The government of Wallonia last night (20 October) rejected the latest offer made by the European Commission in a bid to unblock the stalled ratification process of the EU-Canada free trade deal before the ‘hot potato’ passes to the EU leaders later on Friday.
EU member state representatives discussed a new eight-page “joint interpretative instrument” aimed at clarifying some of the issues raised by the French-speaking Belgian region about the Comprehensive Economic and Trade Agreement (CETA).
The European Commission and Germany attached additional declarations to address concerns on GMOs, use of hormones in food products, and public procurement.
The text was the result of two rounds of negotiations on both Sunday and Wednesday-Thursday.
European diplomats said the document was finalised with the Walloons.
But the minister-president of the region, Paul Magnette, told reporters that he would recommend the Wallonian Parliament maintained its veto on the trade deal.
“Progress has been made but for us, at this stage, it is not sufficient, particularly in matters affecting US companies in Canada which will benefit from the system,” he explained.
Magnette said he would now negotiate directly with Canada.
“For Canadians, there is still room for negotiations, contrary to the EU’s position, and we will meet the [Canadian] minister and negotiator tomorrow to discuss with them if it is still possible to find margins and change the texts submitted to us on Thursday,” he said.
The Commission made a last-ditch concession to the Walloons, adding to the document a separate paragraph on social security and insurance, one of the main concerns raised from the outset of the talks.
“This is what they really wanted,” a European official explained.
The final declaration was wrapped up on Thursday. It stated that the right to regulate data protection and privacy remains at national level, while ensuring that European standards will be protected.
Separately, European officials remarked that Romania and Bulgaria were still demanding clear statements from Ottawa on visa requirements for their nationals before giving their green light.
The President of the Parliament of Wallonia, André Antoine, said on his Twitter account that the decision belongs “only” to the Walloons.
“Democracy versus technocracy,” he wrote.
While the Walloon parliament debates whether to uphold its veto, the EU leaders will discuss in the European Council how to build a new consensus on a “free and fair” trade policy. CETA will be part also of the discussions.
The new push to find a solution came against a backdrop of pessimism aired by some senior officials.
European Council President Donald Tusk tweeted he was “deeply concerned” after he met with Belgian Prime Minister Charles Michel before the summit started. “Credibility of Europe at stake,” he wrote.
Tusk is not the only one who warned that Europe’s reputation abroad would be tarnished if the Walloons maintain their veto.
Commissioner Cecilia Malmström and national diplomats agreed that the bloc’s credibility is at serious risk.
For many, including Tusk, CETA will be the last free trade agreement the EU negotiates, if the bloc fails to conclude the ratification process.
The European Commission was however still hoping for a breakthrough in the final hours of the summit, which is expected to wrap up early afternoon on Friday. “We are aware this is a very difficult process,” an official said.
If Wallonia finally accepts the new declaration, the text will be adopted by written procedure, paving the way for an official signature ceremony at the EU-Canada summit on 27 October.
A diplomat explained that “Monday is probably the limit of decency” for closing the procedure and formally inviting the Canadian delegation for the signature ceremony in Brussels next week.
But a Commission source said there is no deadline and officials could negotiate “until half an hour before the summit starts”.
“Nevertheless we should give some time to the Canadians to book their plane tickets and fly to Brussels,” the source said.
The EU's current trade relations with Canada are guided by a Framework Agreement for Commercial and Economic Cooperation, in force since 1976.
The EU and Canada launched CETA negotiations in May 2009 and agreed on the content and its general strategy in June 2009.
The European Commission proposed the signature of the EU-Canada Comprehensive Economic and Trade Agreement (CETA) to the Council of the EU in July 2016. If the Council approves the agreement, it will need the European Parliament consent for it to be finalised.
The national parliaments of the EU Member States would then also need to ratify CETA for the areas which fall under their responsibility to take effect.
This ratification procedure follows the release of the legally reviewed CETA text in February 2016.
In 2015 Canada was the EU's 12th most important trading partner, accounting for 1.8% of the EU's total external trade. The EU was Canada's second most important trading partner, after the US, with around 9.5% of Canada's total external trade in goods in 2015.