The Growth Potential of the 'Next-11': The Importance of Emerging Markets for Canadian Agrifood Trade

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Cairns, Alexander Philip
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University of Guelph

The capacity of Canada’s export-oriented agrifood sectors to cope with contemporary challenges may hinge on their ability to identify new export markets. This thesis uses an import demand model, developed by Hallak (2006), to assess how per capita expenditure on Canadian agrifood exports is influenced by income growth and the presence of a preferential trade agreement for a group of emerging economies, known as ‘the Next-11.’ Results reveal that while as a group the Next-11 does not appear to be distinct from other income groups or the BRICs in terms of their expenditures on agrifood imports, Vietnam and South Korea demonstrate expenditure elasticities notably higher then other Next-11 and BRIC members. Finally, the findings cast doubt on the capacity of PTAs to enhance Canadian agrifood trade. However, this result may be indicative of Canada’s longstanding commitment to multilateral trade liberalization and the corresponding delay in the adoption of PTAs.

Next-11, Agrifood trade, Heckman Selection Model