -0.02                              0.01                    0.00                              0.00                    0.27                     0.02                   0.01                           0.01                     0.00                     0.00     -0.01                           0.00                        0.07             0.00                        0.05                         0.00




Source: GTAP model simulations and GTAP 6 database and author’s calculations




                                                                                                                                                                                                                                                                                                       49
Table 23. Comparison of welfare results of the removal of Canadian preferences and multilateral 50%
reduction of tariffs


                                                  Per capita utility                                                             Equivalent variation US$ million




                                                       50% liberalistion by all




                                                                                                                                              50% liberalistion by all
                            removal of Canadian




                                                                                                           removal of Canadian
                                                                                  50% liberalisation by




                                                                                                                                                                         50% liberalisation by
                            preferences




                                                                                                           preferences
                                                                                  Canada




                                                                                                                                                                         Canada
                                                       regions




                                                                                                                                              regions
Rest of Oceania             0.02                        0.81                       0.05                     9.76                               463.9                       28.24
Australia                   0.00                        0.11                       0.00                      8.73                             336.24                        7.62
China                        0.01                        0.36                      0.01                    122.47                             3729.3                       90.51
North/East Asia              0.02                       0.92                       0.01                    150.49                             7406.6                       80.81
Japan                       0.01                        0.32                       0.00                    292.27                           11485.46                     120.83
Indonesia                    0.01                       0.31                       0.00                     6.13                              413.19                        2.11
Malaysia                     0.00                        1.64                      0.00                      1.09                            1273.12                       -2.88
Philippines                  0.00                         0.1                      0.00                      2.61                              62.85                        1.31
Singapore                    0.01                       0.68                       0.00                      7.41                             507.53                        1.59
Thailand                     0.00                        1.07                      0.00                     -2.54                            1063.63                       -0.54
Vietnam                      0.02                       2.64                       0.02                      6.78                             770.67                        4.92
Rest of the World           0.00                        0.14                       0.00                     26.89                            1066.37                       13.32
Bangladesh                   0.02                       0.26                       0.01                      7.72                             110.78                        6.28
India                        0.01                        0.44                      0.00                     27.28                            1915.73                       19.45
Sri Lanka                    0.02                       1.26                       0.02                      2.44                             178.76                        2.27
Canada                      0.05                        0.02                       0.08                    339.81                             133.89                     484.31
United States               -0.01                       -0.01                      0.00                   -1173.43                           -667.55                     -158.69
Mexico                      -0.01                        0.1                      -0.01                    -25.91                             551.23                      -31.83
Rest of North America       -0.06                       -6.09                     -0.03                      -1.7                            -165.63                       -0.73
Colombia                     0.00                        -0.2                      0.00                      0.06                            -152.65                       -1.26
Peru                        0.04                        0.06                       0.01                     18.85                              29.62                        4.73
Venezuela                   0.00                         0.1                       0.00                      1.43                             105.57                       -1.92
Argentina                    0.00                        0.13                      0.00                      7.14                             319.59                        1.74
Brazil                       0.01                        0.26                      0.00                     21.29                            1135.55                        6.13
Chile                        0.00                        0.07                      0.00                     -1.87                              41.14                       -1.52
Uruguay                      0.04                       0.26                       0.04                      6.05                              45.8                         6.24
EU                           0.01                       0.12                       0.00                    477.47                            8992.83                      171.17
Rest of Europe               0.00                       0.16                       0.00                      0.95                             638.82                        2.75
Turkey                       0.01                        0.46                      0.00                      6.44                             610.12                         3.7
Rest of Middle East and N    0.00                       0.31                       0.00                     -7.24                            2314.03                      -20.95
Morocco                     0.00                        0.64                       0.00                     0.69                              196.68                        0.75
Tunisia                      0.00                        1.5                       0.00                       0.6                             261.27                        0.46
Botswana                    0.01                        0.58                       0.00                      0.38                              27.11                        0.17
South Africa                 0.00                        0.32                      0.00                     -0.73                             311.25                       -1.71
Rest of SACU                 0.02                        1.8                       0.01                      0.71                              80.44                        0.49
Malawi                      -0.01                        1.43                     -0.01                     -0.08                              22.26                       -0.08
Mozambique                   0.01                       -0.22                      0.00                      0.15                              -7.13                        0.07
Tanzania                     0.00                       -0.29                      0.00                     -0.19                             -25.38                       -0.13
Zambia                       0.01                        0.09                      0.00                      0.17                               2.78                        0.08
Zimbabwe                     0.00                        0.65                      0.00                       0.1                              51.67                        0.04
Rest of SADC                 0.00                       1.21                       0.00                      0.04                              204.9                       -0.74
Madagascar                   0.00                       -0.14                      0.00                      0.01                              -5.87                       -0.03
Uganda                       0.00                       -0.29                      0.00                     -0.11                             -15.38                       -0.07
Rest of Sub-Saharan         -0.01                       -0.16                     -0.01                     -5.72                             -199.3                       -6.68




Source: GTAP model simulations and GTAP 6 database; author’s calculation




                                                                                                50
                                           Table 21. GTAP regions as aggregated for the present study
    Mapping to model regions   GTAP region                Member Regions (226)                         Mapping to model regions          GTAP region                       Member Regions (226)
    Australia                  Australia                  Australia                                    Botswana                          Botswana                          Botswana
    Oceania                    New Zealand                New Zealand                                  South Africa                      South Africa                      South Africa
                               Rest of Oceania            American Samoa                               Rest of South African Customs Uni Rest of South African Customs Uni Lesotho
                                                          Cook Islands                                                                                                     Namibia
                                                          Fiji                                                                                                             Swaziland
                                                          French Polynesia                             Malawi                            Malawi                            Malawi
                                                          Guam                                         Mozambique                        Mozambique                        Mozambique
                                                          Kiribati                                     Tanzania                          Tanzania                          Tanzania, United Republic of
                                                          Marshall Islands                             Zambia                            Zambia                            Zambia
                                                          Micronesia, Federated States of              Zimbabwe                          Zimbabwe                          Zimbabwe
                                                          Nauru                                        Rest of Southern African DevelopmRest of Southern African DevelopmAngola
                                                          New Caledonia                                                                                                    Congo, the Democratic Republic of the
                                                          Norfolk Island                                                                                                   Mauritius
                                                          Northern Mariana Islands                                                                                         Seychelles
                                                          Niue                                         Madagascar                        Madagascar                        Madagascar
                                                          Palau                                        Uganda                            Uganda                            Uganda
                                                          Papua New Guinea                             Rest of Sub-Saharan Africa        Rest of Sub-Saharan Africa        Benin
                                                          Samoa                                                                                                            Burkina Faso
                                                          Solomon Islands                                                                                                  Burundi
                                                          Tokelau                                                                                                          Cameroon
                                                          Tonga                                                                                                            Cape Verde
                                                          Tuvalu                                                                                                           Central African Republic
                                                          Vanuatu                                                                                                          Chad
                                                          Wallis and Futuna                                                                                                Comoros
    China                      China                      China                                                                                                            Congo
    North and East Asia        Hong Kong                  Hong Kong                                                                                                        Cote d'Ivoire
                               Japan                      Japan                                                                                                            Djibouti
                               Korea                      Korea, Republic of                                                                                               Equatorial Guinea
                               Taiwan                     Taiwan                                                                                                           Eritrea
                               Rest of East Asia          Macau                                                                                                            Ethiopia
                                                          Mongolia                                                                                                         Gabon
                                                          Korea, Democratic People’s Republic of                                                                           Gambia
    Indonesia                  Indonesia                  Indonesia                                                                                                        Ghana
    Malaysia                   Malaysia                   Malaysia                                                                                                         Guinea
    Philippines                Philippines                Philippines                                                                                                      Guinea-Bissau
    Singapore                  Singapore                  Singapore                                                                                                        Kenya
    Thailand                   Thailand                   Thailand                                                                                                         Liberia
    Viet Nam                   Viet Nam                   Viet Nam                                                                                                         Mali
    Bangladesh                 Bangladesh                 Bangladesh                                                                                                       Mauritania
    India                      India                      India                                                                                                            Mayotte
    Sri Lanka                  Sri Lanka                  Sri Lanka                                                                                                        Niger
    Canada                     Canada                     Canada                                                                                                           Nigeria
    United States of America   United States of America   United States of America                                                                                         Reunion
    Mexico                     Mexico                     Mexico                                                                                                           Rwanda
    Rest of North America      Rest of North America      Bermuda                                                                                                          Saint Helena
                                                          Greenland                                                                                                        Sao Tome and Principe
                                                          Saint Pierre and Miquelon                                                                                        Senegal
    Colombia                   Colombia                   Colombia                                                                                                         Sierra Leone
    Peru                       Peru                       Peru                                                                                                             Somalia
    Venezuela                  Venezuela                  Venezuela                                                                                                        Sudan
    Argentina                  Argentina                  Argentina                                                                                                        Togo
    Brazil                     Brazil                     Brazil                                       Rest of World                     Rest of Southeast Asia            Brunei Darussalam
    Chile                      Chile                      Chile                                                                                                            Cambodia
    Uruguay                    Uruguay                    Uruguay                                                                                                          Lao People’s Democratic Republic
    EU15                       Austria                    Austria                                                                                                          Myanmar
                               Belgium                    Belgium                                                                                                          Timor Leste
                               Denmark                    Denmark                                                                        Rest of South Asia                Afghanistan
                               Finland                    Finland                                                                                                          Bhutan
                               France                     France                                                                                                           Maldives
                               Germany                    Germany                                                                                                          Nepal
                               United Kingdom             United Kingdom                                                                                                   Pakistan
                               Greece                     Greece                                                                         Rest of Andean Pact               Bolivia
                               Ireland                    Ireland                                                                                                          Ecuador
                               Italy                      Italy                                                                          Rest of South America             Falkland Islands (Malvinas)
                               Luxembourg                 Luxembourg                                                                                                       French Guiana
                               Netherlands                Netherlands                                                                                                      Guyana
                               Portugal                   Portugal                                                                                                         Paraguay
                               Spain                      Spain                                                                                                            Suriname
                               Sweden                     Sweden                                                                         Central America                   Belize
                               Switzerland                Switzerland                                                                                                      Costa Rica
                               Rest of EFTA               Iceland                                                                                                          El Salvador
                                                          Liechtenstein                                                                                                    Guatemala
                                                          Norway                                                                                                           Honduras
    Rest of Europe             Rest of Europe             Andorra                                                                                                          Nicaragua
                                                          Bosnia and Herzegovina                                                                                           Panama
                                                          Faroe Islands                                                                  Rest of Free Trade Area of the AmeAntigua & Barbuda
                                                          Gibraltar                                                                                                        Bahamas
                                                          Macedonia, the former Yugoslav Republic of                                                                       Barbados
                                                          Monaco                                                                                                           Dominica
                                                          San Marino                                                                                                       Dominican Republic
                                                          Serbia and Montenegro                                                                                            Grenada
                               Albania                    Albania                                                                                                          Haiti
                               Bulgaria                   Bulgaria                                                                                                         Jamaica
                               Croatia                    Croatia                                                                                                          Puerto Rico
                               Cyprus                     Cyprus                                                                                                           Saint Kitts and Nevis
                               Czech Republic             Czech Republic                                                                                                   Saint Lucia
                               Hungary                    Hungary                                                                                                          Saint Vincent and the Grenadines
                               Malta                      Malta                                                                                                            Trinidad and Tobago
                               Poland                     Poland                                                                                                           Virgin Islands, U.S.
                               Romania                    Romania                                                                        Rest of the Caribbean             Anguilla
                               Slovakia                   Slovakia                                                                                                         Aruba
                               Slovenia                   Slovenia                                                                                                         Cayman Islands
                               Estonia                    Estonia                                                                                                          Cuba
                               Latvia                     Latvia                                                                                                           Guadeloupe
                               Lithuania                  Lithuania                                                                                                        Martinique
    Turkey                     Turkey                     Turkey                                                                                                           Montserrat
    Morocco                    Morocco                    Morocco                                                                                                          Netherlands Antilles
    Tunisia                    Tunisia                    Tunisia                                                                                                          Turks and Caicos
    Rest of MENA               Rest of Middle East        Bahrain                                                                                                          Virgin Islands, British
                                                          Iran, Islamic Republic of                                                      Russian Federation                Russian Federation
                                                          Iraq                                                                           Rest of Former Soviet Union       Armenia
                                                          Israel                                                                                                           Azerbaijan
                                                          Jordan                                                                                                           Belarus
                                                          Kuwait                                                                                                           Georgia
                                                          Lebanon                                                                                                          Kazakhstan
                                                          Palestinian Territory, Occupied                                                                                  Kyrgyzstan
                                                          Oman                                                                                                             Moldova, Republic of
                                                          Qatar                                                                                                            Tajikistan
                                                          Saudi Arabia                                                                                                     Turkmenistan
                                                          Syrian Arab Republic                                                                                             Ukraine
                                                          United Arab Emirates                                                                                             Uzbekistan
                                                          Yemen
                               Rest of North Africa       Algeria
                                                          Egypt
                                                          Libyan Arab Jamahiriya




Source: GTAP database and authors’ adjustments.



                                                                                                  51
                             Table 22. GTAP sectors as aggregated for the present study

                  Mapping to model sectors                 GTAP sectors
                  Paddy rice                               Paddy rice
                  Wheat                                    Wheat
                  Cereal grains nec                        Cereal grains nec
                  Vegetables, fruit, nuts                  Vegetables, fruit, nuts
                  Oil seeds                                Oil seeds
                  Sugar cane, sugar beet                   Sugar cane, sugar beet
                  Primary agriculture                      Plant-based fibers
                                                           Crops nec
                                                           Animal products nec
                                                           Raw milk
                                                           Wool, silk-worm cocoons
                                                           Fishing
                  Bovine cattle, sheep and goats, horses   Bovine cattle, sheep and goats, horses
                  Natural resources                        Forestry
                                                           Coal
                                                           Oil
                                                           Gas
                                                           Minerals nec
                  Bovine meat products                     Bovine meat products
                  Meat products nec                        Meat products nec
                  Vegetable oils and fats                  Vegetable oils and fats
                  Dairy products                           Dairy products
                  Processed rice                           Processed rice
                  Sugar                                    Sugar
                  Food products nec                        Food products nec
                  Beverages and tobacco products           Beverages and tobacco products
                  Textiles                                 Textiles
                  Wearing apparel                          Wearing apparel
                  Leather products                         Leather products
                  Other manufacturing                      Wood products
                                                           Paper products, publishing
                                                           Petroleum, coal products
                                                           Chemical, rubber, plastic products
                                                           Mineral products nec
                                                           Ferrous metals
                                                           Metals nec
                                                           Metal products
                                                           Motor vehicles and parts
                                                           Transport equipment nec
                                                           Electronic equipment
                                                           Machinery and equipment nec
                                                           Manufactures nec
                  Services                                 Electricity
                                                           Gas manufacture, distribution
                                                           Water
                                                           Construction
                                                           Trade
                                                           Transport nec
                                                           Water transport
                                                           Air transport
                                                           Communication
                                                           Financial services nec
                                                           Insurance
                                                           Business services nec
                                                           Recreational and other services
                                                           Public Administration, Defense, Education, Health
                                                           Dwellings




Source: GTAP database and authors’ adjustments.




                                                              52
                         Annex Figure 1. Canada: average trade weighted preference margins by source country


       Malaysia                                                                                       miscelanous
Rest of the World
   Rest of SADC                                                                                       Textiles
          Turkey
      Philippines                                                                                     Wearing apparel
       Australia
         Vietnam                                                                                      Bovine cattle, sheep and goat meat
           Brazil                                                                                     products
             EU                                                                                       Other manufacturing
      Indonesia
           China                                                                                      Dairy products
            Peru
       Argentina
                                                                                                      Vegetables, fruits and nuts
   Rest of SACU
            India
                                                                                                      Beverages and tobacco products
 North/East Asia
       Sri Lanka
                                                                                                      Leather products
        Uruguay
           Japan
                                                                                                      Meat products
     Madagascar
 Rest of Oceania
                                                                                                      Primary argiculture nec
     Bangladesh

                    -6   -5         -4       -3        -2       -1       0        1           2   3
                                                                                                      Food products nec
                              % difference between average and bilateral protection measure




                                                                        53
                              Annex Figure 1, continued. Canada: average trade weighted preference margins by source country


                     Rest of North America                                                                         miscelanous
                                   Tanzania
                                      Malawi                                                                       Textiles
                                       Chile
                                     Uganda                                                                        Wearing apparel
                                  Botswana
                                      Mexico                                                                       Bovine cattle, sheep and goat meat
                                                                                                                   products
                                   Colombia
                       Rest of Sub-Saharan                                                                         Other manufacturing

                              United States
                                  Zimbabwe                                                                         Dairy products

                                     Zambia
                                    Thailand                                                                       Vegetables, fruits and nuts

                             Rest of Europe
                               Mozambique                                                                          Beverages and tobacco products

                                 Venezuela
                                    Morocco                                                                        Leather products

                                South Africa
                                                                                                                   Meat products
                                  Singapore
      Rest of Middle East and North Africa
                                                                                                                   Primary argiculture nec
                                     Tunisia

                                               -1.5     -1   -0.5   0   0.5   1     1.5    2    2.5    3     3.5
                                                                                                                   Food products nec
                                                 % difference between average and bilateral protection measure



Source: GTAP database; OECD Secretariat calculations.




                                                                                  54
     Source: GTAP 6.05 database.
                                   -12
                                         -10
                                               -8
                                                       -6
                                                                 -4
                                                                           -2
                                                                                         0
                                                                                             2
                                                                                                 4
                                                                                                     6
                                                                                                         8




                                                                   Rest of Oceania
                                                                          Australia
                                                                                China
                                                                   North/East Asia
                                                                                Japan
                                                                         Indonesia
                                                                          Malaysia
                                                                         Philippines
                                                                         Singapore
                                                                           Thailand
                                                                           Vietnam
                                                                 Rest of the World
                                                                        Bangladesh
                                                                                 India
                                                                          Sri Lanka
                                                                      United States
                                                                            Mexico
                                                            Rest of North America
                                                                          Colombia
                                                                                 Peru
                                                                        Venezuela




55
                                                                         Argentina
                                                                                Brazil
                                                                                Chile
                                                                           Uruguay
                                                                                                                                                  (percentage points)




                                                                                  EU
                                                                   Rest of Europe
                                                                             Turkey
                                               Rest of Middle East and North Africa
                                                                           Morocco
                                                                           Tunisia
                                                                         Botswana
                                                                       South Africa
                                                                      Rest of SACU
                                                                            Malawi
                                                                      Mozambique
                                                                          Tanzania
                                                                           Zambia
                                                                        Zimbabwe
                                                                      Rest of SADC
                                                                       Madagascar
                                                                                                             Annex Figure 2. Canada: average trade-weighted preference margins by beneficiary country, 2001




                                                                            Uganda
                                                              Rest of Sub-Saharan

								
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