The Trans-Pacific Partnership: Impact on British Columbia
57 Pages Posted: 18 Apr 2016
Date Written: October 10, 2014
This Research Report assesses the likely impact of the Trans-Pacific Partnership (TPP) on the British Columbia economy from the vantage point of what is known as the negotiations enter the end phase of negotiations in the Fall of 2014. The assessment is based on a two-step process. First, the impact of the TPP at Canada-level is simulated using a dynamic specification of the widely-used GTAP model, modified to directly represent services trade conducted through foreign affiliates as well as on a cross-border basis, and to reflect the impact of liberalization of FDI in the services sectors. The simulations take into account tariff reductions, preference utilization, the compliance cost of using preferences, the regionalization of rules of origin, and the reduction of non-tariff barriers to goods, services and investment. Second, a computable partial equilibrium (CPE) model – the Global Simulation Model (GSIM) – is used to identify the direct trade impacts on British Columbia and the Rest of Canada, which are represented directly as individual trading partners both with international partners and with each other. Based on the decomposition of the TPP trade impacts, the study infers the impacts of the TPP on the BC economy consistent with the Canada-level GTAP simulation results.
Keywords: Trans-Pacific Partnership, TPP, FTA, British Columbia, Canada, CGE, GTAP, GSIM
JEL Classification: F02, F13, F15
Suggested Citation: Suggested Citation