EU, Canada sign long-de­layed trade deal af­ter Bel­gian drama

Tar­iff re­moval could start from early 2017

Kuwait Times - - FRONT PAGE -

The Euro­pean Union and Canada signed yes­ter­day a land­mark trade pact, end­ing days of drama af­ter a small Bel­gian re­gion re­fused to en­dorse the agree­ment and deeply em­bar­rassed the EU.

The long-de­layed Com­pre­hen­sive and Eco­nomic Trade Agree­ment was be­dev­iled by yet an­other hold up overnight when Cana­dian Prime Min­is­ter Justin Trudeau’s plane had to re­turn to Ottawa be­cause of me­chan­i­cal is­sues. “What pa­tience,” ex­claimed Euro­pean Com­mis­sion Pres­i­dent Jean-Claude Juncker as he em­braced the ar­riv­ing Trudeau at EU head­quar­ters in Brus­sels.

In a brief ex­change to­gether in French, Trudeau said “dif­fi­cult things are dif­fi­cult, but we were able to suc­ceed.” He de­clined to speak to re­porters. Trudeau and Juncker signed the pact with Euro­pean Coun­cil Pres­i­dent Don­ald Tusk and Slo­vak Prime Min­is­ter Robert Fico, whose coun­try holds the EU’s ro­tat­ing pres­i­dency.

On the other side of EU head­quar­ters, a rowdy group of around 250 anti-CETA protesters gath­ered to block the front en­trance as riot po­lice watched. Red paint was smeared on the build­ing. Some demon­stra­tors had ac­tu­ally en­tered the foyer. Po­lice took away 16 peo­ple, but did not break up the protest, spokes­woman Ilse Van de Keere said. The EU needed una­nim­ity among all its 28 mem­bers and Bel­gium needed the back­ing of all its re­gions to ap­prove the pact. Trudeau had been due to sign CETA on Thurs­day, but was forced to cancel his flight when the coun­try could not sign on be­cause of op­po­si­tion from the Wal­lo­nia re­gion.

Af­ter sev­eral rounds of talks late into the night Bel­gium for­mally gave its en­dorse­ment on Satur­day morn­ing. Smaller than the US state of New Jersey, Wal­lo­nia re­gion blocked the deal be­tween more than 500 mil­lion EU cit­i­zens and 35 mil­lion Cana­di­ans for sev­eral weeks. Politi­cians there ar­gued the deal would un­der­mine la­bor, en­vi­ron­ment and con­sumer stan­dards and al­low multi­na­tion­als to crush lo­cal com­pa­nies.

The EU says CETA will re­move more than 99 per­cent of tar­iffs and boost trade with Canada by 12 bil­lion eu­ros ($13.2 bil­lion) a year, cre­at­ing eco­nomic growth and jobs on both sides of the At­lantic. It in­sists the deal will not pre­vent gov­ern­ments from mov­ing to pro­tect en­vi­ron­men­tal and so­cial stan­dards if they be­lieve ac­tion is needed, de­spite con­cerns in Wal­lo­nia and else­where that big com­pa­nies would have free rein.

“This is an im­por­tant day for the EU and Canada too, be­cause we set­ting in­ter­na­tional stan­dards which will have to be fol­lowed by oth­ers with whom we are in ne­go­ti­a­tions as far as free trade is con­cerned,” Juncker told re­porters yes­ter­day.

Work on the agree­ment was launched in 2009 and the text was ac­tu­ally fi­nal­ized two years ago but sat in limbo await­ing en­dorse­ment. The de­lay has raised trou­bling ques­tions about the EU’s abil­ity to seal big trade agree­ments. Work on a sim­i­lar pact with the United States dubbed TTIP has barely ad­vanced this year and lit­tle progress is likely be­fore a new US pres­i­dent takes of­fice in Jan­uary.

“There is no re­al­ism in con­clud­ing TTIP right now,” EU Trade Com­mis­sioner Ce­cilia Malm­stroem said yes­ter­day, not­ing the US elec­tion cam­paign. None of it bodes well for the trade talks that Bri­tain will need to have with its 27 EU part­ners once it leaves the bloc.

Not the last act

Yes­ter­day’s sign­ing will not be the last act. As­sum­ing the Euro­pean Par­lia­ment gives its as­sent, CETA could come into force par­tially early next year. How­ever, full im­ple­men­ta­tion, which would in­clude a con­tentious in­vest­ment pro­tec­tion sys­tem, will en­sue only af­ter clear­ance by more than three dozen na­tional and re­gional par­lia­ments. The Bel­gian ex­pe­ri­ence shows this out­come is no given. The main fo­cus of protests against CETA and TTIP re­mains the sys­tem to pro­tect for­eign com­pany’s in­vest­ments. Crit­ics say its pro­vi­sion for ar­bi­tra­tion pan­els to rule on dis­putes with states can be abused by multi­na­tional com­pa­nies to dic­tate pub­lic pol­icy, such as on en­vi­ron­men­tal stan­dards.

The EU and Canada say their in­vest­ment pro­tec­tion sys­tem guar­an­tees the right of gov­ern­ments to reg­u­late, make use of in­de­pen­dent judges and be more trans­par­ent. The deal will elim­i­nate tar­iffs on al­most 99 per­cent of goods. The ben­e­fi­cia­ries would in­clude, for ex­am­ple, car­mak­ers or the EU tex­tile sec­tor, for which Cana­dian du­ties of up to 18 per­cent can be im­posed at present. Ser­vice com­pa­nies could also ben­e­fit and EU com­pa­nies would be able to ten­der for pub­lic con­tracts at Cana­dian pro­vin­cial and mu­nic­i­pal level, the first time Canada has of­fered this. Canada would be able to send larger quo­tas of meat, beef and wheat to the EU mar­ket, and EU dairy pro­duc­ers would be able to ex­port more than dou­ble the cur­rent amount of “high qual­ity” cheeses to Canada. —Agen­cies

BRUS­SELS: Demon­stra­tors wear­ing paint splat­tered clothes protest out­side of an EU-Canada sum­mit at the Euro­pean Coun­cil build­ing in Brus­sels yes­ter­day. —AP

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