The Star, Toronto
Implementing Canada-EU free-trade deal could take another two years
Six months after it was announced, free-trade agreement with European Union still has a long way to go.
By Les Whittington, Ottawa Bureau reporter
24 April 2014
OTTAWA—Six months after Prime Minister Stephen Harper travelled to Brussels to announce Canada’s largest-ever free-trade pact with Europe, Canada and the European Union are still negotiating key aspects of the deal, with implementation possibly as much as two years away.
While the ongoing talks are cloaked in secrecy, industry sources are worried about the delay in completing the agreement and the opposition says Harper misled Canadians for his own political purposes in October when he trumpeted a breakthrough in the high-stakes negotiations.
At the time, Harper took the stage in Brussels with European Commission President Jose Manuel Barroso and unveiled an agreement that would produce “a historic win” for Canada, opening up a huge new market for Canadian exporters and creating thousands of jobs.
Canadian officials estimated then that finalizing the deal, fixing all the legal language, translating the agreement and obtaining approval in Europe and Canada would take until the spring of 2015.
But negotiators have yet to resolve a handful of thorny trade issues and the EU now doesn’t expect the pact to be put in place until late 2015 or early 2016.
While all indications are the pact — officially called the Comprehensive Economic and Trade Agreement (CETA) — will in time be finished and ratified by parliamentarians in Canada and Europe, the chance that the deal will run into problems increases as time goes on, those close to the negotiations say.
“They missed their window,” says Jason Langrish, executive director of the Canada Europe Roundtable for Business, which has supported CETA.
He said Canada now must deal with an EU in flux. A new European Parliament is being elected next month by voters in 28 member states and a European Commission president will be chosen to replace Barroso in the fall.
In the wake of the political and social turmoil caused by the deep recession in Europe, parties on the far right and far left of the political spectrum may play a greater role after the election, raising questions about what policies are likely to be supported by the next set of EU authorities.
Langrish said it is still expected that the new legislators will approve CETA but it is less certain than it would have been under the current European Parliament. All 28 member states of the EU must also ratify the pact.
Canadians who follow these talks say negotiators are still working on a small number of important outstanding issues. On the table are proposed rules related to import quotas for beef and pork, provision of services by business, investment rules and guidelines for determining, for instance, whether Canadian-exported cars with a mix of Canadian and United States parts are eligible for tariff reductions under CETA.
It’s anyone’s guess when Canadians will see a final text of CETA and learn what has been negotiated by the Conservatives on their behalf, says NDP trade critic Don Davies.
“Here we are, it’s coming up to May. The last I heard was they expected to have an agreement by the end of January. They still don’t,” he told the Star.
“We now know that the whole charade of Stephen Harper going to Brussels last October to sign the deal was a complete manipulation of the process and we know that there was no deal actually even concluded.”
Davies said Harper’s announcement in Brussels, which came as Parliament was being reconvened in Ottawa after a lengthy prorogation, “was the Conservatives’ attempt to try to change the channel from the Senate scandal. So they jumped the gun and attempted to mislead the Canadian public that a deal had been reached that had not been.”
A spokesperson for International Trade Minister Ed Fast dismissed the NDP’s criticism, saying it’s obvious that an agreement in principle on free trade has to be finalized by negotiators and lawyers.
“An agreement in principle means that Canada and the EU have reached an agreement on all key issues. The minor technical work that remains to finish off the text of the agreement is continuing,” Rudy Husny said.
“As standard practice in all trade negotiations, once the technical, legal and translation work is complete, Canada will proceed with implementing legislation in Parliament,” he said. He declined to speculate on a completion date.
Another factor that is raising questions about how the final approval of CETA will go is the recently initiated talks between the EU and the United States on a Transatlantic Trade and Investment Partnership (TTIP).
These negotiations appear to have sparked increased concern in Europe over a controversial feature of current trade negotiations — investor-state dispute settlement (ISDS) mechanisms. These measures allow corporations to go before an independent tribunal and sue governments that allegedly discriminate against foreign companies.
CETA contains an ISDS clause and any EU-United States agreement is expected to have one as well. But, reflecting complaints by NGOs that corporations are abusing these measures, the European Commission called a temporary halt in ISDS discussions with Washington to hold a public consultation on the measures.
“I fully agree with the many critics who claim that ISDS until now has led to some very worrying litigation against the state,” EU trade commissioner Karel De Gucht said.
Scott Sinclair, a trade analyst with the Canadian Centre for Policy Alternatives, says the CETA talks could yet be influenced by the investor-state worries raised by the EU-U.S. negotiations.
“The longer they wait (to finish CETA), the more chance there is that they’ll be sideswiped by the controversies over the TTIP,” he said.