The conventional wisdom is that free trade deals are, on the whole, a net benefit to an economy. But that isn't true if you don't actually take advantage of the opportunities created by those deals.
Canada has grabbed few opportunities from its one-year-old Comprehensive Economic and Trade Agreement (CETA) with the European Union. Twelve months in, it looks like European exporters are reaping all the benefits.
Canada's merchandise trade deficit with the European Union jumped by 46 per cent in the first nine months of the year, compared to the same period a year earlier, before the trade deal came into effect provisionally, Statistics Canada data shows.
Watch: What Canadians should know about CETA, the Canada-EU trade deal (story continues below)
From January to September of this year, European exporters sold $12.7 billion more in goods to Canada than Canada sold to Europe, up from $8.7 billion in the same period before the deal.
Exports from the EU to Canada jumped 13 per cent in the past year, but Canada's exports to the EU grew a paltry 3.8 per cent in that time, said Krishen Rangasamy, senior economist at National Bank of Canada.
"That's disappointing to say the least, considering exports to other trade partners grew more than 5 per cent over the same period," he wrote in a client note Tuesday.
Rangasamy offers two possible explanations.
"We're hoping it's just exporters trying to find their feet in this new market," he told HuffPost Canada.
If that's the case, then these early trade numbers are nothing to worry about. But it may be that Canada has a "competitiveness issue," Rangasamy said. If so, "then this is a bigger problem."
Earlier on HuffPost Canada:
It may be that Canadian goods "are too expensive compared to other products on the European market; the Canadian dollar may be an issue there," he speculated.
Ultimately, Rangasamy says it's "too early to say" what's going on, and it will be worth keeping an eye on the data over the next year.
But so far, "this data is not encouraging."