Supporters say it will boost trade by billions through cuts in tariffs
BRUSSELS—Prime Minister Justin Trudeau has finally signed Canada’s free trade deal with the European Union reached after seven arduous years of negotiation.
The presidents of the European Council and European Commission, Donald Tusk and Jean-Claude Juncker, joined the prime minister at the formal signing of the Comprehensive Economic and Trade Agreement, known as CETA.
“The fact that throughout people were asking tough questions of a deal that will have a significant impact on our economies, and giving us the opportunity to demonstrate that that impact will be positive, is a good thing,” Trudeau told a news conference following the signing.
The road ahead to full ratification remains long, but Trudeau and his EU counterparts took a moment October 30 to revel in the milestone.
Trudeau had initially expected to sign the deal in Brussels days ago, but the restive Belgian region of Wallonia nearly killed it because of its opposition to the pact’s investor-state dispute settlement mechanism.
International Trade Minister Chrystia Freeland accompanied Trudeau to Belgium and called it a great day for Europe. “It shows that Europe can do trade deals,” Freeland quipped to reporters as she entered the European Council after the prime minister.
More than a week ago, Freeland walked out of talks in Belgium, saying it appeared the EU was incapable of signing an agreement.
“OK we did it!” she said during a photo opportunity following the signing ceremony.
The Canadian contingent also included Foreign Affairs Minister Stephane Dion, chief negotiator Steve Verhuel and EU trade envoy Pierre Pettigrew.
The deal’s supporters say it will boost trade by billions through cuts in tariffs across a broad swath of sectors including agriculture, pharmaceuticals and the auto industry.
But simmering opposition among anti-trade activists and left-wing political parties in some European countries has been fierce and nearly blocked the deal. On a sleepy Sunday morning in the largely shuttered EU capital, Trudeau’s entourage was greeted by a small but vocal group of protesters at the European Council that banged drums and threw red paint at EU staffers.
The socialist regional government of Wallonia, led by Paul Magnette, picked up the anti-CETA baton that had flourished previously in France, Germany and Austria.
The latest obstacle to CETA was removed Friday when Wallonia officially voted to withdraw its opposition to the deal, paving the way for Trudeau’s trip. That came after a week of intense talks in Europe after Freeland’s emotional exit.
“That leadership that we were able to show between Canada and Europe is not just something that will reassure our own citizens but should be an example to the world of how we can move forward on trade deals that do genuinely benefit everyone,” Trudeau said.
The prime minister’s long anticipated journey to Brussels got off to a bumpy start, with a mechanical problem forcing his plane to return to Ottawa about 30 minutes after it took off Saturday night. After more than an hour on the ground, the flight left again and continued on to Belgium without further incident.
A planned meeting with Quebec Premier Philippe Couillard had to be cancelled because of Trudeau’s new compressed schedule. Couillard arrived at Sunday’s meetings with former Quebec premier Jean Charest, one of the early drivers of the trade negotiations with Europe.
Formidable obstacles remain before the deal can be ratified and fully in force.
With the Liberals and Conservatives both favouring the deal, its approval will sail through Parliament unopposed.
But Europe is another matter.
The European Parliament must approve CETA, and Trudeau’s meeting with Schulz, a German social democrat, is part of the government’s ongoing efforts to win support there.
The European Parliament’s approval, combined with Canada’s, would mean that as much as 90 percent of the deal would come into force under what is called provisional application.
But in the coming years, the deal must be ratified in by the EU’s 28 countries and several more smaller regional governments such as Wallonia. That process could take years, and could be derailed.
Gus Van Harten, an Osgoode Hall law professor who specializes in trade, said he believes the European Parliament will likely approve the deal, but the foreign investor protection mechanism will likely pose problems in the future. That’s because national and regional governments have the ability to block it, ending the provisional application of the deal.
“The inclusion of the foreign investor protection system in the CETA was a dubious decision and political gamble from the start, and it has now blown up in a lot of faces,” said Van Harten. “CETA as a whole remains in jeopardy regardless of signature.”
Sunday was not the first time Brussels witnessed the pomp and circumstance of a CETA signing ceremony.
In October 2013, former Conservative prime minister Stephen Harper flew to Brussels with great fanfare and signed an agreement in principle with European Commissioner Jose Manuel Barroso.
In September 2014, Harper hosted Barroso and at another signing ceremony in Ottawa to mark the end of negotiations.
But while they were celebrating in Ottawa, the seeds of discontent with the investor protection chapter were flowering in Germany. After the Liberals won power a year later, German Vice Chancellor Sigmar Gabriel—a major opponent of that chapter—would find himself working with Freeland to strengthen that section of the agreement. They eventually succeed, and celebrated their achievement as the final breakthrough needed to push CETA across the finish line.
Then the Walloons came along, catching everyone by surprise.
“They’ve really taken up the concerns of many groups in Europe,” said Stuart Trew of the Canadian Centre for Policy Alternatives.
“The Wallonia government appears to have taken those quite seriously.”